M/S JSW STEEL LIMITEDversusPRATISHTHA THAKUR HARITWAL & ORS.

                [2025] 3 S.C.R. 1200 : 2025 INSC 401

                        M/s JSW Steel Limited
                                 v.
                  Pratishtha Thakur Haritwal & Ors.
                (Contempt Petition (Civil) No. 629 of 2023
                                      In
                  Writ Petition (Civil) No. 1177 of 2020)
                               27 March 2025
           [B.R. Gavai* and Augustine George Masih, JJ.]


                           Issue for Consideration
       Whether the case of the present Petitioner is specifically covered
       by the judgment of this Court in the case of Ghanshyam Mishra
       and Sons Private Limited v. Edelweiss Asset Reconstruction
       Company Limited and Others [2021] 13 SCR 737; After the said
       judgment was brought to the notice of the respondents/authorities,
       whether the respondents/authorities could have proceeded with
       the recovery proceedings.

                                 Headnotes†
       Insolvency and Bankruptcy Code, 2016 – Contempt of Courts
       Act, 1971 – s.2(b) – Insolvency proceedings were initiated
       against an erstwhile company – The petitioner-company was
       declared as the Successful Resolution Applicant – Resolution
       Plan was submitted – The NCLT approved the Resolution Plan –
       Pursuant thereto, the management of the erstwhile company
       was taken over by the petitioner company – Thereafter, various
       demand notices were raised upon the petitioner company for
       recovery of Sales Tax, Central Tax and Entry Tax – Petitioner-
       company contended that the act of the respondents in
       initiating proceedings for the dues which are not part of the
       Resolution Plan are on the face of it contemptuous in nature
       and in violation of the law laid down by this Court in the case
       of Ghanshyam Mishra – Correctness:
       Held: In view of clear pronouncement of law by this Court, all
       the dues of any of the stakeholders including the statutory dues
       owed to the Central Government, any State Government or any


* Author
[2025] 3 S.C.R.                                                               1201

      M/s JSW Steel Limited v. Pratishtha Thakur Haritwal & Ors.


     local authority, which were not part of the Resolution Plan, stood
     extinguished from the date on which the Resolution Plan stood
     approved – A successful resolution applicant cannot suddenly be
     faced with “undecided” claims after the resolution plan submitted
     by him has been accepted as this would amount to a hydra head
     popping up which would throw into uncertainty amounts payable
     by a prospective resolution applicant who would successfully take
     over the business of the corporate debtor – All claims must be
     submitted to and decided by the RP so that a prospective resolution
     applicant knows exactly what has to be paid in order that it may
     then take over and run the business of the corporate debtor –
     In the instant case, there is no hesitation in holding that the demands
     raised by the respondents/authorities for a period prior to the date
     on which the NCLT has approved the Resolution Plan were totally
     contemptuous in nature – The respondents could not have raised
     the said demands inasmuch as they are not part of the Resolution
     Plan – In spite of public notice, neither the State of Chhattisgarh
     nor its authorities raised any claim before the CoC – In that view
     of the matter, this Court is of the considered view that the case of
     the present Petitioner is specifically covered by the judgment of
     this Court in the case of Ghanshyam Mishra, which judgment was
     brought to the notice of the respondents/authorities, the respondents/
     authorities could not have proceeded with the recovery proceedings.
     [Paras 22, 24, 27, 33]

                               Case Law Cited
     Ghanshyam Mishra and Sons Private Limited v. Edelweiss Asset
     Reconstruction Company Limited and Others, Civil Appeal No.
     8129 of 2019 decided on 13.04.2021 by the Supreme Court of
     India : 2021 INSC 250 : [2021] 13 SCR 737 – relied on.
     State Tax Officer v. Rainbow Papers Limited [2022] 13 SCR 808 :
     (2023) 9 SCC 545 – distinguished.
     Committee of Creditors of Essar Steel India Limited through
     Authorised Signatory v. Satish Kumar Gupta and Others [2019] 16
     SCR 275 : (2020) 8 SCC 531; Innoventive Industries Ltd. v. ICICI
     Bank & Anr. [2017] 8 SCR 33 : (2018) 1 SCC 407; K. Shashidhar v.
     Indian Overseas Bank and Others [2019] 3 SCR 845 : (2019)
     12 SCC 150; Maharashtra Seamless Limited v. Padmanabhan
     Venkatesh and Others [2020] 2 SCR 1157 : (2020) 11 SCC 467;
     Karad Urban Cooperative Bank Ltd. v. Swwapnil Bhingardevay & Ors.
1202                                                      [2025] 3 S.C.R.

