TMI Blog2021 (12) TMI 851X X X X Extracts X X X X X X X X Extracts X X X X ..... sing under any law for the time being in force, such as authorities to whom statutory dues are owed, guarantors and other stakeholders involved in the resolution plan. The plea of the Opposite Parties that the State Authorities were unable to file their respective claims before the NCLT in the sum of ₹ 204,63,06,573/- since it has not finalized and in any event NCLT is not competent to decide the legality of the demands is untenable. Under Section 3(6) of the IBC a claim inter alia includes a right to payment, whether or not such right is reduced to judgment, fixed, disputed, undisputed, weaken, equitable secured or unsecured . In terms of Section 31 of the IBC, the ARP is binding on all creditors including Central Government and the State Government. Since all of the impugned demands raised against FACOR pertain to the period prior to the Plan Effective date i.e. 31st January, 2020, all such demands stand automatically extinguished in terms of the ARP - the impugned demand raised against the Petitioner by the Opposite Parties are unsustainable in law. Petition disposed off. - WRIT PETITION (CIVIL) No.20286 of 2020 - - - Dated:- 10-12-2021 - (DR. S. MURALIDHAR ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ector, physically or by virtual mode, on the date that may be fixed by this Court and agitate all his arguments before him. In view of the above submissions, we require the petitioner to appear before the opposite party No.2- Director of Mines, on 03.09.2020 at 11.00 A.M. by virtual mode for issuance of MDCC. On appearance of the petitioner, the Director of Mines will do well to dispose of the application of the petitioner by a speaking order. The matter to come up on 09.09.2020. Till then no coercive action shall be taken against the petitioner for the reason of non-renewal of trade license. 3. It is in compliance with the above order that the aforementioned order dated 8th September, 2020 was passed by the Director of Mines, Odisha. This led later to FACOR being permitted to amend the writ petition by an order dated 15th September, 2020 of this Court. The interim order passed initially on 24th August, 2020 has continued throughout. 4. It may be mentioned here that during the pendency of the present petition, there have been developments that resulted in a second amendment to the petition. FACOR paid amounts under protest and has been issued the MDCC and its trading licenc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the demand raised by mining department against it by virtue of ten demand notices of different dates. All of the demands were for periods prior to the plan effective date with the exception of one online demand dated 16th June 2020 which pertained to the period from 1st July to 31st December 2020, which according to the FACOR it has duly paid. FACOR contends that in terms of the ARP all of the aforementioned demand notices stood extinguished. 11. Apprehending that it was not being issued by MDCC on account of the outstanding demand notices, FACOR on 17th July 2020, 24th July, 2020 and 1st August, 2020 wrote to the Officers issuing the demand notices about the CIRP and pointed out that in terms of the ARP no payments were due and payable against the demand notices. A letter to the same effect was sent on 8th August, 2020 by FACOR to the concerned Officer to process its application for MDCC. 12. With the Opposite Parties failing to act upon the Petitioner's request, FACOR filed the present petition seeking the reliefs as noted hereinbefore. Referring to Rule 8(1) of the Mining Rules it is contended by FACOR that there was a failure by Opposite Party No.3 to process t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e in view of the Resolution Plan. Except the Hon'ble Supreme Court, no Tribunal can say that the demands raised by the State Authorities in compliance of the judgment dated 2nd August 2017 of the Hon'ble Supreme Court passed in W.P.(C) No.114 of 2014 are not enforceable. 16. It was stated by the Opposite Parties that on 16th June, 2020 FACOR submitted an online application before Opposite Party No.2 for issuance of MDCC. While examining the said application it was found that a large amount of money is outstanding against the lessee . The contention of the Opposite Parties is that the demand amount of ₹ 204,63,06,573/- is sub-judice in different Courts/Tribunals at the instance of the lessee. Since the demands could not been finalized, the State was not in a position to lodge claims or file proceedings before NCLT. It was further claimed by the Opposite Parties that with its application, FACOR had uploaded an MDCC format of a third party i.e. M/s. MCL pertaining to year 2011 and not its own. In the i3MS system unless the MDCC certificate is uploaded, the application for renewal would be incomplete. 17. FACOR has filed a rejoinder affidavit disputing all of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d. 02.08.2017 of the Hon'ble Supreme Court passed in W.P.(C) No.114 of 2014 is not enforceable in view of the Resolution Plan. Except the Hon'ble Supreme Court no Tribunal can say that the demands raised by the State Authorities in compliance of the Judgment dtd. 02.08.2017 of the Hon'ble Supreme Court passed in W.P.(C) No.114 of 2014 are not enforceable. 