M/S. Imec Services Limited vs Office Of The Assistant Commissioner Of ...

IN THE MATTER OF: IMEC Services Ltd. ...Appellant

Versus

Office of the Assistant Commissioner of Customs & Ors. ...Respondents

Present: For Appellant : Mr. Gaurav Mitra, Mr. Himanshu Satija, Mr. Jay Zaveri, Ms. Rhea Prakash, Ms. Ridhi Ranjan, Advocates. For Respondents : Mr. Vivek Kohli, Sr. Advocate with Mr. Asav Rajan, Ms. Vasudha, Mr. Akash Saxena, Ms. Charu Trivedi, Mr. Kashish Chadha, Mr. Devang Shrotriya, Advocates for R-2. Mr. Krishnendu Datta, Sr. Advocate with Mr. Ankur Singh, Ms. Pallavi Sengupta, Mr. Rahul Gupta, Mr. Arjun Krishnan, Advocates for R-4.

ORDER

(Hybrid Mode)

28.02.2025: Heard learned counsel for the parties. This appeal has

been filed against order dated 13.08.2024 passed by the Adjudicating

Authority in IA No.3925 of 2022. Appellant filed an IA No.3925 of 2022 for

reliefs as extracted in Para 1 of the impugned order, which is to the following

effect:

"1. This is an application filed under Section 60(5) of the Insolvency and Bankruptcy Code, 2016 ('IB Code') by the Applicant seeking the following reliefs:

(a) This Tribunal be pleased to direct and declare that by virtue of the Slump Sale Agreement dated 30th

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March 2011, all responsibilities, obligations and/or liabilities relating to the Steel Division, including the export obligations vest with and shall be complied by the Corporate Debtor,

(b) This Tribunal be pleased to direct the Resolution Professional of the Corporate Debtor to acknowledge its obligations and/or liabilities under the said Show Cause Notice dated 01st December 2021;

(c) This Tribunal be pleased to direct the Resolution Professional of the Corporate Debtor to comply with the demands of Customs Authorities arising out of Advance License bearing number 1110022706 dated 30th June 2010 and Advance License bearing number 1110022950 dated 16th August 2010;

(d) This Tribunal be pleased to direct the Resolution Professional to ensure the reflection of the amounts owed to the Customs Authorities and/or any obligations/liabilities transferred through the Slump Sale Agreement dated 30 March 2011 in the subsequent Resolution Plan proposed and finalized before this Tribunal."

2. The Adjudicating Authority by the impugned order has rejected the

application. Aggrieved by the said order this appeal has been filed.

3. Appellant filed an application, after notices were issued to the Customs

Authority. The Appellant has pleaded that liability of the custom duty is on

the Corporate Debtor by virtue of Slump Sale Agreement dated 30.03.2011.

The application was resisted by the Resolution Professional as well as the

Company Appeal (AT) (Insolvency) No.2129 of 2024 3

SRA. The Adjudicating Authority came to the conclusion that issue regarding

liability under the Customs Act are beyond the jurisdiction of the Adjudicating

Authority, which finding has been returned in Para 6 of the judgment. The

Adjudicating Authority after recording the above finding, however, made

certain observations in Para 7, 8 and 9, which were the reasons for rejecting

the application.

4. Shri Gaurav Mitra, learned counsel appearing for the Appellant

challenging the order submits that when the Adjudicating Authority took the

view that the Adjudicating Authority has no jurisdiction to enter into the issue

of determination of the liability of the custom duty, it was not necessary to

make any further observations.

5. Learned counsel for the SRA submits that in fact, by the Show Cause

Notice issued by the Customs Authority on 01.12.2021 demand of the

custom's dues was made from the Appellant and after the reply to the Show

Cause Notice, the liability was fixed by 31.03.2023, against which appeal was

filed, which appeal was disposed of by order of the Appellate Authority by

dated 24.07.2024 remanding the matter back to the Customs Authority for

consideration and the issue regarding liability of the custom duty has not yet

been finalised by the Customs Authority.

6. Learned counsel for the RP also supported the order and submits that

Appellant has no right to file application before the Adjudicating Authority

and issue was to be considered only by the Customs Authority in accordance

with Customs Act.

Company Appeal (AT) (Insolvency) No.2129 of 2024 4

7. We have considered the submissions of learned counsel for the parties

and perused the record.

8. From the materials brought on the record, it is clear that it is on

account of the customs dues, Applicant/Appellant has filed the application

before the Adjudicating Authority. From the facts which have been noticed

above, it is clear that Appellant is pursuing remedy under the Customs Act

and the liability with regard to customs duty has not yet been finalised. We

only observe that the Adjudicating Authority after having taken the view that

Adjudicating Authority has no jurisdiction to enter into the issue regarding

determination of the liability of the custom duty, should have been closed the

application at this stage and no further observation on merit was required.

We clarify that it is for the Customs Authority to consider and decide the

matter without being influenced by the impugned order passed by the

Adjudicating Authority. Subject to above observation, we dismiss the appeal.

[Justice Ashok Bhushan] Chairperson

[Barun Mitra] Member (Technical)

[Arun Baroka] Member (Technical) Archana/nn

Company Appeal (AT) (Insolvency) No.2129 of 2024