305

Hon’ble NCLT Mumbai Bench held that:
(i) ‘Clean Slate Principle’ and mandates that an auction purchaser cannot be fastened with the obligation to pay any dues in respect of properties, purchased in auction, for the period prior to the date when the auction sale is completed. It is trite law that all claims of Creditors, including statutory authorities, are to be dealt with in accordance with the provisions of Code upon commencement of Liquidation proceedings and are to be settled in accordance with the provisions contained in Section 53 of the Code. The claims, not filed by the Creditors extinguishes and the successor of the Corporate Debtor cannot be called upon to pay dues arising out of such claims in case such dues remains still unpaid in terms of Section 53 of the Code.
(ii) The Code provides the manner in which a lien over the property of the Corporate Debtor held by any creditor can be exercised for recovery of dues. It is not in dispute that neither of Respondents, even if they can be said to have lien over the property which they didn’t has followed the procedure contemplated in the Code in this relation. Hence, the lien of all creditors on the property, if any, stands vacated upon admission of claim. It is made clear that we are not dealing with the issue whether any of Respondent had statutory lien over the property of Corporate Debtor so as to entitle such creditor to acquire the status of secured creditor for distribution in terms of Section 53 of the Code because this issue is not for consideration before us in this Application.