M/s. Life Insurance Corporation of India Vs Mr.Sutanu Sinha, - It is relevant to observe that in provisions where the legislature intended to prescribe a strict bar (e.g. Section 61(2) IBC, Section 34 of the Arbitration and Conciliation Act, Section 125 of the Electricity Act), the legislative intent was expressly stated. In contrast, no such embargo exists in Section 42 of the IBC or Regulation 21A of Liquidation Regulations. Hence, condonation of delay is permissible when justified on facts.

 NCLT Hyd-2 (2025.07.16) in M/s. Life Insurance Corporation of India Vs Mr.Sutanu Sinha, [IA(IBC) 1154 of 2020 in C.P (IB) No.294/7/HDB/2017],held that;

• In Sesh Nath Singh v. Baidyabati Sheoraphuli Cooperative Bank Ltd. (2021)7 SCC 313, the Hon’ble Supreme Court held that proceedings under the IBC are subject to the provisions of the Limitation Act, 1963, including Section 5, unless expressly excluded.

• The IBC is a beneficial legislation aimed at maximizing the value of assets and ensuring equitable distribution among stakeholders. Procedural timelines, though significant, are meant to promote expedient resolution and liquidation—not to defeat substantive claims on hyper-technical grounds. The Hon’ble Supreme Court in Swiss Ribbons Pvt. Ltd. v. Union of India (2019) 4 SCC 17 emphasized the need to balance procedural compliance with equitable justice, and such balancing must guide this adjudication as well.

• In the absence of express exclusion, the Limitation Act applies to proceedings before this Authority. In Surendra Trading Company v. Juggilal Kamlapat Jute Mills Co. Ltd. (2017) 16 SCC 143, the Hon’ble Supreme Court clarified that statutory timelines under the Code are directory and not mandatory.

• The bar on condonation of delay under Section 61(2) of the IBC, as elucidated in National Spot Exchange Ltd. v. Anil Kohli AIR 2021 SC 4339, does not apply here. Section 42 of the Code contains no outer limit for preferring an Appeal nor any bar on the applicability of the Limitation Act. Therefore, this Tribunal retains jurisdiction to condone the delay upon sufficient cause being shown.

•  It is relevant to observe that in provisions where the legislature intended to prescribe a strict bar (e.g. Section 61(2) IBC, Section 34 of the Arbitration and Conciliation Act, Section 125 of the Electricity Act), the legislative intent was expressly stated. In contrast, no such embargo exists in Section 42 of the IBC or Regulation 21A of Liquidation Regulations. Hence, condonation of delay is permissible when justified on facts.

• Equitable principles warrant invocation in this case. Rejecting the Applicant’s claim purely on procedural grounds, despite its partial security and considerable exposure, may result in disproportionate prejudice and disrupt the equitable distribution of the liquidation estate. A purposive construction of the Code militates against such exclusion.

Excerpts of the Order;

# 1. This is an application filed under Section 42 of the Insolvency and Bankruptcy Code, 2016 (IBC), challenging the rejection of the Applicant’s revised claim by the Liquidator of M/s. IVRCL Limited (CD) vide communication dated 28.11.2019.

# 2. Application:

2.1 The Applicant had extended financial assistance to the CD in 2008 by subscribing to Secured, Redeemable, Non-Convertible Debentures (NCDs) worth Rs.200 crores.

2.2 The CD was admitted into Corporate Insolvency Resolution Process (CIRP) on 23.02.2018, and an Order of Liquidation was passed on 26.07.2019.

2.3 Upon the Liquidator’s Public Announcement dated 31.07.2019, the Applicant submitted its claim in Form-D on 21.08.2019. However, the said Form did not contain details on the status of relinquishment of security interest as required by Column 8A of Form-D, inserted via IBBI Notification dated 25.07.2019.

2.4 The Liquidator pointed out this omission vide email dated 18.09.2019. The Applicant responded promptly on 19.09.2019, stating that it had not relinquished its security interest. Subsequently, at the instance of the Liquidator, the Applicant submitted a revised Form-D on 05.11.2019, clarifying partial relinquishment.  

2.5 The Liquidator, while acknowledging receipt of the revised claim, declined to admit it unless delay in submission was condoned by the NCLT. Consequently, the present Application was filed under Section 42.

