The approval of a Resolution Plan under the IBC extinguishes all prior tax dues, making any recovery attempts invalid.

ORDER :

1. These three writ petitions involve identical questions of facts and law and hence, are being decided by this common order.

2. Mr. Mahaveer Bishnoi, learned Additional Advocate General has put in appearance on behalf of the respondents.

3. The Commercial Taxes Officer, Works and Leasing Taxes, Bhilwara passed the assessment orders dated 21.03.2017, 05.03.2018 and 28.03.2019 for the assessment years 2014-2015, 2015-2016 and 2016-2017 respectively by which the respondents held the petitioner-company liable to pay the amount of Rs.10,06,266/-, 43,073/- and 1,75,55,035/- on account of non-payment of the entry tax for the goods purchased by the petitioner from outside the State of Rajasthan. In furtherance of the aforesaid assessment orders, notice for payment of demand were also issued.

4. The respondent-Department, in order to recover the aforesaid due amount from the petitioner-company, issued a notice/communication dated 17.07.2019 to the Manager SBI, Agoocha, District Bhilwara (respondent No.2), invoking special mode of recovery under Section 50 of RVAT, 2003 read with Section 9 CST Act whereby it had directed the respondent No.2 to recover the outstanding amount of Rs.1,86,04,374/- from the Bank account of the petitioner-company.

5. The petitioner-company has filed the present writ petitions challenging the action of respondents, directing the respondent No.2 to recover the outstanding amount from its Bank account.

6. Mr. Vinay Kothari, learned counsel for the petitioner-company submits that the petitioner is not raising its grievance against the assessment orders which were passed by the respondents in these writ petitions, as it has availed appropriate legal remedy available to it under the law against the same. The petitioner is only challenging the impugned notice/communication dated 17.07.2019 sent to the respondent No.2 - Bank.

7. Learned counsel for the petitioner further submits that During the pendency of these writ petitions, the petitioner-company became sick. Accordingly, Corporate Insolvency Resolution Process (CIRP) was initiated under the Insolvency and Bankruptcy Code, 2016.

8. It was also submitted that the National Company Law Tribunal (NCLT), Kolkata Bench, Kolkata passed a final order dated 19.12.2023 under Section 31(1) of the IBC accepting the resolution plan, duly approved by the Committee of Creditors (CoC). The order of NCLT mandates that the CIRP shall be binding on the Corporate Debtors, McNally Bharat Engineering Company Ltd., its employees, members, creditors, guarantors including the Central Government, any State Government or any local authority to whom a debt in respect of payment of dues arising under any law for the time being in force, such authorities to whom statutory dues are owed and other stakeholders involved in the Resolution Plan.

9. It was emphasized by the learned counsel for the petitioner that approval of the Resolution Plan by the NCLT with effect from 19.12.2023 waived and/or extinguished and/or settled all tax dues of whatever nature of Central, State and local authorities pertaining to the period prior to the effective date. It was contended that the assessment orders pertains to the years 2014-2015, 2015-2016 and 2016-2017 and for the recovery of the amount in pursuance of the same, communication was issued to the Bank in the year 2019, all liabilities of the petitioner which became a sick unit and went for CIRP stood extinguished on account of the acceptance of the Resolution Plan w.e.f. 19.12.2023 (date of order passed by NCLT). As a consequence, The impugned communication/notice dated 17.07.2019 (Annex.5) issued in pursuance of the assessment orders dated 21.03.2017, 05.03.2018 and 28.03.2019 for the assessment years 2014-2015, 2015-2016 and 2016-2017 respectively are no more legally tenable.

10. Learned counsel for the petitioner placed reliance on the Division Bench judgment of this court in the case of Ultra Tech Nathdwara Cement Ltd. Vs. Union of India & Ors. [MANU/R