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    [2020] 13 SCR 465 : (2020) 9 SCC 729; Kalpraj Dharamshi and
    Another v. Kotak Investment Advisors Limited and Another [2021] 2
    SCR 677 : 2021 SCC OnLine SC 204; K.N. Rajakumar v. V. Nagarajan
    and Others (2022) 4 SCC 617; Ruchi Soya Industries Limited
    and Others v. Union of India and Others (2022) 6 SCC 343; Ajay
    Kumar Radheyshyam Goenka v. Tourism Finance Corporation of
    India Limited [2023] 4 SCR 986 : (2023) 10 SCC 545 : 2023 SCC
    OnLine SC 266 – referred to.

                               List of Acts
    Insolvency and Bankruptcy Code, 2016; Contempt of Courts
    Act, 1971; Constitution of India; Central Sales Tax Act, 1956,
    Chhattisgarh Value Added Tax Act, 2005 and Entry Tax Act, 1976.

                            List of Keywords
    Willful disobedience of judgment; Insolvency proceedings;
    Resolution Plans; Demand notices; Statutory dues of the central
    or state government; Dues which are not part of Resolution
    Plan; Undecided claims; Contemptuous; Stakeholder; Party to
    proceedings.

                           Case Arising From
    CIVIL ORIGINAL/INHERENT JURISDICTION: Contempt Petition
    (Civil) No. 629 of 2023
    In
    Writ Petition (Civil) No. 1177 of 2020
    From the Judgment and Order dated 13.04.2021 of the Supreme
    Court of India in WC No. 1177 of 2020

                        Appearances for Parties
    Advs. for the Appellant:
    Gopal Jain, Sr. Adv., Ms. Nandini Gore, Akhil Abraham Roy,
    Mohammad Shahyan Khan, Ms. Manvi Rastogi, M/S. Karanjawala
    & Co.
    Advs. for the Respondents/Alleged Contemnors:
    Ms. Pragati Neekhra, Aditya Bhanu Neekhra, Atul Dong, Aniket
    Patel.
[2025] 3 S.C.R.                                                        1203

        M/s JSW Steel Limited v. Pratishtha Thakur Haritwal & Ors.


                       Judgment / Order of the Supreme Court

                                     Judgment

       B.R. Gavai, J.

1.     For the reasons stated, I.A. No. 21914 of 2024 for amendment of
       cause title is allowed. Cause Title is amended accordingly.
2.     This Contempt Petition is filed by the Petitioner Company- M/s
       JSW Ispat Special Products Limited (now M/s JSW Steel Limited)
       under Article 129 read with Article 142 of the Constitution of India
       and Section 2(b) of the Contempt of Courts Act, 1971 alleging
       willful disobedience of the judgment dated 13th April 2021 passed
       by this court in Civil Appeal No. 8129 of 2019 and other connected
       matters titled as “Ghanshyam Mishra and Sons Private Limited v.
       Edelweiss Asset Reconstruction Company Limited and others”
       by the alleged Contemnors/Respondents.
3.     Shorn of unnecessary details, the facts which led to the filing of the
       present Contempt Petition are:
       3.1. Insolvency proceedings were initiated against the erstwhile
            Company- M/s Monnet Ispat and Energy Ltd. 1 as per the
            Insolvency and Bankruptcy Code, 20162. After the Insolvency
            process was initiated, the Interim Resolution Professional3 was
            appointed as per the Code, and it was determined that the
            total debt upon the erstwhile Company was much more than
            its liquidation value. As per the regulations, an advertisement
            inviting claims against the erstwhile Company, which were to
            be submitted to the IRP was issued on 27th July 2017 and
            the last date for submission of the claim was 7th August 2017.
            After the claims process was over, the announcement for
            submission of Resolution Plans by companies was issued. The
            Petitioner Company was declared as the Successful Resolution