# 3. Counter of the Respondent:

3.1 The Respondent relies on Regulation 21A of the IBBI (Liquidation Process) Regulations, 2016 (Liquidation Regulations), to submit that the Applicant was required to intimate its decision on relinquishment of security interest within 30 days from the liquidation commencement date, failing which the asset is deemed to be part of the liquidation estate.

3.2 The Respondent contends that the Form-D did not disclose the status of relinquishment, and repeated communications and meetings reflected the Applicant's delay and omission in this regard.

# 4. We have heard the Learned Senior Counsel for the Applicant and Learned Counsel for the Respondent, perused the written submissions and have gone through the entire records.

# 5. Findings:

5.1 The present application was filed on 01.12.2020, i.e., 368 days after the rejection of the revised Form-D by the Liquidator on 28.11.2019. Though the application was initially allowed by this Authority on 02.02.2022, the said Order was subsequently set aside by the Hon’ble National Company Law Appellate Tribunal (NCLAT) vide Order dated 29.07.2024, with a direction to consider the matter afresh.  

5.2 It is not in dispute that Column 8A in Form-D, which requires disclosure regarding relinquishment of security interest, was introduced by the IBBI Notification dated 25.07.2019—prior to the Liquidator’s public announcement dated 31.07.2019. Accordingly, the Applicant was duty-bound to furnish the relevant disclosure in terms of the amended Form-D and Regulation 8A, which reads as under:

• [8A WHETHER SECURITY INTEREST RELINQUISHED Yes/No]

5.3 Liquidation Regulations mandates that a Secured Creditor must intimate its decision on relinquishment of security interest within 30 days of the liquidation commencement date. A failure to do so results in the secured asset forming part of the liquidation estate by operation of Law.

5.4 Admittedly, the initial claim submitted by the Applicant did not comply with the amended Form-D and lacked the necessary disclosure under Column 8A. However, the Liquidator, instead of rejecting the claim outright, provided the Applicant an opportunity to clarify the position via email dated 18.09.2019. The Applicant responded promptly on 19.09.2019 and thereafter submitted a revised Form-D on 05.11.2019. The record also reflects that the Liquidator addressed an email on 24.09.2019 (forming part of the Applicant record), requesting resubmission of Form-D with appropriate disclosure regarding relinquishment.

5.5 Thereafter, the Liquidator asked the Applicant to obtain condonation of delay from this Authority. The Liquidator’s continuous engagement with the revised claim and the instruction to seek condonation contributed significantly to the delay in approaching this Authority.

5.6 The total delay, therefore, consists of (i) 71 days in submission of the revised Form-D; and (ii) 368 days in filing the present Application after rejection of the claim by the Liquidator.

5.7 Both periods must be assessed in the context of the Liquidator’s interactions with the Applicant and the developing legal framework concerning procedural timelines.

5.8 It is a well-settled principle that even in the absence of a formal application for condonation of delay, such delay can be condoned where sufficient cause is evident on record. In Sesh Nath Singh v. Baidyabati Sheoraphuli Cooperative Bank Ltd. (2021)7 SCC 313, the Hon’ble Supreme Court held that proceedings under the IBC are subject to the provisions of the Limitation Act, 1963, including Section 5, unless expressly excluded. Therefore, the absence of an express prayer for condonation is not fatal in the present case.

5.9 The IBC is a beneficial legislation aimed at maximizing the value of assets and ensuring equitable distribution among stakeholders. Procedural timelines, though significant, are meant to promote expedient resolution and liquidation—not to defeat substantive claims on hyper-technical grounds. The Hon’ble Supreme Court in Swiss Ribbons Pvt. Ltd. v. Union of India (2019) 4 SCC 17 emphasized the need to balance procedural compliance with equitable justice, and such balancing must guide this adjudication as well.

