The National Company Law Appellate Tribunal in the case Dharmindra Constructions Pvt. Ltd. & Anr. v Rajendra Kumar Jain, wherein the bench comprising of Chairperson, Justice Ashok Bhushan and the Technical Member, Mr. Barun Mitra observed while adjudicating an appeal and has has held that Operational Creditors are only entitled for minimum of the liquidation value.
FACTS OF THE CASE
It has been admitted by the Corporate Debtor, Kudos Chemie Ltd. & Ors into the Corporate Insolvency Resolution Process. The Operational Creditor/Appellant, Dharmindra Constructions Pvt. Ltd being an operational creditor of the Corporate Debtor was not allotted any amount in the resolution plan, since the liquidation value of the Appellant/Operational Creditor was NIL. The Adjudicating Authority approved the Resolution Plan submitted by the Successful Resolution Applicant on 17.03.2022. It has been observed by the Adjudicating Authority that as per the Information Memorandum, the operational creditors were segregated into three categories. As the first being the workmen and employees, who have been paid Rs. 20 Lakhs as against the verified claim of them of Rs. 18.88 crores. The second being the Government dues which are towards the NIL payment was made as against as verified claim of Rs.295.18 Crores and the third being the operational creditors other than workmen & employees and the dues of the government, to whom NIL payment has been made as against a verified claim of Rs.295.18 crores.
An application was filed before the NCLAT by the Appellant/Operational Creditor, wherein challenging the order dated 17.03.2022 which is being passed by the Adjudicating Authority. Further, it has been argued that since the approved resolution plan did not allocate any amount for the operational creditor, the same is being violative of the Insolvency and Bankruptcy Code, 2016. Therefore, the said Resolution Plan requires statement that claims of all the stakeholders have been dealt with and there being no consideration in the plan about the claim of the Appellant/Operational Creditor.
It has further been submitted by the Resolution Professional that the value of the liquidation of the Operational Creditor was NIL, hence no amount was allocated to it in the Resolution Plan. Thus, the Resolution Plan deals with the claim of stakeholders.
VERDICT OF NCLAT
It has been observed by the bench that the Liquidation value of the Appellant/ Operational Creditor was Nil. Therefore, the operational creditors which are Government and whose verified claim is Rs. 295.18 Crores, were paid NIL and the requirement of the said obligation for payment of amount to the Operational Creditor is under Section 30(2)(b) and the plan had not violated the said provision.
The bench stated that this court is of the view that the Operational Creditors are only entitled for minimum of the liquidation value and there being no breach of any of the provisions of the Code, this court is unable to interfere with the impugned order.
It has also been held by the bench that the Operational Creditors are only entitled for minimum of the liquidation value. Accordingly, the bench dismissed the appeal.
