The Madurai Bench of the Madras High Court has held that a company sold as a going concern during liquidation cannot claim that its liabilities are automatically extinguished under the clean-slate principle of insolvency law.
Justice C. Saravanan observed that a buyer acquiring a corporate debtor as a going concern takes over its assets and liabilities as a package, and cannot avoid liabilities merely because the company has undergone liquidation.
The Court made the observations while hearing a petition filed by EMC Limited, a wholly owned subsidiary of Salasar Techno Engineering Limited, challenging a GST demand for the financial year 2021–22.
The impugned order dated December 30, 2025, confirmed a total demand of approximately…