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Judgment
01.05.2025: This appeal has been filed challenging the order dated 22.04.2025 by which an order adjudicating authority has rejected 12A application filed by the RP.
In the present case the adjudicating authority has passed an order initiating CIRP on an application filed by the operational creditor on 04.02.2025. The IRP was appointed by the same order however, it is the case of the appellant that IRP received the copy of the order only on 12.03.2025 and then after receiving the certified copy of the admission order public announcement was made on 14.03.2025 in the Financial Express (English as well as Gujarati version).
Claim was filed by Union Bank of India on 31.03.2025. The CD and OC entered into settlement agreement on 02.04.2025 and thereafter Form FA was given to the IRP, an application under Section 12A was submitted on 04.04.2025 by the IRP which came to be considered and rejected.
Ld. Counsel for the Appellant submits that the observation made by adjudicating authority that only part payment has been made and other payments are to be made till June,2025 is wholly irrelevant and the adjudicating authority should have relied on the settlement only.
It is further submitted that the observation of adjudicating authority that CoC ought to have been constituted by RP is also not correct since still there was 7 days’ time after the last date of receiving claim i.e. 28.03.2025 for constituting the CoC.
Ld. Counsel for the appellant has relied on the Judgment of this Tribunal in Comp. App. (AT) (Ins) Nos. 336 & 337 of 2025 in the matter of ‘Himanshu Singh vs. HDFC Bank Ltd.’ and is relying on paragraph 25 which is as follows:
“25.We, however, hasten to add that mere fact that a stakeholder of the corporate debtor before constitution of the CoC has filed an objection, itself may not be a reason to reject 12A application. Adjudicating Authority has to advert to the relevant factors which may include the nature and quantum of claim of the stakeholders. In a case where Adjudicating Authority finds that substantial and majority of claim has already settled with the corporate debtor that may be a factor which may weigh to the Adjudicating Authority in allowing 12A application. No straight jacket formula can be laid down for adjudication by the Adjudicating Authority of a 12A application and the objections filed therein. Facts of each application under 12A and objection therein need to be looked into before taking a decision as to whether the application under 12A be allowed or rejected.
We have also heard Ld. Counsel for the IRP who submits that claim has been received by Union Bank of India on 31.03.2025 for an amount Rs. 1.33 lakh.
We have considered the submissions of parties and perused the record.
The adjudicating authority in the last paragraph of order has made the following order:
“Hence we observe that this application is not maintainable and the payment if any has been made (even part payment) for settlement during moratorium period and hence this application is dismissed. The RP is directed to form the CoC immediately and place the proposal before the CoC for its consent in terms of Section 12A of IBC, 2016”.
The Circumstances and facts as noticed by the adjudicating authority for rejecting the application cannot be said to be irrelevant. The fact that there was a due of Rs. 29 lakhs for which the settlement was entered but only Rs. 2 lakhs were paid to the Operational Creditor and the Operational Creditor sought to close the proceeding was also relevant factor when the debt itself was not liquidated of the OC, the adjudicating authority did not commit any error in noticing the said fact. The adjudicating authority has also noted the claim filed by the FC on 31.03.2025.
In view of the Judgment of Hon’ble Supreme Court in ‘Glas Trust Company LLC vs. Byju Raveendran & Ors.’ (2025) 3 SCC 625 after admission of the proceeding, proceeding becomes In Rem proceeding and the claim of the financial creditor was admittedly received prior to settlement entered between the parties.
We are of the view that since the adjudicating authority has already granted liberty to RP to form the CoC and place the proposal before the CoC for its consent in terms of 12A. The above clearly protect the interest of the appellant also. In event settlement is agreed by the Committee of Creditors a fresh form FA can be given to the RP and fresh application of 12A can be filed.
With these observations, we dismiss the appeal.