# In the matter of Uttam Galva Steel Limited IA No. 1744-MB-C-I-2021 in C.P. (IB) No. 920-MB-C-I-2020

> NCLT judgment dated 2022-10-14. Citation: TCN-2022-NCLT-00731. The case involves an application filed by the Department of Sales Tax seeking directions to the…

- **Court:** NCLT
- **Order date:** 14 Oct 2022
- **Citation:** TCN-2022-NCLT-00731
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/uttam-galva-steel-limited-ia-no-1744-mb-c-i-2021-in-cp-ib-no-920-mb-c-i-2020-647bd17e

## Summary

### Background

The case involves an application filed by the Department of Sales Tax seeking directions to the Resolution Professional (RP) to admit their claim as an Operational Creditor in the Corporate Insolvency Resolution Process (CIRP) of Uttam Galva Steels Limited. The applicant also sought a stay on the implementation of the resolution plan. The RP had initially rejected a significant portion of the applicant's claim, leading to the application before the NCLT.

## Facts

The Department of Sales Tax filed a claim as an operational creditor against Uttam Galva Steels Limited, which was undergoing CIRP. The RP made a public announcement on 2020-10-06, setting 2020-10-20 as the last date for claim submissions. The Department of Sales Tax lodged a claim on 2020-10-27 for Rs. 974,33,92,360 for the assessment years 2009-10 to 2016-17. The RP rejected a claim amounting to Rs. 943 Crore via email dated 2020-12-30. The Department of Sales Tax argued that it is responsible for collecting revenue and taxes under VAT & GST Act, and Uttam Galva Steels Limited, being the assessee, was liable to deposit tax. The RP admitted Rs. 31 Crore of the claim at full value, as it was crystallized and reflected in the corporate debtor's records as of the

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## Issues and analysis

### Issue 1: Whether the Resolution Professional was justified in rejecting a portion of the claim submitted by …

**Ratio:** The Resolution Professional is required to verify claims submitted by creditors and admit

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**Reasoning:** The NCLT reasoned that the RP had admitted the portion of the claim that was reflected in

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**Interpretation:** The interpretation of the IBC allows the RP to admit undisputed claims at full

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**Application:** In this case, the RP admitted Rs. 31 Crore of the claim at full value and

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## Parties

- **Judges:** P.N. Deshmukh…; Shyam Babu…
- **Appellants:** Department of…
- **Respondents:** Uttam Galva…; Milind Khas…

## Timeline

- **2020-10-06 — Public Annou…**: Resolution Professional…
- **2020-10-20 — Last Date for Receipt…**: Declared last date for…

## 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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