2019 (3) TMI 1691 - Tri - Insolvency and Bankruptcy

Prayer for direction to the IRP/RP to consider and admit its claim by including it in the list of the Operation Creditor of the Corporate Debtor - rejection of prayer on the ground that the claim has been filed belatedly - HELD THAT - It is true that the regulation 12(2) after amendment has granted liberty to a creditor who has failed to submit the claim with the proof within the time stipulated in the public announcement and such a claimant could submit the claim with proof to the IRP/ RP on or before 90th day of Insolvency commencement date. The aforesaid time obviously has expired as the CIR Process and in the present matter was commenced on 16.03.2018 and the claim were initially invited by fixing the last date as 30.03.2018. It is no where stated as to how the claims which are to be filed alone are to be collated in terms of Section 21. First of all, as a matter of fact as the first step the IRP/RP has to prepare the list in accordance with the books of accounts and then invite the claims otherwise the dues reflected in the books of accounts would be rendered completely meaningless - It is only in case there is any discrepancy in the books of accounts that the claim needs to be modified or additions are required to be made. The IRP/RP are directed to collate the claim of the Central Board of Goods and Service Tax the needful shall be done within three days - application allowed.

Summary

Issues involved:
- Timeliness of claim submission by the Central Board of Goods and Service Tax Department in insolvency proceedings.

Analysis:
The Central Board of Goods and Service Tax Department filed an application seeking direction for the inclusion of its claim as an Operational Creditor of the Corporate Debtor. The claim was initially rejected due to being filed beyond the stipulated timelines under the Insolvency and Bankruptcy Code 2016. The Tribunal referred to relevant provisions of the Code, emphasizing the duty of the Resolution Professional to call for claim submissions from creditors through a public announcement with specified deadlines. The last date for claim submission was determined based on the appointment of the Interim Resolution Professional and the subsequent public announcement, as outlined in the Insolvency and Bankruptcy Board of India Regulations.

The Tribunal highlighted the importance of adhering to the specified timelines for claim submission, noting that any delays could result in rejection under the Code and related regulations. It was observed that the Central Board's claim was filed well after the prescribed deadlines, rendering it ineligible for consideration. However, a crucial amendment to Regulation 12(2) allowed creditors to submit claims with proof until the approval of a resolution plan by the committee of creditors. In this case, the resolution plan was approved post the deadline for claim submission, raising questions about the validity of the rejection based on timeliness.

In a significant decision, the Tribunal acknowledged the necessity of accurately collating claims in alignment with the Corporate Debtor's accounts to ensure completeness and accuracy. It directed the Resolution Professional to include the Central Board's claim within three days, highlighting the importance of reconciling filed claims with the Corporate Debtor's financial records. This ruling emphasized the need for procedural adherence while also recognizing the practical implications of claim submission timelines in insolvency proceedings.

Therefore, the Tribunal's decision to allow the application and instruct the Resolution Professional to incorporate the Central Board's claim underscored the balance between regulatory compliance and practical considerations in insolvency resolution processes. The judgment served as a reminder of the critical role of accurate claim submission timelines and the need for meticulous claim collation procedures to facilitate fair and efficient insolvency proceedings.