2018 (5) TMI 1920 - Tri - Insolvency and Bankruptcy

Tribunal approves Resolution Plan, addresses Creditors' concerns, upholds Committee of Creditors' discretion

The Tribunal approved the Resolution Plan filed by the Insolvency Resolution Professional, leading to the discharge of duties. Concerns raised by ... Validity of Resolution Plan - Valuation ascertained by the Registered Valuer appointed by the Insolvency Resolution professional - HELD THAT:- In spite of receipt of their claim much beyond the period prescribed under the I & B Code, the Resolution Plan has taken care of the claim of the appellants, we are not inclined to interfere with the order passed by the Adjudicating Authority. In a particular case, what should be the percentage of claim amount payable to one or other Financial Creditor or Operational Creditor or Secured Creditor or Unsecured Creditor can be decided by the Committee of Creditors based on facts and circumstances of each case. In absence of any discrimination or perverse decision, it is not open to the Adjudicating Authority or this Appellate Tribunal to modify the plan. Appeal dismissed. Issues:1. Approval of Resolution Plan by the Adjudicating Authority.2. Concerns raised by the Operational Creditors regarding outstanding dues.3. Failure to file claims within the prescribed period.4. Settlement of dues for Operational Creditors based on Resolution Plan.5. Disputed claims and contingent liabilities under the Resolution Plan.6. Adjudication of claims and interference with the order passed by the Adjudicating Authority.Approval of Resolution Plan by the Adjudicating Authority:The appeals were filed against the order approving the Resolution Plan by the Adjudicating Authority. The Tribunal, upon reviewing the Resolution Plan and valuation of the Corporate Debtor's properties, found the plan satisfactory and approved it. The Resolution Plan was filed by the Insolvency Resolution Professional, leading to the discharge of the professional from duties as the plan was accepted.Concerns raised by the Operational Creditors regarding outstanding dues:Operational Creditors raised concerns that the Resolution Plan did not address their total outstanding dues adequately. Specific instances were highlighted where only a percentage of the principal amount was allowed in favor of the Operational Creditors. The Tribunal noted the ongoing winding up proceedings filed by one of the Operational Creditors, which were pending while the Resolution Plan was approved.Failure to file claims within the prescribed period:The 1st respondent Corporate Debtor argued that the appellants failed to file their claims within the prescribed period. Despite this, the claims were considered in the Resolution Plan based on the Corporate Debtor's books of accounts.Settlement of dues for Operational Creditors based on Resolution Plan:The Resolution Plan provided for the settlement of dues of Operational Creditors, even if claims were not received before the approval of the plan. The plan accounted for the outstanding dues of the Operational Creditors and specified the settlement terms, including the percentage of the total outstanding amount to be paid within a specified timeframe.Disputed claims and contingent liabilities under the Resolution Plan:Certain Operational Creditors had disputed claims and contingent liabilities against the Corporate Debtor. The Resolution Plan acknowledged these disputes and pending legal proceedings, categorizing the claims as contingent claims subject to final adjudication. Any payments due to these Operational Creditors were to be made in accordance with the terms of the Resolution Plan post-adjudication.Adjudication of claims and interference with the order passed by the Adjudicating Authority:The Tribunal found that despite claims being received beyond the prescribed period, the Resolution Plan adequately addressed the concerns of the appellants. It was noted that the Committee of Creditors could decide on the percentage of claim amount payable to different types of creditors based on individual circumstances. The Tribunal declined to interfere with the Adjudicating Authority's order, emphasizing that modifications to the plan were not warranted in the absence of discrimination or perverse decisions.In conclusion, the appeals were dismissed, and the Tribunal refrained from expressing opinions on winding up proceedings or other litigations pending before competent courts.