Case Law Details
Orchid Chemicals & Pharmaceuticals Ltd. Vs Commissioner of GST & Central Excise (CESTAT Chennai)
The case of Orchid Chemicals & Pharmaceuticals Ltd. vs. Commissioner of GST & Central Excise was brought before the Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) Chennai, challenging an Order-in-Original dated August 8, 2014. The appellant’s legal representative presented a copy of the Resolution Plan, which had been approved by the National Company Law Tribunal (NCLT) and subsequently upheld by the Supreme Court. The tribunal reviewed similar precedents, including a ruling by CESTAT Mumbai in the Jet Airways case and the Supreme Court’s decision in Ghanashyam Mishra and Sons Pvt. Ltd. vs. Edelweiss Asset Reconstruction Co. Ltd., which held that tax appeals stand abated upon NCLT approval of a resolution plan under insolvency proceedings.
In alignment with these precedents and the Central Board of Indirect Taxes and Customs (CBIC) Instruction No. 1083/04/2022-CX9, CESTAT Chennai ruled that Orchid Chemicals’ appeal also stood abated. This decision reaffirmed the legal position that tax-related liabilities are extinguished upon the approval of an insolvency resolution plan. Consequently, the tribunal disposed of the appeal, following the established jurisprudence on the interplay between insolvency proceedings and pending tax disputes.
FULL TEXT OF THE CESTAT CHENNAI ORDER
This appeal is filed against Order-in-Original No.06/2014 (ST) dated 08.08.2014 passed by Commissioner of Central Excise, Chennai III Commissionerate.
2. Shri Raghav Rajeev, Ld. Advocate files a copy of the Resolution Plan approved by the NCLT, and submits that the Resolution Plan under challenge has been accepted even by the Hon’ble Supreme Court.
3.1 We find that the Mumbai Bench of the CESTAT, in the case of M/s. Jet Airways (India) Ltd. v. Commissioner of Service Tax-V, Mumbai & anor. in Final Order No. A/85896-85897/2023 dated 12.05.2023, has referred to an earlier order of the CESTAT in Final Order No. A/86026-86036/2022 dated 19.07.2022 in their own case, referred to the decision of the Hon’ble Apex Court in the case of Ghanashyam Mishra and Sons Pvt. Ltd. v. Edelweiss Asset Reconstruction Company Ltd. & Ors. (Civil Appeal No. 8129 of 2019) vide judgement dated 13.04.2021, and thereafter, has also referred to the CBIC Instruction No. 1083/04/2022-CX9 dated 23.05.2022, and ordered that the appeals before the Bench stand abated since the NCLT had approved the Resolution Plan in the insolvency proceedings.
3.2 Respectfully following the above ratio of the co-ordinate Bench, we hold that the present appeal also stands abated.
4. The appeal is disposed of accordingly.
(dictated and pronounced in open court)
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