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2019 (5) TMI 1684 - Tri - Insolvency and BankruptcyExclusion of period when ex-promoters / directors have not been co-operating with the Resolution Professional - HELD THAT - As a matter of fact, application was filed on 25.10.2018 and the proceeding with regard co-operation by the ex-promoters/ directors are still pending as the necessary information / documents and record is yet to be furnished in its entirety. Therefore, the COC has thought it fit to authorise the resolution professionals to move for such application. Moreover, the period of 270 days will come to an end on 1 1.05.2019 and possibility of getting a resolution plan resulting in reasonable settlement of the creditors dues is most probable. Accordingly, we find that the prayer for extension of time from 25.05.2018 to till date is meritorious and the same is accepted - the period from 25.05.2018 to till date shall be excluded from the period of 270 days and resolution may be expedited. Application disposed off.
Issues: Application for exclusion of period from 25.05.2018 to the present due to pending litigation and lack of cooperation from ex-promoters/directors.
Analysis: 1. The application was filed seeking direction to exclude the period from 25.05.2018 to the present, as another application filed on 25.10.2018 was still pending due to non-cooperation by ex-promoters/directors. The Committee of Creditors (COC) passed a resolution authorizing the Resolution Professional to file such an application with the NCLT to exclude the period of litigation from the stipulated time for Corporate Insolvency Resolution Process. 2. The resolution passed by the COC received overwhelming support with 99.89% votes, indicating the seriousness of the situation and the necessity to extend the time period due to the pending issues related to non-cooperation by the ex-promoters/directors. The COC believed that extending the time period would enhance the chances of reaching a resolution plan and settling the creditors' dues satisfactorily. 3. The application highlighted that the proceeding regarding cooperation by the ex-promoters/directors was still ongoing as they had not provided all the required information, documents, and records. The Resolution Professional was thus authorized to seek an extension of time to ensure a fair and comprehensive resolution process. 4. Considering the circumstances and the impending deadline of 270 days, the Tribunal found merit in the application and accepted the request for the exclusion of the period from 25.05.2018 to the present. This decision aimed to expedite the resolution process and increase the likelihood of achieving a reasonable settlement for the creditors. 5. The Tribunal directed that the period from 25.05.2018 to the present should be excluded from the 270-day timeline, emphasizing the importance of cooperation and timely provision of necessary information by all parties involved. The resolution was disposed of with the expectation of progress in the resolution process. 6. Additional concerns were raised regarding a non-applicant respondent who had not disclosed essential information or provided documents. The respondent's counsel assured that the necessary information and documents would be shared with the Resolution Professional by a specified date, and the respondent would cooperate further as required. 7. The case was scheduled for further consideration on 24.05.2019, indicating the ongoing monitoring and supervision by the Tribunal to ensure compliance and progress in the resolution proceedings. The resolution of the issues related to non-cooperation and pending litigation was crucial for the successful resolution of the corporate insolvency matter at hand.
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