The Chennai bench of the National Company Law Appellate Tribunal(NCLAT) refused to condone the delay in a claim under Corporate Insolvency Resolution Process (`CIRP’) since it was without any valid ground.
Mr ShyamRathod, the `Appellant’ filed an appeal under Section 61 of the Insolvency and Bankruptcy Code, 2016, (IBC), against the `Impugned Order’ whereby the Tribunal/`Adjudicating Authority’ has dismissed the said Application filed by the `Appellant’/`Applicant’ herein seeking Condonation of Delay of 49 days in filing of the `Claim under `Form – C’.
An application was filed by the `Applicant’/`Appellant’ seeking Condonation of Delay of 49 days in filing of the `Claim’ before the Respondent and for acceptance of the `Claim’. The Corporate Insolvency Resolution Process (`CIRP’) of the `Corporate Debtor’ was initiated on 21.03.2022 and the public announcement was made on 23.03.2022, the last date for submission of `Claim’ being 04.04.2022. Admittedly, the `Claim’ was filed belatedly by the `Applicant’ after the expiry of the 90th day on 06.08.2022.
The application was signed by the `Appellant’/`Applicant’ on 26.11.2022 and e-filed before the `Adjudicating Authority’ on 28.11.2022. The `Adjudicating Authority’ has noted that except for a vague averment that there was a delay seeking `legal advice’, there are no proper pleadings or material placed on record to substantiate the reason for delay.
In the case of `Esha Bhattacharjee’ Vs. `Managing Committee of Raghunathpur Nafar Academy &Ors.’, “it was held that the Condonation of Delay cannot be granted as a matter of course and such a liberal approach cannot be taken when there are no proper grounds given by the `Appellant’/`Applicant’.”
It was stated that the `Adjudicating Authority’ has failed to recognize the `Claim’ of the `Appellant’ as `Financial Debt’ as the unsecured loan was against the `payment of interest’ and is tantamount to a `debt’ disbursed against `time value of money’ and therefore falls within the ambit of `Financial Debt’.
“The ground taken by the Counsel for the `Appellant’ that it was initially filed under `Form – B’ as an `Operational Creditor’ which was rejected vide email communication dated 03.08.2022, and thereafter the `Appellant’ had resubmitted her `Claim’ under `Form – C’ on 07.08.2022, does not strengthen or substantiate her case as the timelines given under IBC are to be strictly adhered to and any latches on behalf of the `Appellant’ in filing, the `Claim’ under a wrong category cannot be a substantial ground for condoning the delay.”, the two-member bench comprising Justice M. Venugopal, Member (Judicial) and Ms Shreesha Merla] Member (Technical) observed,
It was evident that the actual period of delay in submitting the `Claim Form’ is 125 days. It is also significant to mention that the `Appellant’ approached the `Adjudicating Authority’, with a further delay of 100 days, and the only reason that was given is that they were seeking `legal advice’, which the `Adjudicating Authority’ has rightly held is only a bald explanation and does not construe a `sufficient cause for the delay’.
IBC is a time-bound process, in the absence of sufficient cause for delay, the NCLAT dismissed the appeal.
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