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2021 (3) TMI 1252 - Tri - Insolvency and BankruptcySeeking approval of the Resolution Plan - Section 30(6) of the Insolvency and Bankruptcy Code, 2016 - HELD THAT - In K. SASHIDHAR VERSUS INDIAN OVERSEAS BANK OTHERS 2019 (2) TMI 1043 - SUPREME COURT the Hon'ble Apex Court held that if the CoC had approved the Resolution Plan by requisite percent of voting share, then as per section 30(6) of the Code, it is imperative for the Resolution Professional to submit the same to the Adjudicating Authority (NCLT). On receipt of such a proposal, the Adjudicating Authority is required to satisfy itself that the Resolution Plan as approved by CoC meets the requirements specified in Section 30(2). The instant Resolution Plan meets the requirements of Section 30(2) of the Code and Regulations 37, 38, 38(1A) and 39(4) of the Regulations. The Resolution Plan is not in contravention of any of the provisions of Section 29A of the Code and is in accordance with law. The Resolution Plan is feasible and viable. There are no workers claims. Adequate provision is provided for future claims of Operational Creditors if any the by Resolution Applicant. Resolution Applicant agreed to pay the full CIRP cost and also future costs if any as certified by the Resolution Professional and CoC. The Resolution Applicant is making full payments to Financial Creditors. The Resolution Plan submitted by M/s. Leadadroit Services Pvt. Ltd. is hereby approved - Application allowed.
Issues Involved:
1. Approval of the Resolution Plan under Section 30(6) of the Insolvency and Bankruptcy Code, 2016. 2. Compliance with the provisions of the Insolvency and Bankruptcy Code, 2016, and related regulations. 3. Evaluation and approval process by the Committee of Creditors (CoC). 4. Distribution of payments to creditors. 5. Implementation and supervision of the Resolution Plan. Issue-wise Detailed Analysis: 1. Approval of the Resolution Plan under Section 30(6) of the Insolvency and Bankruptcy Code, 2016: The application was filed by the Resolution Professional (RP) seeking approval of the Resolution Plan submitted by M/s. Leadadroit Services Pvt. Ltd. The Corporate Insolvency Resolution Process (CIRP) for the Corporate Debtor was initiated by an order dated 06.11.2018, and Mr. Navin Srichand Kanjwani was appointed as the Interim Resolution Professional. The CoC decided to replace the IRP with Mr. Rajat Mukherjee as the RP, confirmed by the Tribunal on 18.02.2019. The RP issued Form-G inviting expressions of interest (EOI) from prospective resolution applicants (PRAs). M/s. Leadadroit Services Pvt. Ltd. submitted the Resolution Plan, which was revised and approved by the CoC with a voting share of 94.60%. 2. Compliance with the provisions of the Insolvency and Bankruptcy Code, 2016, and related regulations: The RP ensured compliance with the Code and related regulations throughout the CIRP. The RP appointed registered valuers to determine the fair value and liquidation value of the Corporate Debtor as required under Regulation 27 of the IBBI (IRP for Corporate Persons) Regulations, 2016. The Resolution Plan was verified for eligibility under Section 29(A) of the Code. The Plan proposed an upfront payment of INR 39.20 Lacs to creditors, including CIRP costs. The Resolution Plan met the requirements specified in Section 30(2) of the Code and Regulations 37, 38, 38(1A), and 39(4) of the Regulations. 3. Evaluation and approval process by the Committee of Creditors (CoC): The CoC conducted multiple meetings to evaluate the Resolution Plan. In the 5th meeting held on 26.07.2019, the CoC approved the revised and final Resolution Plan of M/s. Leadadroit Services Pvt. Ltd. with a voting share of 94.60%. The CoC's decision was based on detailed deliberations and discussions on the Resolution Plan. The Hon'ble Supreme Court's observations in Committee of Creditors of Essar Steel India Limited Vs. Satish Kumar Gupta & Ors. were referred to, emphasizing that a successful resolution applicant should not face "undecided" claims after the resolution plan is accepted. 4. Distribution of payments to creditors: The Resolution Plan proposed specific distributions to creditors. The CIRP costs were estimated at ?16 Lacs, to be paid in priority. Operational creditors were to be paid not less than the amount payable in the event of liquidation, with a provision of ?14.50 Lacs for operational dues. Financial creditors were to receive ?8.70 Lacs as full and final payment, with ASREC India Ltd. receiving ?8.23 Lacs and Jana Kalyan Sahakari Bank receiving ?0.46 Lacs. The Resolution Plan balanced the interests of all stakeholders and included provisions for future claims of operational creditors. 5. Implementation and supervision of the Resolution Plan: The Resolution Applicant proposed to appoint suitably qualified and experienced persons for the operations of the Corporate Debtor. The Plan provided for the reconstitution of the board of directors, reduction of share capital, infusion of equity subscription amount, and issuance of promoter equity shares. The Tribunal ordered that the Resolution Plan becomes effective from the date of the order and shall be binding on all stakeholders. The moratorium under Section 14 of the Code ceased to have effect from the date of the order. The Applicant and the Monitoring Committee were tasked with supervising the implementation of the Resolution Plan, with periodic status updates to be filed before the Authority. Order: The Tribunal approved the Resolution Plan submitted by M/s. Leadadroit Services Pvt. Ltd., making it effective from the date of the order. The Resolution Plan shall be binding on the Corporate Debtor, its employees, members, creditors, and other stakeholders. The Resolution Applicant shall take over the Corporate Debtor with all its assets and liabilities as per the terms of the approved Resolution Plan. The approval of the Resolution Plan does not waive any statutory obligations of the Corporate Debtor, and necessary approvals must be obtained from appropriate authorities. The Memorandum of Association (MoA) and Articles of Association (AoA) shall be amended accordingly and filed with the Registrar of Companies (RoC). The moratorium under Section 14 of the Code shall cease to have effect from the date of the order. The Applicant shall forward all records relating to the conduct of the CIRP and the Resolution Plan to the IBBI and send a copy of the order to the CoC and the Resolution Applicant for necessary compliance.
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