# In the matter of Adhunik Metaliks Ltd. Vs. State of Odisha and others., WP(C)-1553/2022

> HC judgment dated 2022-12-08. Citation: TCN-2022-HC-00008. The writ petitions concern the validity of demands raised against Adhunik Metaliks Ltd. for periods…

- **Court:** HC
- **Order date:** 8 Dec 2022
- **Citation:** TCN-2022-HC-00008
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/high-courts-new-delhi/adhunik-metaliks-ltd-vs-state-of-odisha-and-others-wp-8b1a0eb7

## Summary

### Background

The writ petitions concern the validity of demands raised against Adhunik Metaliks Ltd. for periods prior to the commencement of insolvency proceedings before the NCLT under the IBC. The petitioner contends that demands pertaining to periods before the insolvency commencement cannot be enforced. The court considers the implications of the Insolvency and Bankruptcy Code (IBC) on the enforceability of such demands, particularly in light of the Supreme Court's observations in Ghanashyam Mishra & Sons Private Limited v. Edelweiss Asset Reconstruction Company Limited.

## Facts

Adhunik Metaliks Ltd. filed multiple writ petitions challenging demands raised by the State of Odisha for periods prior to the commencement of its insolvency proceedings. The insolvency commencement date was August 3, 2017. The resolution plan was approved by the NCLT on July 17, 2018, and made effective by the NCLAT on March 3, 2020. The demands relate to various taxes, including Orissa Value Added Tax, Orissa Entry Tax, Central Sales Tax, and Orissa Sales Tax, for periods such as 2007-2008, 2011-2013, 2015, and 2016-2017. The petitioner argues that these pre-insolvency demands cannot be enforced due to the provisions of the IBC and the Supreme Court's ruling in Ghanashyam Mishra & Sons Private Limited v. Edelweiss Asset Reconstruction Company Limited.

## Issues and analysis

### Issue 1: Whether demands raised against the Petitioner for periods prior to the commencement of insolvency …

**Ratio:** The legislative intent behind the IBC is to provide a clean slate for the resolution

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**Reasoning:** The court relies on the Supreme Court's interpretation of the IBC, emphasizing that the

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**Interpretation:** The IBC aims to revive the corporate debtor and make it a going concern. This

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**Application:** Given that the demands in question pertain to periods prior to the commencement

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## Parties

- **Judges:** S. Mural…; M.S. R…
- **Respondents:** Adhunik Metaliks…; State of…

## Timeline

- **2017-08-03 — Insolvency Commencement…**: The date on which the insolvency…
- **2018-07-17 — Resolution Plan…**: The date on which the National Company Law Tribunal (NCLT) approved the resolution plan…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 3(10) — Definitions](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-3)

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