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2022 (3) TMI 1430 - AT - Insolvency and BankruptcySeeking inclusion of additional, belated and unverified claim in the Resolution Plan of the Corporate Debtor - bone of contention between the Appellant and the Resolution Professional and Respondent No. 1 is the amount of Rs. 3,14,81,158/- allowed as CIRP costs by the Adjudicating Authority through the impugned order dated 02nd September, 2021 without verification of costs and other details by Resolution Professional or without recommendation of CoC even seems without any scrutiny by the Adjudicating Authority. HELD THAT - The Resolution Professional is to provide for essential supplies which means electricity, water, telecommunication service, and information technology services are to be considered in CIRP cost and as far as other costs are concerned it is be approved by the CoC. Furthermore, the lease schedule working as appearing at Annexure I page 7 of the written submission of the Resolution Professional, the rental start date of the first leased equipment was from 10th June, 2015 to 09th June, 2017 and for the last 23rd equipment, the rental start date was 01st July, 2016 and last rental date was 30th June, 2020. So the term of the lease deed has already expired by June, 2020 prior to public announcement which was made on 13th August, 2020 asking the creditors to submit their claims and the Respondent No. 1 has already submitted its claim 13th January, 2021 of Rs. 1.05 Crore approx., which included Rs. 11 lacs approx. towards lease rental dues and claim towards Fair Market Value - Rs. 43.54 lacs. The Resolution Professional has already considered Rs. 95 lac in total out of Rs. 1.05 Crore. Thus, we are not in a position to accept even the claim towards extension rental of Rs. 2.71 Crore. There are the Appeal and the Appeal deserves to be allowed - appeal allowed.
Issues Involved:
1. Inclusion of additional, belated, and unverified claims in the Resolution Plan. 2. Verification and adjudication of claims by the Resolution Professional (RP). 3. Admissibility of claims filed after the stipulated period. 4. Classification of claims as Corporate Insolvency Resolution Process (CIRP) costs. 5. Jurisdiction and powers of the Adjudicating Authority under the Insolvency and Bankruptcy Code (IBC). Detailed Analysis: 1. Inclusion of Additional, Belated, and Unverified Claims in the Resolution Plan: The Appellant, the Resolution Professional (RP) of the Corporate Debtor (CD), contested the inclusion of an additional claim of Rs. 3,14,81,158/- by Respondent No. 1 (R1) in the Resolution Plan. The Adjudicating Authority directed the RP, Committee of Creditors (CoC), and the Resolution Applicant to include this claim, which was submitted belatedly and without verification. The RP argued that the claim was time-barred and not admissible within the framework of the IBC and related regulations. 2. Verification and Adjudication of Claims by the Resolution Professional (RP): The RP emphasized the necessity of verifying claims on merits, as per the provisions of the IBC and CIRP Regulations. The RP found the additional claim of Rs. 3,14,81,158/- inadmissible based on various reasons, including discrepancies in the claim form and lack of supporting invoices. The RP argued that the claim was not verified or ratified by the CoC and was not adjudicated by the Adjudicating Authority, making it untenable. 3. Admissibility of Claims Filed After the Stipulated Period: The RP highlighted that the claim by R1 was filed after the 90-day period stipulated in CIRP Regulations, which expired on 09.11.2020. The Adjudicating Authority's acceptance of this belated claim was challenged, citing that the outer limit for filing claims is 90 days from the insolvency commencement date, as per Regulation 12(2) of the CIRP Regulations. The RP argued that condoning such delays would nullify the amendment made to Regulation 12(2). 4. Classification of Claims as Corporate Insolvency Resolution Process (CIRP) Costs: The Adjudicating Authority allowed Rs. 3,14,81,158/- as CIRP costs, claiming it was incurred for running the business of the CD during the CIRP period. However, the RP contested this classification, arguing that the claim was not verified or approved by the CoC and did not fall under the definition of CIRP costs as per Section 5(13) of the IBC. The RP also pointed out that the lease term had expired, and no revenue was earned from the leased equipment during the CIRP process. 5. Jurisdiction and Powers of the Adjudicating Authority under the Insolvency and Bankruptcy Code (IBC): The RP argued that the Adjudicating Authority overstepped its jurisdiction by directing the inclusion of the unverified claim without adhering to the procedural requirements of the IBC. The RP cited various judgments to support the position that the Adjudicating Authority should not interfere with the commercial wisdom of the CoC and should operate within the framework of the IBC. Conclusion: The Tribunal found merit in the Appeal, noting that the Adjudicating Authority's order to include the belated and unverified claim was erroneous. The Tribunal emphasized the importance of adhering to the stipulated timelines and procedural requirements under the IBC. The Tribunal set aside the order of the Adjudicating Authority, allowing the Appeal and highlighting that the Resolution Professional had substantially complied with the requirements of the IBC in verifying and admitting claims.
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