NCLT has jurisdiction over insolvency matters, Resolution Professional's role, and creditor benefits post-resolution.

The writ petition was found not maintainable as the NCLT has jurisdiction over matters related to insolvency resolution. The Resolution Professional's role ends with the successful resolution of the corporate debtor, but they can pursue avoidance applications separately. Adjudication of avoidance applications can occur post-resolution, benefiting creditors rather than the new management. The judgment was set aside, directing the NCLT to proceed with the avoidance application hearing and distribute the recovered amount among creditors as determined by the NCLT.

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Issues Involved:
1. Alternate efficacious remedy before NCLAT.
2. RP being functus officio after CIRP.
3. Adjudication of avoidance applications after CIRP.
4. Beneficiaries of avoidance applications.

Detailed Analysis:

(A) Issue of Alternate Efficacious Remedy Before the NCLAT:
The Ld. Single Judge addressed the maintainability of the writ petition, considering the appellants' argument that the writ petition should be dismissed due to the existence of an efficacious alternate remedy under Section 61 of the IBC. The Judge observed that the NCLT has jurisdiction over applications and petitions "in relation to insolvency resolution and liquidation for corporate persons." However, the issue was whether the proceedings in question were related to insolvency resolution. The Judge concluded that the writ petition was maintainable because the CIRP ended with the approval of the Resolution Plan on 15.05.2018, and no proceedings remained pending except issues pertaining to the Plan itself.

(B) RP Being Functus Officio After CIRP:
The Ld. Single Judge questioned whether the RP becomes functus officio after the resolution of the corporate debtor. The Judge observed that the RP's role is administrative, not adjudicatory, and cannot continue beyond an order under Section 31 of the IBC unless the Resolution Plan explicitly permits the RP to function for any specific purpose beyond its approval. The Judge emphasized that the RP's authority is limited by the proviso to Section 23(1), which sets an outer limit for its functioning. Therefore, the RP cannot continue to act as former RP after the CIRP period.

(C) Adjudication of Avoidance Applications After CIRP:
The Ld. Single Judge noted that Regulation 35A of the CIRP Regulations, 2016, provides a timeline for the RP to form an opinion on objectionable transactions and submit details to the NCLT before the approval of the Resolution Plan. The Judge held that the purpose of these timelines is for the RP to include these details in the Resolution Plans. The Judge further observed that the Resolution Applicant cannot file an avoidance application since it is for the benefit of the Corporate Debtor and the CoC before the resolution. Allowing adjudication of avoidance applications after resolution would mean the NCLT stepping into the new management's shoes. Therefore, any order on suspect transactions must be passed before the approval of the resolution plan. Section 26 of the IBC cannot be interpreted to mean that an application for avoidance of transactions can survive after the CIRP process.

(D) Beneficiaries of Avoidance Applications:
The Ld. Single Judge relied on Clause 2.4 of the ILC Report dated 20.02.2020, which states that the successful Resolution Applicant cannot file an avoidance application. The purpose of avoidance applications is not to benefit the Resolution Applicants or the company after resolution but the Corporate Debtor and the CoC before the resolution. The Judge concluded that after the Plan is approved, the company is in the hands of the new management, and neither the NCLT nor the RP has any right or power over the company.

Contentions of the Parties:
1. Tata Steel BSL Ltd. argued that the writ petition should have been dismissed due to the existence of an alternate remedy before the NCLAT. They contended that avoidance applications are filed as per IBC provisions, and the NCLT is the appropriate forum. They argued that Section 26 clarifies that filing an avoidance application does not affect the CIRP, and such applications can continue parallelly and beyond CIRP.
2. Union of India contended that the phrases "arising out of" or "in relation to" in Section 60(5)(c) are of wide import, extending the NCLT's jurisdiction to matters related to insolvency resolution. They argued that the RP's statutory duty to file avoidance applications survives the CIRP, and the NCLT can still decide such applications.
3. Resolution Professional concurred with Tata Steel BSL Ltd. and the Union of India, arguing that the RP can continue to pursue avoidance applications, and the Corporate Debtor can substitute the RP to pursue the applications.
4. Venus Recruiters Pvt. Ltd. argued that the jurisdiction of the NCLT ceases after CIRP, and the IBC does not provide for the continuation of avoidance applications post-CIRP. They cited the Innoventive Industries case to emphasize the necessity for speedy resolution under the IBC.

Findings and Conclusion:
1. Alternate Remedy Before NCLAT: The phrase "arising out of" or "in relation to" under Section 60(5)(c) of the IBC is of wide import, and the NCLT has jurisdiction to entertain such matters. The writ petition was not maintainable, and the respondent should have pursued an appeal before the NCLAT.
2. RP Functus Officio: The RP's role in CIRP ends with the successful resolution of the corporate debtor. However, the RP can continue to pursue avoidance applications as they are separate proceedings from CIRP.
3. Adjudication of Avoidance Applications: Avoidance applications can survive CIRP, and the benefit from such adjudication should go to the creditors of the corporate debtor, not the new management. The RP is not functus officio concerning avoidance applications.
4. Beneficiaries of Avoidance Applications: The benefit arising from adjudication of avoidance applications should be distributed among the creditors, not the corporate debtor in its new avatar.

Conclusion:
The impugned Judgment was set aside, and the NCLT was directed to proceed with the hearing of the avoidance application. The amount recovered should be distributed among the creditors as determined by the NCLT.

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