NCLAT Delhi: Claims Of Tax Assessment Orders Passed During Moratorium Under IBC Can Be Considered As Unsecured Operational Debt

The NCLAT Delhi, comprising Mr. Justice Rakesh Kumar Jain, Mr. Naresh Salecha, and Mr. Indevar Pandey, held that tax assessment orders issued during the moratorium under Sections 14 and 33(5) of the Insolvency and Bankruptcy Code (IBC) are to be considered unsecured operational debt. \r

Anil Ltd. entered the Corporate Insolvency Resolution Process (CIRP) on 23.07.2017, which led to its liquidation on 25.10.2018. The State Tax Department's attachment order for unpaid dues during the moratorium was challenged. NCLAT upheld that such orders, issued after the moratorium, violated the IBC's provisions and could not enforce recovery claims.\r

The tribunal clarified that while taxes could be assessed during the moratorium, recovery efforts were prohibited, affirming the debts as unsecured and rejecting the appellant's secured creditor status.