# In the matter of PRC International Hotels Hotels Private Limited IA-973-IB-2020 in CP-540-IB-2018

> NCLT judgment dated 2021-04-20. Citation: TCN-2021-NCLT-02332. The case involves an application filed by S. Boomadevi, a financial creditor, against S.…

- **Court:** NCLT
- **Order date:** 20 Apr 2021
- **Citation:** TCN-2021-NCLT-02332
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/prc-international-hotels-hotels-private-limited-ia-973-ib-2020-in-cp-540-ib-2018-9d65f9d4

## Summary

### Background

The case involves an application filed by S. Boomadevi, a financial creditor, against S. Rajendran, the Resolution Professional (RP) of M/s. PRC International Hotels Private Limited, regarding the disbursal of an amount due to the applicant under the approved resolution plan. The Corporate Insolvency Resolution Process (CIRP) was initiated against PRC International Hotels Private Limited based on an application under Section 7 of the Insolvency and Bankruptcy Code (IBC), 2016. A resolution plan was approved by the Committee of Creditors (CoC) and subsequently by the Tribunal. The applicant claimed Rs. 1,44,05,791/- in Form C, but the RP admitted a claim of Rs. 87,21,124/-, with a proposed settlement of 15% of the admitted claim. The applicant sought the disbursal of

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## Facts

S. Boomadevi, a financial creditor of PRC International Hotels Private Limited, filed a claim of Rs. 1,44,05,791/- during the CIRP. The Resolution Professional, S. Rajendran, admitted a claim of Rs. 87,21,124/-. The Resolution Plan approved by the CoC proposed a settlement of 15% of the admitted claim, amounting to Rs. 13,08,169/-, to be paid within 30 days of the plan's approval. The applicant sought disbursal of this amount along with 12% interest. The RP contended that the CoC had decided to meet additional litigation costs from the amounts payable to related party financial creditors, including the applicant. The applicant argued that the resolution plan did not provide for such deductions and the full amount should be disbursed. The CoC had approved the Resolution

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## Issues and analysis

### Issue 1: Whether the additional litigation costs can be met from the amounts payable to related party …

**Ratio:** The resolution plan, once approved, is binding on all stakeholders, including the CoC and

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**Reasoning:** The Tribunal reasoned that if the CoC and RP had not factored in the cost of additional

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**Interpretation:** The interpretation of Section 31 of the IBC, 2016, suggests that the approved

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**Application:** In this case, since the resolution plan did not explicitly provide for meeting

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## Parties

- **Judges:** R. VARADH…; Anil Ku…
- **Appellants:** S. Boom…
- **Respondents:** PRC International…; S. RAJE…

## Timeline

- **2018-07-24 — CIRP Init…**: CIRP initiated against PRC International Hotels Private Limited based on an application…
- **2018-10-24 — Claim Subm…**: Applicant, S. Boomadevi, submitted a…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 60(5) — Adjudicating Authority for corporate persons](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-60)

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