Sirpur Paper Mills Limited Vs Commissioner of Customs Central Excise (Telangana High Court)
Telangana High Court on July 25, 2025, disposed of an appeal filed by Sirpur Paper Mills Limited against an order of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT), Bangalore. The High Court’s decision was based on a crucial development: the approval of a resolution plan for the paper mill by the National Company Law Tribunal (NCLT), which explicitly extinguished all past indirect tax demands against the company.
The appeal, filed under Section 35-G of the Central Excise Act, 1944, challenged a CESTAT order dated January 18, 2010, which had affirmed a Commissioner (Appeals) decision rejecting the paper mill’s earlier appeal concerning excise demands. The case had a long history, with a previous writ petition (W.P.No.23436 of 2006) also filed by Sirpur Paper Mills challenging a show cause notice issued by the Central Excise Department on March 3, 2006.
A pivotal turn in the company’s financial and legal status occurred when it was referred to the NCLT under the Corporate Insolvency Resolution Process (CIRP). The NCLT, in its final order No.30839 of 2020 dated March 4, 2020, in C.P.(IB) No.52/9/HDB/2017, approved a resolution plan for Sirpur Paper Mills. This NCLT order included a specific and comprehensive clause (7.5(d)) that stated:
