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2020 (10) TMI 736 - Tri - Insolvency and BankruptcyLiquidation process - Priority of settlement of dues - Payment of dues of Applicant as Secured Creditors as provided under the provisions of Part II Chapter II of the Insolvency & Bankruptcy Code, 2016 - HELD THAT:- It is clear that the dues of the Government, Central Government and/or State Government or any legal authority fall under the category of "Operational Debt". That apart, the Applicant is claiming that in view of the provision of section 48 of Gujarat Value Added Tax, 2003, he may be treated as Secured Creditor. This contention of the Applicant is/are also not maintainable in view of the definition stated hereinabove as also in view of section 238 of the IBC. While deciding the issue of 'Operational Creditor' and 'Financial Creditor', the Hon'ble Supreme Court observed in SWISS RIBBONS PVT. LTD. AND ANR. VERSUS UNION OF INDIA AND ORS. [2019 (1) TMI 1508 - SUPREME COURT] wherein it is inter alia observed that "an 'Operational Debt" would include a claim in respect of the provision of goods or service, including employment, or a debt in respect of payment of goods or services, including employment, or a debt in respect of payment of dues arising under any law and payable to the Government or any local authority. Statutory dues such as income tax, value added tax and other statutory dues arising out of law will arise only if the company/corporate debtor is operational and, therefore, such dues have a direct nexus with the company" - Thus, any dues and services of the Government Departments are considered as "Operational Creditor". Under such circumstances, the very purpose for which the IA has been filed is not going to succeed as they fall under the category of Operational Creditor as per the provisions of IBC. Application dismissed.
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