Her Majesty's Revenue & Customs (HMRC) are appealing against the club's proposals to pay 25 per cent of their debts and argue they are owed £30million by the south coast club.
The High Court hearing started on Tuesday and a ruling will be made on Thursday.
Richard Sheldon, representing Pompey, warned on Wednesday that a decision against the club mark the end of the club as they cannot give assurances of fulfilling their fixtures for the coming season.
He also said such a decision would delay a sale, suggesting that would see the side go out of the Football League altogether just three months after competing in the FA Cup final.
"It will go out of the league. The club will probably be liquidated," he said.
"If the club is not sold it will clearly be relegated out of the Football League. The administrators cannot give the assurances needed that this season's fixtures can be completed.
"It will then go out of the Football League and into some distant league, but the reality is that it will probably go into liquidation because the administrators will not be able to fund the continued business."
HMRC argued that liquidation would not be inevitable if the club remained in administration.
Both sides have also indicated they will go to the Court of Appeal if they lose, meaning there is unlikely to be a conclusion to the debate this week.
Scunthorpe are due to travel to Fratton Park in the Championship on Saturday December 18, with the return fixture coming on the final game of the season on Sunday May 8.