9911796707
|
Home
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2019 (9) TMI 1026 - AT - Insolvency and BankruptcyMaintainability of appeal - initiation of CIRP - pre-existing dispute - Section 9 of Insolvency and Bankruptcy Code, 2016 - HELD THAT - Under Section 18, the IRP is required to receive and collate all the claims submitted by the Creditors. This is not a process of sitting and deciding disputed claims. For collating, the IRP has to receive the claim and examine the same. While examining, the IRP did not find that the claim was made out with support of appropriate documents. As such, the IRP may not have considered the claim and the Adjudicating Authority has looked into it and did not find anything wrong with the act of collating done by IRP. CIRP process cannot be converted into adjudication Forum to settle claims already in disputes in Court. In the circumstances, we do not find any reason to interfere with the Order which has been passed. The Suit of the Appellant is already pending. Once the Moratorium period is over, the Appellant would be free to pursue its suit. Appeal not admitted and is dismissed.
Issues:
Operational Creditor wanting to hold up pending CIRP process due to pre-existing dispute. Analysis: The judgment involves the case of an Operational Creditor seeking to disrupt the Corporate Insolvency Resolution Process (CIRP) under Section 9 of the Insolvency and Bankruptcy Code, 2016, due to a pre-existing dispute. The Appellant, claiming to have provided services to the Corporate Debtor between 2005-06 & 2008-09, moved the Insolvency Resolution Professional (IRP) with a claim of over ?17 crores. However, the IRP did not accept the claim as it lacked supporting documents. Subsequently, the Appellant approached the Adjudicating Authority, seeking to admit the claim, conduct a forensic audit, and halt the CIRP process. The Adjudicating Authority, after evaluating the case, noted that the Appellant had previously filed a winding-up petition against the Corporate Debtor, which was unsuccessful due to lack of substantiated claims and doubtful business transactions. The High Court, in its judgment, found the defense raised by the Corporate Debtor to be bona fide and likely to succeed in a Civil Court. The Appellant was directed to pursue the matter in the Civil Court, where a suit had been filed and was still pending. The Appellant argued that an attachment order in the suit indicated a strong case, but the Adjudicating Authority did not find merit in the claim as it lacked substantial documentary evidence. The National Company Law Tribunal (NCLT) also observed discrepancies in the varying claim amounts presented by the Appellant in different legal proceedings. Under Section 18, the IRP's role is to receive and collate creditor claims, not to adjudicate disputed claims. The IRP's decision not to accept the claim due to insufficient documentation was upheld by the Adjudicating Authority. The judgment emphasizes that the CIRP process should not be used as an adjudication forum for settling disputed claims already under legal scrutiny. The Appellate Tribunal, therefore, dismissed the appeal without admitting it, stating that the Appellant could pursue the suit once the moratorium period ended. No costs were awarded in the judgment.
|
