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TMI Blog2024 (4) TMI 305X X X X Extracts X X X X X X X X Extracts X X X X ..... ept in escrow account cannot be accepted. The order dated 30.11.2023 cannot be read to mean that amount of Rs.132,82,52,568/- has to be kept in escrow account. Hon ble Supreme Court in COMMITTEE OF CREDITORS OF ESSAR STEEL INDIA LIMITED THROUGH AUTHORISED SIGNATORY VERSUS SATISH KUMAR GUPTA OTHERS [ 2019 (11) TMI 731 - SUPREME COURT] has held that allocation of plan value to different category of creditors can be different. It was held that Operational Creditor has to be given priority of payment above all Financial Creditors. It is also relevant to notice that commercial wisdom of the CoC in approving Resolution Plan has to be given paramount importance and NCLT and this Appellate Tribunal can interfere in the order approving the Resolution Plan only when there is violation of statutory provisions of Section 30(2) of the Code. Present is not a case where violation of any statutory provision under Section 30(2) of the Code has been alleged by the Appellant. Appellant s claim was accepted as Other Creditor and in the allocation of amount of Rs.1 Lakh against the claim of the Appellant it is not shown that there is any violation of any statutory provision. There are no ground to inte ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d. (i) Appellant filed its claim in Form C on 25.02.2022 followed by Form F, both were rejected by the Resolution Professional vide communications dated 16.03.2022 and 01.06.2022 on the ground the Corporate Debtor has filed objections to the partial award and the final award before the Delhi High Court. (ii) Appellant has also filed I.A. (IB) No.1271/KB/2022 before the Adjudicating Authority seeking direction to the Resolution Professional to reject the claim made by Yes Bank to the tune of Rs.370,36,10,306/-. (iii) An I.A. (IB) No.1131/KB/2022 was filed by the Appellant challenging the communications sent by the Resolution Professional vis- -vis the Appellant s claim which application was partly allowed by the Adjudicating Authority vide order dated 30.11.2023. The Adjudicating Authority although held that the Appellant is not a Financial Creditor but directed setting aside the order of the Resolution Professional rejecting entire claim of the Appellant of Rs.132 Crore. (iv) Appellant wrote to the Resolution Professional on 07.12.2023 and thereafter to adhere to the direction issued by the Adjudicating Authority on 30.11.2023. (v) On 04.01.2024, the Adjudicating Authority approved ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion Professional has referred to clause 7.10.1 and clause 7.10.2 of the Resolution Plan. It is submitted that the plan has been approved by the CoC in its commercial wisdom, which needs no interference by this Appellate Tribunal. It is submitted that the Appellant is 35% shareholder i.e. related party of the Corporate Debtor, hence, its claim could be treated differently from non-related parties. 4. Learned counsel appearing for the Successful Resolution Applicant also refuting the submissions of the Appellant submits that the Adjudicating Authority vide order dated 30.11.2023 accepted the claim of the Appellant as Other Creditor and the decision of the Resolution Professional was upheld. It is submitted that the order dated 30.11.2023 has been wrongly interpreted by the Appellant. The Resolution Plan considered the claim of the Appellant in Para 7.10.1 and 7.10.2. The plan provides assured financial proposal to the Appellant s contingent claim by providing payment of Rs.1 Lakh as final payment. 5. Learned counsel appearing for the CoC also supported the submission of learned counsel for the Resolution Professional and submitted that the Resolution Plan having been approved by the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in the plan would be paid subject to the outcome of the execution petition pending before the Hon'ble Delhi High Court and till such time amounts could be held in escrow account. 42. In case the Applicant fails in his execution petition, the amount held in the escrow account can be redistributed as per the Commercial wisdom of CoC. The provision in the plan against the claim made by the Applicant may be made based on the commercial wisdom of CoC but to be made on fair and equitable basis keeping in mind, that one of the objectives of IBC is to balance the interests of all the stakeholders. 43. In view of above this application being I.A. (IB) 1131/KB/2022 filed by Rishima SA Investments LLC (Mauritius). Applicant herein is partly allowed and disposed of in terms of the directions above. 10. One of the issue which has arisen for consideration is as to what is the import of order dated 30.11.2023, whether the entire amount of claim of Rs.132,89,52,568/- was to be kept in escrow account or only the amount provided in the plan against the admitted claim has to be kept in the escrow account. 11. When we look into Para 41 and 42 of the order, it is clear that what was intended by th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... By reading para 77 (of Swiss Ribbons) dehors the earlier paragraphs, the Appellate Tribunal has fallen into grave error. Para 76 clearly refers to the UNCITRAL Legislative Guide which makes it clear beyond any doubt that equitable treatment is only of similarly situated creditors. This being so, the observation in para 77 cannot be read to mean that financial and operational creditors must be paid the same amounts in any resolution plan before it can pass muster. On the contrary, para 77 itself makes it clear that there is a difference in payment of the debts of financial and operational creditors, operational creditors having to receive a minimum payment, being not less than liquidation value, which does not apply to financial creditors. The amended Regulation 38 set out in para 77 again does not lead to the conclusion that financial and operational creditors, or secured and unsecured creditors, must be paid the same amounts, percentage wise, under the resolution plan before it can pass muster. Fair and equitable dealing of operational creditors' rights under the said regulation involves the resolution plan stating as to how it has dealt with the interests of operational credi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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