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of <h1>Appellate Tribunal Upholds Decision on Liquidation Application Appeal</h1> <h3>WEST BENGAL FINANCIAL CORPORATION Versus BIJOY MURMURIA, C.P. ISPAT PRIVATE LIMITED, STATE BANK OF INDIA, PUNJAB NATIONAL BANK, KARNATAKA BANK LIMITED</h3> WEST BENGAL FINANCIAL CORPORATION Versus BIJOY MURMURIA, C.P. ISPAT PRIVATE LIMITED, STATE BANK OF INDIA, PUNJAB NATIONAL BANK, KARNATAKA BANK LIMITED - ... Issues Involved:1. Whether the subject matter of present Application IA No.479/KB/2021 is different from the prayer in IA No.426/KB/2021Rs.2. Whether the time limit of 330 days provided in Section 12 of IBC is mandatoryRs.Issue-wise Detailed Analysis:Issue No. (i): Whether the subject matter of present Application IA No.479/KB/2021 is different from the prayer in IA No.426/KB/2021Rs.The Adjudicating Authority, in its order dated 16.03.2021, condoned the delay of 43 days in submitting the Resolution Plan by CP Ispat Pvt. Ltd. (R2) and directed the Resolution Professional (RP) to place the Resolution Plan before the Committee of Creditors (CoC) for consideration by 22.03.2021, with the CoC to deliberate and decide by 25.03.2021. This order was not challenged by the Appellant, thus attaining finality. The CoC did not strictly adhere to this timeline and approved the Resolution Plan on 08.04.2021. The Appellant challenged this action through IA No.426/KB/2021, seeking an injunction to restrain the CoC from considering the Resolution Plan, which was dismissed by the Adjudicating Authority on 30.04.2021. This dismissal was upheld by the Appellate Tribunal on 02.08.2021. Subsequently, the Appellant filed IA No.775/KB/2021, seeking dismissal of the RP's application for approval of the Resolution Plan and an order for liquidation. The Adjudicating Authority dismissed this application on 08.10.2021, noting that the subject matter was similar to IA No.426/KB/2021 and had already been settled. The Appellate Tribunal agreed, finding no new grounds to consider and affirming the finality of the previous decisions.Issue No. (ii): Whether the time limit of 330 days provided in Section 12 of IBC is mandatoryRs.The object of the IBC is the resolution of the insolvency of a Corporate Debtor, and efforts must be directed towards this goal. While the law mandates that CIRP proceedings should conclude within 330 days, the Supreme Court in the case of Committee of Creditors of Essar Steel India Ltd. vs. Satish Kumar Gupta and Ors. (2020) 8 SCC 531, recognized that in exceptional cases, this period can be extended by the Adjudicating Authority or Appellate Tribunal. The Supreme Court struck down the term 'mandatorily' in Section 12(3) as manifestly arbitrary, holding that in exceptional cases, where delays are due to factors beyond the control of the litigants, the period can be extended beyond 330 days. The general rule remains that 330 days is the outer limit, but exceptions can be made in the interest of all stakeholders to avoid liquidation. Thus, the Appellate Tribunal found that the time limit in Section 12 is not mandatory and dismissed the Appellant's argument that failure to complete the resolution within 330 days necessitates liquidation. Consequently, the appeal was dismissed with no orders as to costs.
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