2019 (4) TMI 1011 - Tri - Insolvency and Bankruptcy

Maintainability of application - time limitation - claims has been filed after efflux of more than six months from the date of the approval of the Resolution Plan - HELD THAT - It is trite that once Resolution Plan is approved, it is deemed as all claims pending against the Corporate Debtor are settled by way of Resolution Plan whereby further claims cannot be entertained against the Corporate Debtor running under management of Resolution Applicant - thus application is belatedly filed when cause of action is no more sustainable against this Corporate Debtor which has already undergone restructuring through Resolution Plan approved by this Bench. The application is hereby dismissed as misconceived.

Summary

Issues:
- Rejection of claims by Resolution Professional during CIRP period
- Timeliness of filing application after approval of Resolution Plan
- Special treatment for claims made during CIRP period

Analysis:
1. The judgment pertains to an application filed by the Applicants stating that their claims, related to supplying scrap to the Corporate Debtor during the CIRP period, were rejected by the Resolution Professional (RP) citing non-placement before the RP as per IBBI Regulations.

2. The RP argued that the Resolution Plan had been approved earlier than the filing of this application, making it untimely after more than six months from the approval date, suggesting that all claims against the Corporate Debtor are settled post-approval of the Resolution Plan.

3. The Tribunal emphasized that once a Resolution Plan is approved, all pending claims against the Corporate Debtor are considered resolved through the Plan, and no further claims can be entertained against the Corporate Debtor under the Resolution Applicant's management.

4. It was noted that the Applicants failed to promptly challenge the rejection of their claims and instead attempted to acquire the corporate debtor through a Resolution Plan, which was rejected. Subsequently, they filed this application at a later stage, which was viewed as an attempt to circumvent the ongoing Resolution Plan.

5. The Tribunal concluded that the application was belatedly filed, rendering the cause of action unsustainable against the Corporate Debtor, which had already undergone restructuring via the approved Resolution Plan, and thus dismissed the application as misconceived.

6. During the proceedings, the Applicants' counsel argued for special treatment of their claim due to the supply being made during the CIRP period. However, the RP contended that the Applicants were, in fact, debtors to the Corporate Debtor, and the CoC had determined that the Applicants had acted in concert with the promoters, leading to the rejection of their claims.

7. Given that the Resolution Plan had addressed the grievances of the Applicants, and the claims were filed post the Plan's approval, the Tribunal concurred with the RP's argument, affirming that the Applicants could not challenge the approved Resolution Plan at that stage, resulting in the dismissal of the application.