1    “erstwhile Company” for short
2    “the Code” for short
3    “IRP” for short
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             Applicant4 after voting by the Committee of Creditors5, and the
             Resolution Plan was submitted on 12th December 2017. The
             National Company Law Tribunal, Mumbai Bench6, approved the
             Resolution Plan vide order dated 24th July 2018 and pursuant
             to the same, the management of the erstwhile Company was
             taken over by the Petitioner Company.
     3.2. Thereafter, various demand notices were raised upon the
          Petitioner Company by the Odisha Mining Corporation Ltd. for
          recovery of Sales Tax against iron ore purchased by the erstwhile
          Company. Aggrieved by the demand notices, claiming that the
          dues were extinguished as per the Code because they were
          raised for a period before the management of the erstwhile
          Company was taken over by the Petitioner Company, a Writ
          Petition (Civil) No. 1177 of 2020 was filed before this Court.
     3.3. Various similar matters were tagged together by this Court,
          including the aforesaid Writ Petition. Vide a common judgment
          in the case of Ghanshyam Mishra (supra), it was held that
          any and all creditors, including the Central Government, State
          Government or any local authority are bound by the Resolution
          Plan as approved by the Adjudicating Authority and all claims
          which are not a part of the Resolution Plan stand extinguished.
     3.4. It appears that thereafter the alleged Contemnor No. 3-
          Assistant Commissioner, Commercial Taxes, Division-II, Raipur,
          Chhattisgarh issued a notice dated 15th September 2021. It was
          stated that the Petitioner Company being a nationalized dealer
          had not submitted the return or statement for the period from
          1st April 2017 to 30th June 2017 and the Petitioner Company
          was directed to appear in person or through an authorized
          representative for assessment proceedings before the office
          of the Divisional Deputy Commissioner, Commercial Taxes,
          Division-II and to furnish the books of accounts and documents
          relating to the above period and to show cause as to why the
          Petitioner Company should not be assessed with a penalty.
          The Petitioner Company sent a reply dated 8th October 2021


4   “SRA” for short
5   “CoC” for short
6   “NCLT” or “Adjudicating Authority” for short
[2025] 3 S.C.R.                                                        1205

       M/s JSW Steel Limited v. Pratishtha Thakur Haritwal & Ors.


             to the alleged Contemnor No. 3 stating that the erstwhile
             Company has undergone a Corporate Insolvency Resolution
             Process7 and in light of the judgment of this Court in the case
             of Ghanshyam Mishra (supra), no dues or liabilities of the
             erstwhile Company which pertain to the period prior to the taking
             over of the erstwhile Company by the Petitioner Company and
             which are not part of the Resolution Plan are not required to be
             paid as the dues or liabilities stand permanently extinguished.
             A request was therefore made to withdraw the notice dated
             15th September 2021.
     3.5. The Petitioner Company thereafter filed a Miscellaneous
          Application being M.A. No. 259 of 2022 in Writ Petition (Civil)
          No. 1177 of 2020 seeking clarification of directions given in
          paragraph 95 of the judgment given by this Court in the case
          of Ghanshyam Mishra (supra). The same was dismissed as
          withdrawn with a liberty to file a Contempt Petition by an order
          dated 2nd May 2022.
     3.6. On 13th May 2022, the Petitioner Company issued a letter
          to the alleged Contemnor No. 1- Assistant Commissioner,
          Commercial Tax Department, Raipur-II, Raipur, Chhattisgarh,
          informing him about the order of this Court dated 2nd May 2022
          and requesting him that the law laid down by this Court in the
          case of Ghanshyam Mishra (supra) be adhered to, and any
          failure to do the same would result in the Petitioner Company
          initiating contempt proceedings.
     3.7. It appears that, in spite of the aforesaid letter by the Petitioner
          Company, the alleged Contemnor No. 1 went ahead and issued
          a demand notice dated 17th May 2022 wherein it was stated
          that since no one had appeared representing the Petitioner
          Company to get the tax assessment done, an ex parte decision
          must be taken. The decision resulted in three separate demands
          under the relevant provisions of Central Sales Tax Act, 1956,
          Chhattisgarh Value Added Tax Act, 2005 and Entry Tax Act, 1976
          for the outstanding amount of Central Tax- Rs. 1,08,25,666/,
          State Tax- Rs. 2,66,42,094/-, and Entry Tax- Rs. 61,51,689/- for
          the period between 1st April 2017 to 30th June 2017 and the


