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ABHAY S. OKA, UJJAL BHUYAN
Electrosteel Steel Limited (Now M/s ESL Steel Limited) – Appellant
Versus
Ispat Carrier Private Limited – Respondent
Key Points: - The approved resolution plan extinguishes claims not included therein, rendering related arbitral awards non-executable. (!) (!) - Once the resolution plan is approved under Section 31 of the IBC, all claims not part of the plan stand extinguished and cannot be pursued. (!) (!) - The Facilitation Council lacks jurisdiction to arbitrate on claims that are outside or extinguished by the approved resolution plan, making awards on such claims non-executable. (!) (!) - An award passed without jurisdiction due to the extinguishment of the claim can be challenged in execution under Section 47 CPC as a nullity, within a narrow scope. (!) (!) - The High Court’s view that moratorium or pending proceedings may revive after lifting is incorrect; the resolution plan governs finality of claims. (!) (!)
JUDGMENT :
UJJAL BHUYAN, J.
1. This appeal by special leave is directed against the judgment and order dated 17.07.2023 passed by the High Court of Jharkhand at Ranchi in CMP No. 376 of 2023 filed by the appellant.
2. Appellant had filed CMP No. 376 of 2023 before the High Court of Jharkhand at Ranchi (briefly 'the High Court' hereinafter) under Article 227 of the Constitution of India assailing the order dated 03.03.2023 passed by the learned Presiding Officer, Commercial Court/District Judge-1, Bokaro in Commercial Execution Case No. 21 of 2022 (Execution Case No. 77 of 2018). It may be mentioned that by the aforesaid order dated 03.03.2023, learned Presiding Officer, Commercial Court/District Judge-1, Bokaro (referred to hereinafter as ‘the Executing Court’) had dismissed the application dated 14.05.2019 filed by the judgment debtor (appellant), further directing the judgment debtor (appellant) to comply with the award dated 06.07.2018 passed by the West Bengal Micro, Small and Medium Facilitation Council, Kolkata within fifteen days of the order.
3. Relevant facts may be briefly noted.
4. On 02.12.2014 and 20.12.2014, respondent filed claim petitions before the West Bengal Micro, Sm
The approved resolution plan under the IBC extinguishes claims not included, rendering any arbitral award related to such claims non-executable.
Once a resolution plan is approved under the IBC, all claims not part of the plan are extinguished, and the tribunal lacks jurisdiction to adjudicate on such claims.
The main legal principle established in the judgment is the extinguishment of pre-existing and undecided claims upon approval of the Resolution Plan under Section 31 of the Insolvency and Bankruptcy ....
Execution of an arbitral award is not maintainable during corporate insolvency proceedings as approved resolution plans render prior claims extinguished.
The approval of a resolution plan under the IBC extinguishes all claims not included in the plan, including tax liabilities, ensuring a fresh start for the corporate debtor.
The approval of a resolution plan under the IBC extinguishes all claims not included in the plan, including tax liabilities.
(1) Approval of resolution plan – If a claim is submitted by an operational creditor claiming itself as a financial creditor, claim would have to be accorded due consideration in category to which it....
The rejection of a Resolution Plan must comply with statutory requirements, and commercial wisdom of the Committee of Creditors is paramount, limiting the adjudicatory review.
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