Central Board of Indirect Taxes and Customs issues SOP for IBC cases before NCLT

The Central Board of Indirect Taxes and Customs (CBIC) on Monday released a notification laying out a Standard Operating Procedure (SOP) to be followed by the National Company Law Tribunal (NCLT) for cases under the Insolvency and Bankruptcy Code, 2016 (the Code)..By way of the comprehensive SOP, CBIC intends to resolve the issue of delayed submission of its claims against corporate debtors undergoing the Corporate Insolvency Resolution Process (CIRP)..As per the notification, there is an ordinate delay in filing of claims by Customs and Goods and Services Tax (GST) authorities."This leads to their claims not being admitted and extinguished once a resolution plan is approved. It is also observed that the authorities then litigate on the rejection of each claims, despite the settled position that no claims can be raised once the plan is approved and no demands can be raised on the resolution applicant who has taken over the company through such a resolution plan," the CBIC instruction stated.One of the reasons for this delay, it was noted, was that the concerned zonal offices of these authorities do not receive information regarding initiation of the process in a timely manner. Thus, the Insolvency and Bankruptcy Board of India (IBBI) was requested to shared details of initiation of such processes on a regular basis with an identified officer or a centralized system..To this end, CBIC has nominated the Additional Director General of the Directorate General of Performance Management (DGPM) as the Nodal Officer for the receipt of information regarding initiation of the insolvency resolution process and dissemination of the same.The SOP in detail outlines the duties and responsibilities of the Nodal Officers and Zonal Officers for timely dissemination of information and submission of claims..A summary of the SOP is outlined below:The Nodal Officer shall receive information of initiation of CIRP from IBBI on a dedicated email ID that shall be created for dissemination of information to all Zonal Officers within two working days. The Nodal Officer may nominate others in the DGPM to assist him in his work; For faster and timely dissemination of the information, a dedicated WhatsApp group will also be created by the Nodal Officer and will include those he has nominated for the purpose; The concerned office/commissionerate which has arrears pending against the company shall file its claims in a timely manner to safeguard government dues. The reporting shall be done to the Nodal Officer. The daily exercise to check for any new parties going into insolvency from the website www.ibbi.gov.in shall be undertaken by zonal offices. Correspondences with the Resolution Professional (RP) should be made regarding finalization of the Resolution Plan along with verification of any orders from the Adjudicating Authority (NCLT/NCLAT). A monthly report of work done in terms of checking the public announcements, filing of claims, if any, liaising with CIRP for providing updates on cases to be sent to the Nodal Officer by the ADC/JC in the prescribed format attached with the SOP. The Nodal officer will submit a consolidated monthly report to the Board for the purpose of review of progress..[Read the notification]

Central Board of Indirect Taxes and Customs issues SOP for IBC cases before NCLT

Ritima Singh

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