TaxTMI 
TaxTMI 
2023 (9) TMI 1385
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....P (IB) No. 51/BB/2018 (Filed under Section 60(5) of IBC, 2016 read with Rule 11 of NCLT Rules, 2016 by the Appellant / Applicant) passed by the Adjudicating Authority / NCLT Bengaluru Bench. 2. Earlier, the Adjudicating Authority / NCLT Bengaluru Bench while passing the impugned order on 28.06.2023 in IA No. 393/2022 in CP (IB) No. 51/BB/2018 filed by the Appellant / Applicant, u/s 60(5) of the I&B Code, 2016 at paragraph Nos. 8 to 19 had observed the following: - 8. "On perusal of the facts it is observed that the Applicant herein i.e. Asst. Commissioner of Commercial Taxes, LGSTO-150, Bangalore has filed a claim on 21.12.2018 in Form-F for Rs.54,46,13,819/- after adjusting the receipts of Rs.10,36,36,873/- in respect of GST liability and the same has and resultantly, dismissed the 'Application'. Appellant's Submissions 3. According to the Learned Counsel for the Appellant / Applicant, the 'Corporate Debtor', is a 'Company', among other things, engaged in the 'Business of Manufacture and sale of products of wood, cork, straw and plating materials'. In the course of its' Business', the 'Corporate Debtor', had effected taxable supplies of 'Goods' in and from the....
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....the gross breach committed by Resolution Professional, in rejecting the claim / demand of Rs. 54,46,13,819/- of the Appellant, and not by indicating the 'claim', in its entirety in the IM, and, therefore, it is obvious that placing reliance upon the decision in State Tax Officer (1) Vs. Rainbow Papers Ltd. Dated 06.09.2022, the 'Information Memorandum', the Resolution Plan, as approved by the 'Committee of Creditors' and the Application filed by R3, 4 and 5 before this Tribunal, all of which merits to be set aside as 'null and void' and 'not in accordance with law', as prayed for by the Appellant. 8. The Learned Counsel for the Appellant, points out that the Adjudicating Authority, had failed to appreciate that the 1st Respondent, had failed to follow the requirements u/s 30(2) of the I&B Code, 2016, which mandates that the 1st Respondent, to ensure that the 'Resolution Plan' conforms to the parameters prescribed in the said provision, in the I&B Code. 9. Advancing his argument, the Learned Counsel for the Appellant, comes out with a plea, that the Adjudicating Authority had not appreciated the decision of the Hon'ble Supreme Court in Ebix Singapore Pvt. Ltd. Vs. Committee of....
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....vant statute under which such dues arose. Also, that the Learned Counsel points that the 1st Respondent as well as the 'Committee of Creditors', comprising of R3, 4 and 5 had ignored the ruling of the Hon'ble Supreme Court in 'Committee of Creditors of Essar Steel India Ltd. Vs. Satish Kumar Gupta & Ors.' Reported in 2020 8 SCC 531,wherein it was observed and held that all claims must be submitted to and decided by the Resolution Professional, so that all prospective resolution applicants know exactly what was to be paid in order that it may then take over and run the business of the Corporate Debtor. 14. According to the Appellant, the Adjudicating Authority, had failed to appreciate that the Respondent No. 1/Resolution Professional, was placing the interest of the 'Corporate Debtor', on a high pedestal, than that of State's interest and hence the information memorandum prepared on 17.10.2019 by the Respondent No. 1 is prejudicial to the State's interest and hence, cannot be allowed to stand. 15. The Learned Counsel for the Appellant, points out that the 'Adjudicating Authority' / 'Tribunal' has failed to taking into account that actions of 1st Respondent, adjudicating, and ....
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....nto account by the Adjudicating Authority, which has resulted in serious miscarriage of justice. 21. While winding up, the Learned Counsel for the Appellant, prays for setting aside the impugned order dated 28.06.2003 in I.A. No. 393/2022 in CP(IB) No. 51/BB/2018 passed by the 'Adjudicating Authority' / 'Tribunal'. 1st Respondent's 'Pleas' 22. Contending contra, the Learned Senior Counsel for the 1st Respondent, points out that the 1st Respondent had not withdrawn the 'Appeal', filed before this Tribunal and that the said 'Appeal' was dismissed as 'infructuous', as the Hon'ble High Court of Karnataka had set aside the 'Best Judgment Assessment,' orders, passed by the Appellant. Further, the claim of the 'Appellant', was based on the 'Best Judgment Assessment'. 23. According to the 1st Respondent, Appellant, had moved the 'Adjudicating Authority' / 'Tribunal,' with similar reliefs, prayed in his earlier I.A. No. 134/2020, on the basis of Assessment Order quashed on the Hon'ble High Court in its order dated 02.07.2021 and is 'estopped', by the 'Principle of 'Res-Judicata'. 24. It is represented on behalf of the 1st Respondent, that the 'Adjudicating Authority', had rig....
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.... other person under this Act or the rules made thereunder shall, save as otherwise provided in Section 529A of the Companies Act, 1956, the Recovery of Debts Due to Banks and the Financial Institutions Act, 1993, the Securitisation and Reconstruction of Financial Assets and the Enforcement of Security Interest Act, 2002 and the Insolvency and Bankruptcy Code, 2016, be the first charge on the property of the assesse or the person, as the case may be. 8. From the usage of the words 'save as provided in' in Section 11E is in the nature of an exception intended to exclude the class of cases, mentioned in Companies Act, 1956, 'The Recovery of Debts due to Banks and the Financial Institutions Act, 1993', 'SARFAESI Act, 2002' and 'I & B Code, 2016'. The 'Secured Interest' as defined under the Code excludes charges created by Operation of law. Section 11E of the Central Excise Act, 1944 is distinct from the provisions of the 'Gujarat VAT Act, 2003' and therefore, the decision in the matter of 'State Tax Officer Vs. Rainbow Papers Limited', (Supra) cannot be made applicable to the facts of this case. It is also pertinent to mention that the Master Circular No.1053/02/2017-CX, issue....
