Facts –
According to appellant, the ‘Sales Tax’ and ‘Value Added Tax’ do not come within the meaning of ‘Operational Debt’ and thereby, ‘Sales Tax Department, State of Maharashtra’ cannot be treated to be an ‘Operational Creditor’.
Held –
‘Operational Debt’ in normal course means a debt arising during the operation of the Company (‘Corporate Debtor’). The ‘goods’ and ‘services’ including employment are required to keep the Company (‘Corporate Debtor’) operational as a going concern. If the Company (‘Corporate Debtor’) is operational and remains a going concern, only in such case, the statutory liability, such as payment of Income Tax, Value Added Tax etc., will arise. As the ‘Income Tax’, ‘Value Added Tax’ and other statutory dues arising out of the existing law, arises when the Company is operational, we hold such statutory dues has direct nexus with operation of the Company. For the said reason also, we hold that all statutory dues including ‘Income Tax’, ‘Value Added Tax’ etc. come within the meaning of ‘Operational Debt’.
‘Income Tax Department of the Central Government’ and the ‘Sales Tax Department(s) of the State Government’ and ‘local authority’, who are entitled for dues arising out of the existing law are ‘Operational Creditor’ within the meaning of Section 5(20) of the ‘I&B Code’.
(Pr. Director General of Income Tax (Admn. & TPS) Vs M/s. Synergies Dooray Automotive Ltd. & Ors. (NCLAT))
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