2019 (10) TMI 1481 - AT - Companies Law

Validity of split order - dissenting Financial Creditor raising question with regard to valuation - While one of the Hon ble Member (Judicial) by impugned order ask for fresh valuation but the other Hon ble Member (Technical) dissented by separate order - HELD THAT - Resolution Professional should bring this fact to the notice of the said Bench of the Adjudicating Authority comprising of the same Members i.e. Mr. Bhaskara Pantula Mohan, Member (J) and Mr. V. Nallasenapathy, Member (Technical) who will take steps to refer the matter to the third Member in accordance with law and if so required, after necessary permission of the Hon ble President, National Company Law Tribunal. The Resolution Professional will also bring this fact to the notice of the President, National Company Law Tribunal who may pass the appropriate order to place the matter before the third Member. There is a dissenting order passed by the two Members, we are not considering the question of legality and proprietary of the order or the adverse remarks passed against the Resolution Professional , which is left open for determination by the 3rd Hon ble Member and if so required later it may be decided by this Appellate Tribunal. Appeal disposed off.

Summary

Issues Involved:
1. Appeal against the split order in a Corporate Insolvency Resolution Process regarding a resolution plan's valuation.
2. Requirement for referral to the President, National Company Law Tribunal for a third Member's opinion.
3. Dissenting orders by two members and the need for further determination.

Analysis:
1. The judgment pertains to an appeal against a split order in a Corporate Insolvency Resolution Process involving a resolution plan's valuation for a Corporate Debtor. The Resolution Professional had filed a plan approved by the Committee of Creditors with a significant voting share. However, a dissenting Financial Creditor raised concerns about the valuation, leading to one Member (Judicial) calling for fresh valuation while the other Member (Technical) dissented with a separate order. The matter was not referred to the President, National Company Law Tribunal for a third Member's opinion.

2. The Tribunal directed the Resolution Professional to bring the issue to the attention of the Adjudicating Authority's Bench comprising the same Members, who would then refer the matter to a third Member as per the law. The Resolution Professional was also instructed to inform the President, National Company Law Tribunal, who could order the matter to be placed before the third Member. The judgment emphasized the importance of following due process in such situations to ensure a fair and lawful resolution.

3. Given the dissenting orders by the two Members, the Tribunal refrained from considering the legality or propriety of the orders or any adverse remarks against the Resolution Professional. These aspects were left for determination by the third Member, with the possibility of later review by the Appellate Tribunal if required. The appeal was disposed of with these observations, highlighting the need for a comprehensive and lawful resolution process in corporate insolvency cases to uphold fairness and justice.