Forum for employee dues linked to resolution orders lies before the tribunal seized of the connected proceeding, not first instance appeal.

Claims for employee dues linked to an approved resolution and takeover were held to be outside the Appellate Tribunal's first-instance jurisdiction under the IBC context discussed here. The Tribunal accepted that any grievance arising from the order approving the resolution arrangement should be pursued before the National Company Law Tribunal in the connected company application, rather than before the Appellate Tribunal. It also stated that it was not examining the merits of the competing claims. The applicants were left at liberty to raise their grievances before the proper forum.

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Issues: Whether the applications seeking employee dues were maintainable before the Appellate Tribunal under Section 60(5) of the Insolvency and Bankruptcy Code, 2016, or whether the grievance had to be pursued before the National Company Law Tribunal in the proceedings arising from the resolution order.

Analysis: The applications arose from the resolution and takeover of the erstwhile company under the approved disinvestment process. The grievance related to alleged non-payment of employment-related dues said to have flowed from the order approving the resolution arrangement. In that setting, the Tribunal accepted the respondent's objection that the proper forum for any challenge or claim connected with that order was the National Company Law Tribunal in the concerned company application, and not the Appellate Tribunal in the present proceedings. The Tribunal also clarified that it was not entering into the merits of the rival claims.

Conclusion: The applications were not entertained before the Appellate Tribunal and the applicants were left at liberty to raise their grievances before the National Company Law Tribunal in the connected company application.

Ratio Decidendi: Where the grievance arises from an order approving resolution of the erstwhile entity, the appropriate remedy lies before the forum seized of that resolution proceeding, and the Appellate Tribunal will not entertain the claim in the first instance.

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