# In the matter of Sainth Estates Private Limited IA (IBC)-449-2022 in CP (IB) No. 651-7-HDB-2018

> NCLT judgment dated 2022-07-08. Citation: TCN-2022-NCLT-01815. The application IA (IBC)/449/2022 was filed in CP (IB) No.651/7/HDB/2018 under Section 60(5) of…

- **Court:** NCLT
- **Order date:** 8 Jul 2022
- **Citation:** TCN-2022-NCLT-01815
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/sainth-estates-private-limited-ia-ibc-449-2022-in-cp-ib-no-651-7-hdb-2018-5c2d5e69

## Summary

### Background

The application IA (IBC)/449/2022 was filed in CP (IB) No.651/7/HDB/2018 under Section 60(5) of the Insolvency and Bankruptcy Code, 2016, read with Rule 8, 11 & 32 of NCLT Rules, 2016. The applicant, M/s. Sarwottam Ispat Limited, sought a direction from the Tribunal to Respondent No. 1, K. Premsagar Rao, to release/pay Rs. 55,00,000 as approved in the Resolution Plan on top priority. The applicant claimed that Rs. 2,55,78,001 was filed before IRP/Respondent No. 2, M/s. Sainath Estates Pvt Ltd, and the IRP admitted the claim of Rs. 1,89,93,981 without prejudice. As per the Resolution plan submitted by Mr. K. Premsagar Rao, after haircut, the COC allocated Rs. 55,00,000 to the Applicant, to be paid within one month from the date of approval of the Resolution plan,

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## Facts

M/s. Sarwottam Ispat Limited (Applicant) filed an application seeking the release of Rs. 55,00,000 from K. Premsagar Rao (Respondent No. 1) as per an approved Resolution Plan. The Applicant had filed a claim of Rs. 2,55,78,001, which was admitted by the IRP/Respondent No. 2, M/s. Sainath Estates Pvt Ltd, for Rs. 1,89,93,981. The Resolution Plan allocated Rs. 55,00,000 to the Applicant, to be paid within one month of the plan's approval. However, the payment was pending. The Tribunal had ordered liquidation in IA no.71/2022. The relevance of the liquidation order is that it supersedes the resolution plan, and any claims must now be addressed through the liquidation process.

## Issues and analysis

### Issue 1: Whether the Tribunal should direct Respondent No. 1 to release/pay Rs. 55,00,000 to the Applicant …

**Ratio:** The Tribunal's power to enforce the Resolution Plan is subject to the overall status of

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**Reasoning:** The Tribunal noted that a liquidation order had been passed in IA no.71/2022. This order

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**Interpretation:** The passing of a liquidation order signifies the failure of the resolution

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**Application:** Since a liquidation order was already in effect, the Tribunal could not direct

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## Parties

- **Judges:** N. Venkata…; Veera Brahma Rao…
- **Appellants:** M/s.Sarwottam…
- **Respondents:** M/s Sainath…; K. Premsag…

## Timeline

- **2018-01-01 — CP (IB) No.651/7/HDB/201…**: The Corporate Insolvency Resolution Process (CIRP) was initiated with the filing of CP…
- **2022-01-01 — IA no.71…**: Liquidation order…

## 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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