Orchid Healthcare Vs Commissioner of GST and Central Excise (CESTAT Chennai)
CESTAT: Pre-IBC Tax Dues Extinguished Post-NCLT Plan; CESTAT Chennai: Government Barred from Pursuing Pre-IBC Dues After Resolution Plan Approval; Tax Appeals Abate as CESTAT Cites Supreme Court Ruling on Extinguished Claims
Chennai: The Customs, Excise, and Service Tax Appellate Tribunal (CESTAT), Chennai bench, has dismissed appeals filed by Orchid Healthcare, stating that the Central Government is barred from recovering central excise duty dues from a company once its resolution plan has been approved by the National Company Law Tribunal (NCLT) under the Insolvency and Bankruptcy Code (IBC), 2016. The Tribunal’s decision, in the case of Orchid Healthcare versus the Commissioner of GST and Central Excise, aligns with a binding Supreme Court judgment that prioritizes the finality of approved resolution plans.
The case involved two excise appeals filed by M/s. Orchid Healthcare, Unit II (a 100% Export Oriented Unit), and M/s. Orchid Pharma Ltd., challenging orders confirming demands of central excise duty, along with interest and penalties. These demands related to alleged duty evasion on the clearance of containers without payment of excise duty during the periods of April 2014 to March 2015 and January 2015 to September 2015, amounting to ₹8,383 and ₹61,146 respectively.