5.10 The IBC and its allied regulations must be interpreted purposively. In the absence of express exclusion, the Limitation Act applies to proceedings before this Authority. In Surendra Trading Company v. Juggilal Kamlapat Jute Mills Co. Ltd. (2017) 16 SCC 143, the Hon’ble Supreme Court clarified that statutory timelines under the Code are directory and not mandatory. Further, in Kalpraj Dharamshi v. Kotak Investment Advisors Ltd. (2021) 10 SCC 401, the Hon’ble Supreme Court recognized that a litigant is entitled to benefit under Section 14 of the Limitation Act if it had been bona fide pursuing a remedy in a wrong forum with due diligence. These principles apply with equal force to the Applicant’s conduct in the present case.

5.11 The bar on condonation of delay under Section 61(2) of the IBC, as elucidated in National Spot Exchange Ltd. v. Anil Kohli AIR 2021 SC 4339, does not apply here. Section 42 of the Code contains no outer limit for preferring an Appeal nor any bar on the applicability of the Limitation Act. Therefore, this Tribunal retains jurisdiction to condone the delay upon sufficient cause being shown.

5.12 It is relevant to observe that in provisions where the legislature intended to prescribe a strict bar (e.g. Section 61(2) IBC, Section 34 of the Arbitration and Conciliation Act, Section 125 of the Electricity Act), the legislative intent was expressly stated. In contrast, no such embargo exists in Section 42 of the IBC or Regulation 21A of Liquidation Regulations. Hence, condonation of delay is permissible when justified on facts. 

5.13 In the present case, the delay in submission of the revised Form-D and in filing the Appeal was neither deliberate nor mala fide. The Applicant responded expeditiously to the Liquidator’s communications and acted in good faith. The Liquidator’s act of requiring resubmission and interacting with the revised claim without immediately raising the issue of limitation contributed to the delay. These circumstances justify invoking equitable principles to condone the delay.

5.14 Equitable principles warrant invocation in this case. Rejecting the Applicant’s claim purely on procedural grounds, despite its partial security and considerable exposure, may result in disproportionate prejudice and disrupt the equitable distribution of the liquidation estate. A purposive construction of the Code militates against such exclusion.

# 6. Final Order:

In view of the detailed findings above and considering the principles of equity, justice, and good conscience as embodied in the IBC and the applicable judicial precedents:

• I. The delay of 71 days in submission of the revised Form-D by the Applicant and the delay of 368 days in filing the present Application under Section 42 of the IBC are hereby condoned.

• Ii. The rejection of the Applicant’s revised claim by the Liquidator on the ground of delay is set aside.

• Iii. The Liquidator is directed to consider the Applicant’s revised claim dated 05.11.2019 on merits and in accordance with law, within a period of four weeks from the date of receipt of this Order.

• Iv. It is clarified that this Order does not amount to an adjudication on the validity or admissibility of the claim itself, which shall be considered afresh by the Liquidator independently, without being influenced by the earlier rejection.

# 7. Accordingly, the application stands allowed in the above terms. No order as to costs. 

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NCLT Hyderabad (2024.10.03) M/s Meja Urja Nigam Pvt Ltd, vs. Mr. Sutanu Sinha, Liquidator of M/s IVRCL Limited, - The Liquidator is thus responsible for determining the actual dues to be paid from the proceeds of liquidation. Consequently, claims must pertain to specific payable amounts—whether fixed or variable, disputed or undisputed, legal or equitable, secured or unsecured, or arising from a judgment - rather than assumed, uncertain, or hypothetical claims.

NCLT Hyderabad (2024.10.03) M/s Meja Urja Nigam Pvt Ltd, vs. Mr. Sutanu Sinha,  Liquidator of M/s IVRCL Limited,  [I.A. No.550 of 2021 in C.P. (IB) No. 294/7/HDB/2017] held that

• A combined reading of these sections and regulations suggests that the right to payment or the right to remedy for breach of contract would give rise to a debt, existence of which once established, result in a claim that the liquidator has to admit the same. The operational creditor therefore must submit its claims with proof to establish its right to payment from the corporate debtor.

• Upon verification, the Liquidator has the discretion to either accept or reject a claim. This discretion contrasts with the more limited authority granted to the Resolution Professional (RP) during the verification of claims in CIRP proceedings.

• The Liquidator is thus responsible for determining the actual dues to be paid from the proceeds of liquidation. Consequently, claims must pertain to specific payable amounts—whether fixed or variable, disputed or undisputed, legal or equitable, secured or unsecured, or arising from a judgment - rather than assumed, uncertain, or hypothetical claims.

