Income Tax Department vs Sanjay Gupta Resolution Professional ...

[Arising out of order dated 11.10.2023 passed by the Adjudicating Authority (National Company Law Tribunal), Mumbai Bench-1 in I.A. No.513 of 2022 in CP (IB) No.590/MB/C-1/2018]

IN THE MATTER OF:

Income Tax Department Through Deputy Commissioner of Income Tax (Central) 2, Raipur (C.G.) Having its address at: 8th floor, Tower A, CBD Complex, Nava Raipur, Raipur, Chhattisgarh - 492101 Mail id: raipur.dcit.cen2@incometax.gov.in ...Appellant

Versus

Sanjay Gupta Resolution Professional of Topworth Steel and Power Pvt. Ltd. Having his address at: Sanjay Gupta & Associates, Cost Accountants, C-4-E/135, Janak Puri, New Delhi - 110058 Email - sanjay@sgaindia.in ...Respondent

Present: For Appellant: Ms. Kinjal Vyas, Advocate. For Respondents: Mr. Dhrupad Vaghani, Mr. J. Rajesh, Mr. Tushar Goel and Mr. J.S. Khurana, Advocates

ORDER

ASHOK BHUSHAN, J.

This Appeal has been filed by the Appellant - Income Tax Department

challenging the order dated 11.10.2023 passed by NCLT, Mumbai Bench-

Cont'd.../ -2-

1, by which order the I.A. filed by the Resolution Professional for approval

of the Resolution Plan has been allowed and the Resolution Plan in the

CIRP of Topworth Steel and Power Private Limited has been approved. The

Appellant aggrieved by the approval of the Resolution Plan has come up in

this Appeal. Brief facts of the case necessary to be noticed for deciding this

appeal are:-

(i) CIRP commenced against the Corporate Debtor - Topworth Steel and

Power Private Limited, by order dated 29.01.2020. IRP was appointed

by order dated 29.01.2020. Subsequently, vide order dated

14.07.2020, Mr. Sanjay Gupta (Respondent herein) was appointed as

Resolution Professional.

(ii) In pursuance of public announcement made by the IRP, claims were

filed in the CIRP by Financial Creditors and Operational Creditors. In

all 29 CoC meetings were held. Registered Valuers were appointed.

According to the report of the Valuers, the average liquidation value of

the Corporate Debtor was determined as R.238,15,90,254/-.

(iii) Resolution Plan was submitted. The Resolution Plan came to be

approved by the CoC. On basis of which, application was filed being

I.A. No.513 of 2022 by the Resolution Professional for approval of the

plan which plan stood approved by the impugned order.

2. Appellant's case in the Appeal is that the Appellant being unaware of

the CIRP process could not file its claim whereas total demand against the

Company Appeal (AT) (Insolvency) No.1564 of 2023 -3-

Corporate Debtor is Rs.360,73,33,263/-. It was further submitted that all

Assessment Orders were passed ex-parte under Section 144 of the Income

Tax Act against the Corporate Debtor since the Corporate Debtor did not

participate. In appeal, the Appellant has given the details of various

Assessment Orders and date of order passed against the Corporate Debtor.

3. The perusal of the details given at page 4 and 5 of the appeal indicate

that all Assessment Orders which have been passed against the Corporate

Debtor are subsequent to the initiation of CIRP against the Corporate

Debtor i.e. subsequent to 29.01.2020.

4. An Additional Affidavit has been filed by the Appellant where two

more Assessment Orders for Assessment Years 2007-08 to 2013-14 dated

10.11.2016 and 02.12.2019 has been brought on the record along with the

Audit Report under Section 44AB of the Income Tax Act dated 31.10.2019.

5. Learned counsel for the Appellant submits that the Appellant being

not aware of the CIRP could not file claim. It is submitted that the

Appellant came to know about the CIRP only after approval of the

Resolution Plan, when the Resolution Professional informed about the

approval of the Resolution Plan. Appellant Department by email dated

26.10.2023, 27.10.2023 and 30.10.2023 sought information with respect

to CIRP.

6. We have considered the submissions of learned counsel for the

Appellant as well as learned counsel appearing for the Respondent.

Company Appeal (AT) (Insolvency) No.1564 of 2023 -4-

7. Learned counsel for the Resolution Professional submitted that since

no claim was filed by the Department, the Appellant is not reflected in the

list of creditors nor any amount has been allocated to it.

