2023 (2) TMI 1181 - AT - Insolvency and Bankruptcy

Approval of a Resolution Plan in respect of McNally Sayaji Engineering Limited (Corporate Debtor) - approval of the resolution plan by the Committee of Creditors already done - HELD THAT - The Resolution Plan has been approved with 99.787% voting share. As per the CoC, the plan meets the requirement of being viable and feasible for revival of the Corporate Debtor. By and large, all the compliances have been done by the RP and the Resolution Applicant for making the plan effective after approval by this Bench. On perusal of the documents on record, it is clear that the Resolution Plan is in accordance with sections 30 and 31 of the IBC and also complies with regulations 38 and 39 of the IBBI (Insolvency Resolution Process for Corporate Persons) Regulations, 2016. Granting time to comply with the statutory obligations or seeking approvals from authorities - HELD THAT - The Resolution Applicant is directed to do so within one year from the date of this order, as prescribed under section 31(4) of the Code. This Adjudicating Authority has power to grant reliefs, waivers and concessions only in relation to the Code and the Companies Act 2013 (within the powers of the NCLT) for achieving the objective of the Code. No reliefs, waivers and concessions that fall within the domain of other government department/authorities are granted. The reliefs, waivers and concessions that pertain to other governmental authorities/departments shall be dealt with the respective competent authorities/forums/offices, Government or Semi Government of the State or Central Government with regard to the respective reliefs, waivers and concessions. The competent authorities including the Appellate authorities may consider grant such reliefs, waivers and concessions keeping in view the spirit of the Code. On the date of approval of resolution plan by the Adjudicating Authority, all such claims, which are not a part of resolution plan, shall stand extinguished and no person will be entitled to initiate or continue any proceedings in respect to a claim, which is not part of the resolution plan - Petition disposed off.

Issues Involved:
1. Application under section 30(6) of the Insolvency and Bankruptcy Code, 2016.
2. Constitution and meetings of the Committee of Creditors (CoC).
3. Collation of claims.
4. Corporate Insolvency Resolution Process (CIRP) and compliances.
5. Evaluation and voting on Resolution Plans.
6. Compliance of the approved Resolution Plan with various provisions.
7. Details of Resolution Plan/Payment Schedule.
8. Management/Implementation and Reliefs as per the Resolution Plan.
9. Relinquishment/Waiver of liabilities and Approvals.
10. Orders and directions from the Tribunal.

Detailed Analysis:

1. Application under section 30(6) of the Insolvency and Bankruptcy Code, 2016:
The application I.A. (IB) No. 1214/KB/2022 was filed under section 30(6) of the Insolvency and Bankruptcy Code, 2016, following the approval of the resolution plan by the Committee of Creditors (CoC). This application was submitted by the Resolution Professional of McNally Sayaji Engineering Limited for the approval of a Resolution Plan.

2. Constitution and meetings of the Committee of Creditors (CoC):
The Interim Resolution Professional (IRP) made a public announcement on 15 February 2021, calling for proof of claims from creditors. The CoC was constituted with sixteen Financial Creditors, and a report was filed before the Adjudicating Authority. Eleven CoC meetings were held during the CIRP period, from 14 December 2021 to 17 August 2022.

3. Collation of claims:
The amounts claimed and admitted by various creditors were summarized, with significant discrepancies between claimed and admitted amounts. For instance, Secured Financial Creditors claimed Rs. 3217,25,44,643.08, but only Rs. 294,15,79,977.95 was admitted.

4. Corporate Insolvency Resolution Process (CIRP) and compliances:
Invitations for Expressions of Interest (EoI) were issued on 28 January 2022, with the last date for receipt being 12 February 2022. Seventeen EoIs were received, and the Information Memorandum, Evaluation Matrix, and Request for Resolution Plan (RFRP) were shared with Prospective Resolution Applicants. The last date for submission of Resolution Plan was extended to 21 April 2022.

5. Evaluation and voting on Resolution Plans:
The Resolution Plans were discussed and revised in various CoC meetings. In the 8th CoC meeting, negotiations and bidding took place, and the revised plans were put for e-voting in the 11th CoC meeting. The Resolution Plan submitted by Tega Industries Limited was approved with a 99.787% voting share.

6. Compliance of the approved Resolution Plan with various provisions:
A Compliance Certificate in Form 'H' was submitted, detailing compliance with sections 30 and 31 of the IBC and regulations 38 and 39 of the CIRP Regulations. The Resolution Applicant also submitted an affidavit of eligibility under section 29A of the Code.

7. Details of Resolution Plan/Payment Schedule:
The Resolution Plan defined the "Transfer Date" and included details on the management of the company post-resolution, the term of the resolution plan, and its implementation and supervision.

8. Management/Implementation and Reliefs as per the Resolution Plan:
The Resolution Plan provided for the management of the company, the term of the resolution plan, and its implementation. Reliefs, exemptions, and waivers were sought for successful implementation.

9. Relinquishment/Waiver of liabilities and Approvals:
Reliefs, waivers, and concessions were sought, with the Tribunal granting those within its jurisdiction under the Code and the Companies Act 2013. Claims not part of the resolution plan were extinguished, as per the Supreme Court's judgment in Ghanashyam Mishra and Sons Pvt Ltd v Edelweiss Asset Reconstruction Company Ltd.

10. Orders and directions from the Tribunal:
The Tribunal approved the Resolution Plan, finding it compliant with sections 30 and 31 of the IBC. The Resolution Applicant was directed to comply with statutory obligations within one year. Reliefs and waivers were granted as per the Code and relevant Supreme Court judgments. The Resolution Professional was discharged from duties, and the Resolution Applicant was granted access to the corporate debtor's records and premises. The Moratorium under section 14 of the Code ceased, and the Resolution Plan became binding on all stakeholders.

Conclusion:
The Tribunal approved the Resolution Plan submitted by Tega Industries Limited, finding it compliant with the necessary legal provisions and viable for the revival of McNally Sayaji Engineering Limited. The Resolution Professional was directed to hand over all relevant records to the Resolution Applicant, and the Moratorium was lifted.

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