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Is any creditor bound by the Resolution Plan once it is approved by an adjudicating authority u/s 31(1) of IBC?

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Court :
Supreme Court of India

Brief :
Orissa   Manganese   &   Minerals   Limited (hereinafter referred to as “Corporate Debtor” or “OMML”) was engaged in the business of mining iron ore, graphite, manganese   ore   and   agglomerating   iron   fines   into   pellets through   its   facilities   in   Orissa   and   Jharkhand.     The Corporate   Insolvency   Resolution   Process   (hereinafter referred   to   as   “CIRP”)   was   initiated   in   respect   of   the Corporate Debtor by an application under Section 7 of I&B Code filed by the State Bank of India (hereinafter referred to as   “SBI”)   before   the   National   Company   Law   Tribunal, Kolkata Bench, Kolkata (hereinafter referred to as “NCLT”).

Citation :
CIVIL APPEAL NO.8129 OF 2019

IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE/ORIGINAL JURISDICTION 
CIVIL APPEAL NO.8129 OF 2019

GHANASHYAM MISHRA AND SONS
PRIVATE LIMITED THROUGH
THE AUTHORIZED SIGNATORY   ...APPELLANT(S)

VERSUS

EDELWEISS ASSET RECONSTRUCTION
COMPANY LIMITED THROUGH THE 
DIRECTOR & ORS.    .... RESPONDENT(S)

WITH

CIVIL APPEAL NO.____1554_______ OF 2021
[Arising out of Special Leave Petition No.11232 of 2020]

WRIT PETITION (CIVIL) NO.1177 OF 2020
CIVIL APPEAL NOS.______1550­1553____________ OF 2021

[Arising out of Special Leave Petition Nos.7147­7150 of
2020]

J U D G M E N T  

B.R. GAVAI, J. 

1. Leave   granted   in   Special   Leave   Petition   (Civil) Nos. 11232 of 2020 and 7147­7150 of 2020.  

2. The short but important questions, that arise for consideration in this batch of matters, are as under:­

(i) As to whether any creditor including the Central Government, State Government or any   local   authority   is   bound   by   the Resolution Plan once it is approved by an adjudicating   authority   under   sub­section

(1)   of   Section   31   of   the   Insolvency   and Bankruptcy   Code,   2016   (hereinafter referred to as ‘I&B Code’)?

(ii) As to whether the amendment to Section 31   by   Section   7   of   Act   26   of   2019   is clarificatory/declaratory  or  substantive   in nature?

(iii) As to whether after approval of resolution plan   by   the  Adjudicating   Authority  a creditor including the Central Government, State Government or any local authority is entitled   to   initiate   any   proceedings   for recovery   of   any   of   the   dues   from   the Corporate Debtor, which are not a part of the   Resolution   Plan   approved   by   the adjudicating authority?

3. We will first refer to the facts in each of these matters.

CIVIL   APPEAL   NO.8129   OF   2019   [GHANASHYAM MISHRA  AND SONS  PRIVATE  LIMITED Vs.  EDELWEISS ASSET   RECONSTRUCTION   COMPANY   LIMITED   & OTHERS]

4. Orissa   Manganese   &   Minerals   Limited (hereinafter referred to as “Corporate Debtor” or “OMML”) was engaged in the business of mining iron ore, graphite, manganese   ore   and   agglomerating   iron   fines   into   pellets through   its   facilities   in   Orissa   and   Jharkhand.     The Corporate   Insolvency   Resolution   Process   (hereinafter referred   to   as   “CIRP”)   was   initiated   in   respect   of   the Corporate Debtor by an application under Section 7 of I&B Code filed by the State Bank of India (hereinafter referred to as   “SBI”)   before   the   National   Company   Law   Tribunal, Kolkata Bench, Kolkata (hereinafter referred to as “NCLT”).

To know more in details find the attachment file

 

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on 05 May 2021
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