8. Appellant's case itself in the Appeal is that they could not file claim

and they come to know about the order only after approval of the Resolution

Plan vide order dated 11.10.2023. Learned counsel for the Appellant

submits that in the Audit Report dated 31.10.2019, the Corporate Debtor

has acknowledged its contingent liability to the Income Tax dues. It is

relevant to notice the details which were given in the appeal by the

Appellant in Para 7(i). Appellant has given details of different Assessment

Orders which according to the Appellant were passed after initiation of

CIRP i.e. during moratorium period. Para 7(i), including the table is as

follows:

"i. The Assessment Orders came to be passed on various dates after the initiation of moratorium period under CIRP for Assessment Years 2008-09, 2009-10, 2012-13, 2013-14, 2014-15, 2015-16, 2016-17, 2017- 18, 2018-19, 2019-20 and 2020-21 for the amount aggregating to Rs.20,09,73,58,125/-. The breakup of the assessment details with respect to the relevant Assessment Years has been reproduced herein below:

Sr. A.Y. Section Date of Date of Demand raised initiation of order (In Rs.) proceedings 1. 2008- 271(1)(c) 03.12.2019 17.02.2022 78,77,262 09 2. 2009- 271(1)(c) 13.12.2019 17.02.2022 16,22,678 10

Company Appeal (AT) (Insolvency) No.1564 of 2023 -5-

3. 2012- 154 r.w.s. 144 08.08.2022 08.08.2022 4,05,34,55,992 13

4. 2012- 271(1)(b) 25.12.2019 01.06.2021 20,000 13

5. 2012- 271(1)(c) 25.12.2019 01.06.2021 15,89,03,100 13

6. 2013- 271(1)(b) 13.04.2022 20.10.2022 20,000 14

7. 2013- 271(1)(c) 04.04.2022 21.10.2022 37,25,83,696 14

8. 2013- 153C r.w.s. 144 26.03.2021 12.03.2022 75,1477,870 14

9. 2014- 271(1)(b) 13.04.2022 20.10.2022 20,000 15

10. 2014- 271(1)(c) 04.04.2022 21.10.2022 32,33,18,839 15

11. 2014- 153C r.w.s. 144 26.03.2021 12.03.2022 92,46,91,810 15

12. 2015- 271(1)(b) 13.04.2022 20.10.2022 20,000 16

13. 2015- 271(1)(c) 04.04.2022 21.10.2022 14,07,37,906 16

14. 2015- 153C r.w.s. 144 26.03.2021 12.03.2022 29,55,41,100 16

16. 2016- 144 r.w.s. 263 02.05.2022 22.07.2022 1,92,56,16,704 17

17. 2016- 271(1)(b) 13.04.2022 20.10.2022 20,000 17

18. 2016- 271(1)(c) 13.04.2022 21.10.2022 7,92,54,098 17

19. 2016- 271(1)(b) 25.07.2022 27.01.2023 10,000 17

20. 2016- 271(1)(c) 19.12.2019 09.06.2021 94,37,14,540 17

21. 2017- 272A(1)(d) 13.04.2022 20.10.2022 20,000 18

22. 2017- 270A 04.04.2022 21.10.2022 1,77,66,95,920 18

23. 2017- 153C r.w.s. 144 26.03.2021 12.03.2022 1,52,91,73,080 18

25. 2018- 272A(1)(d) 13.04.2022 20.10.2022 20,000 19

26. 2018- 270A 04.04.2022 21.10.2022 37,53,36,556 19

27. 2018- 272A(1)(d) 13.04.2022 12.10.2023 20,000 19

28. 2018- 153C r.w.s. 144 26.03.2021 12.03.2022 30,12,59,670 19

30. 2018- 234D 26.03.2021 12.03.2022 1,28,631 19

31. 2019- 272A(1)(d) 13.04.2022 20.10.2022 20,000 20

32. 2019- 270A 04.04.2022 21.10.2022 2,97,05,98,266 20

33. 2019- 144 26.03.2021 12.03.2022 1,79,48,92,850 20

Company Appeal (AT) (Insolvency) No.1564 of 2023 -6-

35. 2019- 234D 26.03.2021 12.03.2022 12,697 20

36. 2020- 143 1a 20.12.2021 20.12.2021 1,37,02,74,860 21 TOTAL 20,09,73,58,125

9. When we look into the aforesaid table, it is clear that all Assessment

Orders were passed subsequent to initiation of CIRP and initiation of

moratorium, which is an admitted fact.

10. In facts of the present case, when no claim was filed and Appellant

itself submits that Assessment Orders were passed after enforcement of

moratorium, we see no ground to interfere with the order passed by the

Adjudicating Authority approving the Resolution Plan. We, thus, do not

find any ground to interfere with the impugned order. Appeal is dismissed.

[Justice Ashok Bhushan] Chairperson

[Arun Baroka] Member (Technical)

NEW DELHI

1st March, 2024

Archana

Company Appeal (AT) (Insolvency) No.1564 of 2023