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TaxTMI 
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2022 (10) TMI 889
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....tes for R-3. Mr. Krishnendu Datta, Sr. Advocate with Mr. Rajat Sinha, Mr. Burjis Shabir, Ms. Srishty Kaul, Mr. Anant Singh, Mr. Aashish Vats, Advocates for SRA. Mr. Raunak Dhillon, Ms. Isha Malik and Ms. Niharika Shukla, Advocates for Respondent No.2. Mr. Sunil Aggarwal, Mr. Tushar Gupta, Mr. Sumit Kr. Advocates JUDGMENT ASHOK BHUSHAN, J. This Appeal by Financial Creditor of the Corporate Debtor, i.e., Jet Airways (India) Limited has been filed against the order dated 22.06.2021 passed by the National Company Law Tribunal, Mumbai Bench Court No.I allowing I.A. No.2081 of 2020 filed by Resolution Professional for approval of the Resolution Plan. 2. The brief facts of the case giving rise to this Appeal are: (i) In the year 2016-17, the Appellant has extended various loans credit to Jet Airways (India) Limited. The Corporate Debtor committed default in making the repayment of the loan. On 30.03.2019, the Promoter of the Corporate Debtor executed a Share Pledge Agreement in favour of the Appellant to secure their outstanding dues and 2,95,46,679 equity Shares were Pledged in favour of the Appellant. (ii) On 20.06.2019, the Corporate Insolvency Resolution Pro....
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....lvency) No.1220 of 2019) pronounced on September 10, 2020. (v) In the meantime, two Resolution Plans were submitted by the prospective Resolution Applicants. On 28.09.2020 in 16th Committee of Creditors ("CoC") Meeting more than one Resolution Applicants submitted their revised Plan, which were discussed and deliberated on 03.10.2022 in 17th CoC Meeting. In the 17th CoC Meeting, the Resolution Plan submitted by Jalan Fritesch Consortium was approved. In 18th CoC Meeting also, the representative of the Appellant put forth their contention that their claim of approximately Rs.200 crores has been rejected on the ground that they being equity shareholders. (vi) The Appellant filed an I.A. No. 2480 of 2020 on 04.12.2020, where following prayers were made: "(I) Allow the present application and direct the respondent to reverse its decision of reducing the claim of the applicant by the value of invoked shares pledged and transferred by the applicant bank. (II) Pass any other order/ direction that the Hon'ble Adjudicating Authority may deem fit in the interest of justice and equity." (vii) The RP filed an IA No.2081 of 2020 praying for approval of the Resolution ....
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....ion Applicants. The RP had no jurisdiction to review and revise an admitted claim of the Appellant. I.A. No.2480 of 2020 filed by the Appellant for restoring its admitted claim was never adjudicated by the Adjudicating Authority, causing great prejudice to the Appellant. The RP reduced the claim of Appellant relying on judgment of this Tribunal in India Power Corporation Ltd. vs. Meenakshi Energy Ltd. and Other in Company Appeal (AT) (Insolvency) No.1220 of 2019, which judgment, in turn, relied on judgment of this Tribunal in PTC India Financial Services Ltd. Vs. Mr. Venkateshwaralu Kari and Mandava Holdings Pvt. Ltd. Company Appeal (AT) (Ins) No. 450 of 2018 decided on 20.06.2019. The judgment of Meenakshi Energy Ltd. delivered on 10.09.2020, which was relied by RP for reduction of the claim. The judgment of the Hon'ble Supreme Court in Civil Appeal No.5443 of 2019 titled PTC India Financial Servics Ltd. v. Mr. Vemkateshwarlu Kari and Anr. having delivered by Hon'ble Supreme Court on 12.05.2022 setting aside the judgment of this Tribunal in PTC India Financial Services Ltd. Vs. Mr. Venkateshwaralu Kari and Mandava Holdings Pvt. Ltd., the very basis of reduction of the claim by RP ....
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....accordance with the question of law, specially the judgment of this Tribunal in PTC India Financial Services Ltd. (supra). It is submitted that reduction of the claimed amount was in accordance with existent law as was applicable at the relevant time. The Appellant has invoked the Pledged Shares on 17.06.2019 and perfected its title to the Pledged Shares by registering itself as beneficial owner in respect of the Pledged Shares in the record of the depository. Even on 10.09.2020, this Tribunal in India Power Corporation Ltd. v Meenakshi Energy Limited & Ors. once again affirmed the decision of PTC India on 19.09.2020. The Respondent No.1 informed the Appellant that the aggregate claim filed by the Appellant would be reduced to the extent Fair Market Value of the Shares of the Corporate Debtor acquired by the Appellant as on the date of invocation of the Pledge. Accordingly, Respondent No.1 reduced the claim of the Appellant by Rs.202.09 crores as per the Market Value of the Pledged Shares and the RP has acted in accordance with the Code. The Appellant having voted in favour of the Resolution Plan, is now estopped from challenging the approval of the Resolution Plan. 7. The learn....