Excerpts of the Order;

1. In March 2012, M/s IVRCL Ltd, the Corporate Debtor (CD) was awarded a works contract by the Meja Urja Nigam Pvt Ltd, a subsidiary of NTPC Ltd (Appellant), for a total consideration of Rs 289.76 crores. The contract was set to be completed by December 2016, following an extension granted in January 2016. However, in September 2016, “due to extremely poor performance” of the CD, the contract was terminated by the Appellant.

2. In September 2017, the CD raised a final bill of Rs 126.93 crores for the work completed under the contract. This bill was subjected to the Appellant's inspection and examination, and the CD deployed a team for joint measurement and inspection of the work. In the meanwhile, the CD was admitted into the Corporate Insolvency Resolution Process (CIRP) in February 2018.

3. Pursuant to inspection and examination in July 2019, the Appellant accepted a reduced claim of Rs 11.29 crores only against the CD’s final bill of Rs 126.93 crores for the project. Additionally, the Appellant raised a claim of Rs 1089.13 crores against the CD.

4. In the same month, July 2019, the liquidation of the CD was ordered, and a liquidator was appointed. The Liquidator then advised the Appellant to file its claim under IBC, which was done by the Appellant on 15.04.2020. 

5. As it was filed beyond the due date mentioned in the public announcement, the Respondent Liquidator rejected the Appellant’s claim. Aggrieved by the decision of the Liquidator, the Appellant filed IA No. 800 of 2020 which was allowed by this Authority and the respondent was directed to consider the Appellant’s claim on merits.

6. In compliance with the directions of this Authority, the respondent Liquidator is stated to have considered the claim of the Appellant on merits, and rejected the same on 02.02.2021 by citing his reasons. The present application is against the rejection of the Appellant’s claim by the respondent, where a direction has been sought for admission of the claim of Rs 1235.71 Crores.

7. In his counter, the Respondent Liquidator has reiterated the reasons for rejecting different claims laid by the Appellant altogether amounting to Rs 1235.71 Cores.

8. Both the Appellant and the Respondent Liquidator have presented their arguments and counterarguments regarding the rejected claims. Before proceeding further, it is necessary to refer to the relevant Sections of the IBC and applicable Regulations regarding claims by operational creditors and the responsibilities of the Liquidator in verifying such claims.

The Law

9. Under Section 35(1)(a) of IBC  the Liquidator is to “verify claims of all the creditors”, and in this regard, the operational creditor under Regulation 16(1) of the Liquidation Regulations is expected to “submit its claim” to the Liquidator and “submit proof of claim” in Form-C of Schedule II under Regulation 17(1). Under Regulation 17(2), the “existence of debt due to an operational creditor” may be proved on the basis of the record available with an information utility, or “other relevant documents which adequately established the debt”.

10. The Liquidator under Regulation 23 “may call for such other evidence or clarification as he deems fit from a claimant for substantiating the whole or part of its claim” and “shall verify the claims” under Regulation 30 and “may either admit or reject the claim”. 

The term ‘claim’ is defined in Section 3(6) of IBC to mean

• “(a) a right to payment, whether or not such right is reduced to judgment, fixed, disputed, undisputed, legal, equitable, secured or unsecured;

• b) right to remedy for breach of contract under any law for the time being in force, if such breach gives rise to a right to payment, whether or not such right is reduced to judgment, fixed, matured, unmatured, disputed, undisputed, secured or unsecured;”

and ‘debt’ is defined in Section 3(11) to mean

• “…a liability or obligation in respect of a claim which is due from any person and includes a financial debt and operational debt;”

Definition of ‘operational debt’ is provided in Section 5(21) to mean

• “…a claim in respect of the provision of goods or services including employment or a debt in respect of the [payment] of dues arising under any law for the time being in force and payable to the Central Government, any State Government or any local authority;

11. A combined reading of these sections and regulations suggests that the right to payment or the right to remedy for breach of contract would give rise to a debt, existence of which once established, result in a claim that the liquidator has to admit the same. The operational creditor therefore must submit its claims with proof to establish its right to payment from the corporate debtor.

