9911796707
TMI Blog2024 (8) TMI 1099X X X X Extracts X X X X X X X X Extracts X X X X ..... PGST Act"), vide Annexure P-6. 4. The 1st petitioner-Company was engaged in the business of manufacturing and trading of Inverters & Batteries and has its factory premises in the Industrial Area, Katha Baddi, District Solan, Himachal Pradesh. 5. For running its operations, it had availed various facilities from financial creditors and also with the State Bank of India. 6. On account of default in adherence to the financial discipline by the erstwhile management of the Company, the State Bank of India had initiated Corporate Insolvency Resolution Process (in short "the CIRP) of the petitioner-Company by filing C.P. no. (IB)-540(PB)/2017 under Section 7 of the Insolvency and Bankruptcy Code, 2016 (for short "the IBC or Code") before the National Company Law Tribunal (for short "the NCLT) at New Delhi, Principal Bench, where the registered office of the 1st petitioner-Company was situated. 7. The said petition came to be admitted on 05.04.2018 and a Resolution Professional was appointed replacing the earlier management which stood suspended, and by operation of Section 14 of the IBC, 2016 a moratorium was imposed. Annexure P-1 is the said order dt. 05.04.2018. 8. Pursuant to the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rs" and was duly admitted vide Annexure P-5 under Section 40 of the Code for the claimed amount. This is in view of Section 5 (20) & (21) of the Code, which define "operational creditors" and "operational debt". The claim of the 2nd respondent is mentioned at serial No. 733 of Annexure P-5. 19. In the meantime, the Liquidator issued a Public Notice dt. 04.05.2020 and an Addendum on 25.06.2020, inviting bids from prospective applicants willing to take over the 1st petitioner-Company as a going concern. This is consistent with Regulation 32 (e) and Regulation 32-A of the Insolvency and Bankruptcy Board of India (Liquidation Process) Regulation, 2016 (for short 'the Liquidation Regulations, 2016') which permit the Liquidator to sell the corporate debtor as a going concern. 20. Expressions of interest were received from interested parties including by petitioner no. 2 for taking over of the 1st petitioner-Company as a going concern. 21. The present management of the Company participated in the e-auction process and was the highest successful bidder with bid value of Rs.49.95 crore and submitted Annexure P-5A, acquisition plan for taking over the 1st petitioner-Company as a going con ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ppellate Tribunal, New Delhi (in short "the NCLAT"), under Section 61 of the IBC vide Company Appeal (AT) Insolvency no.673 of 2022. However, the same was dismissed on 03.02.2023 (Annexure P-8). 28. The said ex-promoter further challenged the same before the Supreme Court by filing a statutory appeal under Section 62 IBC, which was also dismissed on 07.08.2023 (Annexure P-9). 29. In view of the said events, the acquisition plan of the petitioner became a binding document in rem and is the final document having force of law. 30. Subsequently, even the liquidation process was closed on 02.11.2022 by the NCLT, New Delhi, vide Annexure P-10. 31. In view of all these events, the claims of respondents no. 1 & 2 are deemed to be settled in terms of the manner of distribution of sale proceeds as per Section 53 of IBC, and by operation of law, they are not left with any claim against petitioner no. 1/Company with its new management. 32. In spite of this settled legal position and in spite of the 1st petitioner-Company writing letters on 06.06.2022 (Annexure P-11) and on 17.11.2022 (Annexure P-12) to respondent no.3 for taking note of the order dt. 11.05.2022 of the NCLT approving the a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng of the admission order dt. 05.04.2018 by the NCLT under Section 7 IBC. 40 It is contended that the claim of respondent no. 2 was duly dealt with under liquidation, and the balance amount, if any, stood extinguished and no right survived with the respondents to keep their charge/red entries over the properties in question. 41. Therefore, the following reliefs have been prayed in the Writ petition:- "i. Issue an appropriate writ, order or direction in the nature of certiorari, quashing the letter/communication dated 07.01.2020 (Annexure P-4), issued by Respondent No. 2, vide which the red entries/charge on account of dues recoverable from erstwhile management of Petitioner Company under Himachal Pradesh Goods and Service Tax Act, 2017 has been created over the properties of Petitioner No. 1 Company in an illegal and arbitrary manner, in view of the order dated 11.05.2022 (Annexure P-6) passed by National Company Law Tribunal, New Delhi approving acquisition plan of the Petitioner Company as "Going Concern" in view of the principle of "Clean Slate" as laid down by the Hon'ble Supreme Court in Ghanshyam Mishra and sons Pvt. Ltd. vs. Edelweiss Asset Reconstruction Company Limited ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ny State Government or any local authority to whom a debt in respect of the payment of dues arising under any law for the time being in force, such as authorities to whom statutory dues are owed" 67. As such, with respect to the proceedings, which arise after 16.8.2019, there will be no difficulty. After the amendment, any debt in respect of the payment of dues arising under any law for the time being in force including the ones owed to the Central Government, any State Government or any local authority, which does not form a part of the approved resolution plan, shall stand extinguished. 