7   “CIRP” for short
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          Petitioner Company was directed to pay the amounts within 30
          days of receipt of the demand notice. A reply dated 10th October
          2022 was given by the Petitioner Company stating that it is not
          liable to pay any dues as the period for which the demand is
          raised is of a period before the approval of the Resolution Plan
          by the Adjudicating Authority. It was therefore requested that
          the demand notices be withdrawn in view of the judgment of
          this Court given in Ghanshyam Mishra (supra).
     3.8. It can further be seen from the record that the alleged Contemnor
          No. 2 -Additional Revenue Collector, Commercial Tax Office,
          Circle-7, Raipur, Government of Chhattisgarh, issued another
          demand notice to the Petitioner Company dated 9th December
          2022 under Section 146 of the Chhattisgarh Land Revenue
          Code, 1959 containing three separate demands of Central Tax,
          Sales Tax and Entry Tax for the same amounts as the demand
          notice dated 17th May 2022 and the Petitioner Company was
          again directed to pay the outstanding dues within 7 days.
     3.9. Being aggrieved by the actions of the alleged contemnors which
          according to the Petitioner Company were in willful disobedience
          of the judgment of this Court given in the case of Ghanshyam
          Mishra (supra), the present Contempt Petition came to be filed.
4.   Vide order dated 20th February 2023, we had issued notice in the
     present Contempt Petition, returnable in four weeks. By the said
     order, we had dispensed with the personal presence of the alleged
     contemnors until specific orders were passed.
5.   In response to the notice, the respondents have submitted their replies.
6.   We have heard Mr. Gopal Jain, learned Senior Counsel appearing for
     the Petitioner Company and Ms. Pragati Neekhra, learned Counsel
     for the alleged Contemnors/Respondents.
7.   Mr. Gopal Jain, learned Senior Counsel submitted that the act of
     the respondents in initiating proceedings for the dues which are not
     part of the Resolution Plan are on the face of it contemptuous in
     nature and in violation of the law laid down by this Court in the case
     of Ghanshyam Mishra (supra).
8.   He submits that once a Resolution Plan is duly approved by the
     Adjudicating Authority under sub-section (1) of Section 31 of the
     Code, all claims not included in the Resolution Plan are deemed to
[2025] 3 S.C.R.                                                      1207

      M/s JSW Steel Limited v. Pratishtha Thakur Haritwal & Ors.


     be frozen and binding on all the stakeholders. It is submitted that
     this Court has in unequivocal terms clarified that the word “other
     stakeholders” as mentioned in Section 31(1) of the Code also includes
     Central, State and any other local authority.
9.   It is further submitted that though the Petitioner Company had
     informed the contemnors/respondents about the judgment of this
     Court in the case of Ghanshyam Mishra (supra) and specifically
     informed about the order passed in the aforesaid judgment specifically
     with regard to the Petitioner Company, the contemnors have chosen
     to proceed further with the recovery proceedings. It is, therefore,
     submitted that their act amounts to willful disobedience of the orders
     of this Court.
10. Mr. Gopal Jain further submitted that despite a public announcement,
    the respondents/contemnors failed to file the claim during the
    resolution process. The demand raised by the contemnors were
    belated and raised after the approval of the Resolution Plan. It is
    submitted that the provisions of the Code are clear inasmuch as,
    after the public announcement, all the creditors including the Central
    Government, State Government and local authorities are required
    to come forward and put up their claims before the Resolution Plan.
    It is submitted that once the Resolution Plan is approved by the
    Adjudicating Authority, the SRA starts running of the business from
    a “clean slate”.
11. Per contra, Ms. Pragati Neekhra, learned counsel, appearing for the
    respondents/alleged contemnors submits that the alleged contemnors
    are the responsible Government Officers and law-abiding citizens.
    She submits that the demand notices were issued in good faith
    and not to undermine the dignity of this Court in any manner. She
    submits that there has been no intention on the part of the alleged
    contemnors to disobey or disregard the orders passed by this Court.
12. Ms. Pragati Neekhra further submitted that the judgment of this Court
    in the case of Ghanshyam Mishra (supra) was not applicable in the
    present case inasmuch as neither the State of Chhattisgarh nor any
    of the authorities were made parties in the insolvency proceedings
    before the NCLT. She submits that the judgment of this Court in the
    case of Ghanshyam Mishra (supra) would not bind the respondents
    and as such, a case of contempt was not made out. It is submitted
    that the learned NCLT could not have passed an order which ignored
1208                                                           [2025] 3 S.C.R.