12. The Liquidator is then responsible for receiving and verifying these claims, during which he may request additional evidence or clarification from the operational creditor to substantiate the claim. After verification, the Liquidator may admit or reject the claim in whole or in part, as the case may be.

13. The act of verification of the claims has been considered by different benches of Hon’ble NCLAT/NCLT in the context of the Resolution Professional in a CIRP, to state that in collating and verifying the claim submitted by a creditor, the duties and functions are administrative and not adjudicatory in nature, and that one has to prima-facie satisfy himself about that claim from the documents submitted [Ome Prakash Verma v. Amit Jain, 2022 SCC OnLine NCLAT 491 (para 9)]. The task is limited to confirming that the claims made are true and correct, without enquiring into the rights and liabilities of the parties [Ramakant Suryanath Pande v. CS Prakash K. Pandya, 2019 SCC OnLine NCLT 4814 (para 9-11)]. Verification of claim is a process of establishing truth, accuracy or validity of the claim, and it is not meant to be passing judgement or making of a decision on the quantum of the claim [BMW India (P) Ltd. v. Sathiq Buhari, 2021 SCC OnLine NCLT 20952 (paras 17-21)]. This verification cannot be treated  as an adjudicatory exercise [S.S. Natural Resources (P) Ltd. v. Ramsarup Industries Ltd., 2021 SCC OnLine NCLAT 583 (para 139)].

14. Upon verification, the Liquidator has the discretion to either accept or reject a claim. This discretion contrasts with the more limited authority granted to the Resolution Professional (RP) during the verification of claims in CIRP proceedings. The operating clauses of the respective Regulations are:

Liquidation Regulation 30	CIRP Regulation 13
Verification of Claims	Verification of Claims
The liquidator shall verify the claims submitted within thirty days from the last date for receipt of claims and may either admit or reject the claim, in whole or in part, as the case may be.	The interim resolution professional … shall verify every claim …. as on the insolvency commencement date, within seven days from the last date of the receipt of the claims, and thereupon maintain a list of creditors containing names of creditors along with the amount claimed by them, the amount of their claims admitted and the security interest, if any, in respect of such claims, and update it.

15. The distinction between the powers of the RP and the Liquidator has been explained by the Hon’ble NCLAT in the case of Avil Menezes (Liquidator) [Avil Menezes (Liquidator) v. Tata Consulting Engineers Ltd. : (2024) ibclaw.in 344 NCLAT ] by holding, that 

• “for the purpose of liquidation, the liquidator has some special powers which are significantly different from those of the RP” 

and that

• “while in the resolution phase, the submission of claims and verification thereof is with respect to primarily determining the eligibility to be a member of the Committee of Creditors, under the liquidation process, the verification is done with the primary objective to determine the total amount of dues and priority thereof to be paid out of the liquidation estate.” (emphasis supplied)

The Liquidator is thus responsible for determining the actual dues to be paid from the proceeds of liquidation. Consequently, claims must pertain to specific payable amounts—whether fixed or variable, disputed or undisputed, legal or equitable, secured or unsecured, or arising from a judgment - rather than assumed, uncertain, or hypothetical claims.

16. Rejection of the Appellant’s various claims by the Liquidator is to be considered, keeping in view the above legal position:

Claim No.1

17. This claim pertains to Owner Issued Material (OIM) provided by the Appellant for the project to be executed by the CD, which remained unutilized and was not returned to the Appellant. According to the Appellant, OIM reconciliation was to occur at regular intervals, but the CD failed to conduct it, both before and after the contract's termination. Based on the reconciliation statements prepared by the Appellant, the total recoverable amount is computed to be Rs 19,98,92,676.

18. The Respondent Liquidator of the CD has not disputed that some of the material was left at the CD’s project site and could not be returned. However, it is asserted that the OIM remained at the project site which was secured by the Appellant by using agencies like CISF etc. Moreover, it is claimed that this unutilized material fell within permissible wastage limits.

19. It is undisputed that the contract with the CD was unilaterally terminated by the Appellant, after which the Appellant took control of the CD’s project site. As stated by the Respondent, the site was secured by the CISF and other agencies of the Appellant. Therefore, unutilized material, if any, remained under the control of the Appellant, and the CD cannot be held liable for its return. This claim has rightly been rejected by the Liquidator.

