Under Section 53(1)(b)(ii) of IBC, the debts owed to a secured creditor, which would include the State under the Gujarat Value Added Tax, 2003, are to rank equally with other specified debts including debts on account of workman’s dues for a period of 24 months preceding the liquidation commencement date – State Tax Officer (1) Vs. Rainbow Papers Ltd. – Supreme Court

Summary of the decision of Hon'ble Supreme Court in the following points: A. Time lines stipulated in the IBC even for completion of proceedings are directory and not mandatory B. Amendment in Regulation 12 of CIRP Regulations, 2016 C. Claim time period under CIRP Regulation 12 is not mandatory but only directory? D. Approval of a Resolution Plan by the Adjudicating Authority E. Section 31(2) uses the expression “may” and Resolution Plan Rejection F. Statutory charge in terms of the GVAT Act squarely falls within the definition of “Security Interest” G. Priority of statutory dues to the Government and/or other authorities under IBC H. Decision

Scroll to Top