NCLAT | BHEL’s claim of over Rs 977 crores in insolvency process against Monnet Power to be reconsidered

National Company Law Appellate Tribunal (NCLAT): Justice S.J. Mukhopadhaya, Chairperson dismissed an appeal against the order of National Company Law Tribunal, Mumbai filed by Navneet Kumar Gupta, Resolution Professional of Monnet Power Co. Ltd.

In the Corporate Insolvency Resolution Process against Monnet Power (corporate debtor), the respondent Bharat Heavy Electricals Ltd. (operational creditor) filed an application before the Resolution Professional to admit its entire claim of Rs 977,49,97,545 along with interest. On considering the same, the Resolution Professional did not accept part of the claim. NCLT, by the impugned order, held that the Resolution Professional wrongly disallowed the substantial claim in its entirety and directed him to re-examine the claim on basis of the accounts and evidence of BHEL. Aggrieved thereby, the Resolution Professional preferred the present appeal.

The only question which arose for consideration in this appeal was “whether the Resolution Professional had jurisdiction to reject the claim of BHEL in its entirety, without going into evidence?”

The Appellate Tribunal relied heavily on Swiss Ribbons (P) Ltd. v. Union of India, 2019 SCC OnLine SC 73 wherein this issue fell for consideration before the Supreme Court. It was held in that case that a Resolution Professional had no adjudicatory powers. Holding the present case being covered by Swiss Ribbons, the High Court declined to interfere with the impugned order. The Resolution Professional was directed to act in accordance with the directions NCLT. [Navneet Kumar Gupta v. BHEL, 2019 SCC OnLine NCLAT 114, decided on 26-02-2019]

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