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2019 (4) TMI 1869 - Tri - Insolvency and BankruptcyApproval of Resolution Plan - section 30(6) of I B Code - HELD THAT - It is a peculiar situation in the present case where a resolution applicant is before this Adjudicating Authority offering better value to the Corporate Debtor but this Adjudicating Authority cannot send the approved resolution plan back to the CoC for reconsideration along with apparently better Resolution Plan on two counts firstly the resolution applicant has come after the submission of the approved resolution plan to the Adjudicating Authority and secondly the CoC or RP has not sought any relief to recall the approved resolution plan and for allowing them to reconsider the approved resolution plan along with the new resolution plan offering better value. The power of this bench to suo moto direct the CoC to consider the new resolution plan and reconsider the already approved resolution plan is confined by the scheme of the I B Code. The Resolution plan is approved - moratorium declared.
Issues Involved:
1. Approval of the Resolution Plan under section 30(6) read with section 31(1) of the Insolvency and Bankruptcy Code, 2016 (IBC). 2. Compliance of the Resolution Plan with section 30(2) of the IBC. 3. Objections regarding the eligibility of the Resolution Applicant under section 29A of the IBC. 4. Consideration of a new Resolution Plan after the submission of the approved plan to the Adjudicating Authority. 5. Intervention application by Harkar Developers Pvt Ltd. 6. Objections by the erstwhile Promoter and Director of the Corporate Debtor. Issue-wise Detailed Analysis: 1. Approval of the Resolution Plan under section 30(6) read with section 31(1) of the IBC: The Resolution Professional (RP) filed M.A. 1363/2018 seeking approval of the Resolution Plan submitted by Dera Finvest Private Limited. The Resolution Plan was approved by 98.72% of the Committee of Creditors (CoC) through e-voting conducted on 01.11.2018-02.11.2018. The Tribunal approved the Resolution Plan with modifications, making it binding on the corporate debtor and its stakeholders. 2. Compliance of the Resolution Plan with section 30(2) of the IBC: The RP confirmed that the Resolution Plan complies with section 30(2) of the IBC: - The plan provides for the payment of insolvency resolution process costs in priority. - Payment to Operational Creditors is more than what would be payable in liquidation. - Management of the Corporate Debtor's affairs post-approval is provided. - Implementation and supervision of the Resolution Plan are included. - The plan does not contravene any law in force. 3. Objections regarding the eligibility of the Resolution Applicant under section 29A of the IBC: The Resolution Applicant submitted an affidavit stating its eligibility under section 29A. The objections raised by the erstwhile Promoter/Director regarding the applicant's eligibility were not supported by specific averments and were dismissed by the Tribunal. 4. Consideration of a new Resolution Plan after the submission of the approved plan to the Adjudicating Authority: Chhattisgarh Distilleries Limited filed MA 602/2019 seeking to submit a new Resolution Plan offering a higher amount. The Tribunal noted that it cannot send the approved plan back to the CoC for reconsideration as the new applicant came after the submission of the approved plan, and no relief was sought by the CoC or RP to recall the approved plan. The Tribunal referenced the Supreme Court's judgment in K. Sashidhar vs Indian Overseas Bank, which limits the Adjudicating Authority's role to grounds specified in section 30(2). 5. Intervention application by Harkar Developers Pvt Ltd: Harkar Developers Pvt Ltd filed an affidavit alleging that the Resolution Applicant was involved in a criminal case. The Tribunal found the allegations to be irrelevant and dismissed the application. 6. Objections by the erstwhile Promoter and Director of the Corporate Debtor: The erstwhile Promoter/Director raised objections regarding the eligibility of the Resolution Applicant, the transfer of licenses, and the increase in the amount offered to Operational Creditors. The Tribunal dismissed these objections, noting that they were not supported by specific averments and were an attempt to challenge the commercial wisdom of the CoC. Conclusion: The Tribunal approved the Resolution Plan submitted by Dera Finvest Private Limited with modifications, binding on all stakeholders. The moratorium under section 14 ceased, and the RP was directed to forward all records to the IBBI. The application by Chhattisgarh Distilleries Limited was rejected, and the deposited amount was ordered to be returned. The Tribunal emphasized adherence to applicable laws and allowed the Resolution Applicant to seek clarifications if needed.
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