Appeals Dismissed: Tribunal Upholds Approval of Resolution Plan under Insolvency Code

The appeals challenging the approval of the Resolution Plan submitted by a Consortium were dismissed by the Adjudicating Authority. The Tribunal found the plan compliant with the Insolvency and Bankruptcy Code, balanced in treating creditors, and fully implemented. Claims by various parties were analyzed, with decisions made based on the nature of claims and timely challenges. The Tribunal emphasized fairness in treatment and rejected discrimination claims, ultimately upholding the Resolution Plan's approval without awarding costs.

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Issues Involved:
1. Challenge to the approval of the Resolution Plan.
2. Classification and treatment of claims by the Resolution Professional.
3. Allegations of discrimination and unfair treatment in the Resolution Plan.
4. Compliance with the Insolvency and Bankruptcy Code (I&B Code) and related regulations.
5. Implementation and estoppel arguments regarding the Resolution Plan.

Issue-wise Detailed Analysis:

1. Challenge to the Approval of the Resolution Plan:
The appeals challenge the approval of the Resolution Plan submitted by the Consortium of Aion Investment II Private Limited & JSW Steel Limited, which was approved by the Adjudicating Authority (National Company Law Tribunal), Mumbai Bench, on 24th July 2018. The appellants argue that the plan fails to address their claims adequately and is discriminatory against operational creditors.

2. Classification and Treatment of Claims by the Resolution Professional:
- Bharat Petroresources Limited (BPRL): BPRL filed its claim as an operational creditor for Rs. 9,58,88,886, which was admitted. However, its further claim of Rs. 9,92,86,892 for future claims accrued after the Insolvency Commencement Date was not accepted. The Tribunal held that future claims could not be considered by the Resolution Professional under Section 18(1)(b) of the I&B Code.
- GAIL (India) Ltd.: GAIL filed its claims in Form-F, which is for creditors other than financial or operational creditors, due to a mistaken belief. Consequently, its claims were not accepted as operational debts, unlike BPRL, which filed in Form-B and was treated as an operational creditor.
- IFCI Limited: IFCI was categorized as an unsecured financial creditor despite having an exclusive mortgage over a property. The Tribunal noted that IFCI did not object to this classification during the resolution process and had accepted payments under the Resolution Plan.
- Bharat Heavy Electricals Limited (BHEL): BHEL's claim was significantly reduced by the Resolution Professional. The Tribunal found that BHEL did not challenge this reduction timely and had no evidence to support its further claims.

3. Allegations of Discrimination and Unfair Treatment in the Resolution Plan:
- Operational Creditors vs. Financial Creditors: The appellants argued that the Resolution Plan was discriminatory, providing better terms to financial creditors compared to operational creditors. The Tribunal noted that the Resolution Plan ensured roughly the same treatment for both, with financial creditors receiving 26.26% recovery and operational creditors 21.77%.
- Specific Claims: BPRL and GAIL contended that their claims were not treated equally. The Tribunal found that the Resolution Professional's classifications were based on the forms submitted and the nature of claims, and the appellants were estopped from challenging these classifications at a late stage.

4. Compliance with the I&B Code and Related Regulations:
The Tribunal emphasized that the Resolution Plan complied with the I&B Code and related regulations. It referenced decisions in "Binani Industries Limited vs. Bank of Baroda & Anr." and "Swiss Ribbons Pvt. Ltd. & Anr. vs. Union of India & Ors." to support the view that the plan balanced the interests of all stakeholders and was not discriminatory.

5. Implementation and Estoppel Arguments Regarding the Resolution Plan:
The Tribunal noted that the Resolution Plan had been fully implemented by 31st August 2018, including payments to creditors and other stipulated actions. The appellants, having accepted payments and benefits under the plan, were estopped from challenging it. The Tribunal found no merit in the appeals and dismissed them.

Conclusion:
The appeals by Bharat Petroresources Limited, IFCI Limited, GAIL (India) Ltd., and Bharat Heavy Electricals Ltd. were dismissed. The Tribunal upheld the Resolution Plan's approval, finding it compliant with the I&B Code and fair in its treatment of creditors. No costs were awarded.

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