Tribunal Upholds Insolvency Code Timelines, Stresses Timely Compliance

The Tribunal dismissed the appeal, emphasizing the importance of adhering to the Insolvency and Bankruptcy Code (IBC) timelines. It held that the Resolution Professional (RP) fulfilled duties diligently and was not required to include belated claims. The Tribunal underscored that once a Resolution Plan is approved, claims not included stand extinguished, including statutory dues. The approved Plan, supported by 91.02% of the Committee of Creditors, was pending final approval. The Tribunal found no basis to intervene in the process, highlighting the significance of timely compliance for an efficient insolvency resolution process.

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Issues Involved:
1. Timeliness of Filing Claims
2. Duties of the Resolution Professional
3. Adherence to the Insolvency and Bankruptcy Code (IBC) Timelines
4. Impact of Delayed Claims on the Corporate Insolvency Resolution Process (CIRP)
5. Extinguishment of Claims Not Included in the Resolution Plan

Detailed Analysis:

1. Timeliness of Filing Claims:
The Appellant, the Deputy Commissioner, Central GST, Ahmedabad South, filed a claim on 04.09.2020, beyond the stipulated time and extended period. The original deadline was 31.03.2020, extended to 16.08.2020 due to the Covid-19 lockdown. The claim was rejected as it was submitted 19 days late. The Appellant argued that they were not aware of the deadline, but the Tribunal noted that the Appellant was informed via email on 28.07.2020 about the CIRP and the deadline.

2. Duties of the Resolution Professional:
The Appellant contended that the Resolution Professional (RP) failed to perform duties under Section 21(1) of the IBC by not including their claim. However, the Tribunal found that the RP had acted diligently, issuing public announcements and extending deadlines as required. The RP incorporated the Appellant's claim in the Information Memorandum for consideration by the Committee of Creditors (CoC).

3. Adherence to the Insolvency and Bankruptcy Code (IBC) Timelines:
The Tribunal emphasized the mandatory nature of the timelines under the IBC. The CIRP must be completed within a specified period to ensure the value of the debtor's assets is maximized. The Tribunal referred to the Supreme Court's judgment in 'Ebix Singapore Private Limited' which stressed the importance of adhering to the prescribed timelines to avoid delays and ensure the efficiency of the insolvency process.

4. Impact of Delayed Claims on the Corporate Insolvency Resolution Process (CIRP):
Allowing delayed claims could disrupt the CIRP, causing delays and potentially leading to the failure of Resolution Plans already submitted. The Tribunal noted that the RP had to make corrections in the Information Utility and stakeholders list, which could further delay the CIRP. The Tribunal cited the Supreme Court's judgment in 'Ghanashyam Mishra and Sons Private Limited' which held that claims not part of the Resolution Plan stand extinguished once the plan is approved.

5. Extinguishment of Claims Not Included in the Resolution Plan:
The Tribunal reiterated that once a Resolution Plan is approved, all claims not included in the plan are extinguished. This applies to statutory dues owed to the government. The Tribunal referenced the Supreme Court's judgment in 'Director General of Income Tax Vs. Synergies Dooray Automotive Ltd.' which held that statutory claims not included in the Resolution Plan cannot be pursued post-approval.

Conclusion:
The Tribunal dismissed the appeal, holding that the RP was not obligated to include belated claims, and there was no dereliction of duty. The Tribunal emphasized the importance of adhering to the timelines under the IBC to ensure the efficiency and effectiveness of the insolvency resolution process. The Resolution Plan, approved by 91.02% of the CoC, was pending approval before the Adjudicating Authority, and the Tribunal found no grounds to interfere with the process.

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