2018 (6) TMI 680 - AT - Insolvency and Bankruptcy

Corporate Insolvency Resolution Process - appellants had failed to file their respective claim within the prescribed period - Held that - In spite of receipt of their claim much beyond the period prescribed under the I & B Code, the Resolution Plan has taken care of the claim of the appellants, we are not inclined to interfere with the order passed by the Adjudicating Authority. In a particular case, what should be the percentage of claim amount payable to one or other Financial Creditor or Operational Creditor or Secured Creditor or Unsecured Creditor can be decided by the Committee of Creditors based on facts and circumstances of each case. In absence of any discrimination or perverse decision, it is not open to the Adjudicating Authority or this Appellate Tribunal to modify the plan. We find no merit in the appeal. They are dismissed Insofar the winding up proceedings or other litigations pending before any Court of law, we are not expressing any opinion as the Court of competent jurisdiction will decide the same

Summary

Issues:
Appeal against approval of Resolution Plan by Adjudicating Authority.

Analysis:
The appeals were filed against the order approving the Resolution Plan by the Adjudicating Authority. The appellants argued that the plan did not address their total outstanding dues adequately. Specifically, they highlighted that only 5% of the principal amount was allowed in their favor. One of the appellants had initiated winding up proceedings, while the Corporate Applicant had filed under Section 10, which was admitted during the process.

The 1st respondent, the Corporate Debtor, contended that the appellants failed to file their claims within the prescribed period. Despite this, the claims were considered in the Resolution Plan based on the Corporate Debtor's books of accounts.

Regarding Darshak Enterprise Private Limited, the respondent stated that even though the claim was not received before the approval of the plan by the CoC, the Resolution Professional accounted for the dues from the Corporate Debtor's books. The plan settled the outstanding dues at 5% of the total within thirty days of approval, and the appellant received the amount as per the plan.

For Symphony Limited, the respondent argued that the claim was considered from the Corporate Debtor's books, and the Resolution Plan addressed contingent operational dues subject to litigation. The plan acknowledged the disputed claims and pending legal proceedings, categorizing the claims as contingent, to be paid upon adjudication.

The Tribunal found that despite the delayed claims, the Resolution Plan adequately addressed the appellants' dues. It was emphasized that the Committee of Creditors determines the percentage of claim payable to each creditor based on individual circumstances. In the absence of discrimination or a perverse decision, the Tribunal held that neither the Adjudicating Authority nor the Appellate Tribunal could modify the plan.

Ultimately, the appeals were dismissed, and no opinion was expressed on winding up proceedings or other litigations pending before the courts, leaving such decisions to the competent jurisdiction without imposing any costs.