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2023 (2) TMI 682 - DELHI HIGH COURTJurisdiction - power to issue SCN - CIRP proceedings - Approval of resolution plan - sustainability of the show-cause notice - DRI’s stand is, that prior to the amendment brought about in Regulation 12 of the 2016 Regulations, it was only required to file “proof of claim”, and the proof of claim not filed - stand taken vis-à-vis non-filing of proof of claim is, that SML had acknowledged the debt due, and accordingly sought an extension of time to fulfilits export obligations - waterfall claim for distribution of proceeds from sale of Liquidation of assets - applicability of doctrine of forum non-conveniens. Whether Section 53 of the Code, which provides for a waterfall mechanism for the distribution of proceeds, obtained from the sale of liquidation of assets, would override Section 48 of the GVAT Act? HELD THAT:- In the instant case, the DRI/DGFT neither submitted a proof of claim nor responded to a specific communication via e-mail dated 17.05.2017, addressed to respondent no.3. Section 48 of the GVAT Act is not pari materia with Section 142A of the 1962 Act. Section 142A of the 1962 Act plainly states that any amount payable by way of duty, penalty, interest or any other sum payable by an assessee or any other person under the Act shall have the first charge on the property of the assessee or the person, as the case may be, save as otherwise provided inter alia under the Code. Section 48 of the GVAT Act does not contain any such exception and/or carve out - the fact that extensions were sought to fulfil export obligations would not help the cause of the respondents. As a matter of fact, respondent nos. 2, 3 and 7 have, in their counter-affidavit, admitted that since the amounts due had not been crystallized, they could not respond to the Public Announcement made by the IRP. If the law, as enunciated by the Supreme Court in GHANASHYAM MISHRA AND SONS PRIVATE LIMITED THROUGH THE AUTHORIZED SIGNATORY VERSUS EDELWEISS ASSET RECONSTRUCTION COMPANY LIMITED THROUGH THE DIRECTOR & ORS. [2021 (4) TMI 613 - SUPREME COURT] is applied, then the dues, if any owed to the respondents would have to be declared as having extinguished, and if such is the position, the adjudication of the impugned show-cause notice would be an exercise in futility. The doctrine of forum non-conveniens assumes, that although the Court has jurisdiction, in certain cases, it takes the view, that the action filed before it could be agitated conveniently before another forum. Therefore, in such an eventuality, the writ action is not entertained by the Court for the reasons of convenience, and not on the ground that it does not have the jurisdiction to try and adjudicate the action lodged before it. This writ petition was filed in March 2021, and the objection concerning the Court's power to entertain the writ action was taken much later, it would be unfair to return the writ petition, on the ground that this Court is not a convenient forum for adjudicating the dispute arising between the parties. The impugned show-cause notice seeks to do, what is, in fact, an exercise in futility, given the law laid down by the Supreme Court in Ghanashyam Mishra. The Supreme Court has enunciated, in no uncertain terms, the clean slate principle; it cannot be set at naught by entertaining claims that concern the period obtaining before the approval of the Resolution Plan. The impugned SCN is quashed.
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