Can a claim which was rejected by RP on documentary evidence basis be paid from Contingency Fund after approval of Resolution Plan? – S. Gopi, Proprietor, Goutham roadways Vs. M/s Empee Distilleries Ltd. – NCLAT Chennai
In this case, the claim of the Applicant rejected by Resolution Professional on the basis of documentary evidence. The Adjudicating Authority denied to grant relief to make payment of the Applicant’s Claim from the Contingency Fund.
NCLAT held that Contingency Fund means a provision created in a Resolution Plan to avoid inevitable losses of creditors. It is made to include Liabilities arising which are uncertain and inevitable in nature or pending under verification. Maintaining a Claim does not necessitate or carry any nexus between the commission of a Default and the submission of a Claim. A Creditor can exercise his right to payment or to remedy for the matured, unmatured, secured, unsecured, Disputed or Undisputed Debts. In Code, 2016 to recover Debt from the Corporate Debtor, it is necessary for a Claimant to be a Creditor. While definite, identified or ascertained Claims can be easily accounted for, the problem lies when Claims which are either inevitable or contingent ones.
Further it held that the Contingency Fund is for the specific purpose to cater for Claims which were not Determined and settled finally, at the time of the Resolution Plan. There is a stipulated time frame as provided in the Resolution Plan and the Fund after meeting out the requirements of the Claims, ceased to exist. By no stretch of imagination, it can be inferred that any Claim can be entertained after the Resolution Plan, was fully implemented and the new management of the Successful Resolution Applicant had taken over.