Claim No.2A

20. The claim of Rs 39,34,814 pertains to the under-insurance of the Contractor All Risk (CAR) Policy. It is alleged that this amount became payable to the Appellant due to the CD’s failure to include the cost of insurance for Owner Issued Material (OIM), as required by the contract. However, the Respondent contends that the responsibility for insuring the OIM rested with the Appellant. Since the Appellant neither obtained a separate policy nor suffered any loss due to theft or damage of the material, the claim was rejected.

21. In our view, although the CD breached its contractual obligation, no valid claim arises as no insurance policy was purchased, and no material loss occurred. The mere failure to incur an insurance expense, without any resultant loss, does not justify a claim. Therefore, the Liquidator was correct in rejecting this claim."

Claim No.2B

22. This claim relates to a shortfall in the amount retained for royalty payments owed to the Government on materials such as sand  used in the work carried out by the Corporate Debtor (CD). According to the Appellant, the total royalty payable by the CD amounted to Rs 2,16,09,724, of which Rs 25,04,802 was retained by the Appellant from amounts due to the CD, leaving a balance of Rs 1,91,04,922 to be paid by the CD.

23. It is evident that this claim does not pertain to any direct obligation of the CD towards the Appellant but rather concerns royalty payments owed to the State Government, for which liability has not yet arisen. Therefore, the Liquidator has rightly rejected this claim.

Claim No.2C

24. A sum of Rs 5,00,000 has been claimed in relation to an accident that occurred at the CD’s site in 2015. While the occurrence of the accident is not disputed, the Appellant has not demonstrated how the accident resulted in an expense or liability of the CD towards the Appellant. We find no error in the rejection of this claim.

Claim No.3

25. The CD had received an insurance claim of Rs 20,00,00,000 on account of collapse of an erected structure. For the restoration work, the entire structural steel was to be procured by the Appellant for a sum of Rs 11,30,00,000, which was paid by the CD. The Appellant has made a claim of balance amount of Rs 8,70,00,000 out of the insurance money received by the CD.

26. The Appellant has pointed to certain clauses of the contract with the CD to state that the proceeds of claims of insurance should have been deposited with them. Once again, the amount claimed is not in the nature of any expense incurred on behalf of or for the CD which could be treated as an obligation towards the Appellant. This claim has also been rightly denied by the Liquidator.

Claim No.4

27. This claim of Rs 14,48,00,000 is in the nature of penalty or fine for delaying the project. It is the position of the Respondent that the delay occurred due to a force-majeure event which was beyond the control of the CD. The Appellant has contested the existence of any force-majeure event at any point of time.

28. That Unit-2 of the project had collapsed on 11.03.2015 is a fact. Delay in execution of the project by the CD due to the collapse is a matter of enquiry. Given these circumstances, any contractual obligation that may give rise to a right to payment remains uncertain. Thus, the Liquidator's rejection of this claim was justified.

Claim No.5

29. This claim of Rs 116,10,32,733 under various headings, pertains to the works undertaken by the Appellant after the cancellation of the contract with the CD in September 2016. These works, awarded to several small agencies and M/s Simplex Infrastructure Limited, involved procurement of insurance policies, equipment rental, skilled manpower, and overhead expenses, including scrap collection.

30. The CD was not involved in any of these activities carried out post-cancellation. Furthermore, the CD was neither notified of the work being conducted nor given an opportunity to rectify any alleged deficiencies in its performance under the contract with the Appellant. 

31. While the Appellant has submitted invoices and bills for the expenses incurred, no corresponding bills were reportedly issued in the name of the CD. Given these circumstances, the Liquidator's rejection of these claims was not unjustified

Claim No.6A

32. This claim of Rs 28,62,76,266 pertains to unrecovered advances paid to the sub-agencies of the CD, which were carrying out various works based on running bills to be certified by the Appellant. These advances were reportedly provided to expedite payments to the sub-agencies and ensure the continuation of work. According to the Respondent, the amounts claimed have already been fully recovered by the Appellant through the encashment of Bank Guarantees held by them.

33.

