TaxTMI 
TaxTMI 
TaxTMI 
2024 (3) TMI 243
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....s. 25,26,240/- towards arrears of tax for Assessment Year 2013-2014 and 2015-2016 both under VAT and CST respectively as detailed below : - Assessment Year VAT CST Total 2013-14 5,75,414.00 6,83,528.00 12,58,942.00 2014-15 4,68,978.00 7,71,372.00 12,40,350.00 2015-16 - 26,948.00 26,948.00 Total 25,26,240.00 4. A dispute arose under the Central Sales Tax Act, 1956, on account of failure on the part of the petitioner to submit necessary Form-C and Form-F. Therefore, an Assessment Order came to passed on 24.12.2018 for the Assessment Year 2014-2015. There is a mention to the same in Paragraph 17 of the Counter Affidavit filed by the respondent. 5. Copy of the aforesaid Assessment Order seeking to revise the deemed assessment completed in terms of Section 22 of the Tamil Nadu Value Added Tax (TNVAT) Act, 2006, has not been filed along with the typed set of papers either by the petitioner or by the respondent. 6. It is the case of the petitioner that Assessments were deemed to have been completed earlier under Section 22 of Tamil Nadu Value Added Tax (TNVAT) Act, 2006 on 31.10.2015. They were however reversed later. It appears that an assessment o....
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....ted 01st February 2019 and relevant page (page No.17) of resolution plan (under the heading resolution for disputed legal case and contingent liabilities) for your reference." 11. One of the promoters of the petitioner Company namely Mr.Mahavir Chand Bafna himself initiated Corporate Insolvency Resolution Process (CIRP) in CP/682(IB)/CB/2017 on 20.12.2018 as a resolution applicant under the provisions of Insolvency and Bankruptcy Code, 2016 before the National Company Law Tribunal (NCLT) Chennai. 12. The National Company Law Tribunal (NCLT) by its order dated 01.02.2019, sanctioned Corporate Insolvency Resolution plan (CIRP) submitted by the resolution applicant, the promoter of the petitioner namely Mr.Mahavir Chand Bafna. 13. In the sanctioned resolution plan of the NCLT vide its order dated 01.02.2019, the Tax Liability of the petitioner was crystalized under various enactments was as follows : - Sl.No. Duties & Taxes As on 30 June 2018 (Rs in Crs) Proposed to pay% Amt proposed to pay (Rs in Crs) 1 TDS Payable 0.21 0.05 0.01 2 Income Tax 1.99 0.05 0.1 3 Service Tax 0.27 0.05 0.01 4 Professional Tax 0.17 0.05 0.01 Total 2.64 0.13....
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....king to recover Rs. 25,26,240/- from the petitioner as against the amount that was quantified by the petitioner in the resolution plan for a sum of Rs. 53,00,000/- is unsustainable. 19. In this connection, the learned counsel for the petitioner has placed reliance on the decision of the Courts in the following cases:- (i) Ghanashyam Mishra and Sons Private Limited, Through the Authroised Signatory Vs. Edelweiss Asset Reconstruction Company Limited, Through the Director and others, (2021) 9 SCC 657. (ii) Ruchi Soya Industries Limited and others Vs. Union of India and others, (2022) 6 SCC 343. (iii) Aircel Cellular Limited Vs. Union of India and others in W.P.No.21174 of 2023 dated 10.01.2023. 20. On the other hand, the learned Additional Advocate General for the respondent would submit that the impugned order is unsustainable. 21. Specifically, the learned Additional Government Pleader submits that the respondent was unaware of the proceedings before the NCLT. Hence, the Resolution Plan that was sanctioned by the NCLT on 01.02.2019, which appears to have been affirmed by the Hon'ble Supreme Court is not binding on the Commercial Tax Department as the Commercial Tax Depa....
