Case Details: Viaan Industries Ltd. Versus Union of India- (2025) 29 Centax 103 (Bom.)
Judiciary and Counsel Details
- B.P. Colabwalla & Firdosh P. Pooniwalla, JJ.
- S/Shri Sunny Shah & Ashish Suryavanshi, Advs. for the Petitioner.
- S/Shri Amar Mishra, AGP, Jitendra Mishra & Sangeeta Yadav, Advs. for the Respondent.
Facts of the Case
The petitioner challenged the orders issued by the department under Section 74 of CGST Act, along with the show cause notices for the period 2017-2024. The petitioner argued that, following the successful approval of the Corporate Insolvency Resolution Process (CIRP) and the resolution plan sanctioned by the National Company Law Tribunal (NCLT), any tax liabilities for the period prior to the approval of the resolution plan should be subsumed within the resolution plan. The petitioner contended that recovery of tax liabilities incurred before the date of the resolution plan’s sanction could not be pursued by the state authorities, as these liabilities were covered under the approved resolution plan. The petitioner relied on Section 74 of the CGST Act, Section 122 of the Maharashtra GST Act, and Section 31 of the Insolvency and Bankruptcy Code, 2016, and sought an interim stay on the enforcement of the department’s orders and show cause notices.
High Court Held
The Hon’ble High Court held that the petitioner had made a strong prima facie case for granting an interim stay on the orders and show cause notices issued by the department. The court found that tax liabilities arising prior to the approval of the resolution plan were subsumed under the CIRP process, as per Section 31 of the Insolvency and Bankruptcy Code, 2016. The court granted an interim stay on the recovery actions and directed the department to file their reply affidavits. The matter was listed for further proceedings.
