Grasim Industries Limited vs. Tecpro Systems Ltd. - Verification of Claims of Creditors during CIRP

NCLT (PB) New Delhi.(21.03.2018) in Grasim Industries Limited vs. Tecpro Systems Ltd. [CA -19(PB) /2018 in (IB) -197(PB)/2017] held that,

•  he (IRP) is  under mandatory duty to verify every claim and maintain the  list of creditors containing their names along with the amount claimed by them and the amount of their claim admitted.

• Such a claim is not verifiable from the books of accounts of the Corporate Debtor. Moreover, the same amount is subject matter of arbitration before the Arbitral Tribunal and there is a specific bar created by the admission order in terms of Section 14 of the Code

• In the present case, there is no verifiable claim before the IRP and the dispute is pending in arbitration proceedings which could not proceed on account of moratorium. Allowing the disputed claim to be taken into account at this stage would unnecessarily hamper the insolvency resolution process and defeat the very purpose of admitting the petition.

Excerpts of the order;

This is an application filed by Grasim Industries Ltd.for brevity (GIL') claiming that it is one of the bona fide claimants and its claim of Rs. 40.47 crores made against the corporate debtor has been unfairly and illegally rejected by the resolution professional. The prayer made in the application is to set aside the list of creditors prepared and published by interim resolution professional which has been displayed on the website of the corporate debtor so far as it relates to the rejection of claim of the applicant by ‘GIL’. 

It is pertinent to mention that the petition in the instant appeal  was admitted on 07.08.2017 and the IRP was appointed. The IRP received a number of claims from operational creditors, financial creditors and the employees of the corporate debtors  in response to public notice. The applicant sent its claim on 22.08.2017 and the claim could not be admitted by the IRP as is evident from the perusal of the list of claims received from  the various creditors of the corporate debtor. The claim of the applicant has been collated and it figures at serial No. 429. The reasons for not accepting the claim are that performance  guarantee has been en-cashed and the contract is terminated  by the applicant-GIL. The aforesaid decision has been challenged on the ground that under s.18 read with Regulations 10, 12, and 13 of IBBI (CRP) Regulations, 2017, IRP has no power to refuse to accept the claim. 

In the detailed reply filed by the resolution professional the receipt of claim is admitted. It has however been asserted that non-acceptance of the claim and its reasons for rejection were published on the website of the corporate debtor on 12.10.2017. It was a part of fulfilling his duty under Regulation 13, that the IRP verified the claim received from the applicant along with others and has stated various reasons for rejection. The grounds of rejection are as under: 

a) The claim has not been filed in the requisite Form-B; 

b) The applicant had terminated the contract vide notice dated 03.09.2016 (Annexure ‘E) with the application and  had demanded claimed amount from the corporate  debtor. 

The corporate debtor in its reply to the termination notice  dated 29.09.2016 disputed the claim amount (Annexure (F). Thereafter the applicant initiated arbitration proceedings by issuing notice dated 28.11.2016 and sought to appoint a Sole  Arbitrator (Exhibit 'C' with the reply). The applicant has also invoked the advance bank guarantee of Rs. 389/- crores provided to it by the corporate debtors. 

Accordingly, after scrutiny of the claim made by the applicant it was found that  no case was made out as there was disputed question of fact,  which was pending adjudication before the Arbitral Tribunal. It is also pertinent to mention that the corporate debtor in its reply to termination notice dated 29.09.2016 (Annexure (F) made a counter claim against the applicant. Parawise reply by the IRP has also been given which is not necessary for us to capture at this stage for the view we are taking in this matter. 

We have heard the ld. Counsel for the parties at length. Having heard the ld. Counsel, we are of the considered view that the instant application does not merit acceptance and the same is liable to be dismissed. In a matter like the one in hand the dispute with regard to the amount claim was raised between the applicant and the corporate debtor. In such a situation there could not be any outstanding amount in the books of account of the corporate debtor on the date of commencement of the CIRP, namely, 07.08.2017. 

Therefore, under Regulation 13 of the Regulations such a claim could not be verified and therefore would not be admissible. We do not  find any merit in the contention that the IRP did not have any  power to verify the claim and admit the same. The aforesaid  power emerges from Regulation 13(1) which reads as under: 

• "13. (1) The interim resolution professional or the resolution professional, as the case may be, shall verify every claim, as on the insolvency commencement date, within seven days from the last date of the receipt of the claims, and thereupon maintain a list of creditors containing names of creditors along with the amount claimed by them, the amount of their claims admitted and the security interest, if any, in respect of such claims, and update it. 

(2) The list of creditors shall be 

- a) available for inspection by the persons who submitted proofs of claim; 

- b) available for inspection by members, partners, directors and guarantors of the corporate debtor; 

- c) displayed on the website, if any, if the corporate debtor; 

- d) filed with the Adjudicating Authority; and e) presented at the first meeting of the committee.” 

A perusal of the aforesaid Regulation makes it clear that he is  under mandatory duty to verify every claim and maintain the  list of creditors containing their names along with the amount claimed by them and the amount of their claim admitted. This is exactly what the RP has done in this case. Such a claim is not verifiable from the books of accounts of the Corporate Debtor. Moreover, the same amount is subject matter of arbitration before the Arbitral Tribunal and there is a specific bar created by the admission order in terms of Section 14 of the Code. According to the Moratorium imposed by this Court in the admission order the continuation of pending suits or proceedings against the corporate debtor including execution of any decree and the proceedings before the arbitration panel are to remain stayed. The object of the moratorium clearly is to provide a cool period of 180 days extendable by 90 days to the IRP/RP and the COC to conclude the corporate insolvency resolution process. In the present case, there is no verifiable claim before the IRP and the dispute is pending in arbitration proceedings which could not proceed on account of moratorium. Allowing the disputed claim to be taken into account at this stage would unnecessarily hamper the insolvency resolution process and defeat the very purpose of admitting the petition. 

As a sequel to the above discussion we do not accept the claim made by the applicant and upheld the decision taken by the IRP. The application is devoid of merit and the same is dismissed. 

Disclaimer: The sole purpose of this blog is to create awareness on the subject and must not be used as a guide for taking or recommending any action or decision. A reader must do his own research and seek professional advice if he intends to take any action or decision in the matters covered in this blog.

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