Belated Claims by Creditors not to be Considered as IBC Proceedings are Time Bound: NCLAT [Read Order]
Belated claims by creditors not to be considered as IBC proceedings are time bound, rules NCLAT
NCLAT – IBC Proceedings – NCLAT delhi – tax updates – taxscan
NCLAT – IBC Proceedings – NCLAT delhi – tax updates – taxscan
The New Delhi Bench of the National Company Law Appellate Tribunal (NCLAT) held that the belated claims by creditors not to be considered as the nature proceedings under the Insolvency and Bankruptcy Code, 2016 (IBC) are time bound.
The instant appeal was preferred by the appellant Ms. Pooja Mehra, who was aggrieved by the order whereby National Company Law Tribunal (NCLT) had dismissed an application filed by the appellant seeking to condone delay in filing the claim and to direct Respondent No.1 i.e. Resolution Professional Mr. Nilesh Sharma to admit the claim of the appellant’s in the category of “Financial Creditor”.
The NCLT by the impugned order, has rejected the appellant’s application for acceptance of belated claim after approval of the Resolution Plan by the Committee of Creditors (CoC).
The counsel for the appellant submitted the appellant cannot be made to suffer because of the discrepancies of the internal management of the Corporate Debtor. In fact, as per the Doctrine of Indoor Management i.e Turquand's Rule, the Appellant needs to be protected as she entered into a contract with the Company and if a company (corporate debtor in this case) enters into a contract, the obligations of following company’s policies fall on the members of the Corporate Debtor (Directors of the Corporate Debtor in this case), and not on the appellant.
The counsel for the resolution professional submitted that the appellant was sleeping over his rights and the legal position is well settled that a person who sleeps over his rights ought not be given any indulgence. Close to 3 years had passed since the commencement of CIRP proceedings of the Corporate Debtor and the Appellant never showed any interest with respect to the flat purchased by him. The proceedings under Code are time bound and the belated claim of the Appellant cannot be considered and is liable to be rejected.
A Two-Member Bench comprising Justice Ashok Bhushan, Chairperson and Arun Baroka, Member (Technical) observed that “The claim of the Appellant is that since approval of Resolution Plan is pending before the Adjudicating Authority, its claim can be considered on merits. We have examined this issue in detail basis the facts of the case, wherein the Appellant seeks condonation of 540 days and basis the current position of law. It becomes unsustainable to accede to his request to allow his belated claim to be considered, particularly in the background that there is no acceptable material on record to suggest actual disbursement of Rs.50 lakhs to the Corporate Debtor and more so when the Appellant itself has filed Form – C and not CA raising its claim.” “The appellant was sleeping over his rights. A person who sleeps over his rights ought not be given any indulgence. Close to 3 years had passed since the commencement of CIRP proceedings of the Corporate Debtor and the appellant never showed any interest with respect to the flat purchased by him. The proceedings under Code are time bound and the belated claim of the appellant cannot be considered and is liable to be rejected” the Tribunal held.
To Read the full text of the Order CLICK HERE
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