Employee,S Provident Fund ... vs Cyclo Transmission Limited & Anr /
- CitationCompany Appeal (AT) (Insolvency) No. 975 of 2021
Ratio decidendi
The rule this decision rests on
The appellate tribunal rests its dismissal on the following principle: where a creditor has not submitted its claim within the time fixed in the public announcement under the insolvency process, and the record contains no order of the Adjudicating Authority directing that the claim be received, the creditor cannot found a challenge to the approval of a resolution plan on the ground that its claim, sent later by email and speed post, was not provided for; the approval of a resolution plan which allocates the admitted dues of such non-claiming creditors is not thereby shown to be erroneous, and an appeal against that approval lacking merit is dismissed.
Written by Miss Lucy from the judgment below, not taken from a headnote.
Judgment
As delivered
Employee's Provident Fund Organisation ...Appellant
Versus
Cyclo Transmission Ltd. & Anr. ...Respondents
Present: For Appellant: Mr. Prateek Kohli, Advocate.
For Respondents: Mr. Manish Jha, Advocate for R-2.
ORDER
(Virtual Mode)
30.11.2021: Heard Learned Counsel for the Appellant and Leaned Counsel
appearing for the erstwhile Resolution Professional. This Appeal has been filed
against the order dated 16.07.2021 by which the Adjudicating Authority (National
Company Law Tribunal) Mumbai Bench has allowed the Application of Resolution
Professional for approval of the Resolution Plan of the Resolution Applicant.
This Appeal has been filed by 'Employee's Provident Fund Organisation'. It is the
submission of the Learned Counsel for the Appellant that total claim amount was
Rs.2,68,06,704/- out of which only Rs.58,06,123/- has been allocated in the
Resolution Plan and paid.
2. Learned Counsel for the Resolution Professional submits that no claim was
received as contended by Learned Counsel for the Appellant. In the Resolution
Plan 100% payment of PF (Employees) and PF (Workmen) has been allocated.
Cont'd.../ 2
3. We have considered submissions of Learned Counsel for the parties and
perused the record.
4. CIRP proceedings were initiated by order of the Adjudicating Authority
dated 18.12.2018. Insolvency Resolution Professional issued public
announcement on 25.12.2018 inviting claims from the Creditors on or before
08.01.2019. Learned Counsel for the Appellant has submitted that the claim of
Rs.2,68,06,704/- was submitted by email dated 22.01.2020 and via speed post
on 04.02.2020. The Adjudicating Authority has noted in Para 8.4 the claim
amount of PF (Employees) and PF (Workmen) as Rs.29,59,537/- and
Rs.28,46,586/-, respectively. It is clearly mentioned that the above claims has
not been submitted. Despite the claims having not been submitted 100% amount
was allocated. Para 8.4 of the order of the Adjudicating Authority is to the
following effect:
"8.4 Payment towards claims that have not been submitted
A synopsis of how the Resolution Applicant has dealt with certain dues for which claims have been submitted, on an exceptions basis, is set out below:
No. Details of Creditor Claim not Amount Allocation submitted Allocated Ratio (%) (Rs.) (Rs.)
1.a. ESIC Employer* 5,71,100 5,71,100 100.0%
1.b. ESIC Employee* 2,68,750 2,68,750 100.0%
2.a. PF (Employee)* 29,59,537 29,59,537 100.0%
Company Appeal (AT) (Insolvency) No. 975 of 2021 3
2.b. PF(Workmen)* 28,46,586 28,46,586 100.0%
3 Bombay Labour 8,189 8,189 100.0% Welfare Fund*
4.a. TDS of Employees 12,204 12,204 100.0%
TDS of Sub- 36,277 36,277 100.0% Contractors TDS of Professional 1,04,804 1,04,804 100.0% Services
4.b. Prof Tax** 13,50,725 14,453 1.07%
Total 81,58,172 68,21,900***
* As per Page 26 of the latest IM, there are pending dues towards PF, ESIC, labour welfare fund for which no claim has been submitted. However, the same shall be paid in full on an exceptional basis.
**As per the Page 26 of the latest IM, there are pending dues towards Income Tax (TDS Deduction and Professional Tax) for which no claim has been submitted. However, allocation has been made towards some payment of these dues.
***Save and except the above dues, it is expressly clarified that the Resolution Plan does not envisage payment for any other dues arising prior to the Effective Date, for which no claims have been admitted by the RP. The above payments are exceptional in nature and cannot be considered as a precedent to be applied to any other dues for which no claim has been submitted/ admitted. Under no circumstances shall the liability of the Resolution Applicant towards settlement of dues under this Resolution Plan exceed Rs.10,50,00,000/-."
5. The contents of the Resolution Plan contains specific mention that there
are pending dues towards PF, ESIC, labour welfare fund for which no claim has
been submitted. However, the same shall be paid in full on an exceptional basis.
The Appellant had not placed any material on record nor an order passed by the
Company Appeal (AT) (Insolvency) No. 975 of 2021 4
Adjudicating Authority issuing direction to receive claim of the Appellant which
admittedly was not submitted within the time as allowed in the public
announcement. We, thus, accept the submission of Learned Counsel for the
Resolution Professional that no claim was submitted regarding PF and the
submission made by Learned Counsel for the Appellant that a claim of Rupees
Two Crores and odds was submitted by email and speed post could not be
accepted. We do not find any error in the judgment of the Adjudicating Authority
approving the Resolution Plan. There is no merit in the Appeal. Appeal is
dismissed.
[Justice Ashok Bhushan] Chairperson
[Justice Jarat Kumar Jain] Member (Judicial)
[Dr. Alok Srivastava] Member (Technical) Archana/nn.
Company Appeal (AT) (Insolvency) No. 975 of 2021
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