Pre-resolution tax claims extinguished under insolvency resolution plan approval, leaving the demand unenforceable and the appeal infructuous.

Claims and statutory dues arising before approval of a resolution plan under the Insolvency and Bankruptcy Code, 2016 stand extinguished once the plan is sanctioned under Section 31(1), so they cannot be enforced against the corporate debtor. On that basis, a tax demand relating to the pre-resolution period was treated as unenforceable, and the appeal was rendered infructuous after conclusion of the insolvency process.

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Issues: Whether the tax demand raised for the period prior to approval of the resolution plan survived after sanction of the resolution plan under the Insolvency and Bankruptcy Code, 2016, and whether the appeal had become infructuous.

Analysis: The demand in dispute related to the period preceding approval of the resolution plan, and the resolution process had been concluded by an order under Section 31(1) of the Insolvency and Bankruptcy Code, 2016. In view of the binding principle that claims and statutory dues predating approval of the resolution plan stand extinguished, the demand could not be enforced against the assessee.

Conclusion: The pre-resolution tax demand was held to be extinguished and the appeal was treated as infructuous.

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