Extinguishment of Tax Dues and Refund of Pre-Deposits Under Clean Slate Principle of IBC

sketch of the Bombay High Court
Case
Aarem Insights Private Limited Formerly known as Shop CJ Network Private Limited v. Joint Commissioner of State Tax Appeals VII (Bombay High Court, 07-09-2026)
Law
Constitution of India, Insolvency and Bankruptcy Code, Maharashtra Value Added Tax Act.

Highlights of the Judgment:

  • Detailed examination of the "clean slate" principle under Section 31 of the Insolvency and Bankruptcy Code, 2016.
  • Extinguishment of past statutory tax claims and dues not forming part of an approved resolution plan.
  • Analysis of the binding nature of NCLT-approved resolution plans on tax authorities under state tax enactments.
  • Interplay between corporate insolvency resolution proceedings and pending statutory appellate proceedings under the MVAT Act, 2002.
  • Evaluation of the legality of retaining statutory pre-deposits made for tax appeals following the extinguishment of underlying tax liabilities.
  • Application of key Supreme Court precedents regarding the finality of frozen claims post-resolution.