2019 (9) TMI 1726 - AT - Insolvency and Bankruptcy

Allocation for payment in favour of Financial Creditor - Revised Resolution Plan under Section 12A is under consideration before the Committee of Creditors - HELD THAT - The Appellant and the Promoters during the discussion in the meeting of Committee of Creditors may give fresh proposal for payment and the amount to be paid to all the similarly situated Financial Creditors and Operational Creditors . If no revised proposal equating all the Financial Creditors and Operational Creditors is submitted by 12th September, 2019, this Appellate Tribunal will not allow further time to the Appellant and will proceed in the matter on merit. In case a revised proposal as per our observation is submitted by 12th September, 2019, the Committee of Creditors will consider the same and will ensure that no discrimination is made between equally situated Financial Creditors , Operational Creditors and Creditors and pass appropriate order by 26th September, 2019. Post the case for order on 30th September, 2019.

Summary

Issues involved:
Revised 'Resolution Plan' under Section 12A pending consideration before the 'Committee of Creditors'; Allocation for payment to a specific 'Financial Creditor' disputed; Requirement for a fresh proposal for payment to all 'Financial Creditors' and 'Operational Creditors'; Deadline for submission of revised proposal; Potential consequences of failure to submit a revised proposal; Instructions for the 'Committee of Creditors' to ensure no discrimination among creditors; Next hearing date scheduled; Requirement for a status report from the 'Resolution Professional'.

The judgment revolves around a revised 'Resolution Plan' under Section 12A that is currently being reviewed by the 'Committee of Creditors'. The counsel for a 'Financial Creditor' highlights the absence of any allocation for payment to their client in the plan. Consequently, the Appellant and the Promoters are directed to present a fresh proposal during the 'Committee of Creditors' meeting, specifying the amounts to be paid to all 'Financial Creditors' and 'Operational Creditors'. Failure to submit a revised proposal equating the creditors by 12th September 2019 would result in the Appellate Tribunal proceeding with the case on merit. However, if a revised proposal is submitted by the specified date, the 'Committee of Creditors' must ensure no discrimination among 'Financial Creditors', 'Operational Creditors', and 'Creditors', issuing an appropriate order by 26th September 2019.

The judgment sets the next hearing date for the case as 30th September 2019, indicating the timeline for further proceedings. Additionally, it mandates the 'Resolution Professional' to submit a status report by 27th September 2019, ensuring transparency and accountability in the resolution process. These directives aim to streamline the resolution proceedings, address the concerns raised by the 'Financial Creditor', and uphold the principles of fairness and equality among all categories of creditors involved in the resolution plan.