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     all the Government dues including the indirect taxes which is billed
     and collected by the Debtor Company. It is submitted that the State
     was entitled to its dues under the Chhattisgarh Value Added Tax
     Act 2005, Central Sales Tax Act, 1956 and Entry Tax Act, 1976
     for the period between 1st April 2017 and 30th June 2017. As such,
     the alleged contemnor No.2 had rightly raised 3 (three) separate
     demand notices on 9th December 2022 under Section 146 of the
     Chhattisgarh Land Revenue Code, 1959. She submits that since
     the erstwhile Company had neither filed their returns nor paid the
     dues, the alleged contemnors were justified in raising the demand
     notices. To buttress her submissions, Ms. Neekhra has relied on the
     judgment of this Court in the case of State Tax Officer v. Rainbow
     Papers Limited 8.
13. She further submits that the Petitioner Company herein had sought
    clarification of the judgment of this Court dated 13th April, 2021 in
    the case of Ghanshyam Mishra (supra) by filing a Miscellaneous
    Application being M.A. No.259 of 2022 in Writ Petition (Civil) No.1177
    of 2022 which is rejected by this Court. As such, the present Contempt
    Petition is not at all tenable.
14. The legal position is no more res integra. This Court in the case of
    Ghanshyam Mishra (supra) has considered a batch of petitions. The
    questions which fell for consideration before the Court were as under:
            "(i)   As to whether any creditor including the Central
                   Government, State Government or any local authority
                   is bound by the Resolution Plan once it is approved
                   by an adjudicating authority under sub-section (1) of
                   Section 31 of the Insolvency and Bankruptcy Code,
                   2016 (hereinafter referred to as ‘I&B Code’)?
            (ii)   As to whether the amendment to Section 31 by
                   Section 7 of Act 26 of 2019 is clarificatory/declaratory
                   or substantive in nature?
            (iii) As to whether after approval of resolution plan by the
                  Adjudicating Authority a creditor including the Central
                  Government, State Government or any local authority
                  is entitled to initiate any proceedings for recovery of


8   (2023) 9 SCC 545
[2025] 3 S.C.R.                                                          1209

      M/s JSW Steel Limited v. Pratishtha Thakur Haritwal & Ors.


                  any of the dues from the Corporate Debtor, which
                  are not a part of the Resolution Plan approved by
                  the adjudicating authority?”
15. Though the judgment is titled as “Ghanshyam Mishra and sons
    Private Limited through the Authorized Signatory versus
    Edelweiss Asset Reconstruction Company Limited through the
    Director & Ors.”, this Court was seized of a batch of cases and the
    case of the present petitioner was very much up for consideration
    in the said batch of cases.
16. The Petitioner Company had filed Writ Petition (Civil) No.1177 of
    2020 (M/s Monnet Ispat & Energy Ltd. & Anr. v. State of Odisha
    & Anr.). This Court after considering various judgments of this Court,
    at length, on the issue answered the questions as under:
           “95. In the result, we answer the questions framed by us
           as under:
           (i)    That once a resolution plan is duly approved by
                  the Adjudicating Authority under sub-section (1) of
                  Section 31, the claims as provided in the resolution
                  plan shall stand frozen and will be binding on the
                  Corporate Debtor and its employees, members,
                  creditors, including the Central Government, any
                  State Government or any local authority, guarantors
                  and other stakeholders. On the date of approval of
                  resolution plan by the Adjudicating Authority, all
                  such claims, which are not a part of resolution
                  plan, shall stand extinguished and no person will
                  be entitled to initiate or continue any proceedings
                  in respect to a claim, which is not part of the
                  resolution plan;
           (ii)   2019 amendment to Section 31 of the I&B Code is
                  clarificatory and declaratory in nature and therefore
                  will be effective from the date on which I&B Code
                  has come into effect;
           (iii) Consequently all the dues including the statutory
                 dues owed to the Central Government, any State
                 Government or any local authority, if not part of
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               the resolution plan, shall stand extinguished and
               no proceedings in respect of such dues for the
               period prior to the date on which the Adjudicating
               Authority grants its approval under Section 31
               could be continued.”
                                              [Emphasis supplied]

