# In the matter of Su-Kam Power System Ltd. & Another vs. State of Himachal Pradesh & Others

> HC judgment dated 2024-08-21. Citation: TCN-2024-HC-00046. The case involves Su-Kam Power System Ltd. & Another (petitioners) versus State of Himachal Pradesh…

- **Court:** HC
- **Order date:** 21 Aug 2024
- **Citation:** TCN-2024-HC-00046
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/high-courts-new-delhi/su-kam-power-system-ltd-another-vs-state-of-himachal-pradesh-others-34a9344f

## Summary

### Background

The case involves Su-Kam Power System Ltd. & Another (petitioners) versus State of Himachal Pradesh & Others (respondents). The 1st petitioner is a company incorporated under the Companies Act, 1956. The 2nd petitioner is a resident of Haryana. The issue pertains to certain red entries/charge over the properties of the 1st petitioner on account of dues recoverable from the erstwhile management. The State Bank of India initiated Corporate Insolvency Resolution Process (CIRP) against the petitioner-company due to default in financial discipline. The CIRP was initiated by filing C.P. no.(IB)-540(PB)/2017 under Section 7 of the Insolvency and Bankruptcy Code, 2016 (IBC) before the National Company Law Tribunal (NCLT) at New Delhi. The petition was admitted on

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## Facts

Su-Kam Power System Ltd. (petitioner) faced financial difficulties, leading to the initiation of Corporate Insolvency Resolution Process (CIRP) by State Bank of India. The NCLT admitted the petition on 05.04.2018, imposing a moratorium. Liquidation proceedings commenced after unsuccessful resolution attempts, with Raj Kumar Ralhan appointed as Liquidator. The Department of State Taxes & Excise, Himachal Pradesh (respondent), filed a claim of Rs.354,11,34,131/-. The respondent marked a charge/red entry on the petitioner's properties for arrears of VAT/CST/HPGST. The Liquidator treated the respondent's claim as an operational debt. An e-auction was conducted, and the current management became the highest bidder with Rs.49.95 crore. The NCLT approved the acquisition

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## Issues and analysis

### Issue 1: Whether the red entry/charge created by the respondents on the properties of the 1st …

**Ratio:** Section 238 of the IBC provides that the provisions of the IBC have overriding effect on

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**Reasoning:** The court reasoned that since the provisions of the IBC have overriding effect on all

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**Interpretation:** The court interpreted Section 238 and Section 14 of the IBC to mean that any

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**Application:** The court applied the ratio to the facts of the case and held that the red

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## Parties

- **Judges:** M.S.Ramachandra…; Satyen V…
- **Respondents:** Su-Kam Power…; State of Himachal…
- **Other parties:** Kohi…
- **Advocates:** Aalok J…; Vedhant…; +2 more

## Timeline

- **1998-10-14 — Company Incor…**: The 1st petitioner, Su-Kam Power System Ltd., was incorporated under the Companies Act,…
- **2017-01-01 — CIRP Init…**: State Bank of India initiated Corporate Insolvency Resolution Process (CIRP) against the…

## 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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