Upon approval of a resolution plan under IBC, all claims not expressly included therein, including tax liabilities, are extinguished and cannot be pursued.

JUDGMENT :

PRANAV TRIVEDI, J.

1. Heard learned advocate Mr.B.S.Soparkar for the petitioner and learned Senior Standing Counsel Mr. Karan G. Sanghani for the respondent.

2. Rule returnable forthwith. Learned Senior Standing Counsel Mr. Karan G. Sanghani waives service of the notice of rule on behalf of the respondent.

3. With the consent of the learned advocates for the respective parties, the matter is taken up for hearing, as the issue involved is very short.

4. The petition has been filed under Article 226 of the Constitution of India with the following prayers :-

“(a) Quash and set aside the impugned notice u/s 148 of the Act dated 31.03.2015 at Annexure A to this petition;

(b) Pending the admission, hearing and final disposal of this petition, to stay further proceedings pursuant to the impugned notice;

(c) Any other and further relief deemed just and proper by granted in the interest of justice;

(d) To provide for the cost of petition.”

5. The brief facts of the case are as follows:

5.1 The petitioner is a company registered under the Companies Act, 1956, inter alia engaged in the business of manufacturing of components for the general engineering and automotive industries. The Petitioner filed the return of income for the Assessment Year 2021-22.

5.2 The case was reopened by the issuance of a notice dated 31.03.2025 under Section 148 of the INCOME TAX ACT , 1961 (hereinafter referred to as“the Act”).

5.3 The petitioner was subjected to the insolvency proceedings under the Insolvency and Bankruptcy Code, 2016 (“IBC Code”), wherein, a Corporate Insolvency Resolution Process (“CIRP”) was initiated by the Indian Overseas Bank under Section 7 of the IBC Code, which was admitted by the Adjudicating Authority vide order dated 01.09.2020.

5.4 An Interim Resolution Professional was appointed by the Hon’ble Tribunal, who made a public announcement in accordance with Section 13, 15 and other relevant provisions of the Code read with the Regulation 6 of the Insolvency Regulations, 2016, thereby inviting claims from the various creditors of the Petitioner.

5.5 Further, under the CIRP, the Resolution Plan of Steel Wheels Limited for the revival of the Petitioner was approved by the Hon’ble Tribunal vide order dated 12.10.2023 under Section 30 (6) of the Code. The said Resolution Plan provided for the waiver and extinguishment of all the unassessed/assessed tax liabilities for the period prior to the NCLT approval date.

5.6 The respondent has issued the impugned notice dated 31.03.2025, under Section 148 of the Act.

5.7 Challenging the legality of the impugned notice dated 31.03.2025, the petitioner has filed this petition.

6. Mr. B.S.Soparkar, learned advocate appearing on behalf of the petitioner submitted that on the approval of the Resolution Plan under Section 31 of the IBC, all dues of the Corporate Debtor except those which have been specifically provided for in the Resolution Plan would stand extinguished in terms of the provisions of the IBC and the decisions of the Hon’ble Apex Court in the case of The Committee of Creditors of Essar Steel Ltd. Vs. Satishkumar Gupta reported in (2020) 8 SCC 531 and in case of Ghanshyam Mishra and Sons Pvt. Ltd. Vs. Edelweiss Asset Reconstruction Company Ltd. , reported in (2021) 9 SCC 657 . Mr. Soparkar, learned advocate submitted that in the present case, the tax dues stand extinguished in terms of the Resolution Plan.

6.1 Mr. Karan G.Sanghani, learned Senior Standing Counsel for the respondent-Department is not in a position to controvert the position of law as far as the extinguishment of the tax dues are concerned in terms of Section 31