2024 (12) TMI 952 - AT - IBC

NCLAT rejects delayed claim worth Rs. 6 crores filed after resolution plan approval deadline

Vadilal Industries Ltd. Versus Fanendra Munot & Ors.

NCLAT Principal Bench dismissed appellant's claim filed on 19.03.2022, well after the 24.11.2020 deadline and after CoC approved the resolution plan on ... Rejection of the Appellant's claim by the Resolution Professional (RP) due to delay - Approval of the resolution plan by the Committee of Creditors (CoC) and its implications on pending claims - HELD THAT:- There is no dispute in regard to the fact that public announcement was made on 11.11.2020 and the last date to file the claim was 24.11.2020. There is also no dispute that the application has been filed by the Appellant on account of loss suffered for which the Appellant has already filed a civil suit on 14.10.2019 before the Civil Court, Ahmedabad in which two prayers have been made, namely, for supplying remaining SMP in terms of the purchase order and recovery of a sum of Rs. 6,05,09,000 on account of financial loss. It is not in dispute as well that the application has been filed in respect of the claim of Rs. 6,05,09,000 regarding which civil suit has already pending, however, in any case, the Appellant has admittedly filed the claim in Form B on 19.03.2022 much after 18.10.2021 when the members of all the CoC in its 11th meeting approved the plan submitted by the resolution applicant. The contention of the Appellant is that the claim was filed on 19.03.2022 during the period when the order passed in suo motu writ petition (c) no. 3 of 2022 by the Hon’ble Supreme Court, therefore, the period was condonable. He has also argued that the claim can be extinguished only after approval of the resolution plan by the Tribunal and has relied upon a decision of this Court in the case of Puneet Kaur [2022 (6) TMI 108 - NATIONAL COMPANY LAW APPELLATE TRIBUNAL , PRINCIPAL BENCH , NEW DELHI] but after the decision of the Hon’ble Supreme Court in the case of M/s RPS Infra [2023 (9) TMI 516 - SUPREME COURT] in which the issue was as to whether the appellant’s claim pertaining to an arbitral award, which is in appeal under Section 37 of the said Act, is liable to be included at a belated state i.e. after the resolution plan has been approved by the CoC and the answer to this question was given by the Hon’ble Supreme Court has held that 'The mere fact that the Adjudicating Authority has yet not approved the plan does not imply that the plan can go back and forth, thereby making the CIRP an endless process. This would result in the reopening of the whole issue, particularly as there may be other similar persons who may jump onto the bandwagon.' The dicta of the Hon’ble Supreme Court in the case of M/s RPS Infra is followed, which is a judgment delivered by the Hon’ble Supreme Court on 11.09.2023 much after the decision in the case of GPR Power [2021 (11) TMI 1045 - SUPREME COURT] decided on 29.11.2021 holding therein that once the CoC has approved the plan then no claim is to be entertained. There is no error committed by the Tribunal in rejecting the application of the Appellant and rejecting its claim - The appeal is thus found without any merit and the same is hereby dismissed. Issues Involved:1. Rejection of the Appellant's claim by the Resolution Professional (RP) due to delay.2. Approval of the resolution plan by the Committee of Creditors (CoC) and its implications on pending claims.3. Applicability of the Supreme Court's suo motu writ petition regarding the extension of limitation.4. The impact of the Supreme Court's decision in M/s RPS Infrastructure Ltd. vs. Mukul Kumar & Anr. on the admission of claims post-CoC approval.Issue-wise Analysis:1. Rejection of the Appellant's Claim by the RP Due to Delay:The Appellant filed its claim in Form B on 19.03.2022, which was rejected by the RP on the grounds of delay. The Tribunal dismissed the Appellant's application challenging this rejection, as the claim was submitted significantly after the CoC approved the resolution plan on 18.10.2021. The Tribunal emphasized that the claim was filed after the deadline for submission, which was set for 24.11.2020, following the public announcement on 12.11.2020. The Appellant's argument that the delay was condonable due to the Supreme Court's extension of limitation was not accepted, as the claim was filed well beyond the prescribed period.2. Approval of the Resolution Plan by the CoC and Its Implications on Pending Claims:The CoC approved the resolution plan on 18.10.2021, and the Tribunal subsequently approved it on 31.03.2023. The Appellant's claim was rejected as it was filed after the CoC's approval. The Tribunal highlighted that once the CoC approves a resolution plan, no further claims can be entertained, as this would disrupt the finality and certainty required in the Corporate Insolvency Resolution Process (CIRP). The Tribunal cited the Supreme Court's decision in M/s RPS Infrastructure Ltd. vs. Mukul Kumar & Anr., which reinforced that claims cannot be admitted post-CoC approval to prevent making the CIRP an endless process.3. Applicability of the Supreme Court's Suo Motu Writ Petition Regarding the Extension of Limitation:The Appellant argued that the delay in filing the claim was within the extended limitation period as per the Supreme Court's suo motu writ petition (c) no. 3 of 2020, which excluded the period from 15.03.2020 to 28.02.2022 from the limitation period. However, the Tribunal found that this extension did not apply to the Appellant's case, as the claim was filed after the resolution plan's approval and outside the permissible period for filing claims.4. Impact of the Supreme Court's Decision in M/s RPS Infrastructure Ltd. vs. Mukul Kumar & Anr.:The Tribunal relied heavily on the Supreme Court's judgment in M/s RPS Infrastructure Ltd. vs. Mukul Kumar & Anr., which clarified that claims filed after the CoC's approval of a resolution plan cannot be entertained. This decision emphasized the need for a time-bound process in CIRP and deemed public announcements as constituting deemed knowledge for claimants. The Tribunal concluded that the Appellant's claim could not be admitted post-CoC approval, aligning with the Supreme Court's directives to prevent reopening resolved issues and maintain the CIRP's integrity.In conclusion, the Tribunal dismissed the appeal, finding no merit in the Appellant's arguments and upholding the rejection of the claim due to its belated submission after the CoC's approval of the resolution plan. The Tribunal's decision was consistent with the principles laid down by the Supreme Court regarding the finality of the CIRP process.