Tribunal rules against Company Appeal seeking 'Secured Financial Creditor' status post-Resolution Plan approval

The Tribunal dismissed the Company Appeal challenging the Impugned Order, where the Appellant sought recognition as a 'Secured Financial Creditor'. The Adjudicating Authority's jurisdiction post-Approval of Resolution Plan was limited, and relief altering the terms of the Plan was not granted. The Tribunal upheld the Appellant's categorization as an 'Unsecured Financial Creditor' and found no material irregularity or patent illegality in the Impugned Order, resulting in the dismissal of the appeal with no costs.

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Issues involved:
The issues involved in this case include the categorization of the appellant as an 'Unsecured Creditor', the relief sought by the appellant to be recognized as a 'Secured Financial Creditor', the approval and implementation of the Resolution Plan, and the legal infirmities in the Impugned Order.

Background:
The Appellant filed Company Appeal (AT) (CH) (Ins) No. 251/2023 challenging the Impugned Order dated 12/05/2023 in IA/361/IB/2020 in C.P.(IB)/540(CHE)/2017 before the National Company Law Tribunal, Division Bench - II, Chennai. The Adjudicating Authority dismissed the Appellant's application seeking intervention without costs.

Prelude:
The correct Company Petition number is C.P.(IB)/540/(CHE)/2017, not C.P.(IB)/IB/889/(CHE)/2019 as mentioned in the Impugned Order. The Appellant's Counsel pointed out the error and sought rectification.

Appellant's Pleas:
The Appellant sought a declaration as a 'Secured Creditor' and requested that any allocation of funds under a Resolution Plan recognize its status as a 'Secured Financial Creditor'. The Appellant argued that the application's dismissal suffered from serious legal infirmities.

Respondent's stance:
The Respondent contended that the Appellant was categorized as an 'Unsecured Financial Creditor' during the Corporate Insolvency Resolution Process. The Committee of Creditors approved the Resolution Plan, resulting in a change in control and ownership of the Corporate Debtor.

Pros & Cons:
The Adjudicating Authority's jurisdiction post-Approval of Resolution Plan is limited. Any relief altering the terms of a Resolution Plan cannot be granted. The Tribunal noted the Supreme Court's approval of the Resolution Plan and the Appellant's admission as an 'Unsecured Financial Creditor'.

Result:
After considering the facts and circumstances, the Tribunal concluded that the Impugned Order did not have material irregularity or patent illegality. The Company Appeal (AT) (CH) (Ins) No. 251/2023 was dismissed with no costs.

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