68. The only question, which remains is, what happens to such dues if they pertain to a period wherein Section 7 petitions have been admitted prior to 16.8.2019. 69. To answer the said question, we will have to consider, as to whether the said amendment is clarificatory/declaratory in nature or a substantive one. If it is held, that it is declaratory or clarificatory in nature, it will have to be held, that such an amendment is retrospective in nature and exists on the statute book since inception. However, if the answer is otherwise, the amendment will have to be held to be prospective i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... other stakeholders involved in the resolution Plan. The legislative intent behind this is, to freeze all the claims so that the resolution applicant starts on a clean slate and is not flung with any surprise claims. If that is permitted, the very calculations on the basis of which the resolution applicant submits its plans, would go haywire and the plan would be unworkable. 87 to 90. xxx xxx xxx 91. It is a cardinal principle of law, that a statute has to be read as a whole. Harmonious construction of sub-section (10) of Section 3 of the I&B Code read with sub-sections (20) and (21) of Section 5 thereof would reveal, that even a claim in respect of dues arising under any law for the time being in force and payable to the Central Government, any State Government or any local authority would come within the ambit of 'operational debt'. The Central Government, any State Government or any local authority to whom an operational debt is owed would come within the ambit of 'operational creditor' as defined under sub-section (20) of Section 5 of the I&B Code. Consequently, a person to whom a debt is owed would be covered by the definition of 'creditor' as defined under subsection (10 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f payment of dues arising under any law and payable to the Government or any local authority." 43. It is also contended that in view of Section 238 of the IBC, the provisions of the IBC override the provisions of the HPGST Act, 2017 and also the provisions of the VAT Act and the CST Act, and that respondent no. 4 is liable to issue "NOC" to the petitioners and the respondents are bound to delete the red entry/charge of the property. The stand of the respondents 44. Reply has been filed by the respondents refuting the said contentions. 45. While not disputing the events mentioned by the petitioners leading to the approval of the takeover acquisition plan of the 1st petitioner-Company by the current management and also not denying that the proceedings of the NCLT approving the approval plan submitted by the current management, got confirmed upto the Supreme Court, it is, however, pleaded that the State Debts have priority over rights of secured creditors. 46. Reliance is placed on the judgments in Central Bank of India vs. State of Kerala & Ors. (2009) 4 SCC 94, to contend that there is priority of State Debt over Debts of other Secured Creditors. 47. It is contended that the d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he Claim-sheet of List of Creditors, Annexure P-5, it is mentioned at serial No. 733. 56. However, when the IBC permits Sale of Assets of a Company in Liquidation as a going concern under Regulation 32 (e) & 32A of the Insolvency and Bankruptcy Board of India (Liquidation Process) Regulation, 2016, and in such an e-auction conducted by the Liquidator, the current management made a plan for acquisition vide Annexure P-5A for Rs.49.95 crore and the same was approved by the NCLT on 11.05.2022 vide Annexure P-6 and Sale Certificate was also issued vide Annexure P-7 on 31.05.2022, all the claims of the respondents stood extinguished. 57. The respondents are also estopped from continuing the red entry/charge on the properties of the 1st petitioner-Company, since they had never objected to the acquisition plan submitted by the current management of the 1st petitioner-Company and that they had also not challenged the said order dt. 11.05.2022 (Annexure P-6) passed by the NCLT approving the acquisition plan for the 1st petitioner-Company. 58. Once the said order had been upheld by the NCLAT vide Annexure P-8 dt. 03.02.2023 and by the Supreme Court on 07.08.2023, it is not permissible for ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
