Re-assessment Order for 2012-2013 Quashed Due to Lack of Notice to Liquidator, Violating Natural Justice Principles.

The HC set aside the re-assessment order for the year 2012-2013 against the liquidated company due to a lack of notice to the Liquidator, violating natural justice principles. The court directed the Liquidator to file objections before the Assessing Officer, quashed the demand notice, and mandated the Liquidator's participation in re-assessment proceedings. The court acknowledged the NCLAT's approval for filing the writ petition without prior NCLT consent, emphasizing adherence to the IBC's moratorium principles.

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Issues:
1. Challenge to re-assessment for the year 2012-2013 by a liquidated company.
2. Lack of notice to the Liquidator in the re-assessment proceedings.
3. Interpretation of Section 33(5) of the Insolvency and Bankruptcy Code, 2016 (IBC).
4. Application of the principle of moratorium under the IBC.
5. Proper procedure for recovery and assessment of dues during liquidation proceedings.
6. Approval for filing a writ petition without NCLT approval.

Analysis:
The writ petition was filed by a company under liquidation challenging a re-assessment for the year 2012-2013. The Liquidator representing the company contended that they were not issued a notice for re-assessment and could not participate in the proceedings. Reference was made to Section 33(5) of the IBC, emphasizing that no legal proceeding shall be initiated against a corporate debtor once a liquidation order is passed. The court referred to a previous judgment stating that recovery cannot be made during a moratorium period, and the Liquidator must be approached after finalizing the assessment (ABG Shipyard Liquidator v. Central Board of Indirect Taxes & Customs, (2023) 1 SCC 472).

The Government Advocate argued that notices were sent via email and the company's advocate prosecuting a refund application was informed about the liquidation status. It was contended that since the moratorium period had ended due to the commencement of liquidation, there could be no stay on recovery. The court referred to Paragraph 57 of the ABG Shipyard Liquidator judgment, emphasizing the limited jurisdiction of authorities to assess and determine dues during a moratorium period.

The court found that the Liquidator was not informed of the re-assessment proceedings, leading to a violation of natural justice. It was noted that the Liquidator should have been noticed and participated in the re-assessment proceedings. The court set aside the re-assessment order and directed the Liquidator to file objections before the Assessing Officer. The assessment order itself was considered a notice for re-assessment, and the Liquidator was to be heard on the same day or another date. The demand notice related to the re-assessment order for 2012-2013 was quashed, and the court did not address the issue of refunds for subsequent years.

Initially, the State objected to the writ petition being filed without NCLT approval. The Liquidator sought ex post facto approval, which was initially denied by NCLT but later granted by the National Company Appellate Tribunal. The court allowed the writ petition with the specified directions for the re-assessment proceedings involving the Liquidator's participation and adherence to the principles of natural justice.

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