2023 (8) TMI 618 - AT - Insolvency and Bankruptcy

Seeking rectification of error which is an inadvertent one - secured creditor of corporate debtor - HELD THAT - It must be borne in mind that the ambit of the Adjudicating Authority / Tribunal subsequent to the Approval of Resolution Plan is limited in character. That apart any relief sought which can alter the Terms Of a Resolution Plan cannot be acceded to as opined by this Tribunal However if any relief as prayed for by the Appellant/ Petitioner as projected in IA/361/IB/2020 in CP(IB)540/CHE/2017 (being the Correct Company Petition Number according to the Appellant instead of C.P.(IB)/889(CHE)/2019) is granted by the Adjudicating Authority / Tribunal or this Appellate Tribunal for that matter then the same will not satisfy the requirement of Law . This Tribunal pertinently points out that even the Hon ble Supreme Court had Approved the Resolution Plan through its Order dated 28/02/2020 (which is not in dispute) and the same is accepted by the Learned Counsels appearing for the respective Parties. Suffice it for this Tribunal to succinctly point out that in one of the Miscellaneous Applications dated 03/07/2019 filed before the Adjudicating Authority / Tribunal the Appellant / Petitioner had tacitly admitted its position as an Unsecured Financial Creditor . This Tribunal bearing in mind the attendant facts and circumstances of the instant case in a conspectus and holistic manner comes to a consequent conclusion that the Impugned Order does not suffer from any material irregularity or patent illegality in the eye of Law . Accordingly the Appeal sans merits. Appeal dismissed.

Summary

Issues involved:
The issues involved in this case include the categorization of the appellant as an 'Unsecured Creditor', the relief sought by the appellant to be recognized as a 'Secured Financial Creditor', the approval and implementation of the Resolution Plan, and the legal infirmities in the Impugned Order.

Background:
The Appellant filed Company Appeal (AT) (CH) (Ins) No. 251/2023 challenging the Impugned Order dated 12/05/2023 in IA/361/IB/2020 in C.P.(IB)/540(CHE)/2017 before the National Company Law Tribunal, Division Bench - II, Chennai. The Adjudicating Authority dismissed the Appellant's application seeking intervention without costs.

Prelude:
The correct Company Petition number is C.P.(IB)/540/(CHE)/2017, not C.P.(IB)/IB/889/(CHE)/2019 as mentioned in the Impugned Order. The Appellant's Counsel pointed out the error and sought rectification.

Appellant's Pleas:
The Appellant sought a declaration as a 'Secured Creditor' and requested that any allocation of funds under a Resolution Plan recognize its status as a 'Secured Financial Creditor'. The Appellant argued that the application's dismissal suffered from serious legal infirmities.

Respondent's stance:
The Respondent contended that the Appellant was categorized as an 'Unsecured Financial Creditor' during the Corporate Insolvency Resolution Process. The Committee of Creditors approved the Resolution Plan, resulting in a change in control and ownership of the Corporate Debtor.

Pros & Cons:
The Adjudicating Authority's jurisdiction post-Approval of Resolution Plan is limited. Any relief altering the terms of a Resolution Plan cannot be granted. The Tribunal noted the Supreme Court's approval of the Resolution Plan and the Appellant's admission as an 'Unsecured Financial Creditor'.

Result:
After considering the facts and circumstances, the Tribunal concluded that the Impugned Order did not have material irregularity or patent illegality. The Company Appeal (AT) (CH) (Ins) No. 251/2023 was dismissed with no costs.