Locus standi of the applicant to comment on the claim submitted by the financial creditor and the maintainability of the directions sought by the applicant.

Headnote:
Liquidation - Insolvency and Bankruptcy Code - The court dismissed the application seeking various reliefs related to liquidation, committee of creditors, and compliance under the Insolvency and Bankruptcy Code. The court found that the applicant had no locus to comment on the claim submitted by the financial creditor and that the directions sought by the applicant were not maintainable. The court also held that the relief sought by the applicant to deal with the application for liquidation after the admission of their claim as a financial creditor was already being simultaneously dealt with. Therefore, the court disposed of the application.
Fact of the Case:

The Corporate Debtor was admitted into Corporate Insolvency Resolution Process (CIRP) and subsequently went into CIRP 2. The Committee of Creditors unanimously resolved to liquidate the Corporate Debtor, leading to the filing of the application seeking various reliefs.
Finding of the Court:

The court found that the applicant had no locus to comment on the claim submitted by the financial creditor and that the directions sought by the applicant were not maintainable. The relief sought by the applicant to deal with the application for liquidation after the admission of their claim as a financial creditor was already being simultaneously dealt with. Therefore, the court disposed of the application.
Issues: The issues included the admission of the applicant's claim as a financial creditor, the decision of the Committee of Creditors approving liquidation, and the simultaneous consideration of multiple applications related to liquidation and admission of claims.
Ratio Decidendi: The court held that the applicant had no locus to comment on the claim submitted by the financial creditor and that the directions sought by the applicant were not maintainable. The relief sought by the applicant to deal with the application for liquidation after the admission of their claim as a financial creditor was already being simultaneously dealt with.
Final Decision: The court disposed of the application seeking various reliefs related to liquidation, committee of creditors, and compliance under the Insolvency and Bankruptcy Code.

ORDER

(Heard through Hybrid Mode) This application has been filed by Mrs. Sreedevi P & Another under Section 60(5) of IBC Code read with Rule 11 of NCLT Rules 2016 seeking following reliefs:

approving for Liquidation as u/s 33(2) of Insolvency Bankruptcy Code 2016 Liquidation, which is in violation of the Insolvency and Bankruptcy Code 2016.

Meetings of the Committee of Creditors, to determine the compliance under the Insolvency and Bankruptcy Code 2016.

nature of such debts, to determine the compliances under the Insolvency and Bankruptcy Code 2016.

to determine the compliances under the Insolvency and Bankruptcy Code 2016.

Resolution Professional(s), Ms. Chitra Srinivas and Mr. Y.N. Ramachandran, with respect to Corporate Insolvency Resolution Process initiated against the Corporate Debtor Company, herein.

3 of 10 or any further proceedings, until the disposal of IA IBC 502 CHE 2023 in IBA 146/2020.

146/2020 from the threshold term granted for conducting Corporate Insolvency Resolution Process.

in IA IBC 680/2023 in IBA 146/2020.

10. To issue such other reliefs as deems fit in the interest of justice. BRIEF HISTORY:

2. It is stated that Corporate Debtor was in the business of Real Estate Development. It is stated that Corporate Debtor was admitted into CIRP Process in CP/IB 202/2018 and Ms. Chitra Srinivas was appointed as IRP on 26.03.2018. During the CIRP process, it is stated that RP successfully concluded project takeover management with respect to nine projects from the suspended management. It is stated that the resolution of said projects was ratified by this Tribunal vide IA 487/ IB/2018 in CP 202/(IB)2018 on 24.10.2018. It is stated that the said CIRP was disposed of by Hon’ble Supreme Court vide order dated 20.11.2018 in W.P. (C ) No 452 / 2018 directing the Corporate Debtor to make payment to the Operational Creditor in the Insolvency Application. 4 of 10

3. It is stated that the Corporate Debtor again went into Corporate Insolvency Resolution Process (CIRP 2) on 15.03.2021 on an application under Section 9 of the Code by one Mr. Baiju Cheriyan in IBA/IB/ 146 of 2020. Initially Y.R. Ramachandran was appointed as Interim Resolution Professional and vide order dated 13.02.2023, Mr.S. Kangayan was appointed as Resolution Professional.

4. It is stated that the Committee of Creditors in the 3rd COC meeting held on 30.03.2023 unanimously resolved to liquidate the Corporate Debtor and accordingly the Resolution Applicant moved an IA 680 CHE 2023 for liquidation.

SUBMISSIONS BY APPLICANTS:

5. It is stated that during CIRP I (initiated vide CP 202/IB/2018) in which Ms.Chitra Srinivas was the IRP, a Project Takeover Agreement was executed. In the said agreement, the applicant was listed as member to the Shell Crest Allottees Association, which proves that applicants are the allottees and the financial creditor. It is stated that however 2nd Respondent, RP did not reckon the applicants as financial creditor and hence IA IBC 502/2023 in IBA/146/2020 has been filed by the applicant.

5 of 10

6. It is stated that RP has filed an application for initiation of liquidation proceedings u/s 33 of IBC numbered as IA IBC 680 CHE 2023 in IBA 146/2020. It is stated that the application for liquidation has been filed after the IA 502 of 2023 filed by the applicant.

7. It is stated that in IA 502 CHE 2023, the prayer of applicants is to treat them as financial creditors and include them in Committee of Creditors. When IA IBC 502 CHE 2023 seeking admission of applicant as members in CoC is pending, with full knowledge about it, Resolution Professional has recommended for liquidation with approval of existing CoC, in haste which is bad in law.

8. It is stated that the swift action for initiation of liquidation process on expiry of CIRP period would give advantage to the financial creditor, M/s. Hedge Finance Limited. It is stated that the actual claim of M/s. Hedge Finance Limited against the mortgaged pr

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