The Himachal Pradesh High Court has rejected a GST notice and ordered the unblocking of Input Tax Credit (ITC) of Rs 4.27 crores. The court ruled that claims not filed during the insolvency process cannot be enforced afterwards, emphasising that the IBC law takes precedence over GST laws.
The bench comprising Justice Vivek Singh Thakur and Justice Ranjan Sharma has noted that once a resolution plan is approved under the IBC, any claims not included in the plan are considered extinguished. Since the State did not submit its claim during the CIRP, it cannot later enforce its demand by blocking the ITC.
Under the Insolvency and Bankruptcy Code, 2016, the applicant company had undergone the Corporate Insolvency…