Resolution plan approval under the Insolvency Code confirmed; workmen's claim objections and moratorium challenge did not defeat the plan.

A resolution plan that complied with section 30(2) of the Insolvency and Bankruptcy Code and received 100% approval of the committee of creditors was approvable under section 31(1) and became binding on the corporate debtor and stakeholders. Objections based on rejection of workmen's claims and alleged non-implementation of pay revision arrears did not justify refusal of approval, because the claims were either not filed in the prescribed statutory form or were unsupported on the record. Section 14 of the Code was also held to bar proceedings against the corporate debtor, not a civil suit instituted by it against an operational creditor, so the suit was maintainable.

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Issues: (i) Whether the resolution plan satisfied the requirements of section 30(2) of the Insolvency and Bankruptcy Code, 2016 and was liable to be approved under section 31(1); (ii) whether the objections regarding rejection of workmen's claims and non-implementation of pay revision arrears disclosed any ground to refuse approval of the plan; (iii) whether section 14 of the Insolvency and Bankruptcy Code, 2016 barred a civil suit filed by the corporate debtor against an operational creditor.

Issue (i): Whether the resolution plan satisfied the requirements of section 30(2) of the Insolvency and Bankruptcy Code, 2016 and was liable to be approved under section 31(1)

Analysis: The plan had been approved by the committee of creditors with 100% voting share. It was found to comply with the statutory requirements governing content, treatment of claims, and certification. The plan was treated as a repayment-based resolution proposal supported by budgetary allocation and was held to meet the threshold under section 30(2).

Conclusion: The resolution plan was approved under section 31(1) and became binding on the corporate debtor and all stakeholders.

Issue (ii): Whether the objections regarding rejection of workmen's claims and non-implementation of pay revision arrears disclosed any ground to refuse approval of the plan

Analysis: The workmen's claims were rejected for non-furnishing of the prescribed data in Form E under the insolvency regulations. The claims regarding 1997 pay revision arrears were found unsupported because the revision was stated to operate prospectively from 01.10.2010, with no arrears payable for the earlier period. The 2007 pay revision was not shown to have been implemented in the corporate debtor, while the 1992 pay revision had already been taken into account in the plan. No material irregularity or violation of the earlier directions was established.

Conclusion: The objections did not furnish any valid ground to refuse approval of the resolution plan.

Issue (iii): Whether section 14 of the Insolvency and Bankruptcy Code, 2016 barred a civil suit filed by the corporate debtor against an operational creditor

Analysis: The moratorium was held to bar proceedings against the corporate debtor and not proceedings instituted by the corporate debtor. A suit filed by the corporate debtor against an operational creditor was therefore not prohibited by section 14. The related challenge to the maintainability of the suit failed.

Conclusion: Section 14 did not bar the civil suit filed by the corporate debtor.

Final Conclusion: The resolution plan was approved, the objections to workmen's claims and pay revision benefits were rejected, and the challenge based on moratorium was also rejected, resulting in closure of the insolvency resolution process in terms of the approved plan.

Ratio Decidendi: A resolution plan that satisfies section 30(2) and receives the requisite approval of the committee of creditors is approvable under section 31(1); section 14 bars proceedings against the corporate debtor but does not prohibit proceedings instituted by it; and claims not submitted in the prescribed statutory format may be rejected without affecting the validity of the plan.

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