In the application, the details regarding the adjustment of advances against pending bills and the recovery through Bank Guarantees are not clearly substantiated, rendering this claim uncertain. Therefore, rejection of this claim is also in order..

Claim No.6B

34. This claim of Rs 6,80,560 is for rental payment related to the CD’s use of the Appellant’s accommodation. This has been contested by the Respondent, who asserts that the rent amount was already accounted for in the final bill raised by the CD. If this position is correct, the claim is no longer valid.

Claim No.6C

35. This potential claim of Rs 20,00,000 is for litigation costs that the Appellant expects to incur as the principal employer in defending cases in Labour Courts and Industrial Tribunals related to the retrenchment of workers by the CD. The Respondent has stated that the litigation concerning contract workers is still pending, and any award in favor of the workers will be directly payable by the CD. As both the Appellant and the CD are to pursue the litigation in their respective capacities as principal and immediate employers, each party is responsible for bearing its own legal expenses. Therefore, the Appellant's claim to recover potential litigation costs from the CD has rightly been rejected.

Claim No.7

36. The Appellant has claimed Rs 183,00,00,000 on account of 'loss of goodwill. It is asserted that the CD's failure to commission the project on time led to a 'potential loss of revenue and profits,' which forms the basis for quantifying the loss of goodwill. The Liquidator has contested this claim by stating that the CD executed the work “dutifully and diligently” and the project was delayed due to collapse of Unit No.2 on account of earthquake, and that Unit was to be reconstructed by the CD. We find that the claim of the Appellant is based on the assumption of expected loss of profits and expected ROE (Return on Equity) thereon, and is completely hypothetical. The Liquidator has rightly rejected this hypothetical claim.

Claim No.8

37. Another loss of profit claim of Rs 480,00,00,000 has been made on account of delay caused by the CD in execution of the project for the Appellant. Once again this loss of profit claim is hypothetical and based upon several assumptions and suppositions. The Liquidator was justified in rejecting this claim also. 

Claim No.9A

38. This claim of Rs 43,43,44,533 is stated to be the cost of retaining the Appellant’s personnel on the project without redeployment due to delay in commissioning of the project to be executed by the CD. Rejection of this claim cannot be faulted upon, as the deployment of the Appellant’s personnel was in their own hands, and nothing prevented from redeploying them at any other location. The cost of hiring the personnel at other locations unconnected with the project, cannot be fastened on the CD.

Claim No. 9B & 9C

39. The claims for Rs 1,60,00,000 towards land rental and Rs 2,01,32,592 for electricity charges relate to land and power provided to the CD free of cost during the extended project period. The Respondent has argued that no rental charges can be claimed, as the Appellant did not rent any land. Regarding electricity consumption, it is stated that the CD only used electricity proportionate to the work completed, and the cost of this electricity was deducted from the running bills by the Appellant. As the Appellant has not disputed the Respondent's assertions, these claims appear untenable and were rightly rejected."

Claim No. 10

40. The Appellant has made a lump-sum claim of Rs 200,00,00,000 for potential third-party claims allegedly arising from the “poor performance” of the CD, for which the Appellant claims to have “compensated them in various forms.” The Respondent argues that any claims from third parties related to the project are the responsibility of the Appellant, and the CD cannot be held liable for such claims. As the Appellant has not clarified whether these

third-party claims have been accepted or to what extent, such uncrystallized claims cannot be treated as the responsibility of the CD. The Liquidator was justified in rejecting such uncertain potential claims.

Claim No. 11

41. The Appellant has claimed Rs 32,04,40,683 for transmission charges paid to PGCIL, alleging that these payments were incurred due to the CD's delay in completing the project, which left the Appellant unable to generate power. However, the Respondent contends that these charges were pre-commissioning fees payable by the Appellant to PGCIL for the transmission lines, unrelated to the CD's delay. As the Appellant has not refuted the Respondent's argument, and the contention appears valid, this claim does not hold."

42. To conclude, we find that the claims made by the Appellant before the Liquidator of the CD were mostly tentative, contingent, or potential claims, some of which are purely hypothetical and based on belabored presumptions. Rejection of these in the Liquidation proceedings cannot be interfered with. The Appeal filed in IA No. 550/2021 against the Liquidator’s decision is therefore dismissed.

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