2019 (11) TMI 1575 - AT - Insolvency and Bankruptcy

Approval of Resolution Plan - section 60(5) of the Insolvency and Bankruptcy Code, 2016 - HELD THAT - 'Resolution Plan' submitted by a Consortium of Siri City Pvt. Ltd. and KCR Enterprise LLP, 'Resolution Applicant' has been approved by the 'Committee of Creditors' with 75.91% voting shares. The 'Resolution Plan' was placed before the Adjudicating Authority under section 13 and the Adjudicating Authority has approved the same. Therefore, it is not possible for this Appellate Tribunal to decide the claim on the basis of the disputed question of fact, which can only be decided by a Court of competent jurisdiction. The Appellant allowed to make a claim before the 'Successful Resolution Applicant' or to avail the remedy of 'Suit' in terms of sub-section (6) of Section 60 of the I B Code, if prayer is not allowed.

Summary

Issues:
1. Claim rejection by Resolution Professional
2. Dispute regarding services rendered and payment due
3. Approval of Resolution Plan by Committee of Creditors
4. Jurisdiction of Appellate Tribunal to decide disputed questions of fact
5. Appellant's remedy to make claim before Successful Resolution Applicant or file a Suit

Analysis:
1. The Appellant, Encotec Energy (India) Pvt. Ltd., filed a claim as an 'Operational Creditor' before the Resolution Professional alleging non-payment for services provided to the Corporate Debtor, Sai Wardha Power Generation Ltd. The Resolution Professional rejected the claim, leading to the Appellant's application under section 60(5) of the Insolvency and Bankruptcy Code, 2016. The Adjudicating Authority upheld the rejection citing the absence of any outstanding amount in the Applicant's ledger maintained by the Corporate Debtor.

2. The Adjudicating Authority noted the Appellant's claim of providing services for July and August 2017, despite the Corporate Debtor having paid for services up to June 2017. The Resolution Professional contended that no amount was due to the Applicant, highlighting a significant set-off amount of ?10,93,99,500 payable by the Applicant to another entity, which was adjusted against the receivables from the Corporate Debtor.

3. The Resolution Plan submitted by a Consortium was approved by the Committee of Creditors with 75.91% voting shares. The Adjudicating Authority approved the Resolution Plan, indicating that the Appellate Tribunal lacked jurisdiction to decide the claim based on disputed facts, suggesting that such matters should be resolved in a Court of competent jurisdiction.

4. Considering the above, the Appellate Tribunal allowed the Appellant to pursue the claim before the Successful Resolution Applicant or opt for the remedy of filing a Suit as per sub-section (6) of Section 60 of the I&B Code if the claim was not accepted. The Tribunal emphasized that the Successful Resolution Applicant could settle the matter independently, without influence from the Adjudicating Authority or the Appellate Tribunal, thereby disposing of the Appeal.

This comprehensive analysis highlights the key issues, arguments, and the Tribunal's decision, providing a clear understanding of the legal judgment.