2026 (3) TMI 352 - AT - IBC

Appeals Against Resolution Plan rendered infructuous where liquidation begins and claimants pursue claims before the liquidator, leading to dismissal.

Where liquidation of a corporate debtor commences during pendency of appeals challenging approval of a resolution plan and the appellants have filed ... Approval of resolution plan - Appeal rendered infructuous by subsequent liquidation - claims to be adjudicated by the liquidator - verification and collation of claim. Seeking issue of direction to Resolution Professional to verify and collate the claim filed - Resolution Professional neither accepted nor rejected the claim - HELD THAT:- Bringing the fact on record that, the liquidation has already been ordered by an order of 16.04.2025 in IA(IBC)/34(CHE)/2025 in CP(IBC)/1423/2019. He has submitted that since the liquidation process has already been commenced, and besides that, since the Appellant has already raised a claim before the liquidator, as of today, nothing survives in the instant Company Appeal because of the subsequent development, which has been placed on record. The Comp App (AT) (CH) ((Ins) No.373/2022 would accordingly stand dismissed as infructuous. Comp App (AT) (CH) (Ins) No.272/2022 - Claim raised before liquidator - HELD THAT:- Since the Corporate Debtor has already been put to liquidation, and the Appellant has already raised his claim before the liquidator, nothing survives to be adjudicated on merits in the instant Company Appeal. Accordingly, the Comp App (AT) (CH) (Ins) No.272/2022 would stand dismissed as having been rendered infructuous. Comp App (AT) (CH) (Ins) No.295/2022 Approval of resolution plan - Application preferred under Section 60(5) of the I & B Code, 2016, had approved the Resolution Plan - HELD THAT:- It has already been brought on record by the parties that, since the Corporate Debtor has already been put to liquidation, and the Appellant has admittedly thereafter raised his claim before the liquidator, nothing survives to be adjudicated on merits in the Company Appeal. Accordingly, the Comp App (AT) (CH) (Ins) No.295/2022 would stand dismissed as having been rendered infructuous. Issues: Whether appeals challenging approval of the resolution plan continue to survive where, during pendency of the appeals, liquidation of the corporate debtor has been ordered and the appellants have filed claims before the liquidator.Analysis: The appeals pertain to challenge of orders approving the resolution plan under proceedings that involved consideration under Section 60(5) of the Insolvency and Bankruptcy Code, 2016. Subsequent to filing of these appeals, an order initiating liquidation of the corporate debtor was passed and appellants placed on record that they have submitted their claims to the liquidator. Given commencement of liquidation and prosecution of claims before the liquidator, there remains no substantive relief available in the pending appeals against approval of the resolution plan. The appeals therefore lack a live controversy requiring adjudication on the merits.Conclusion: The appeals are rendered infructuous by the subsequent commencement of liquidation and by the appellants having raised their claims before the liquidator; the appeals are therefore dismissed.Ratio Decidendi: Where liquidation of the corporate debtor is ordered during pendency of appeals against approval of a resolution plan and claimants have submitted claims before the liquidator, the appeals challenging the approval of the resolution plan are rendered infructuous and may be dismissed for want of a live controversy.