# In the matter of KRBL Limited vs. State of Gujarat

> HC judgment dated 2023-09-22. Citation: TCN-2023-HC-00034. The case involves a dispute over the attachment of property by the State Goods and Services Tax…

- **Court:** HC
- **Order date:** 22 Sept 2023
- **Citation:** TCN-2023-HC-00034
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/high-courts-new-delhi/krbl-limited-vs-state-of-gujarat-3e4c7ff7

## Summary

### Background

The case involves a dispute over the attachment of property by the State Goods and Services Tax (SGST) department after the petitioner, KRBL Limited, purchased the property in an auction during the liquidation of M/s. Gran Electronics Private Limited (GEPL). GEPL faced insolvency proceedings initiated by Universal Digital Connect Limited, leading to liquidation. The petitioner purchased the land through a registered sale deed dated 17.12.2021. The SGST department later claimed outstanding dues from GEPL and attached the property, leading to the petitioner filing a petition under Article 226 of the Constitution of India seeking a writ of mandamus to remove the attachment and certify the entry in the revenue records.

## Facts

M/s. Gran Electronics Private Limited (GEPL) faced financial difficulties and closed its operations from February 2019. Universal Digital Connect Limited initiated insolvency proceedings against GEPL under Section 7 of the IBC. The National Company Law Tribunal (NCLT), Mumbai, admitted the petition on 17.01.2020 and imposed a moratorium under Section 14 of the Code. An Interim Resolution Professional (IRP) was appointed, who issued a public advertisement on 25.01.2020 inviting claims. The Sales Tax Department submitted a claim of Rs.77,08,69,644/-, which was rejected by the Resolution Professional. On 12.02.2021, the NCLT ordered the liquidation of GEPL and appointed a liquidator. The liquidator issued a public announcement on 19.02.2021, calling for stakeholders to

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## Issues and analysis

### Issue 1: Whether the claim of the SGST department for outstanding dues from M/s. Gran Electronics Private …

**Ratio:** The principle derived from Ghanshayam Mishra and Sons Private Limited v. Edelweiss Asset

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**Reasoning:** The court reasoned that the SGST department failed to substantiate its claim during the

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**Interpretation:** This means that all claims must be submitted and decided by the resolution

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**Application:** In this case, the SGST department's claim was not part of the resolution plan,

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## Parties

- **Judges:** BIREN VAI…; DEVAN M.…
- **Appellants:** KRBL LI…
- **Respondents:** Gran Electronics…; STATE OF G…
- **Other parties:** Kohi…

## Timeline

- **2019-02-01 — Closure of Op…**: M/s. Gran Electronics Private Limited (GEPL) closed its operations due to financial…
- **2020-01-17 — Insolvency Petition…**: The National Company Law Tribunal (NCLT), Mumbai, admitted the insolvency petition filed…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 14 — Moratorium](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-14)

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