Principal Commissioner Of Income Tax ... vs C. Ramasubramaniam Resolution ...

Principal Commissioner of Income Tax Central - 2, ...Appellant Chennai

Vs

C. Ramasubramaniam, Resolution Professional for ...Respondent Surana Corporation Ltd.

Present: For Appellant: Ms. Lakshmi Gurung, Sr. Standng Counsel with Ms. Easha Kadian, Jr. Standing Counsel for IT Department.

For Respondent: Mr. Ashwini Kumar Singh, Liquidator (R-1).

ORDER

13.12.2019: 'Principal Commissioner of Income Tax Central - 2, Chennai'

moved application to set aside the order dated 19th September, 2019 whereby

order of Income Tax Department dated 4th October, 2018 for attachment of the

refund, which was valid for six months in terms of sub-section (2) of Section

281B of the Income Tax Act, 1961, as amended from time to time, the

Adjudicating Authority observed that the time period of six months has expired

on 3rd April, 2019 and the Corporate Debtor is under liquidation, therefore,

declined to extend the attachment order. The Adjudicating Authority directed

the Income Tax Department to release the refund amount of Rs.4,20,76,684/-

in the accounts of the Assessee/ Corporate Debtor - M/s Surana Corporation

Limited within six weeks.

Company Appeal (AT) (Insolvency) No. 1290 of 2019 -2-

2. Learned counsel for the Appellant submitted that in terms of the

provisions of the Income Tax Act, the Appellant is a Secured Creditor.

However, it is also accepted that the debt being payable in terms of law, the

Appellant is an Operational Creditor. We have brought it to the notice of

learned counsel for the Appellant that in Form B of Insolvency and Bankruptcy

Board of India (Corporate Insolvency Resolution Process) Regulation there is no

provision made for Operational Creditors to claim that Corporate Debtor has

created security interest. On the other hand, in Form C, which is meant for

Financial Creditors, there is specific provision for Financial Creditor to state as

to whether the security interest is created by Corporate Debtor or not.

3. In view of the aforesaid lacuna, even the Income Tax Department if

Secured Creditor, cannot claim to be a Secured Creditor when Form B is filed.

How the matter is sorted out is upto the Liquidator to decide in terms of the

I&B Code.

4. In the circumstances, while we are not inclined to interfere with the

impugned order, we allow the Appellant to make claim before the Liquidator as

a Secured Creditor. If the Form is incomplete, it will file separate Form with

evidence in support of the claim.

5. The appeal stands disposed of with aforesaid observations.

Company Appeal (AT) (Insolvency) No. 1290 of 2019 -3-

6. Let a copy of this order be communicated to the Chairman, IBBI, New

Delhi and the Secretary, Ministry of Corporate Affairs to notice the aforesaid

fact and for necessary correction, if so required.

[Justice S. J. Mukhopadhaya] Chairperson

[Justice Bansi Lal Bhat] Member (Judicial)

[Justice Venugopal M.] Member (Judicial) am/gc

Company Appeal (AT) (Insolvency) No. 1290 of 2019