17. It is thus clear that this Court in unequivocal terms held that all
    such claims which are not a part of the Resolution Plan, shall stand
    extinguished and no person will be entitled to initiate or continue
    any proceedings in respect to a claim, which is not part of the
    Resolution Plan. The Court further held that the 2019 amendment
    to Section 31 of the Code is clarificatory and declaratory in nature
    and therefore will be effective from the date on which the Code
    has come into effect. The Court clearly held that all the dues
    including the statutory dues owed to the Central Government,
    or any State Government or any local authority, if not part of the
    resolution plan, shall stand extinguished and no proceedings in
    respect of such dues for the period prior to the date on which
    the Adjudicating Authority grants its approval under Section 31
    could be continued.
18. Insofar as the present Petitioner is concerned, the Court considered
    its case in Paragraphs 133 to 140. It will be relevant to refer to
    paragraph 140, which reads as under:
          “140. We hold and declare, that the respondents are not
          entitled to recover any claims or claim any debts owed
          to them from the Corporate Debtor accruing prior to the
          transfer date. Needless to state, that the consequences
          thereof shall follow.”
19. In the said Writ Petition (No.1177 of 2020), after the completion
    of CIRP on 5th January 2019, the respondent No.2 therein had
    sent a reminder to the Petitioner Company calling upon it to pay
    an amount of Rs.4,49,34,917.00 towards the service tax, etc. for
    the period between 1st April 2016 to 30th June 2017. In spite of
    the provisions of the Code pointed out by the Petitioner Company
    in reply to the notice of the respondents/authorities, the demand
    was pursued and as such, the present Petitioner was required to
    approach this Court.
[2025] 3 S.C.R.                                                             1211

      M/s JSW Steel Limited v. Pratishtha Thakur Haritwal & Ors.


20. It will be relevant to note that this Court had also referred to an
    order dated 10th August 2018 passed in Special Leave Petition
    (Civil) No.6483 of 2018. In that matter, the Income Tax Authorities
    had challenged the judgment and order of the Delhi High Court vide
    which the Delhi High Court had held that in view of the provisions of
    Section 238 of the Code, the income tax dues after the acceptance
    of Resolution Plan by the RP stood extinguished.
21. It will be relevant to refer to the order dated 10th August 2018 passed
    by this Court in Special Leave Petition (Civil) No.6483 of 2018, which
    reads thus:
           “Heard.
           Delay, if any, is condoned.
           Given Section 238 of the Insolvency and Bankruptcy Code,
           2016, it is obvious that the Code will override anything
           inconsistent contained in any other enactment, including
           the Income-Tax Act.
           We may also refer in this Connection to Dena Bank vs.
           Bhikhabhai Prabhudas Parekh and Co. & Ors. (2000) 5
           SCC 694 and its progeny, making it clear that income-tax
           dues, being in the nature of Crown debts, do not take
           precedence even over secured creditors, who are private
           persons.
           We are of the view that the High Court of Delhi, is, therefore,
           correct in law.
           Accordingly, the Special Leave Petitions are dismissed.
           Pending applications, if any, stand disposed of.”
22. It can thus be seen that in view of clear pronouncement of law by this
    Court, all the dues of any of the stakeholders including the statutory
    dues owed to the Central Government, any State Government or
    any local authority, which were not part of the Resolution Plan,
    stood extinguished from the date on which the Resolution Plan
    stood approved.
23. It is to be noted that even much prior to the judgment of this Court
    in the case of Ghanshyam Mishra (supra), a 3 Judge Bench of this
    Court in the case of Committee of Creditors of Essar Steel India
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     Limited through Authorised Signatory v. Satish Kumar Gupta
     and others9 has observed thus:
            “107. For the same reason, the impugned NCLAT judgment
            [Standard Chartered Bank v. Satish Kumar Gupta,
            2019 SCC OnLine NCLAT 388] in holding that claims
            that may exist apart from those decided on merits by
            the resolution professional and by the Adjudicating
            Authority/Appellate Tribunal can now be decided by
            an appropriate forum in terms of Section 60(6) of the
            Code, also militates against the rationale of Section 31
            of the Code. A successful resolution applicant cannot
            suddenly be faced with “undecided” claims after the
            resolution plan submitted by him has been accepted
            as this would amount to a hydra head popping
            up which would throw into uncertainty amounts
            payable by a prospective resolution applicant who
            would successfully take over the business of the
            corporate debtor. All claims must be submitted to
            and decided by the resolution professional so that a
            prospective resolution applicant knows exactly what
            has to be paid in order that it may then take over
            and run the business of the corporate debtor. This
            the successful resolution applicant does on a fresh
            slate, as has been pointed out by us hereinabove.
            For these reasons, NCLAT judgment must also be set
            aside on this count.”
                                                [Emphasis supplied]