21. It may be noted here that there was a second amendment to the writ petition by I.A. No.8896 of 2021 filed by FACOR which was allowed by this Court on 7th July, 2021. By way of the said amendment, the following averments have been made in para 1 of the said petition: However, without prejudice to its rights the Petitioner, in order to ensure unhindered continuity of its business operations, made payments under protest against some of the claims raised by way of the Demand Notices. In view thereof, on 6 May 2021, the Opposite Party No.2 has issued the MDCC to the Petitioner. Consequently, the Petitioner requested the W.P.(C) No.20286 of 2020 Page 11 of 21 Opposite Party No.3 to renew its Trading License, which has been done by the Opposite Party No.3 on 18 June 2021. The Petitioner is thus aggrieved by the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hereto Clause 3(g)(iii) Specifically, all dues under the provisions of Applicable Laws relating to ongoing litigations (including without limitation, liabilities dues set out in Annexure-3) whether admitted or not, due or contingent, whether or not set out in the IM, the balance sheets of the Company or the profit and loss account statements of the Company or the list of creditors, asserted or unasserted, crystallized or uncrystallized, known or unknown, secured or unsecured, disputed or undisputed, present or future, in relation to any period prior to the Plan Effective Date or arising on account of the acquisition of control by the Applicant over the Company pursuant to this Resolution Plan, shall stand extinguished by virtue of the order of the NCLT approving this Resolution Plan and the Company shall not be liable to pay any amount against such dues. Clause 3(g) (iv): all liabilities (including without limitation, for any penalty, interest, fines or fees) or obligations of the Company, in relation to: (A) any unmet export obligations under the Export Promotions Capital Goods Licenses held by the company (whether subsisting or not) (B) any mining le ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ll claims along with any related legal proceedings, shall stand irrevocably and unconditionally abated, settled and extinguished in perpetuity . 24. Section 31(1) of the IBC further makes it clear that once the ARP is in place, approved by the CoC, it shall be binding on the corporate debtor and its employees, members, creditors including the Central Government, any State Government to whom a debt in respect of the payment of dues arising under any law for the time being in force, such as authorities to whom statutory dues are owed, guarantors and other stakeholders involved in the resolution plan... 25. Indeed, Opposite Party No.2 as an Officer of the State Government is equally bound by the ARP. He is precluded from raising any demand for a period prior to the Plan Effective Date. The legal position in this regard is well settled. In Committee of Creditors of Essar Steel India Limited v. Satish Kumar Gupta (2020) 8 SCC 531, the Supreme Court of India held that under Section 31(1) of the IBC, once the CoC approves the resolution plan, it bind all the stake holders, it is observed as under: Section 31(1) of the Code makes it clear that once a resolution plan is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a recent decision of the Supreme Court in Ghanashyam Mishra and Sons Private Ltd. v. Edelweiss Asset Reconstruction Company Ltd. 2021 SCC Online SC 313. There the Supreme Court considered all of the earlier decisions including Committee of Creditors of Essar Steel (supra), Maharashtra Seamless Limited v. Padmanabhan Venkatesh (2020) 11 SCC 467 and Innovative Industries v. ICICI Bank (2018) 1 SCC 407. The Supreme Court also referred to its earlier decision in Sashidhar v. Indian Overseas Bank (2019) 12 SCC 150. After discussing all of the above judgments, the Supreme Court in Ghanashyam Mishra and Sons Private Ltd. (supra) held as under: 57. It could thus be seen, that the legislature has given paramount importance to the commercial wisdom of CoC and the scope of judicial review by Adjudicating Authority is limited to the extent provided under Section 31 of I B Code and of the Appellate Authority is limited to the extent provided under subsection (3) of Section 61 of the I B Code, is no more res integra. 58. Bare reading of Section 31 of the I B Code would also make it abundantly clear, that once the resolution plan is approved by the Adjudicating Authority ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . It is also required to contain the details of guarantees that have been given in relation to the debts of the corporate debtor by other persons. The details with regard to all material litigation and an ongoing investigation or proceeding initiated by Government and statutory authorities are also required to be contained in the information memorandum. So also the details regarding the number of workers and employees and liabilities of the Corporate Debtor towards them are required to be contained in the information memorandum. 61. All these details are required to be contained in the information memorandum so that the resolution applicant is aware, as to what are the liabilities that he may have to face and provide for a plan, which apart from satisfying a part of such liabilities would also ensure, that the Corporate Debtor is revived and made a running establishment. The legislative intent of making the resolution plan binding on all the stakeholders after it gets the seal of approval from the Adjudicating Authority upon its satisfaction, that the resolution plan approved by CoC meets the requirement as referred to in subsection (2) of Section 30 is, that after the approva ..... X X X X Extracts X X X X X X X X Extracts X X X X
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