TMI Blog2023 (9) TMI 516X X X X Extracts X X X X X X X X Extracts X X X X ..... lay in the filing of claim by the appellant ought to have been condoned by respondent no. 1? - HELD THAT:- Section 15 of the IBC and Regulation 6 of the IBBI Regulations mandate a public announcement of the CIRP through newspapers. This would constitute deemed knowledge on the appellant. In any case, their plea of not being aware of newspaper pronouncements is not one which should be available to a commercial party - the mere fact that the Adjudicating Authority has yet not approved the plan does not imply that the plan can go back and forth, thereby making the CIRP an endless process. This would result in the reopening of the whole issue, particularly as there may be other similar persons who may jump onto the bandwagon. Thus, it is concluded that the NCLAT s impugned judgment cannot be faulted to reopen the chapter at the behest of the appellant - appeal dismissed. - Sanjay Kishan Kaul And Sudhanshu Dhulia , JJ. JUDGMENT SANJAY KISHAN KAUL, J. Factual Background 1. An agreement was entered into on 02.08.2006 between the appellant and M/s KST Infrastructure Private Limited (hereinafter referred to as the Corporate Debtor ), for development of land li ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ndum and invited expressions of interest from prospective resolution applicants. Five such applications were received. 4. Thereafter, the IRP was replaced and respondent no. 1 was appointed as Resolution Professional (RP) of the Corporate Debtor by the COC on 18.06.2020. The resolution plan submitted by KST Whispering Heights Residential Welfare Association was approved by the COC by a majority vote of 80.74% on 11.07.2020. This plan was then submitted by respondent no. 1 to the Adjudicating Authority for approval under Section 31 of the IBC on 08.09.2020. We may note that the Corporate Debtor is not a party before us. However, the Resolution Professional has been arrayed as respondent no.1, while respondent no.2 is the successful resolution applicant. Respondent no.2 was impleaded in the present civil appeal by this Court s order dated 29.10.2021. 5. The appellant sent an email on 19.08.2020 to respondent no.1 highlighting their pending claim of Rs.35,67,05,337 against the Corporate Debtor arising from the arbitral award dated 01.08.2016, confirmed with certain modifications in the proceedings under Section 34 of the said Act. However, respondent no.1 rejected this claim on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d successfully take over the business of the corporate debtor. 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 corporate debtor. This the successful resolution applicant does on a fresh slate, as has been pointed out by us hereinabove. For these reasons, NCLAT judgment must also be set aside on this count. On the other hand, the appellant explained that it could not file the claim in time as it was unaware of the public announcement. A belated claim should not be shut out as the time-periods in the IBC are merely directory and not mandatory as per Brilliant Alloys Private Limited v. Mr. S. Rajagopal Ors., (2022) 2 SCC 544 (hereinafter referred to as Brilliant Alloys ) and in any case the resolution plan was yet to be approved by the Adjudicating Authority. The appellant contended that respondent no.1 had failed to discharge his duty to include the appellant s claim in the information memorandum as a contingent liability. 9. The NCLAT, vide the impugned order dated 30.07.2021, did not favour the view ado ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ating Authority was yet to approve the resolution plan, respondent No.1 should have included the same as a contingent liability. This was also the view taken by the adjudicating agency. It was thus submitted that there was no cause for NCLAT to interfere with the same. The appellant also sought to contend their lack of awareness about the CIRP. It was urged that the Corporate Debtor did not disclose that the CIRP had been initiated, either during the pendency of the proceedings under Section 34 of the Arbitration Act or in appeal under Section 37 of the Arbitration Act. Had the appellant known of the CIRP, it may not have filed an application for restoration of the execution petition on 16.11.2019. 12. It was urged that the appellant urged that respondent No.1 could have easily found this information from the Corporate Debtor s books of accounts. Respondent No.1 s pleas before the Supreme Court: 13. Respondent no.1, on the other hand, contended that the appellant had deemed knowledge of the CIRP as the applicable procedure for inviting claims under the IBC and the IBBI Regulations was followed. Respondent No.1 made sincere efforts to collate all claims, including fili ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he appellant ought to have been vigilant enough in the aforesaid circumstances to find out whether the Corporate Debtor was undergoing CIRP. The appellant has been deficient on this aspect. The result, of course, is that the appellant to an extent has been left high and dry. 20. Section 15 of the IBC and Regulation 6 of the IBBI Regulations mandate a public announcement of the CIRP through newspapers. This would constitute deemed knowledge on the appellant. In any case, their plea of not being aware of newspaper pronouncements is not one which should be available to a commercial party. 21. The mere fact that the Adjudicating Authority has yet not approved the plan does not imply that the plan can go back and forth, thereby making the CIRP an endless process. This would result in the reopening of the whole issue, particularly as there may be other similar persons who may jump onto the bandwagon. As described above, in Essar Steel, (supra) the Court cautioned against allowing claims after the resolution plan has been accepted by the COC. 22. We have thus come to the conclusion that the NCLAT s impugned judgment cannot be faulted to reopen the chapter at the behest of the a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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