24. It can thus clearly be seen that this Court has held that a successful
    resolution applicant cannot suddenly be faced with “undecided” claims
    after the resolution plan submitted by him has been accepted as this
    would amount to a hydra head popping up which would throw into
    uncertainty amounts payable by a prospective resolution applicant
    who would successfully take over the business of the corporate
    debtor. It has also been held that all claims must be submitted to
    and decided by the RP so that a prospective resolution applicant


9   (2020) 8 SCC 531
[2025] 3 S.C.R.                                                     1213

        M/s JSW Steel Limited v. Pratishtha Thakur Haritwal & Ors.


      knows exactly what has to be paid in order that it may then take
      over and run the business of the corporate debtor.
25. In Ghanshyam Mishra (supra), this Court has referred to the
    judgments on the issue in the following cases:
      (i)    Innoventive Industries Ltd. vs. ICICI Bank & Anr.10;
      (ii)   K. Shashidhar v. Indian Overseas Bank and Others11;
      (iii) Committee of Creditors of Essar Steel India Limited Through
            Authorized Signatory v. Satish Kumar Gupta and Others12;
      (iv) Maharashtra Seamless Limited v. Padmanabhan Venkatesh
           and others13;
      (v)    Karad Urban Cooperative Bank Ltd. vs. Swwapnil
             Bhingardevay & Ors.14; and
      (vi) Kalpraj Dharamshi and Another vs. Kotak Investment
           Advisors Limited and Another15.
26. The law laid down by this Court in the case of Ghanshyam Mishra
    (supra) has been followed by various subsequent judgments of this
    Court in the following cases:
      (i)    K.N. Rajakumar v. V. Nagarajan and others16;
      (ii)   Ruchi Soya Industries Limited and others v. Union of India
             and others17;
      (iii) Ajay Kumar Radheyshyam Goenka v. Tourism Finance
            Corporation of India Limited18.
27. In that view of the matter, we have no hesitation in holding that the
    demands raised by the respondents/authorities for a period prior to
    the date on which the learned NCLT has approved the Resolution


10   (2018) 1 SCC 407
11   (2019) 12 SCC 150
12   (2020) 8 SCC 531
13   (2020) 11 SCC 467
14   (2020) 9 SCC 729
15   2021 SCC OnLine SC 204
16   (2022) 4 SCC 617
17   (2022) 6 SCC 343
18   (2023) 10 SCC 545 : 2023 SCC OnLine SC 266
1214                                                       [2025] 3 S.C.R.

