Moratorium on proceedings bars assessments and related claims during CIRP; late claims after plan approval are inadmissible.

The moratorium under the Insolvency Code bars continuation of assessment proceedings by a statutory authority during CIRP and excludes claims founded on assessments completed during the moratorium; such claims were held inadmissible. Claims filed after committee of creditors' approval of a resolution plan are barred because CIRP is time bound and reopening after plan approval undermines finality; belated claims were rejected. Adverse findings against the resolution professional for alleged non-disclosure of pending proceedings were expunged for lack of proof that the proceedings were notified to the IRP/RP or wilfully concealed by management; the appeals were allowed and the impugned admission set aside.

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Issues: (i) Whether assessment proceedings carried out by the Employees' Provident Fund Organisation after imposition of moratorium under the Insolvency and Bankruptcy Code could be continued and whether claims based on such assessment can be admitted in the corporate insolvency resolution process; (ii) Whether claims filed belatedly by the Employees' Provident Fund Organisation after approval of the resolution plan by the committee of creditors can be admitted in the CIRP; (iii) Whether adverse remarks against the resolution professional for alleged non-disclosure of pending proceedings under the insolvency resolution regulations were justified.

Issue (i): Whether assessment proceedings by EPFO after imposition of moratorium and claims based on such assessment can be continued or admitted in CIRP.

Analysis: The moratorium under Section 14(1) creates a statutory freeze on suits and proceedings affecting the corporate debtor during CIRP. Precedent of this Tribunal holds that assessment proceedings by EPFO cannot be continued during the moratorium and that claims based on assessments made during the moratorium are not admissible in CIRP. The assessment in the present matter was completed during the moratorium period and not after liquidation.

Conclusion: Assessment proceedings by EPFO carried out after commencement of the moratorium could not be continued and claims based on such assessment are not admissible in the CIRP; conclusion is against the Respondent (EPFO).

Issue (ii): Whether belated claims filed by EPFO after the committee of creditors approved the resolution plan can be admitted.

Analysis: The CIRP is a time-bound process and claims not submitted within prescribed timelines, particularly claims filed after CoC approval of a resolution plan, cannot be entertained. Authorities caution against reopening CIRP after plan approval to prevent undermining finality and to avoid permitting a cascade of late claims which would prejudice the resolution applicant and impede the process.

Conclusion: Belated claims filed after approval of the resolution plan by the committee of creditors cannot be admitted; conclusion is in favour of the Appellants (RP and CoC).

Issue (iii): Whether adverse remarks against the resolution professional for alleged failure to disclose pending EPFO proceedings under regulation 36(2)(h) were warranted.

Analysis: The information on pending proceedings before the RP and CoC derived from the suspended management and the record does not show disclosure by EPFO to the IRP/RP within the claim filing timeline. In absence of proof that EPFO notified the IRP/RP or that the suspended management omitted the matter knowingly, findings of breach are not supported.

Conclusion: Adverse remarks against the resolution professional for breach of disclosure obligations are unjustified and are to be expunged; conclusion is in favour of the Appellants (RP).

Final Conclusion: The appeals are allowed; the impugned order admitting EPFO's claim is set aside and the adverse remarks against the resolution professional are expunged, with no order as to costs.

Ratio Decidendi: Where the moratorium under the Insolvency and Bankruptcy Code is in force during CIRP, assessment proceedings by statutory authorities such as EPFO cannot be continued and claims based on assessments made during the moratorium are not admissible in the CIRP; claims filed after approval of a resolution plan by the committee of creditors cannot be entertained.

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