In a significant ruling, the National Company Law Appellate Tribunal (NCLAT) has clarified that any claims arising after the commencement of the Corporate Insolvency Resolution Process (CIRP) cannot be entertained by the Resolution Professional (RP). The decision came in the case of Gujarat Urja Vikas Nigam Ltd. vs. Mr. Udayraj Patwardhan, RP of Adel Landmarks Pvt. Ltd., which was deliberated by a bench comprising Justice Rakesh Kumar Jain, Naresh Salecha, and Indevar Pandey.
The dispute centers around a Power Purchase Agreement (PPA) between Gujarat Urja Vikas Nigam Ltd. and the corporate debtor, previously known as Era Infrastructure Limited. The CIRP was initiated on December 5, 2018, after the corporate debtor failed to supply power since March 2015. Following this, Gujarat Urja issued a default notice and subsequently terminated the PPA, seeking compensation of Rs. 3.36 crores.
Despite this, the RP stated that the termination of the PPA during the ongoing CIRP was impermissible due to the moratorium imposed under Section 14 of the Insolvency and Bankruptcy Code. The RP emphasized that claims related to termination could not be verified as valid during the CIRP, leading to the rejection of Gujarat Urja’s claim filed in July 2021.
The NCLAT upheld the RP’s position, stating that the appellant had delayed filing claims by 849 days, which should have been submitted before March 5, 2019, in accordance with CIRP regulations. The tribunal also noted that the public announcement of the CIRP proceedings was sufficient notification for all creditors, including Gujarat Urja, which is a wholly owned public sector unit of the Gujarat government.
The ruling reiterated that claims can only be entertained if they are filed in relation to the CIRP commencement date, emphasizing that subsequent claims do not automatically discharge and must follow different legal proceedings if recovery is sought.
In conclusion, the NCLAT found no merit in the appeal, confirming the Adjudicating Authority’s earlier decision that the RP acted correctly in rejecting claims that arose after the initiation of the CIRP. The tribunal dismissed the appeal without costs, closing any pending interim applications.
