JUDGMENT :

Sudhansu Jyoti Mukhopadhaya, J.

In the ‘Corporate Insolvency Resolution Process’ initiated against ‘Essar Steel India Limited’- (‘Corporate Debtor’), the ‘Committee of Creditors’ approved the ‘Resolution Plan’ submitted by ‘ArcelorMittal India Pvt. Ltd.’- (‘Successful Resolution Applicant’) which was approved by the Adjudicating Authority (National Company Law Tribunal), Ahmedabad Bench, Ahmedabad, with certain modifications by impugned order dated 8th March, 2019.

2. A number of applications were preferred by the ‘Operational Creditors’ and the ‘Financial Creditors’ which were disposed of by individual impugned orders or the impugned order dated 8th March, 2019.

3. A group of appeals were heard together. Some of the appeals were heard separately but common impugned order being under challenge and as common question of law is involved, they are disposed of by this common judgment.

4. Mr. Prashant Ruia (Promoter), Appellant in Company Appeal (AT) (Insolvency) No. 257 of 2019, has challenged the order dated 8th March, 2019 on the ground that ‘ArcelorMittal India Pvt. Ltd.’- (‘Successful Resolution Applicant’) is ineligible in terms of Section 29A of the Insolvency and Bankruptcy Code, 2016 (hereinafter referred to as “I&B Code”).

5. In rest of the appeals, the different orders have been challenged in part, so far it relates to distribution of assets to different ‘Financial Creditors’ and the ‘Operational Creditors’ on the ground of discrimination or the modification of ‘Resolution Plan’ as suggested by the Adjudicating Authority.

6. For the reasons aforesaid, before deciding the issues whether distribution of amount amongst the ‘Financial Creditors’, ‘Operational Creditors’ and other stakeholders as shown in the impugned order dated 8th March, 2019 is discriminatory or not or whether the modification of plan as suggested by the Adjudicating Authority is proper or not, it is desirable to decide the issue as to ‘whether ‘ArcelorMittal India Pvt. Ltd.’ is eligible to file ‘Resolution Plan’ or not as raised by Mr. Prashant Ruia, the promoter of ‘Essar Steel India Limited’ and one of its shareholders.

Company Appeal (AT) (Insol.) No.257 of 2019- (Prashant Ruia v. State Bank of India & Ors.)

7. The grievance of the Appellant- Mr. Prashant Ruia is that though the Board of Directors were to take part in each meeting of the ‘Committee of Creditors’ and were to participate but the members of the Board of Directors were often either asked to leave the meeting room and/ or were invited to take part is some of the meeting, and were excluded from participating during discussions and/or deliberations of the ‘Resolution Plan’ on the ground that such meeting were ‘confidential’.

Grievance against ‘Resolution Plan’

8. Dr. U.K. Chaudhary, learned Senior Counsel for Mr. Prashant Ruia submitted that the Appellant’s right of subrogation under Section 140 of the Contract Act, 1872 and right to be indemnified under Section 145 of the Contract Act are statutory rights which have been extinguished by the ‘Resolution Applicant’ in violation of Section 30(2)(e) of the ‘I&B Code’.

9. According to him, the rights under Section 140 and Section 145 of the ‘Indian Contract Act, 1872’ are future and contingent rights of the Appellant which arise upon making any payment under the guarantee agreement. The ‘Resolution Plan’ can deal only with claims against the ‘Corporate Debtor’ as on the Insolvency Commencement date i.e. 2nd August, 2017. Therefore, ‘ArcelorMittal India Pvt. Ltd.’ in the ‘Resolution Plan’ should not have dealt with in any manner with the Appellant’s right of subrogation and indemnification, much less extinguishing such rights.

10. Learned Senior Counsel for the Appellant further submitted that the ‘Resolution Plan’ submitted by ‘ArcelorMittal India Pvt. Ltd.’, as approved, is violative of Section 29A (e) of the ‘I&B Code’.

11. According to him