CoC constituted on the basis of provisional list of claims and exclusion/delayed inclusion of a Financial Creditor from/on the CoC is prejudicial to the best interests of the Corporate Debtor – Edelweiss Asset Reconstruction Company Ltd. Vs. Mohit Goyal – NCLAT New Delhi
November 11, 2022
NCLAT held that Section 21(1) of the IBC imposes a pre-condition that the IRP shall only after collation of all claims received against the Corporate Debtor and after determination of the financial position of the Corporate Debtor constitute a CoC. The word “collation” ordinarily means verification of claim. The procedure for verification of claims is outlined in Regulation 13. It is also important to note that Section 24(6) provides that each creditor shall vote by the voting share assigned to him based on financial debts owed to such creditor. A duty is also imposed on the Resolution Professional to determine the voting share assigned to each creditor. While it is true that the claims were not submitted by the Appellant before the last date, it cannot be discounted that he had in clear terms stated that he was in the process of submitting his claims as a financial lender. However, in the same breath, we must add that while it is a well settled proposition that time is of essence under IBC, overzeal shown as in the present case, carries with it the risk of stifling the basic canons of fairness and justice, which must be obviated.