# In the matter of Western Coalfields Ltd. Vs. Sai Wardha Power Generation Ltd. & Ors. CA(AT)(Ins) No. 1424 of 2019

> NCLAT judgment dated 2020-01-03. Citation: TCN-2020-NCLAT-00596. Western Coalfields Ltd. filed an appeal against Sai Wardha Power Generation Ltd. & Ors. The…

- **Court:** NCLAT
- **Order date:** 3 Jan 2020
- **Citation:** TCN-2020-NCLAT-00596
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclat-new-delhi/western-coalfields-ltd-vs-sai-wardha-power-generation-ltd-ors-ca-0ef80c6e

## Summary

### Background

Western Coalfields Ltd. filed an appeal against Sai Wardha Power Generation Ltd. & Ors. The appellant claimed that the total operational debt of Rs.753,93,00,000/- was admitted but shown as a 'Contingent Claim' in the resolution plan, with 24 months allowed for payment, which is against the provisions of the 'I&B Code'.

## Facts

Western Coalfields Ltd. filed an appeal claiming an operational debt of Rs.753,93,00,000/- against Sai Wardha Power Generation Ltd. & Ors. The debt was admitted but classified as a 'Contingent Claim' in the resolution plan, with a 24-month payment period. Western Coalfields argued that this classification and payment timeframe violated the 'I&B Code'. The court allowed the appellant to implead 'Consortium of Sri City Private Limited' and 'KCR Enterprise LLP' as additional respondents. The court issued a notice to the respondents to justify the classification of the debt and the payment timeframe, and to explain why the resolution plan should not be declared illegal under Section 61(3) of the 'I&B Code'.

## Issues and analysis

### Issue 1: Whether the time frame to pay the amount in favour of the Appellant should be reduced as per the …

**Ratio:** The ratio is based on the provisions of the 'I&B Code' regarding the treatment of

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**Reasoning:** The court is questioning the classification of the debt as a 'contingent claim' instead

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**Interpretation:** The interpretation hinges on the correct classification of the debt under the

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**Application:** The court will apply the definitions of 'operational debt' and 'contingent

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## Parties

- **Judges:** S.J. Mukhop…; Bansi Lal…
- **Appellants:** Western Coalfields…
- **Respondents:** SAI WARDHA POWER…
- **Advocates:** Aaditya A.…; Manish…

## Timeline

- **2020-01-03 — Appellant's Su…**: Learned counsel for the Appellant submits that the total claim (Operational Debt)…
- **2020-01-03 — Notice to Res…**: Mr. Manish Jha, Advocate accepts notice on behalf of 4th Respondent (Resolution…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 61 — Appeals and Appellate Authority](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-61)

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