Clubmarket faces liquidation threat as tax office refuses to budge
The tax authorities object to approval of the creditor's agreement for the distressed Clubmarket supermarket chain, the authorities told Tel Aviv District Court yesterday. The taxmen have not been able to reach an agreement with the firm's court-appointed trustees over the taxes owed by the chain.
In yesterday's hearing in Judge Varda Alshech's courtroom, the judge rejected the tax authorities' request and insisted the sides continue negotiations.
Alshech announced that if the sides cannot reach agreement , she is likely to order the chain's liquidation. She ordered the sides to an urgent appearance in her court scheduled for this morning.
On Sunday the Clubmarket trustees and the tax authorities both informed the court their talks had failed to reach an agreement, and the trustees asked the court to approve the present agreement - despite the tax office's objections. The authorities claimed the trustees were not objective and asked the judge to appoint an additional trustee.
The heart of the disagreement is the fact that Clubmarket's tax debts have priority over regular, unsecured debts of suppliers. The trustees want the court to waive this priority, but while the law does enable the court to take such an action, this section of the law has never been invoked.
The trustees further claim that such an action is justified since liquidation of the chain would cost the taxpayer another billion shekels.