Department Of State Tax vs Siddheshwar Industries Pvt. Ltd & Anr
- CitationCompany Appeal (AT) (Insolvency) No. 1225 of 2024
Ratio decidendi
The rule this decision rests on
The State Tax Department, claiming as a secured creditor under the Maharashtra Value Added Tax Act, 2002, cannot be held to be a secured creditor of the corporate debtor on the basis of its statutory tax dues; its claim is to be treated as operational debt, following the Tribunal's earlier decision in Zicom Saas Pvt. Ltd., and the appeal against approval of a resolution plan that treated it as operational creditor fails accordingly.
Written by Miss Lucy from the judgment below, not taken from a headnote.
Judgment
As delivered
IN THE MATTER OF: Department of State Tax, Through the Dy. Commr. of State Tax ...Appellant
Versus
Siddheshwar Industries Pvt. Ltd. & Anr. ...Respondents
Present: For Appellant : Ms. Shwetal Shepal, Advocate. For Respondents : Mr. Sumit Shukla, Mr. Sanjeev Panda, Mr. Narendra Kumar, Advocates for R-1 (SRA).
ORDER
(Hybrid Mode)
12.07.2024: Heard learned counsel for the parties. This Appeal has
been filed against order dated 24.11.2023 by which IA No.3461 of 2023 filed
by the Resolution Professional for approval of Resolution Plan has been
allowed and the Resolution Plan of the Corporate Debtor has been approved.
The Appellant has filed a claim and was treated as Operational Creditor and
has been allowed an amount of 1%.
2. Learned counsel for the Appellant submits that the Appellant ought to
have been treated as Secured Creditor, hence, the Resolution Plan deserved
to be rejected.
3. Learned counsel for the Respondent has relied on judgment of this
Tribunal in Company Appeal (AT) (Ins.) No.246 of 2022, Department of
State Tax, Through the Dy. Commissioner of State Tax vs. Zicom Saas
Cont'd.../ 2
Pvt. Ltd. & Anr. decided on 07.02.2023, where similar issue fell for
consideration before this Tribunal pertaining to Maharashtra Value Added
Tax Act, 2002 and it was held that State Tax Department cannot be held to
be secured creditor. Judgment of Hon'ble Supreme Court in State Tax
Officer vs. Rainbow Papers Limited, (2022) SCC OnLine SC 1161 was also
noticed and it was held that the said judgment is distinguishable.
4. Following the judgment of this Tribunal dated 07.02.2023, we are of the
view that Appellant cannot be held to be a secured creditor. There is no merit
in the Appeal. Appeal is dismissed.
[Justice Ashok Bhushan] Chairperson
[Barun Mitra] Member (Technical) Archana/nn
Company Appeal (AT) (Insolvency) No.1225 of 2024
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