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O R D E R
I.A. No.2269 of 2023: This is an application praying for condonation of 14 days’ delay in filing the Appeal. Ground taken in the application is that after Appellant came to know of the order certain time was taken in obtaining necessary approval and collecting documents to file the Appeal. Cause shown sufficient, delay is condoned.
Heard learned counsel for the parties. This Appeal has been filed against order dated 21.03.2023 passed by the Adjudicating Authority by which I.A. No. 2897/MB-IV/2022 filed by the Resolution Professional for approval of the plan has been allowed.
The Appellant - Department of State Tax has come up in the Appeal challenging the approval of the plan on the ground that claim admitted of the Appellant was Rs.27,91,64,187/- whereas in the plan only an amount of Rs.58,58,444/- has been allocated. It is submitted that the Appellant was a Secured Creditor and was entitled to receive the entire claim.
Learned counsel for the Respondent refuting the submission of learned counsel for the Appellant submits that Appellant cannot be treated to be Secured Creditor and said issue has already been considered and answered judgment of this Tribunal in “Company Appeal (AT) (Insolvency) No. 246 of 2022, Department of State Tax, Through the Dy. Commissioner of State Tax vs. Zicom Saas Pvt. Ltd. & Anr., decided on 07.02.2023”. Learned counsel for the Respondent submits that the provision of Section 37 of the Maharashtra Values Added Tax Act, 2002 has been considered in the said judgment and it was held after consideration of the said provision that the Appellant cannot be treated as a Secured Creditor.
We have considered the submissions of learned counsel for the parties and perused the record.
Similar issues were answered by this Tribunal in the judgment dated 07.02.2023 in “Department of State Tax, Through the Dy. Commissioner of State Tax vs. Zicom Saas Pvt. Ltd. & Anr.”, wherein in Para 7, 8, 9 and 10 following has been held:
“7.There are no dispute between the parties regarding the facts which took place in the CIRP and the claim which was admitted in the CIRP. In “Rainbow Paper Limited” (supra), Section 48 of the GVAT Act was relied, which has been quoted in paragraph 2 of the Judgement which is to the following effect:
“The short question raised by the appellant in this appeal is, whether the provisions of the IBC and, in particular, Section 53 thereof, overrides Section 48 of the GVAT Act which is set out herein below for convenience:-
48. Tax to be first charge on property:-
Notwithstanding anything to the contrary contained in any law for the time being in force, any amount payable by a dealer or any other person on account of tax, interest or penalty for which he is liable to pay to the Government shall be a first charge on the property of such dealer, or as the case may be, such person”
8.The Provision of Section 37 of Maharashtra Value Added Tax, 2002 is to the following effect:
“37.Notwithstanding anything contained in any contract to the contrary, but subject to any provision regarding creation of first charge in any Central Act for the time being in force, any amount of tax, penalty, interest, sum forfeited, fine or any other sum, payable by a dealer or any other person under this Act, shall be the first charge on the property of the dealer, or as the case may be, person.”
9.When we compare the provisions of Section 48 of the provision of Gujarat Values Added Tax which was relied in “Rainbow Papers Limited” and the Provisions of Section 37 which is sought to be relied on in the present Appeal, distinction between the provisions is clear. Section 37 specifically uses the expression “subject to any provision regarding creation of first charge in any central act”. The provision itself contemplated thus that Section 37 was subject to any provision in Central Act. The IBC Section 53 itself provides waterfall mechanism which may be treated to be law which has been contemplated under Section 37 of the MVAT Act, 2002.
10.We thus are of the view that the Judgement of the Hon’ble Supreme Court in “Rainbow Paper Limited” relied by Learned Counsel for the Appellant is distinguishable. The Appellant having been treated as Operational Creditor allocation of amount in the Resolution Plan cannot be said to be in violation of Section 30 (2)(b). We thus are of the view that no ground has been made to interfere with the Impugned Order.
The Appeal is dismissed.”
We are of the view that issues raised in the present Appeal are fully covered by the judgment of this Tribunal in “Department of State Tax, Through the Dy. Commissioner of State Tax vs. Zicom Saas Pvt. Ltd. & Anr.”. Following the aforesaid judgment, this Appeal is dismissed.