NCLAT Allows Appeals Against Rejection of Claims in CIRP, Remands for Fresh Consideration. The Tribunal held that the Resolution Professional must consider claims on merits after giving the claimants a fair hearing.

Tribunals: National Company Law Appellate Tribunal Bench: CHENNAI In Favour of Accused
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Case Note & Summary

The National Company Law Appellate Tribunal (NCLAT), Chennai bench, disposed of three company appeals (Nos. 231, 233 & 235 of 2025) filed under Section 61 of the Insolvency and Bankruptcy Code, 2016. The appeals were preferred by Mr. Naseer Ahmed, Mrs. Nuzhat Aisha Naseer, and Mr. Awaiz Ahmed against the Resolution Professional, Ravindra Beleyur, challenging the rejection of their claims in the Corporate Insolvency Resolution Process (CIRP) of a corporate debtor. The appellants contended that their claims were arbitrarily rejected without proper examination and without giving them an opportunity to substantiate the claims. The Tribunal, noting that the appeals involve common questions of fact and law, disposed of them by a common order. The NCLAT set aside the rejection of claims and remanded the matter back to the Resolution Professional for fresh consideration on merits, directing that the appellants be given a fair hearing and an opportunity to produce supporting documents. The Tribunal also directed that the Resolution Professional pass a reasoned order after considering the claims afresh.

Headnote

A) Insolvency and Bankruptcy Code - Rejection of Claims - Section 61 I&B Code, 2016 - CIRP Regulations - The appeals challenged the rejection of claims by the Resolution Professional. The Tribunal found that the claims were rejected without proper consideration and without affording the appellants sufficient opportunity to present evidence. Held that the matter requires fresh consideration on merits after giving the appellants a fair hearing. (Paras 2-5)

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Issue of Consideration

Whether the rejection of claims of the appellants by the Resolution Professional was justified and whether the appellants were given adequate opportunity to substantiate their claims.

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Final Decision

The appeals are disposed of. The rejection of claims is set aside. The matter is remanded to the Resolution Professional for fresh consideration on merits after giving the appellants a fair hearing and opportunity to produce supporting documents. The Resolution Professional shall pass a reasoned order.

Law Points

  • Section 61 of I&B Code
  • 2016
  • CIRP Regulations
  • Rejection of Claims
  • Natural Justice
  • Remand
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Case Details

2024 LawText (NCLAT) (01) 45

Company Appeal (AT) (CH) (Ins) No. 231, 233 & 235/2025

2024-06-03

Mr. G. Sridhar for Mr. NP Vijayakumar, Advocates

Mr. Naseer Ahmed, Mrs. Nuzhat Aisha Naseer, Mr. Awaiz Ahmed

Ravindra Beleyur, Resolution Professional

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Nature of Litigation

Appeals under Section 61 of I&B Code, 2016 against rejection of claims by Resolution Professional in CIRP.

Remedy Sought

Setting aside of rejection of claims and direction for fresh consideration.

Filing Reason

Claims of appellants were rejected by the Resolution Professional without proper consideration.

Previous Decisions

Claims rejected by Resolution Professional; no prior appellate order.

Issues

Whether the rejection of claims was justified. Whether the appellants were given adequate opportunity to present their claims.

Submissions/Arguments

Appellants argued that their claims were arbitrarily rejected without proper examination and without opportunity to substantiate.

Ratio Decidendi

Claims in CIRP must be considered on merits after affording the claimant a fair hearing; rejection without proper consideration is unsustainable.

Judgment Excerpts

Since the instant appeals have been preferred under Section 61 of the I & B Code, 2016, and the Appellate Provision itself contemplates to grant liberty to any 'aggrieved person', to prefer an appeal... All these company appeals are accompanied with an application for Leave to Appeal being IA No. 665/2025, 669/2025, and 672/2025, respectively.

Procedural History

The appeals were filed before NCLAT Chennai against the rejection of claims by the Resolution Professional. The Tribunal heard the matter and disposed of the appeals by a common order dated 03.06.2024.

Acts & Sections

  • Insolvency and Bankruptcy Code, 2016: Section 61
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