Appeal Dismissed for Failure to File Claim in Insolvency Proceedings

The Tribunal dismissed the appeal as the Appellant failed to file any claim despite being aware of the Corporate Insolvency Resolution Process (CIRP) proceedings. The Tribunal held that the Appellant's statutory liability was not included in the resolution plan as they did not submit a claim, leading to the extinguishment of their dues. The decision in Rainbow Papers Ltd was deemed inapplicable due to the Appellant's failure to file a claim. The appeal was dismissed without costs based on the precedent that claims not included in the resolution plan are extinguished.

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Issues Involved: Approval of the resolution plan, non-filing of claims by the appellant, statutory liability, and applicability of legal precedents.

Detailed Analysis:

1. Approval of the Resolution Plan:
The Appellant challenged the order dated 13.03.2020 passed by the Adjudicating Authority (National Company Law Tribunal, Mumbai Bench), which approved the resolution plan for the Corporate Debtor under Section 30(6) and 31 of the Insolvency and Bankruptcy Code, 2016. The resolution plan submitted by Adani Properties Private Limited was approved by the Committee of Creditors (CoC) with a 99.88% vote share. The Appellant, Kalyan Dombivali Municipal Corporation, was not made a party to the application for approval of the resolution plan and was not informed about the same.

2. Non-Filing of Claims by the Appellant:
The Appellant did not file any claim regarding pending property tax dues with the Resolution Professional (RP) nor any application to the Adjudicating Authority. Despite public announcements and a letter dated 11.12.2018 from the RP informing the Appellant about the Corporate Insolvency Resolution Process (CIRP), the Appellant did not submit their claim. The RP had invited claims from all creditors, including government bodies, and collated the claims to prepare the information memorandum (IM).

3. Statutory Liability:
The Appellant argued that the RP was aware of the litigation between the Appellant and the Corporate Debtor regarding unpaid property tax and should have examined the books of accounts to include the statutory liability in the IM. The Appellant relied on the Supreme Court decision in State Tax Officer v. Rainbow Papers Ltd to argue that the RP had a duty to examine the books of accounts for statutory liabilities.

4. Applicability of Legal Precedents:
The Appellant cited the Rainbow Papers Ltd case to argue that the resolution plan should not have been approved without including the statutory liability. However, the Tribunal found this case inapplicable because, in Rainbow Papers, the claim was filed albeit belatedly, whereas the Appellant did not file any claim in the present case. Additionally, the Tribunal noted that the amendment to Regulation 12(2) of the Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) Regulations, 2016, which requires a claim with proof, was in effect when the public announcement was made on 07.12.2018. Therefore, the Appellant's failure to file a claim meant that their dues were not part of the resolution plan and were deemed extinguished.

Conclusion:
The Tribunal concluded that the Appellant did not file any claim despite being informed of the CIRP proceedings and public announcements. The decision in Rainbow Papers Ltd was not applicable as the facts differed significantly. The Tribunal upheld the principle that claims not submitted to the RP and not part of the resolution plan are extinguished, as established in the Supreme Court's decision in Ghanashyam Mishra and Sons Private Limited. Consequently, the appeal was dismissed with no costs.

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