The Bank submitted that the policy amount was payable prior to initiation of the CIRP process but was only remitted post approval of Rplan. Resolution Professional failed to collect and monitor the Policy, as a result, it did not reflect in the assets of the Corporate Debtor and the SRA bid for the company without taking the amount into consideration. The CoC also approved the plan without having any knowledge about this amount. Surrender of policy and payments due occurred prior to approval of the Resolution Plan, therefore, the Bank being a secured creditor is entitled to the amount.
NCLT Hyderabad Bench held that any money with the third parties like creditors in form of security deposits, margin moneys, term deposit receipts or retention money will be released to corporate debtor. Further this amount can be considered as retention money also as this was retained by insurance company on account of lock in period clause in the Insurance Policy. From the above it is very clear that the amount payable by the insurance company belongs to the corporate debtor and the corporate debtor which is under the new management is entitled for the same. Further in terms of the approved resolution plan there is no such clause which provides for payments of receivables to the creditors.