2019 (5) TMI 1668 - Tri - Insolvency and Bankruptcy

Admissibility of application - time limitation - Corporate Insolvency Resolution Process is over - HELD THAT - There is no resolution plan and 270 days of the CIR process are already over, this application merits consideration. An application has been filed by one of the Members of the COC. The grievance of the applicant is that their claim has not been properly adjudicated. Out of a claim of more than ₹ 45 lakhs, only an amount of ₹ 2 lakhs has been admitted - Notice of this application is accepted by the Ld. Counsel appearing for the RP. List all applications for further consideration on 14th May, 2019.

Summary

Issues involved:
1. Jurisdiction of the tribunal to address employee salary distribution issue.
2. Filing of application under Section 33 of the Code due to lack of resolution plan.
3. Grievance of a COC member regarding claim adjudication.
4. Forfeiture of bank guarantee of a prospective Resolution Applicant.

Analysis:

1. The tribunal, in this judgment, addressed the issue of jurisdiction concerning the distribution of employee salaries. The Union of India proposed salary distribution for employees, but the budgetary allocation was not sanctioned, leaving employees unpaid for several months. The tribunal noted its lack of jurisdiction to redress the employees' grievances, especially in the context of the ongoing liquidation proceedings, directing the employees to seek remedy from another forum.

2. The judgment also discussed the filing of an application under Section 33 of the Code due to the absence of a resolution plan and the expiration of 270 days in the Corporate Insolvency Resolution (CIR) process. The Committee of Creditors (COC) directed the Resolution Professional (RP) to file the application, considering the absence of any resolution plan and the financial figures involved, leading to the recommendation of the RP as the liquidator.

3. Another issue addressed in the judgment was the grievance raised by a member of the COC regarding claim adjudication. The member's claim of over ?45 lakhs had only ?2 lakhs admitted, prompting the tribunal to accept the notice of the application and instructing the RP to investigate the matter further.

4. Lastly, the judgment discussed the forfeiture of a bank guarantee of a prospective Resolution Applicant who failed to submit a resolution plan. The COC decided to forfeit the bank guarantee, and the tribunal noted the filing of a reply to this application, along with the pendency of another related application for disposal at a later date.

In conclusion, the tribunal's judgment delved into various issues, including jurisdictional limitations, application filings under the insolvency code, claim adjudication grievances, and consequences for prospective Resolution Applicants, providing detailed analysis and directions for further consideration of the pending applications.