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.... phased manner, uniform proportional reduction, the company would necessarily have to be liquidated and its assets sold and distributed in the manner stipulated in Section 53 of the IBC. 54. ..... 55. ..... 56. Section 48 of the GVAT Act is not contrary to or inconsistent with Section 53 or any other provisions of the IBC. Under Section 53(1)(b)(ii), the debts owed to a secured creditor, which would include the State under the GVAT Act, are to rank equally with other specified debts including debts on account of workman's dues for a period of 24 months preceding the liquidation commencement date. 57. As observed above, the State is a secured creditor under the GVAT Act. Section 3(30) of the IBC defines secured creditor to mean a creditor in favour of whom security interest is credited. Such security interest could be created by operation of law. The definition of secured creditor in the IBC does not exclude any Government or Governmental Authority." 25. It is further submitted that Section 27 of the TNVAT Act, 2006, is pari materia with Section 48 of the Gujarat Value Added Tax (Amendment) Act, 2007. Hence, this Writ Petition is liable to be dismissed. 26. The learned....
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....whereas the last date for filing a claim statement before NCLT has already expired on 31.07.2018. Therefore, it is submitted that the aforesaid claim statement is declared as null and void in accordance with the provisions of IBC Code. 31. I have considered the arguments advanced by the learned counsel for the petitioner and the learned Additional Advocate General for the respondent. 32. Insolvency and Bankruptcy proceeding initiated against the petitioner herein under Insolvency Bankruptcy Code, 2016 by one of the Operational Creditors namely M/s.Aries Limited, had apparently supplied goods for a sum of Rs. 13,01,093/- to the petitioner. As against the aforesaid amount, the petitioner appears to have already paid a sum of Rs. 3,00,000/-. Practically, the insolvency proceeding inititated against the petitioner appears to be staged managed and more in the nature of voluntary Corporate Insolvency Resolution Process. 33. In the Insolvency Proceedings initiated by the so-called operating creditor M/s.Aries Limited to recover the aforesaid amount of Rs. 13,01,093/- from the petitioner was crystalized as Rs. 11,35,353/-. 34. The NCLT vide its dated 16.07.2018 appointed, Mr.Gopalaswam....
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....solution Plan that was submitted by the promoter of the petitioner Mr. Mahavir Chand Bafna on 26.08.2018 gives the particulars of the various creditors as follows : - Stakesholder O/S.Amt/Claim.Amt (Rs.Crs.) Payment Proposed (Rs.Crs.) Rational Secured Financial Creditors 49.23 34.46 Attempt has been made to pay to the secured financial creditors an amount of Rs. 34.46 Crs from the investment by RA & his investors based on cash flow visibility ESI & PF 1.94 1.94 Full amount has been proposed to be paid considering the nature and importance of the employees, workmen for the revival of the organisation. Operational Creditors (Workmen) 0.35 0.24 70% has been proposed to be paid considering the nature and importance of the workmen Operational Creditors (Employees) 0.64 0.32 50% has been proposed to be paid considering the nature and importance of the employees Other Operational Creditors 41.19 6.53 Operational Creditors being unsecured and unlikely to receive any recovery under liquidation scenario have also been proposed to be paid some amount given their importance and contribution towards business operations Statutory Liabilities 2.64 0.13 Statutory lia....
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....lanned and was stage managed advertisement would not have been issued on 18.07.2018 with alacrity. Such a hurry in the proceedings appears irregular and not bonafide. 42. The proceeding that was initiated before the National Company Law Board (NCLT) with the presentation of a petition under Section 8 of the IBC, 2016 on 16.07.2018 appears to be staged managed with a view to defeat the rights of scores of creditors including operating creditors such as the respondent Commercial Tax Department. 43. Mere paper publications of notice to the financial creditors and the operational creditors is not sufficient. Fixing 31.07.2018 as the last date for filing claim statement also shows undue alacrity is getting orders for NCLT to defeat the rights of creditors of the petitioner. 44. The petitioner appears to have orchestrated the proceeding under Section 8 of the IBC, 2016. The entire proceedings was speed tracked before the NCLT with a view to get unjust concession from the NCLT without actual participation of any of the creditors particularly operating creditors like the respondent Commercial Tax Department. 45. A reading of the Corporate Insolvency Resolution Plan that was filed on 20....