TMI Blog2023 (3) TMI 333X X X X Extracts X X X X X X X X Extracts X X X X ..... for recovery of the liability assessed. This is clear from the following extract from the decision in SUNDARESH BHATT, LIQUIDATOR OF ABG SHIPYARD VERSUS CENTRAL BOARD OF INDIRECT TAXES AND CUSTOMS [ 2022 (8) TMI 1161 - SUPREME COURT] where it was held that the respondent could only initiate assessment or reassessment of the duties and other levies. They cannot transgress such boundary and proceed to initiate recovery in violation of Sections 14 or 33(5) of the IBC. The interim resolution professional, resolution professional or the liquidator, as the case may be, has an obligation to ensure that assessment is legal and he has been provided with sufficient power to question any assessment, if he finds the same to be excessive. Merits ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the respondent accepts notice. 4. The petitioner has filed the present petitions impugning two separate orders-in-original, both dated 26.05.2022. In terms of the impugned orders, the Adjudicating Authority has assessed a sum of ₹63.35 crores as service tax and ₹8.95 crores as CENVAT Credit, for the years 2014-2015 and a sum of ₹92.11 crores as service tax and ₹4.05 crores as CENVAT Credit for the years 2015-2016, 2016-2017 and the first quarter of assessment year 2017-2018. In addition, the Adjudicating Authority had also levied penalty and interest. 5. It is the petitioner s case that the proceedings for assessment had commenced after the petition under Section 7 of the Insolvency and Bankruptcy Code, 2016 ( ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... roceedings can be initiated for recovery of the liability assessed. This is clear from the following extract from the decision in Sundaresh Bhatt, Liquidator of ABG Shipyard vs. Central Board of Indirect Taxes and Customs (supra) : 47. Therefore, this Court in V.M. Deshpande case [S.V. Kandoakar v. V.M. Deshpande, (1972) 1 SCC 438] held that the authorities can only take steps to determine the tax, interest, fines or any penalty which is due. However, the authority cannot enforce a claim for recovery or levy of interest on the tax due during the period of moratorium. We are of the opinion that the above ratio squarely applies to the interplay between the IBC and the Customs Act in this context. 48. From the above discussio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he IBC before the liquidator. However, the respondent does not have the power to execute its claim beyond the ambit of Section 53 of the IBC. Such harmonious construction would be in line with the ruling in Gujarat Urja Vikas Nigam Ltd. v. Amit Gupta [Gujarat Urja Vikas Nigam Ltd. v. Amit Gupta, (2021) 7 SCC 209 : (2021) 4 SCC (Civ) 1] , wherein a balance was struck by this Court between the jurisdiction of NCLT under the IBC and the potential encroachment on the legitimate jurisdiction of other authorities. 11. Insofar as, the petitioner s challenge to the impugned orders on merits is concerned, this Court does not consider it apposite to entertain this challenge as the petitioner has an equally efficacious remedy of filing an appe ..... X X X X Extracts X X X X X X X X Extracts X X X X
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