Extinguishment of claims after approval of IBC Resolution Plan and Termination of Arbitral Proceedings.
Respondent No.2 initiated arbitral proceedings against the petitioner. During the pendency of said proceedings, CIRP was initiated by SBI against the petitioner.
On 8.1.2018, moratorium was imposed and 10.1.2018, the claims were invited.
On 22.1.2018, the respondent no.2 being the operational creditor of the petitioner filed claim for Rs.80.90 crores.
On 17.4.2018, the RP informed the respondent no.2 that its claim is pending before the arbitral Tribunal, it cannot considered as a crystalised liability of the petitioner and therefore, it is only a “contingent liability”.
On 11.6.2018, the Tata Steel submitted Resolution Plan.
On 30.7.2018, the RP informed the respondent no.2 that the the treatment of its claims would depend upon the terms of the Resolution Plan as may be approved.
The Resolution Plan has categorically dealt with the sub judice matters and also the claims in Clauses 8.6.2 and 8.7.2 thereof. The Resolution Plan rejecting the said claims was approved by the Adjudicating Authority.
The Petitioner filed application under Section 32(2)(c) AA for termination of arbitral proceedings in view of extinguishment of claim under the approved Resolution Plan.
In the present case, in view of the Resolution Plan being approved by the Adjudicating Authority, the claim of Respondent No. 2 stood extinguished, and therefore, in terms of the judgment of the Hon’ble Supreme Court in Electrosteel (supra), the learned Arbitral Tribunal did not have the jurisdiction to proceed further with the adjudication of the said claim.
Judgment dated 9.1.2026 of the Hight Court of Delhi in W.P. (Civil) No.10431 of 2020 of Tata Steel Limited Vs. Minister of Corporate Affairs and another
