# In the matter of Transstroy Tiruthani- Tiruthani - Chennai Tollways Private Limited

> NCLT judgment dated 2023-10-31. Citation: TCN-2023-NCLT-00979. The case involves an application filed by the liquidator of Transstroy-Tirupati-Tiruthani…

- **Court:** NCLT
- **Order date:** 31 Oct 2023
- **Citation:** TCN-2023-NCLT-00979
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/transstroy-tiruthani-tiruthani-chennai-tollways-private-limited-c842205a

## Summary

### Background

The case involves an application filed by the liquidator of Transstroy-Tirupati-Tiruthani Chennai-Tollways Private Limited, seeking a direction from the NCLT to National Highways Authority of India (NHAI) to remit Rs 2,80,44,000, which was deducted as tax deducted at source (TDS) from the termination payment made to the corporate debtor. Alternatively, the liquidator sought a direction to the Income Tax Office to remit the said amount if it had already been paid by NHAI as TDS. The corporate debtor was undergoing liquidation under the Insolvency and Bankruptcy Code, 2016 (IBC). The liquidator argued that TDS should not have been deducted from the termination payment, as it was a capital receipt and not taxable. The liquidator also relied on a decision of the NCLAT in

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## Facts

Transstroy Tiruthani Chennai Tollways Pvt Ltd was undergoing liquidation under the IBC. Mr. Sanjay Kumar Mishra was appointed as the liquidator. A Concession Agreement existed between the Corporate Debtor (CD) and National Highways Authority of India (NHAI). The Stakeholder Consultation Committee (SCC) resolved to pursue termination payments from NHAI under the Concession Agreement. NHAI made a termination payment of Rs 140,22,00,000, but deducted Rs 2,80,44,000 as TDS. The liquidator contended that the TDS deduction was incorrect as the termination payment was a capital receipt and not taxable. The liquidator relied on a NCLAT decision in Om Prakash Agrawal's case, which stated that a liquidator is not required to file income tax returns and therefore cannot claim a

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## Issues and analysis

### Issue 1: Whether the Liquidator appointed under IBC …

**Ratio:** A company in the process of liquidation remains legally recognized as a company until its

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**Reasoning:** Section 139 of the Income Tax Act, 1961 mandates that every individual must file a tax

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**Interpretation:** The provisions of the IT Act, specifically Section 139, Section 2(31)(iii),

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**Application:** In this case, Transstroy Tiruthani Chennai Tollways Pvt Ltd, being a company

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## Parties

- **Judges:** Rajeev Bh…; Sanjay…
- **Appellants:** Sanjay Kumar…
- **Respondents:** Transstroy…; National Highways…

## Timeline

- **2010-07-12 — Concession Agreement…**: Date of the Concession Agreement…
- **2022-04-08 — Liquidator Ap…**: Mr. Sanjay Kumar Mishra appointed as liquidator for Transstroy-Tirupati-Tiruthani…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 60(5) — Adjudicating Authority for corporate persons](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-60)

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