M/S. Ultratech Nathdwara Cement Limited vs .C.-JAMNAGAR(PREV)
Customs Misc. Application (ORS) No. 10502 of 2021
Facts:
1.NCLT passed an order approving a resolution plan for the company M/s. Binani Cement Limited in favour of M/s. Ultratech Nathdwara Cement Limited, which is the resolution applicant.
2.Demand was raised against the applicant by the respondent. Applicant is challenging the demand of dues by the Applicant.
Issue: Whether appeal is maintainable?
Arguments:
Applicant: Counsel submitted that as per the resolution plan approved by NCLT, no dues exists against the applicant therefore, the demand involved in the impugned order is not recoverable by
the department consequently, the appeal becomes infructuous
Respondent: Counsel submitted that the appellant M/s. Binani Cement Limited became insolvent therefore, the appeal needs to be abated. He further submits that if at all, the present applicant wish to continue the proceeding
Decision: Appeal is not maintainaible and has become infructuous
Rationale:
1.NCLT, after considering plan noted that the appellant is not liable to pay any dues. However, this tribunal is not competent to decide regarding the recovery of any dues. It is the department who has to decide whether any dues is recoverable or otherwise, in the light of the resolution plan approved by the NCLT.
2.Rule 22 is applicable only in case when the assessee is adjudicated as insolvent or in the case of a company when it is wound up. In the present case, the applicant being a company has not been wound up whereas, the same was revived under Insolvency Resolution process as per NCLT order
3.There is no provision made in the Customs and Central Excise Act to give effect of NCLT proceedings. This tribunal being creature under the Customs Act, even though the Insolvency and Bankruptcy Code have over riding effect over all the other acts in absence of any explicit provision under the Customs/Central Excise Act, this tribunal cannot decide finally whether the adjudged amount can be recovered by the department or otherwise.
4.Revenue-department has no proper guideline as to what stand is to be taken in a case where the IBC proceedings is in progress before NCLT/NCLAT or at higher forum. The assessee against whom the IBC proceedings are initiated invariably approach this tribunal through miscellaneous application for disposing of the appeals in the light of the NCLT’s order
Order copy:
