Extinguishment of pre-CIRP claims under an approved resolution plan bars survival of an arbitral award.

Pre-CIRP claims not included in an approved resolution plan stand extinguished by operation of the Insolvency and Bankruptcy Code, and a successful resolution applicant cannot be burdened with excluded or undecided liabilities. Where the disputed claims arose before commencement of CIRP, the statutory moratorium required creditors to pursue them in the insolvency process. Once the resolution plan was approved, any claim not forming part of that plan ceased to survive, so an arbitral award based on such extinguished claims could not be sustained and was liable to be set aside.

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Issues: Whether an arbitral award can survive where the respondent's pre-CIRP claims stood extinguished upon approval of a resolution plan under the Insolvency and Bankruptcy Code, 2016.

Analysis: The claims in dispute had arisen before commencement of CIRP. Once CIRP was initiated, the statutory moratorium operated and creditors were required to lodge their claims in the insolvency process. Upon approval of the resolution plan by the adjudicating authority, claims not forming part of the plan stood extinguished by operation of law. The settled legal position is that a successful resolution applicant cannot be burdened with undecided or excluded claims, and any adjudication or award in respect of such extinguished claims cannot survive.

Conclusion: The award was liable to be set aside because the claims had ceased to survive after approval of the resolution plan.

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