AI Structured Summary
Not yet generated for this judgment
Judgment
22.01.2025 Heard Learned Counsel for the Appellant as well as Mr. PBA Srinivasan Learned counsel appearing for the State Bank of India.
This Appeal has been filed against the order dated 02.06.2022 passed by National Company Law Tribunal, New Delhi Bench, Court-2 in I.A. 2554/2022. I.A. was filed by the RP praying for following directions:
“1.Declare that the demands and claims raised by Respondent No.1 to 4 pertaining to the CIRP Period of Corporate Debtor, after approval of Resolution Plan, to be a part of CIRP cost;
2.Direct Respondent No.1 to 4 to approach Respondent No.5 to raise their claims as per approved Resolution Plan;
3.Direct Respondent No.5/State Bank of India to consider the CIRP cost as per Resolution Plan and release the CIRP cost to Respondent No.1 to 4;”
The Adjudicating Authority disposed of the Application observing that there is no specific provision to allow such kind of prayer, hence the Application was dismissed.
Aggrieved by the said order, this appeal has been filed by the SRA.
We have heard Sh. Gaurav Mitra, Learned Counsel for the Appellant and Sh. Srinivasan appearing from the State Bank of India.
Learned Counsel for the Appellant submits that as per the resolution plan, the CIRP cost was to be made from to the regular cash flow of Corporate Debtor and any CIRP cost remained to be paid the same shall be paid out of 72 crores offered by the Resolution Applicant to the sole Financial Creditor. He submits that in view of the aforesaid, Financial Creditor was to bear any CIRP cost. Learned Counsel Mr. Srinivasan submits that there is no demand to the State Bank of India nor there is any determination by the RP that what are the CIRP cost to be paid to Respondent No.1 to 4 as arrayed in the application. He submits that the CIRP cost if it is determined by the RP the bank shall make the payment.
We have considered submission of Counsel for the parties and perused the record.
The order of the Adjudicating Authority by which resolution plan was approved has been brought on the record and it is useful to extract following part of paragraph 15 dealing with the payment plan, which is as follows:
“15.The relevant extract of the resolution plan as accepted by the CoC and put forth for our consideration is reproduced as under. It is stated to be in line with the provisions of Section 53 of the Code.
| S. No. | Outstanding Dues in order of Priority as per Section 53 of IBC, 2016 | Outstanding Liability as per Books of CD on 30.06.2017 (CIRP Date) | Total Amount offered | Remarks (All waivers/hair-cut subject to the approval of CoC /Adjudicating Authority. |
| A | Insolvency Resolution Process (CIRP Cost) | The CIRP Cost is met out of the regular cash out of the regular cash flows of CD during CIRP period. However, CIRP Cost if any, remains outstanding, to be paid out of the Amount of Rs.7200.00 Lakhs offered by the Resolution Applicant. | ||
| B (I) | Workmen’s Dues – 24 months preceding CIRP | No such dues reported | ||
| (II) | Debts due to Secured Financial Creditors | |||
| a. | State Bank of India | 18733.94 | 7200 | Offer amount of Rs.7200 Lakhs proposed to be paid in order of Priority as per Section 53 of IBC. We assume no outstanding CIRP cost, however the amount to be paid to State Bank of India shall be reduced by the amount of CIRP cost, if any paid/payable and consequently the amount of waiver sought will increase by same amount.” |
| (Claimed Filed/admitted in IM Rs.18733.94 Lakhs) |
When we look into the aforesaid clause of the resolution plan, it is clear that with regard to Insolvency Resolution Process cost, the resolution plan contemplate that the CIRP cost is to be made out of the regular cash and if any cost remains, it is to be paid by amount of Rs.72 Crores offered to the State Bank of India. The decision of the Adjudicating Authority that there is no specific provision to allow such kind of prayer cannot be accepted. CIRP cost which is contemplated in the IBC and the CIRP Regulations, 2016 has to be paid. Mr. Srinivasan is right in his submission that it is for RP to consider the any such claim and take a decision and communicate the same to the State Bank of India.
In the facts of the present case, we dispose of the application I.A. No. 2554 of 2022, clarifying that balance CIRP cost, if any, is to be paid by Sole Financial Creditor – State Bank of India for which RP shall consider the demands received from Respondent No.1 to 4 to the application and after determining that they are CIRP cost may communicate to the Financial Creditor to make the payment. With the above direction, we dispose of the Appeal.