2021 (5) TMI 309 - Tri - IBC

Condonation of delay in submitting the claim before the Liquidator - direction to Liquidator to accept the claim of the Appellant and grant such other further orders which are deemed fit - HELD THAT - It is to be noted here that the provisions of IBC, 2016 mandate that the Claimants are required to submit the claim to the Liquidator in such form and in such manner along with such supporting documents as specified by the Board. Thereafter, upon submission of the claim, the Liquidator is required to verify the claims within the time limits specified by the Board and in this connection referring to the relevant Regulations namely, IBBI (Liquidation Process) Regulations, 2016 and more specifically under Regulation 30, the Liquidator is required to verify the claim submitted within a period of 30 days from the last date of receipt of the claims and may either admit or reject in whole or part as the case may be of such claim. Section 40 of the I B Code, 2016 mandates the Liquidator to record the reason in writing for rejection of the claim and the same is also required to be communicated to the Applicant. It may also be seen that the Applicants during the CIRP period also has not preferred to file a claim before the IRP/RP and as per the provisions of IBC, 2016 the Applicant ought to have filed the claim before the Liquidator at least after the commencement of the Liquidation proceedings, immediately after the public announcement was made of, which the Applicant is very much aware of. The Hon'ble Supreme Court in Gaurav Hargovindbhai Dave -Vs- Asset Reconstruction Company (I) Ltd. Another 2019 (9) TMI 1019 - SUPREME COURT , in relation to the aspect of limitation has restated the well established and well settled principle that there is no equity about limitation , this Application cannot be entertained. In view of the IBC, 2016 being a time bound process as well as the Learned Liquidator being under a compulsion to complete the liquidation process within a period of one year from the date of commencement of liquidation, the application stands dismissed.

Summary

Issues:
- Condonation of delay in submitting claim before Liquidator under Section 42 of IBC, 2016.
- Rejection of claim by Liquidator on grounds of delay and lack of reflection in Corporate Debtor's books.
- Legal provisions regarding claim submission, verification, rejection, and appeal.
- Failure to submit claim during Corporate Insolvency Resolution Process and Liquidation proceedings.
- Precedents and legal principles related to time-bound liquidation process and limitation.

Analysis:
1. Condonation of Delay: The Applicant filed an urgent Application seeking early hearing of an Application under Section 42 of IBC, 2016 for condonation of delay in submitting the claim before the Liquidator. The Tribunal noted the lack of specific details regarding the number of days of delay, emphasizing the need for a clear explanation for each day of delay as per limitation laws.

2. Rejection of Claim: The Applicant, representing multiple claimants, sought relief for delay in submitting claims before the Liquidator. The Liquidator rejected the claims, citing both delay and lack of reflection in the Corporate Debtor's books. The Liquidator's submissions highlighted discrepancies in the records regarding the claimed amounts and fixed deposits.

3. Legal Provisions: The judgment elaborated on the legal requirements for claim submission, verification, rejection, and appeal under IBC, 2016. It emphasized the importance of timely claim submission, the Liquidator's obligations to verify claims, and the rights of creditors to appeal decisions within specified timeframes.

4. Failure to Submit Claims: The Tribunal criticized the Applicant for failing to submit claims during the Corporate Insolvency Resolution Process and even after the commencement of Liquidation proceedings, despite being aware of the process. The judgment highlighted the importance of timely action by creditors in insolvency proceedings.

5. Precedents and Principles: Citing legal precedents and principles, the Tribunal emphasized the time-bound nature of the liquidation process under IBC, 2016. Referring to relevant regulations and court decisions, the judgment highlighted the accountability of the Liquidator to conclude proceedings within a year and dismissed the Application based on the principle that there is "no equity about limitation."

In conclusion, the Tribunal dismissed the Application seeking condonation of delay in claim submission, emphasizing the time-bound nature of the liquidation process and the need for strict adherence to limitation laws and procedural requirements under IBC, 2016.