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2022 (1) TMI 65 - Tri - Insolvency and BankruptcySeeking extinguishment of all the disputed and undisputed claims against the Applicant relating to the period prior to the effective date i.e. 20.09.2018 in terms of the approved Resolution Plan in respect to the tea gardens mentioned therein - HELD THAT - The Hon ble Supreme Court of India in the matter of Committee of Creditors of Essar Steel India Ltd. Vs. Satish Kumar Gupta Ors. 2019 (11) TMI 731 - SUPREME COURT upheld the constitutional validity of the Insolvency and Bankruptcy Code (Amendment) Act, 2019 has held that (d) A successful Resolution Applicant cannot suddenly be faced with undecided claims after the Resolution Plan submitted by him has been accepted as this would amount to a hydra head popping up which would throw into uncertainty amounts payable by the successful resolution applicant and (e) All claims must be submitted to and decided by the Resolution Professional so that a prospective resolution applicant knows exactly what has to be paid in order that it may then take over and run the business of the CD . The prayer made by the Applicant is allowed and the demand of the Respondent for the period prior to 20.09.2018 for ₹ 30,25,057.00 (Rupees Thirty lacs Twenty Five thousand Fifty Seven) only raised in respect of six tea gardens of the Applicant is hereby extinguished and claim, if any, is filed now or in future relating to the period prior to 20th September, 2018 need not be entertained by the Resolution Applicant / Corporate Debtor - Application disposed off.
Issues Involved:
1. Extinguishment of demands prior to 20.09.2018. 2. Compliance with the approved Resolution Plan. 3. Validity of claims not filed during the CIRP. 4. Implementation of the Supreme Court's judgment in the Essar Steel case. Issue-wise Detailed Analysis: 1. Extinguishment of demands prior to 20.09.2018: The Applicant, Assam Company India Ltd., requested the extinguishment of demands amounting to ?30,25,057.00 raised in respect of six tea gardens prior to 20.09.2018. The Tribunal noted that the approved Resolution Plan explicitly stated that any claims or demands prior to the effective date (20.09.2018) would stand extinguished. The Tribunal further emphasized that the Respondents had failed to file their claims during the Corporate Insolvency Resolution Process (CIRP), thus any demands for periods before the effective date should be extinguished. 2. Compliance with the approved Resolution Plan: The Tribunal highlighted that the Resolution Plan approved by the Committee of Creditors (COC) and subsequently by the Tribunal on 20.09.2018 included a clause that all claims relating to the period before the effective date would be deemed settled. The Applicant had already infused ?1,064 crores and settled claims as per the approved plan, including ?18.93 crores to Operational Creditors. The Tribunal reiterated that the terms of the Resolution Plan must be strictly adhered to, and any claims not included in the plan should be considered settled. 3. Validity of claims not filed during the CIRP: The Tribunal observed that the Respondents did not file their claims with the Interim Resolution Professional (IRP) during the CIRP. The Supreme Court's judgment in the Essar Steel case was cited, which held that a successful Resolution Applicant cannot be faced with undecided claims post-approval of the Resolution Plan. The Tribunal affirmed that any claims not filed during the CIRP should not be entertained, aligning with the Supreme Court's directive to ensure certainty for the Resolution Applicant. 4. Implementation of the Supreme Court's judgment in the Essar Steel case: The Tribunal referenced the Supreme Court's judgment in the Essar Steel case, which emphasized that all claims must be submitted to and decided by the Resolution Professional to avoid uncertainty for the Resolution Applicant. The Tribunal concluded that the Respondents had failed to adhere to this principle by raising demands post-approval of the Resolution Plan. Consequently, the Tribunal allowed the Applicant's prayer to extinguish the demands for the period prior to 20.09.2018. Order: The Tribunal allowed the Applicant's prayer, extinguishing the demand of ?30,25,057.00 for the period prior to 20.09.2018. The Tribunal directed that: 1. The company can operate its bank account without obstructions from the Respondent. 2. The Resolution Applicant must strictly implement the approved Resolution Plan. 3. The Petitioner must file a compliance report within 15 days detailing statutory dues paid from the approval date of the Resolution Plan. 4. The Monitoring and Supervising Committee must submit a status report on the implementation of the Resolution Plan within 21 days. The IA (IBC) No.38/GB/2021 was disposed of with these observations and directions.
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