Insolvency and Bankruptcy Board of India (IBBI) has vide its circular dated 15th November, 2021 clarified that it is not necessary for Insolvency Professionals to expressly seek the No Objection Certificate or No Dues Certificate from Income Tax Department while the Voluntary Liquidation Process is going on.
It unnecessarily delays the process and defeats the very purpose of the Bankruptcy Code which is timely resolution of bankruptcies and liquidations. Every creditor is given a 30 day window in which to submit their claims to the Insolvency Professional and they i.e. the Income Tax office/ department stand in the same footing as the other creditors so there is ostensibly no need for special treatment to the revenue office.
Copy of the circular can be found here