Belated Claim Filed After Approval of Resolution Plan – Entitled Only to 50% Refund Under Clause 18.4(xi) of Resolution Plan

NCLAT held that a belated claim filed after the approval of the Resolution Plan is entitled only to a 50% refund under Clause 18.4(xi) of the Resolution Plan.

The National Company Law Appellate Tribunal (NCLAT), Principal Bench comprising Justice Ashok Bhushan (Chairperson) and Technical Members Mr. Barun Mitra and Mr. Arun Baroka, while deciding an appeal, held that a claim filed after the approval of the Resolution Plan is governed by Clause 18.4(xi) of the Plan, entitling the claimant to only 50% of the principal amount. In the absence of contemporaneous evidence of an earlier submission, such a belated claim cannot be considered under more favourable clauses. The Tribunal reiterated that once approved, the Resolution Plan binds all stakeholders and must be strictly complied with.

The Appellant had approached the National Company Law Appellate Tribunal (NCLAT) challenging the order passed by the Adjudicating Authority (NCLT, New Delhi) dated 26.07.2023, whereby IA No. 5579 of 2021 was dismissed. The IA sought directions to compel the Successful Resolution Applicant (SRA) to consider the Appellant’s claim, allegedly filed on 11.01.2019 and to execute the Conveyance Deed for an apartment in the “IREO RISE” project. The Appellant had booked both an apartment and a plot under different IREO projects in 2010, and while a substantial portion of the consideration amount for the apartment was paid, possession was never delivered. Following the imposition of a moratorium due to the initiation of CIRP proceedings on 17.10.2018, a consumer complaint previously filed by the Appellant was dismissed. Although the Appellant submitted a timely claim for the plot, the apartment-related claim was only filed through email on 07.02.2020, much after the Resolution Plan had been approved by the CoC on 23.08.2019 and later by the Adjudicating Authority on 01.06.2021.

The Appellant claimed that the apartment-related claim was initially submitted physically on 11.01.2019 by the father of Appellant No. 2 at the Mohali project office. However, the RP denied receipt of such a claim and clarified that no staff were deployed at the Mohali office. The RP only acknowledged the claim submitted via email on 07.02.2020 and included the Appellant in the List of Financial Creditors dated 30.04.2020. The Appellant argued that their claim, having been admitted and notified to the SRA, should be governed by Clause 18.4(xv) of the Resolution Plan and not by Clause 18.4(xi), which deals with belated or unverified claims. The RP and SRA, however, contended that the Appellant’s claim fell squarely under Clause 18.4(xi) and accordingly entitled them to only a 50% refund of the principal amount.

The Tribunal rejected the Appellant’s assertion that a claim had been submitted on 11.01.2019, finding no credible evidence to support this. It held that the only valid and acknowledged claim was filed on 07.02.2020, well after the Plan’s approval date of 04.09.2019. The objective of Clause 18.4(xi) was noted to be the protection of even those allottees who had not filed timely claims, allowing their claims to be dealt with at the SRA’s discretion within six months post-approval. Since the Resolution Plan binds all stakeholders, the Tribunal held that the Appellant’s belated claim rightly fell within Clause 18.4(xi), and the Adjudicating Authority had committed no error in directing adherence to this provision.

Reliance was also placed by the Tribunal on its earlier decision in Savita Dagar Solanki v. One City Infrastructure Private Limited and Others, REEDLAW 2024 NCLAT Del 09504, which involved similar facts and held that claims submitted post-cutoff date continued to remain alive for a limited period and were to be dealt with by the SRA in accordance with the Plan. Noting that the Appellant filed IA No. 5579 of 2021 only on 29.11.2021, well after the Plan was approved on 01.06.2021, the Tribunal concluded that the Appellant’s claim was rightly governed by Clause 18.4(xi). As such, the Appellant was held entitled to a refund of ₹28,78,342/-, representing 50% of the principal amount. The appeal was accordingly dismissed without any order as to costs.

Consel represented the Appellants was present but not marked.

Mr. Rishabh Nangia, Advocate, appeared for the Success Resolution Applicant.

Ms. Anuja Pethia and Mr. Rishabh Govila, Advocates, appeared for the ERP.

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