TaxTMI Login
Just a moment...
Press 'Enter' to add multiple search terms. Rules for Better Search
Use comma for multiple locations.
---------------- For section wise search only -----------------
Accuracy Level ~ 90%
of 
Press 'Enter' after typing page number.
of Press 'Enter' after typing page number.
No Folders have been created
Are you sure you want to delete "My most important" ?
NOTE:
of Press 'Enter' after typing page number.
of Press 'Enter' after typing page number.
All Case Laws
of Press 'Enter' after typing page number.
of Press 'Enter' after typing page number.
All Case Laws
Join Channel
Note
Bookmark
Share
Don't have an account? Register Here
of Press 'Enter' after typing page number.
Issues: (i) Whether an income-tax demand raised before approval of the resolution plan, but not forming part of the approved resolution plan, could be enforced against the successful resolution applicant. (ii) Whether the writ petition was liable to be rejected on the ground of availability of an alternate statutory remedy.
Issue (i): Whether an income-tax demand raised before approval of the resolution plan, but not forming part of the approved resolution plan, could be enforced against the successful resolution applicant.
Analysis: A resolution plan approved under Section 31(1) of the Insolvency and Bankruptcy Code, 2016 binds all stakeholders, and claims not included in the plan stand extinguished. The tax department's claim had been raised before the Resolution Professional, rejected, and neither that rejection nor the approval of the resolution plan was challenged. Since the impugned demand did not form part of the approved resolution plan, it could not survive or be enforced against the petitioner.
Conclusion: The demand was held unenforceable against the petitioner and the impugned assessment-related notices and appellate order were set aside, in favour of the assessee.
Issue (ii): Whether the writ petition was liable to be rejected on the ground of availability of an alternate statutory remedy.
Analysis: The alternate-remedy objection could not prevail because the governing insolvency principle made the demand itself unenforceable after approval of the resolution plan, and the undisputed factual matrix showed that the claim had already been rejected in insolvency proceedings and had attained finality.
Conclusion: The objection based on alternate remedy was overruled.
Final Conclusion: The court granted relief to the petitioner by protecting the successful resolution applicant from enforcement of the extinguished tax claim and by setting aside the consequential proceedings founded on that claim.
Ratio Decidendi: Once a resolution plan is duly approved under Section 31(1) of the Insolvency and Bankruptcy Code, 2016, all claims not forming part of the plan stand extinguished and cannot be pursued or enforced against the successful resolution applicant.
TaxTMI 
