Slipco Construction Pvt. Ltd. Versus Shri Abhijit Guhathakurta Liquidator of EPC Constructions India Limited
COMPANY APPEAL NO.20/2023 In CP(IB)No.1832/MB/C-II/2017
Facts:
1.EPC Constructions Ltd (“Corporate Debtor”) issued a work order dated 17.03.2012 in favour of the Appellant for construction of annular colums of air-cooled condenser unit at one of plant area for a contract value of Rs.48717304/- valid from 01.03.2012 to 31.03.2013. Before completion of the above contract, dispute arose between the parties which resulted in termination of the contract on 12.02.2013.
2.A reference for Arbitration u/s.18(3) of the Micro, Small and Medium Enterprises Development Act, 2006 and then to Delhi International Arbitration Centre, Delhi High Court, resulting in passing of an award dated 06.03.2018 by the Sole Arbitrator in favour of the Appellant. The said award was presented before the competent court for execution on 14.08.2018 as per the Arbitration & Conciliation Act, 1996.
3.A Company Petition filed by IDBI Bank Ltd under Section 7 of the Code against the Corporate Debtor, the Adjudicating Authority vide its order dated 20.04.2018 admitted the petition, initiated Corporate Insolvency Resolution Process (CIRP). On 26.04.2018, the IRP issued public announcement inviting claims to be filed against the Corporate Debtor. On 10.05.2018, the Appellant filed its claim against the Corporate Debtor and the same was admitted to the tune of Rs.1,06,91,881/-.
4.The claim of appellant was admitted as Operational Debt vide RP’s mail dated 17.08.2018, the Appellant raised an objection vide e-mail dated 04.09.2018 stating that the Appellant herein should not have been treated as an Operational Creditor in view of the final award dated 06.03.2018 passed in favor of the Appellant.
5.On 10.01.2019, the CoC approved a Resolution Plan of Royale Partners Investment Fund which was then approved by the Adjudicating Authority vide its order dated 25.11.2019. However, Royale Partners Investment Fund failed to implement the approved Resolution Plan which resulted in liquidation.
6.On 19.05.2021, the Liquidator made public announcement for submission of claims with 17.06.2021 as the last date for submission of the claim. On 27.05.2021, the Appellant filed a claim for Rs.1,06,00,000/- with the Liquidator. The claim was rejected by the Liquidator and as per the modified list of stakeholders as on 29.11.2021, it was rejected stating that the amount claimed by the OC is in excess of balance as per books of accounts of Corporate Debtor.
7.The Liquidator in his affidavit-in reply stated that the Liquidator vide his e-mail dated 27.05.2023 cautioned the Appellant that claims were to be submitted as per the appropriate format, the Liquidator vide his mail dated 24.07.2021 rejected the claim made by the Appellant on the ground that the claim submitted by the Appellant was not as per the appropriate format. against this rejection the appeal has been filed.
Issue: Whether claim can be admitted ?
Arguments:
Appellant:
1.Counsel submitted that as the claim of the Appellant was accepted by the RP, the Liquidator has no power to reject the claim of the Appellant. In support of the above, the Appellant cited the order of the Hon’ble NCLAT in Vijay Kumar Gupta v Canara Bank
Liquidator:
1.Counsel for the Liquidator has submitted that the Appellant failed to submit the claim in accordance with the forms and the manner specified by Section 38(3) of the Code and Regulation 17 of the Insolvency and Bankruptcy Board of India (Liquidation Process) Regulations, 2016.
Decision: NCLT allowed the appeal.
Rationale:
1.NCLT noted that the claim of Appellant had already been admitted in CIRP and that fresh claim was filed within the time announced by the Liquidator, rejection of the same merely on a procedure / format prescribed in the Liquidation Regulations may not, in our opinion, help to achieve the ends of justice.
2.It held that Corporate Debtor is still undergoing liquidation process, and the application for selling the Corporate Debtor as a going concern is still pending for approval before the Adjudicating Authority. Acceptance of claim of the Appellant at this stage would not have a major direct bearing on the present process of liquidation.
Order:
