New Delhi, Mar 18 (PTI) The Supreme Court on Tuesday rejected an appeal filed by UP Jal Vidyut Nigam Limited (UPJVNL), assailing the insolvency resolution of Essar Power MP Limited (now Mahan Energen Limited).

A bench of Justices Manoj Mishra and Manmohan upheld the concurrent findings of the NCLT and NCLAT, holding that no interference was warranted with a resolution plan that had already been implemented.

The legal battle originated from a 2009 agreement where Essar Power MP Limited (EPMPL) was to receive water from the Rihand reservoir.

Following a series of jurisdictional disputes over water charges between Madhya Pradesh and Uttar Pradesh, EPMPL entered the Corporate Insolvency Resolution Process (CIRP) in September 2020.

Subsequently, UPJVNL submitted claims of over Rs 12 crore for pre-insolvency dues.

However, the Resolution Professional (RP) classified these as "contingent claims" and admitted them at a nominal value of just Rs one.

Rejecting UPJVNL's claims, the apex court noted that under the approved resolution plan, which saw Adani Power Limited emerge as the successful bidder, operational creditors had received "NIL payment" under the approved resolution plan.

It said that even if UPJVNL's claims were fully admitted, the outcome would remain unchanged.

The bench underlined that once a resolution plan is implemented, the Insolvency and Bankruptcy Code (IBC) provision binds all stakeholders, and reopening settled claims would disrupt the insolvency process and prejudice creditors. It observed that the CIRP-period dues raised by UPJVNL had been fully paid under protest by EPMPL.

The bench noted that a fresh agreement has already been signed between UPJVNL and EPMPL, regularising the ongoing commercial relationship.

Earlier in 2021, the National Company Law Tribunal (NCLT) approved Adani's resolution plan and dismissed UPJVNL's application challenging the RP's classification.

Later, the National Company Law Appellate Tribunal (NCLAT) upheld the NCLT’s findings, noting that the RP’s role is administrative, not quasi-judicial, and that contingent claims may be admitted at a nominal value where disputes are pending before courts.

The NCLAT also underscored that the operational creditor’s claims would not have resulted in any payment under the plan, given the priority of secured financial creditors. Advocate Sandeep Singhi from Karanjawala & Co law firm appeared for Adani Power Limited. PTI MNR VN VN