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2019 (9) TMI 1457 - Tri - IBCUpdation of applicants claims by collating it and to prepare Memorandum of Information - reconstitution of Committee of Creditors (CoC) in terms of the provisions of the I B Code - Exclusion of certain period from CIRP process - HELD THAT - The newly appointed member can be provided a copy of the Resolution Plan in compliance of the decision of the Hon ble Supreme Court of India in the matter of Vijay Kumar Jain vs. Standard Chartered Bank 2019 (2) TMI 97 - SUPREME COURT so as to express their opinion on the same either they may ratify the Resolution Plan already approved by the CoC with its requisite majority or they may record their dissenting vote such exercise needs to be completed in the light of the above stated decision of the Hon ble Supreme Court of India. If such formality is complied with the Resolution Plan which earlier has been approved in the 10th meeting of the CoC dated 06.05.2019 will continue to be binding and operative on its all members. Exclusion of certain period from CIRP process - HELD THAT - This Adjudicating Authority is competent to exempt/exclude certain period from Corporate Insolvency Resolution Process in the light of the decision of the Hon ble Supreme Court of India in the matter of Arecellormittal vs. Satisk Kumar Gupta 2018 (10) TMI 312 - SUPREME COURT . The period consumed in pending litigation can be excluded but it cannot be more than 330 days. Moreover even expiry of these 330 days - thus the period consumed in the hearing and disposal of this IA i.e. IA 547 of 2019 i.e. filed on 09.09.2019 needs to be exempted for the purpose of counting of Corporate Insolvency Resolution Process of 270 days equally the time consumed for hearing of disposal of IA No. 427 of 2018 (filed on 19.11.2018) till it was decided/disposed on 23.08.2019 to be excluded for counting the purpose of Corporate Insolvency Resolution Process of the Corporate Debtor company. Application allowed in part.
Issues involved:
1. Clarification sought by RP regarding previous order 2. Classification of claimants as Financial Creditors 3. Reconstitution of Committee of Creditors (CoC) 4. Validity of decisions taken by CoC 5. Inclusion of new financial creditor in CoC 6. Provision of Resolution Plan to newly appointed member 7. Exemption of period from Corporate Insolvency Resolution Process Analysis: 1. The RP sought clarification on a previous order directing the update of applicants' claims, preparation of Memorandum of Information, and reconstitution of CoC. The IA was allowed and disposed of based on the RP's opinion that claimants could be classified as Financial Creditors, necessitating CoC reconstitution as per the I & B Code and previous judicial decisions. 2. The Adjudicating Authority directed the RP to treat claimants as Financial Creditors, following the Supreme Court's decision in Swiss Ribbons vs. Union of India and a previous case. The RP was instructed to reconstitute the CoC with the new financial creditor, emphasizing adherence to the I & B Code for CoC reconstitution. 3. Referring to an IBBI circular, the judgment clarified that including a financial creditor in the CoC post-constitution does not invalidate prior CoC decisions. The circular and I & B Code procedures ensure the validity of decisions taken by the CoC, even after the inclusion of a new Financial Creditor. 4. The judgment highlighted that decisions taken by the CoC before including a new Financial Creditor remain valid and binding, as long as they comply with the I & B Code. The Resolution Plan approved by the CoC will continue to be operative, with the newly appointed member given the opportunity to express their opinion on the Plan. 5. The judgment addressed the exemption of certain periods from the Corporate Insolvency Resolution Process, citing a Supreme Court case. It allowed the exclusion of time consumed in pending litigations and IA hearings from the 270-day resolution process, ensuring compliance with legal precedents. 6. The IA seeking exemption from counting periods was partly allowed, exempting the time consumed in IA hearings for the resolution process. The judgment emphasized the authority's competence to exclude specific periods, ensuring the fair and effective resolution of the Corporate Debtor company's insolvency.
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