STATE TAX OFFICER vs. Patanjali Foods Ltd Formerly Knowns as Ruchi Soya Industries Ltd

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WP/12638/2026HC BombayHCBM01016822202501 October 20264 pages
AI SummaryDismissed

What did the High Court hold?

The High Court held that the writ petition was not maintainable. The Court found that the NCLT had acted within its jurisdiction under the IBC. The NCLT's observations, which the Petitioners found objectionable, were based on the settled legal position that once a resolution plan is approved, claims pertaining to the period prior to the approval stand extinguished. The Court distinguished the Supreme Court's decision in 'S. Rajendra v.s Deputy Commissioner of Income Tax (Benami Prohibition and Ors)', stating that it dealt with a conflict between two special statutes (IBC and Benami Act), whereas the present case involved state tax legislation. The Court reasoned that allowing such an argument would collapse the settled position of law regarding the extinguishment of claims upon resolution plan approval. Therefore, the Petitioners' reliance on the S. Rajendra judgment to claim lack of jurisdiction was misplaced. The Court directed the Petitioners to avail the statutory remedy of appeal under Section 61 of the IBC. No observations were made on the merits of the matter.

What were the facts?

The State Tax Officer and Assistant Commissioner of State Tax, Gujarat (Petitioners) filed a writ petition before the Bombay High Court challenging an order dated 8/11/2023 passed by the National Company Law Tribunal (NCLT), Mumbai. The NCLT order was in interlocutory applications concerning statutory notices issued by the Petitioners. The Petitioners were particularly aggrieved by observations made in paragraphs 6.4 and 6.5 of the NCLT's order. The High Court questioned the maintainability of the writ petition given the statutory remedy of appeal under Section 61 of the Insolvency and Bankruptcy Code, 2016 (IBC) before the National Company Law Appellate Tribunal (NCLAT). The Petitioners argued the order was without jurisdiction, citing the Supreme Court case of S. Rajendra v.s Deputy Commissioner of Income Tax (Benami Prohibition and Ors).

What were the issues?

1. Whether the writ petition is maintainable before the High Court, despite the availability of a statutory appeal under Section 61 of the IBC, on the ground that the impugned NCLT order is without jurisdiction? Assessee (Petitioners) Contentions: The Petitioners contended that the writ petition is maintainable because the impugned order, in the portions they are aggrieved by, was passed without jurisdiction. They relied on the Supreme Court judgment in 'S. Rajendra v.s Deputy Commissioner of Income Tax (Benami Prohibition and Ors)' to support this argument. Revenue (Respondent) Contentions: The judgment does not record specific contentions from the Respondent (Patanjali Foods Ltd.). However, the High Court's reasoning implies that the Respondent would likely argue that the NCLT acted within its jurisdiction under the IBC and that the Petitioners' reliance on the S. Rajendra case is misplaced.

Which sections of the Income-tax Act were involved?

Section 61

AI-generated summary — verify with the full judgment below

IN THE HIGH COURT OF JUDICATURE AT BOMBAY CIVIL APPELLATE JURI ICTION WRIT PETITION NO. 12638 Of 2026 State Tax Officer .. Petitioner V/S. Patanjali Foods Ltd Formerly Knowns as Ruchi Soya Industries Ltd .. Respondent ------------------- Mr. Lakshyaved R. Odhekar with Omkar Mha e and Sujen Shaikh, for the petitioner. -------------------- CORAM : MANISH PITALE & SHREERAM V. SHIRSAT, JJ. DATE : 1ST OCTOBER 2026. PC:

1.

Heard learned counsel for the petitioner.

2.

This petition is filed by the State tax officer and the assistant Commissioner of State Tax, Gujarat in order to assail order dated 8/11/2023 passed by the National Company Law Tribunal, Mumbai, (NCLT) in interlocutory applications in respect of certain statutory notices issued by the petitioners.

3.

The petitioners are particularly aggrieved by the observations made in paragraphs 6.4 and 6.5 of the impugned order.

4.

At the outset, we put a query to the learned counsel for the petitioners as to why this writ petition should be entertained in the 1 of 4 VARSHA DEEPAK GAIKWAD VARSHA DEEPAK GAIKWAD Date: 2026.10.01 19:53:06 +0530 face of the statutory remedy of appeal available under Section 61 of the Insolvency and Bankruptcy Code, 2016 (IBC) for filing an appeal before the National Company Law Appellate Tribunal (NCLAT).

5.

The learned counsel for the petitioners submitted that the present writ could be maintained on the ground that the impugned order, in so far as the portions with which the petitioners are aggrieved, can be said to be without juri iction and as per settled law in such a situation the writ court can certainly exercise juri iction to entertain the writ petition.

6.

Reliance is placed on the judgment of the Supreme Court in the case of 'S. Rajendra v.s Deputy Commissioner of Income Tax (Benami Prohibition and Ors')1 .

7.

We have perused the relevant portion of the impugned order and we find that the NCLT has proceeded on the basis of the settled position of law that once the resolution plan is approved, claims pertaining to the period prior to the approval of the resolution plan stand extinguished. Further observations have been made in the impugned order with which the petitioners are aggrieved.

8.

But, we are of the opinion that the adverse observations made by the NCLT in the impugned order are based upon the juri iction available to the NCLT under the provisions of the IBC.

9.

According to us, reliance placed on the judgment of Supreme Court in the case of 'S. Rajendra v.s Deputy Commissioner of Income Tax (Benami Prohibition and Ors') (supra) is misplaced, for the reason 1 (2026) 5 SCC 563 2 of 4 that in the said case the Supreme Court was considering a conflict between two special statutes i.e. the IBC and the Prohibition of Benami Property Transactions Act, 1988 (Benami Act). While considering the two special statutes, the Supreme Court's found that the provisions of the IBC could not be expansively construed to even trench upon the other field exclusively covered by another special statute.

10.

We find that the parallel sought to be drawn by the learned counsel for the petitioners in the present case cannot be accepted, simply for the reason that in the present case, the petitioners are seeking to raise statutory claims based on the State legislation pertaining to the State of Gujarat. If the contention raised on behalf of the petitioners is accepted then such authorities, who can raise claims pertaining to State taxes would seek to avoid the effect of IBC and the procedure contemplated under the Corporate Insolvency Resolution Process by claiming that since there is a conflict between IBC and such State legislation and that there is a hierarchy of challenges provided under the State legislation, the settled position of law with regard to extinguishment of all such claims upon approval of the resolution plan would collapse. This cannot be countenanced.

11.

We are of the opinion that petitioners cannot rely upon the aforesaid judgment of the Supreme Court in the case of 'S. Rajendra v.s Deputy Commissioner of Income Tax (Benami Prohibition and Ors') (supra) to contend that the impugned order was rendered without juri iction.

12.

Hence, no ground is made out for entertaining the present petition. 3 of 4

13.

However, the petitioners can take recourse to the statutory remedy of filing an appeal under Section 61 of the IBC, strictly in accordance with law.

14.

We make no observations with regard to the merits of the matter. (SHREERAM V. SHIRSAT, J.)

(MANISH PITALE, J.) 4 of 4

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