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.... Management, Third parties, and to seek a direction to the respondent to cooperate in the proceedings." 11. We have heard learned Counsel for the Applicant in IA No.2720 of 2021, learned Counsel for Resolution Professional, learned Counsel for Successful Resolution Applicant and learned Counsel for CoC and have perused the records. 12. In I.A. No.2720 of 2020, learned Counsel for the Applicant has brought on record the order of the Hon'ble Supreme Court dated 15.09.2021 passed by the Hon'ble Supreme Court in Civil Appeal No.3290 of 2017 - Commissioner of Income Tax-5 vs. Jet Airways (India) Ltd. In the order dated 15.09.2021, the approval of Resolution Plan by Adjudicating Authority has been noticed by the Hon'ble Supreme Court. The Hon'ble Supreme Court directed that a copy of Resolution Plan be handed over to learned ASG and mater was listed for further directions. Subsequently, Hon'ble Supreme Court passed an order dated 16.11.2021 in the above Civil Appeal. It is useful to extract the entire order, which is to the following effect: "Learned Additional Solicitor General on the basis of the "Resolution Plan" handed over has placed before us some part of the relevan....
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....ant succeeds on merits in the appeals, it would be entitled to make appropriate recovery against the "Resulting company". He further submits that in any case, he has advised the department to approach the NCLAT as the objections to the "Resolution Plan" by one of the creditors is still pending consideration. In view of the aforesaid, we consider it appropriate to await the decision of the NCLAT before we bestow our consideration in appeals itself. List after the NCLAT decides that matter and liberty to the parties to mention for listing of the matters after the said decision. The "Resolution Plan" placed before us today in Court be kept in a sealed cover." 13. It is after order of the Hon'ble Supreme Court the I.A. No.2720 of 2021 has been filed on 02.12.2021. The learned Counsel for the Applicant has relied on paragraph 5 of the Resolution Plan, Clause 12 of which has been quoted by the Hon'ble Supreme Court in its order dated 16.11.2021. It is submitted that since the Resolution Plan itself contemplates and takes care of the any liability arising out of taxation proceedings against the Corporate Debtor, the Applicant is entitled to raise a c....
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.... filing in the proceedings has been filed and hence, at this stage there is no occasion to admit the claim, which is brought on record as Exhibit-C to the Application, in the CIRP of the Corporate Debtor. Now coming to Clause-12 of Part-V, on much reliance has been placed by learned Counsel for the Applicant, it is clear from the Resolution Plan brought on record that Clause-12 is part of Part-V of Scheme of Arrangement. The Scheme of Arrangement containing details of Part-VI of the Scheme as detailed in the Scheme of Arrangement is as follows: "SCHEME OF ARRANGEMENT BETWEEN JET AIRWAYS (INDIA) LIMITED (DEMERGED COMPANY OR CORPORATE DEBTOR) AND AIRJET GROUND SERVICES LIMITED (RESULTING COMPANY) The Scheme (more particularly defined below) is divided into the following parts: 1. Part I deals with Introduction, Rationale and Operation of the Scheme: 2. Part II deals with the Definitions and Share Capita; 3. Part III deals with demerger of the Demerged Undertaking of the Corporate Debtor into Resulting Company; 4. Part IV deals with the Accounting Treatment; 5. Part V deals with the General Clauses; and ....
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....aim admitted have been tabulated, which is to the following effect: "14. Pursuant to the initiation of the CIRP of the Corporate Debtor, the Appellant submitted the following claims with Respondent No.1. S. No. Date Claim amount Claim admitted Claim No.1 July 04, 2019 Rs.963.47 Crores Rs.963.47 Crores Claim No.2 August 02, 2019 Rs.956.11 Crores Rs.956.10 Crores Claim No.3 January 07, 2020 Rs.956.21 Crores Rs.956.21 Crores Claim No.4 September 22, 2020 Rs.994.16 Crores Rs.747.94 Crores (Note: Crores) 22. By email dated 23.08.2019, the Appellant has informed the RP that Appellant had only invoked the Pledged Shares and the said Shares had not been sold by the Appellant and no proceeds had been appropriated by the Appellant towards the debt due from the Corporate Debtor. The RP in its reply affidavit filed in this Appeal has categorically stated that reduction of the claim of the Appellant was on the basis of the judgment of this Tribunal in India Power Corporation Ltd. vs. Meenakshi Energy Ltd. (supra), in paragraphs 21 and 22 of the affidavit, the following has been stated: "21. On September 20, 2020 th....
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....ntire law on the subject, the Hon'ble Supreme Court has allowed the appeal and set aside the judgment of this Tribunal in PTC India Financial Services Ltd. In paragraph 105 of the judgment of the Hon'ble Supreme Court following law has been laid down: "105. In view of the aforesaid findings, it has to be held that registration of the pawn, that is the dematerialised shares, in favour of PIFSL as the 'beneficial owner' does not have the effect of sale of shares by the pawnee. The pledge has not been discharged or satisfied either in full or in part. PIFSL is not required to account for any sale proceeds which are to be applied to the debt on the 'actual sale'. The two options available to PIFSL as the pawnee under Section 176 of the Contract Act remain and are not exhausted." 25. In view of the law laid down by Hon'ble Supreme Court in PTC India Financial Services Ltd., the reason for reduction of the claim of the Appellant by RP is knocked out. The declaration of law by the Hon'ble Supreme Court has to be treated as law of the land at all relevant times including the date when claim was reduced by the RP. The law declared by the SC has to be given effect specially when ....