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2022 (4) TMI 1040 - AT - Insolvency and BankruptcyDirection to Resolution Professional (RP) to complete the process of voting on the resolution plan under consideration - HELD THAT - It is noted that the Adjudicating Authority vide impugned order dated 14.12.2021 recognised the fact that an application was filed by PNB regarding condoning delay in submission of proof of its claim as is evident in Para 7 (c) of the impugned order, and ordered that the CoC, as it existed on 14.12.2021, shall consider the resolution plan of Loka Properties Pvt. Ltd. There is sufficient reason for the Appellant/PNB to be aggrieved since it had prayed for a position in the CoC with a higher voting share and carrying out of voting without deciding its IA No. 1078/2021 affects its interest. Therefore, it is well within its right to assail the impugned order through the present appeal. A perusal of the impugned order makes it clear that the Adjudicating Authority first considered the application for liquidation filed by the RP on the ground that 270 days period of CIRP had expired on 12.04.2021 and that there was no consensus amongst the members of the CoC for taking further exclusion or extension of the CIRP period, and additionally a resolution plan was under consideration of the CoC vide Adjudicating Authority s order dated 27.10.2021, the application for liquidation was disposed of as not pressed . Thereafter, the Adjudicating Authority considered I.A. No. 922/KB/2021 filed by the one Loka Properties Pvt. Ltd., whose resolution plan was receiving consideration by the CoC, and proceeds to pass an order which can be seen in Paragraph 7(d) of the impugned order, whereby a total exclusion of 245 days has been given in the CIRP period. It is apparent that while certain yardsticks of natural justice and achievement of objective of IBC were being considered in relation to the application of Loka Properties Pvt. Ltd. and SBI regarding consideration of its proposed resolution plan and exclusion of time period from CIRP period, no such opportunity was given to the Appellant which had been pursuing the matter of its revised claim quite diligently. The delay in submission of proof of PNB s claim should be condoned - the RP is directed to consider the documents submitted by the Appellant/PNB as proof of its claim and revise its claim if the documents have merit - appeal allowed - decided in favor of appellant.
Issues Involved:
1. Whether the delay in submission of the proof of claim by Punjab National Bank (PNB) should be condoned. 2. Whether the Committee of Creditors (CoC) should reconsider the resolution plan after including PNB's claim. Detailed Analysis: Issue 1: Delay in Submission of Proof of Claim by PNB The appeal by PNB challenges the order dated 14.12.2021 by the Adjudicating Authority (National Company Law Tribunal, Kolkata Bench), which directed the Resolution Professional (RP) to complete the voting process on the resolution plan based on the CoC's composition as of 14.12.2021. PNB argued that its claim against the Corporate Debtor, M/s. Zenith Finesse India Private Limited, was not considered, which would have altered the CoC's composition and voting share. PNB initially filed its claim on 05.03.2020, which was rejected by the RP on 18.03.2021 for being late. PNB obtained an order on 08.04.2021 from the Adjudicating Authority condoning the delay. However, the RP rejected the proof of claim submitted on 20.04.2021, as the 270-day CIRP period had expired on 12.04.2021. PNB then filed I.A. No. 1078 of 2021 to direct the RP to verify its claim and include it in the CoC. The Tribunal noted that the Adjudicating Authority was aware of PNB's pending application but still directed the CoC to consider the resolution plan without deciding on PNB's application. The Tribunal found sufficient reason for PNB to be aggrieved, as its rightful position in the CoC was not considered, affecting its voting share. Issue 2: Reconsideration of the Resolution Plan by the CoC The Tribunal examined the prayers in I.A. No. 1078 of 2021, which sought the RP to accept PNB's claim by condoning the unintentional delay. The Tribunal noted that the RP had rejected PNB's claim due to the expiration of the 270-day CIRP period. However, the Adjudicating Authority had excluded a total of 245 days from the CIRP period for other reasons, including litigation and the second wave of COVID-19. The Tribunal found it surprising that while the Adjudicating Authority granted exclusions for other reasons, it did not consider PNB's application for condonation of delay. The Tribunal emphasized that natural justice principles and the objectives of the IBC should apply equally to all parties. The Tribunal concluded that the delay in PNB's submission should be condoned, especially given the Adjudicating Authority's exclusion of 245 days from the CIRP period. Conclusion and Directions The Tribunal condoned the delay in PNB's submission of proof of claim and directed the RP to consider the documents submitted by PNB. The RP was instructed to revise PNB's claim if the documents were found to be valid. This process was to be completed within 15 days. The CoC was then directed to consider the revised claim for payment through the resolution plan by the Successful Resolution Applicant. The entire exercise, including the consideration of PNB's documents, was to be completed within 45 days from the date of the judgment. The appeal was allowed, and the resolution plan would stand revised only concerning PNB's revised claim. There was no order as to costs.
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