                         Supreme Court Reports


      Plan were totally contemptuous in nature. The respondents could
      not have raised the said demands inasmuch as they are not part of
      the Resolution Plan.
28. Coming next to the submission of learned counsel for the respondents/
    alleged contemnors, insofar as reliance placed by her on the judgment
    of this Court in the case of Rainbow Papers Limited (supra) is
    concerned, in the said case, this Court was considering the question
    as to whether the provisions of the Code and in particular Section
    53 thereof override Section 48 of the Gujarat Value Added Tax Act,
    2003. We find that, on facts, the said judgment is not applicable to
    the present case.
29. In the said case, in response to the advertisement issued by the RP,
    the State Tax Officer raised its claim before the RP. The claim of the
    State Tax Officer was rejected by the Committee of Creditors19. The
    learned NCLT also rejected the claim of the State Tax Officer and
    an appeal thereagainst also came to be dismissed by the National
    Company Law Appellate Tribunal20. Aggrieved thereby the State Tax
    Officer approached this Court.
30. This Court held that when a grievance was made before the
    Adjudicating Authority with regard to the Resolution Plan, the
    Adjudicating Authority was required to examine if the Resolution Plan
    met the requirements of Section 30(2) of the Code. This Court also
    held that under Section 31 of the Code, while approving the Resolution
    Plan as approved by the CoC, the Adjudicating Authority must come
    to a satisfaction that the Resolution Plan meets the requirements as
    referred to in sub-section (2) of Section 30 of the Code. It has further
    been held by this Court that the condition precedent for approval
    of a Resolution Plan was that it should meet the requirements of
    sub-section (2) of Section 30 of the Code.
31. In that view of the matter, we are of the considered opinion that the
    facts in the case of Rainbow Papers Limited (supra) are totally
    distinguishable to the facts of the present case.
32. In Rainbow Papers Limited (supra), the State Tax Officer had raised
    the claim before the CoC, which was not taken into consideration by


19   “CoC” for short
20   “NCLAT” for short
[2025] 3 S.C.R.                                                      1215

      M/s JSW Steel Limited v. Pratishtha Thakur Haritwal & Ors.


     the CoC. As such, this Court came to a finding that the satisfaction
     arrived at by the Adjudicating Authority under Section 31 of the Code
     was vitiated.
33. Undoubtedly, in the present case, in spite of public notice, neither
    the State of Chhattisgarh nor its authorities raised any claim before
    the CoC. In that view of the matter, we are of the considered view
    that the case of the present Petitioner is specifically covered by the
    judgment of this Court in the case of Ghanshyam Mishra (supra),
    which judgment was brought to the notice of the respondents/
    authorities, the respondents/authorities could not have proceeded
    with the recovery proceedings.
34. When the law laid down by this Court in the case of Ghanshyam
    Mishra (supra) is clear and unambiguous and specifically when the
    Petitioner’s own case was part of the batch which is specifically dealt
    with by this Court, the respondents/alleged contemnors ought not to
    have proceeded further with the recovery proceedings and ought to
    have dropped them forthwith. The continuation of such proceedings
    despite the judgment and order of this Court being pointed out to
    their notice is nothing but contemptuous in nature.
35. We have, therefore, no hesitation in holding that the continuation
    of the proceedings by the respondents/authorities even after the
    judgment of this Court in Ghanshyam Mishra (supra) was specifically
    brought to their notice is contemptuous in nature. However, we do not
    propose to proceed against the respondents/contemnors inasmuch
    as they are entitled to benefit of doubt.
36. It is the contention of the alleged contemnors that the State of
    Chhattisgarh was not a party to the Writ Petition or to the proceedings
    before the learned NCLT. No doubt that even if any stakeholder is not
    a party to the proceedings before the NCLT and if such stakeholder
    does not raise his claim before the Interim Resolution Professional/
    Resolution Professional, the Resolution Plan as approved by the
    NCLT would still be binding on him. However, this being one of
    the first cases arising out of the judgment of this Court in the case
    of Ghanshyam Mishra (supra), we do not propose to take any
    stern action against the respondents/contemnors. In any case,
    the respondents/ contemnors have tendered their unconditional
    apology.
1216                                                      [2025] 3 S.C.R.

                            Supreme Court Reports



37. In this view of the matter, though we hold that the act of the alleged
    contemnors is contemptuous in nature, we do not propose to take any
    action against them. The demand notices issued by the contemnors
    on the Petitioner Company and all proceedings pursuant thereto
    are held to be illegal and the same are quashed and set aside. We
    dispose of the contempt petition accepting unconditional apology of
    the contemnors.

     Result of the case: Contempt petition disposed of.



     †
         Headnotes prepared by: Ankit Gyan