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....referred I.A. No. 134/2020 among other things praying for relief, in setting aside the Resolution Professional's, order negativing the 'whole claim' of the Appellant / Petitioner, for Rs.54,46,13,819/-; in admitting the 'whole claim', and to 'suitably', revised the 'Information Memorandum' and 'Expression of Interest', in the 'CIRP', of the 'Corporate Debtor', after taking into consideration of its claim for Rs.54,46,13,819/-. 30. It transpires that the Adjudicating Authority / Tribunal, had dismissed the I.A. No. 134/2020, with a direction being issued to the 'Commercial Taxes Department', to place before the 'Resolution Professional', only 'ascertained' 'crystalised Demand' that might have arisen from a regular assessment for the period under consideration and that the 'Resolution Professional' is to place the same, before the Committee of Creditors/ reconstituted Committee of Creditors for its considerations. 31. It cannot be brushed aside, that in IA No. 393/2022 in CP(IB) No.51/BB/2018, (Filed by the Appellant / Petitioner under Section 60(5) of the Code, 2016, read with Rule 11 of the NCLT Rules, 2016), a declaration was sought in respect of the Resolution Plan, approve....
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....resent case, in Section 53(1)(e)] that the State is to be treated as a 'secured creditor'. However, the separate and distinct treatment of amounts payable to secured creditor on the one hand, and dues payable to the government on the other clearly signifies Parliament's intention to treat the latter differently - and in the present case, having lower priority. As noticed earlier, this intention is also evident from a reading of the preamble to the Act itself. 51. According to the principles of statutory interpretation, when an enactment uses two different expressions, they cannot be construed as having the same meaning. It was held in Member, Board of Revenue v. Anthony Paul Benthall36 that: "When two words of different import are used in a statute, in two consecutive provisions, it would be difficult to maintain that they are used in the same sense..." This idea is reflected in a subsequent judgment in Brihan Mumbai Mahanagarpalika & Anr. v. Willington Sports Club & Ors." 52. The views expressed by the present judgment finds support in the decision reported as Sundaresh Bhatt, Liquidator of ABG Shipyard v. Central Board of Indirect Taxes and Cus....
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.... that Section 238 of the IBC overrides the provisions of the Electricity Act, 2003 despite the latter containing two specific provisions which open with non-obstante clauses (i.e., Section 173 and 174). The position of law with respect to primacy of the IBC, is identical with the position discussed in Sundaresh Bhatt and Duncan Industries (supra) [refer also: Innoventive Industries (supra), CIT v. Monnet Ispat & Energy Ltd. 40, Ghanashyam Mishra & Sons (P) Ltd. v. Edelweiss Asset Reconstruction Co. Ltd. 41, and Jagmohan Bajaj v. Shivam Fragrances Private Limited. 53. In view of the above discussion, it is held that the reliance on Rainbow Papers (supra) is of no avail to the appellant. In this court's view, that judgment has to be confined to the facts of that case alone." 35. It is to be remembered that the 'Hon'ble High Court Karnataka', had set aside all the 'Assessment Orders', (vide order dated 02.07.2021 in WP No.45290/2019) issued by the Appellant / Petitioner relating to the period September, 2017 to December, 2018, and directed the 'GST Department' to 'process' the Return, filed by the 'Corporate Debtor' in accordance with law, however, the GST Department had n....
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....e the RP only ascertained, crystallised demand that may have arisen from a regular assessment for the period under consideration and the RP shall place the same before the CoC/reconstituted CoC, for its consideration. 10. However, the Applicant through the instant IA has inter alia sought to declare the Resolution Plan dated 11.02.2020 approved by the CoC based on the Information Memorandum prepared by the R-1/RP as null and void as the said Plan is contrary to the provisions of the Code and Regulations and to direct the R2, R3 and R4 to comply with the common order dated 28.05.2021 passed by this Adjudicating Authority in IA No.134 of 2020. Therefore, the Applicant had raised same issues between the same Parties in the IA No.134 of 2020 in which case order has already been passed by this AA. 11. It has been correctly contended by the Respondents that once an issue has already been adjudicated upon by this Tribunal, the same cannot be adjudicated again without taking necessary consequential steps in accordance with the observations of the Tribunal. It was stated by this Adjudicating Authority in the above order dated 28.05.2021 tha....
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....of the Hon'ble High Court of Karnataka dated 13.02.2019 in WP No.40360-40364/2018, the Corporate Debtor filed its GST returns for the period September 2017 to October 2018 on 30.03.2019. Ordinarily, as per Section 62(2) of KGST Act, 2017, where the GST returns are filed within 30 days from the date of passing of the best judgment orders, these assessment orders shall be deemed to have been withdrawn. 15. The RP submitted that pursuant to the orders of the Hon'ble High Court of Karnataka in WP 15646/2018, WP 40360-40364/2018 and in particular the interim order dated 13.02.2019 in WP 40360-40364/2018, the Corporate Debtor was allowed to file its return within one week and the CD complied with the order and finally filed its GST returns for the period September 2017 to October 2018 on 30.03.2019. The CD paid its entire GST liability for this period before filing the GST returns. The actual GST liability for the said period was Rs.53,23,37,694/- based on the books of accounts and the transactions which was also paid in full as against the best judgment orders (which are estimates) of Rs.84,82,50,692/-. Pursuant to the filing of GST ret....