Page 88 - GSTL_18th June 2020_Vol 37_Part 3

302 GST LAW TIMES [ Vol. 37
very clear that it intends to revive the dying industry by providing an opportuni-
ty to a resolution applicant to take over the same and begin the operation on a
clean slate. For that purpose, the evaluation of all dues and liabilities as they exist
on the date of finalization of the resolution plan have been left in the exclusive
domain of the resolution professional with the approval of the COC. The courts
are given an extremely limited power of judicial review into the resolution plan
duly approved by the COC. In the case at hand, the situation has proceeded
much further. The operational creditors i.e. the Commercial Taxes Department of
Govt. of Rajasthan as well as the respondent Commissioner of Goods and Ser-
vices Tax assailed the resolution plan by filing appeals before Hon’ble the Su-
preme Court with a specific plea that their dues have not been accounted for by
the COC in the resolution plan. The objection so raised stands repelled with the
rejection of the appeals by Hon’ble the Supreme Court. In addition thereto, it
may be mentioned here that from the two possible situations; one being liquida-
tion and the other being revival, the respondents will gain significantly in the
later because as per the assessed liquidity value, their dues have been assessed as
nil, whereas as per the resolution plan with revival of the industry at the instance
of the resolution applicant (the petitioner company herein), their rights have
been secured to the extent of Rs. 72 crores odd. It may be emphasized here that
the amount of Rs. 72 crores assessed by the resolution professional in favour of
the respondent GST Department has already been deposited by the successful
resolution applicant i.e. the petitioner company.
21. Therefore, we are of the firm opinion that the respondents would be
acting in a totally illegal and arbitrary manner while pressing for demands raised
vide the notices which are impugned in this writ petition and any other demands
which they may contemplate for the period prior to the resolution plan being
finalized.
22. The demand notices are ex facie illegal, arbitrary and per se and can-
not be sustained.
23. Accordingly, the impugned demand notices and orders viz. notice
dated 11-2-2019 (Annex. 10), letter dated 7-9-2018 (Annex. 11), order dated 20-3-
2019 (Annex. 12), notice dated 6-3-2019 (Annex. 13), notice dated 8-3-2019 (An-
nex. 14), notice dated 29-3-2019 (Annex. 15), notice dated 29-3-2019 (Annex. 16),
notice dated 10-4-2019 (Annex. 18), order dated 9-4-2019 (Annex. 19), two notices
dated 11-6-2019 (Annex. 20) and any further demands pending as on the date of
finalization of the resolution plan issued/raised by the respondents Central
Goods and Services Tax Department, Govt., of India are quashed and struck
down.
24. Before parting, we would like to express our serious reservation on
the approach of the concerned Officers of the GST in persisting with the de-
mands raised from the petitioner in gross ignorance of the pertinent statement
made by Hon’ble the Finance Minister before the Parliament (referred to supra)
and the amendment brought around in the IBC. We are of the firm view that the
authorities should have adopted a pragmatic approach and immediately with-
drawn the demands rather than indulging in a totally frivolous litigation, there-
by unnecessarily adding to the overflowing dockets of cases in the courts.
25. The writ petition is allowed accordingly.
26. No order as to costs.
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