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2019 (11) TMI 842 - AT - Insolvency and BankruptcyCross Border Insolvency Protocol - participation of the Dutch Trustee (Administrator) in the meeting of the Committee of Creditors - HELD THAT - In the present case, we make it clear that the Committee of Creditors have no role to play as the agreement reached between the Dutch Administrator and the Resolution Professional of India is on the basis of the direction of this Appellate Tribunal. In spite of the same, unfortunately the Committee of Creditors interfered with the matter and put its view to the Resolution Professional resulting into difference of the suggestions. The Dutch Trustee is equivalent to the Resolution Professional of India, therefore, as per law he has a right to attend the meeting of the Committee of Creditors . However, as we do not want to overlap the power between one and other, we are of the view that the suggestion given by the Dutch Trustee (Administrator) as shown in its Clause 6.1.2 should be part of the Agreement Cross Border Insolvency Protocol . Therefore, we direct to insert Clause 6.1.2, as suggested by the Dutch Trustees' - The Dutch Trustee (Administrator) will work in co-operation with the Resolution Professional of India and, if any, suggestion is required to be given, he may give it to the Resolution Professional . The impugned order dated 20th June, 2019 passed by the Adjudicating Authority (National Company Law Tribunal), Mumbai Bench in so far it relates to the observations that the Dutch Court has no jurisdiction in the matter of corporate insolvency resolution process of Jet Airways (India) Limited, (Offshore Regional Hub) is set aside - appeal disposed off.
Issues Involved:
1. Cross Border Insolvency Protocol Agreement 2. Participation of the Dutch Trustee in the Committee of Creditors (CoC) meetings 3. Jurisdiction of the Dutch Court in the corporate insolvency resolution process of Jet Airways (India) Limited 4. Continuation of the joint Corporate Insolvency Resolution Process (CIRP) Issue-wise Detailed Analysis: 1. Cross Border Insolvency Protocol Agreement: The judgment addresses the establishment of a "Cross Border Insolvency Protocol" between the Resolution Professional (RP) of Jet Airways (India) Limited and the Dutch Trustee. The protocol is aimed at facilitating cooperation between parallel insolvency proceedings in India and the Netherlands. The protocol outlines the construction, purpose, aims, effectiveness, communication, rights to appear and attend, assets, claims, costs, stays of proceedings, and miscellaneous provisions. The protocol emphasizes the need for international cooperation, coordination of activities, communication, and information sharing to maximize the value of the company's assets for the benefit of all creditors. 2. Participation of the Dutch Trustee in the Committee of Creditors (CoC) meetings: The primary contention revolved around Clause 6.1.2 of the Cross Border Insolvency Protocol, which concerns the Dutch Trustee's participation in CoC meetings. The RP, influenced by the CoC, suggested that the Dutch Trustee should not be entitled to participate in CoC meetings. Conversely, the Dutch Trustee proposed that they should be allowed to participate as an observer without voting rights. The tribunal resolved this by directing the inclusion of the Dutch Trustee's suggestion, allowing them to participate in CoC meetings as an observer but without voting rights. The tribunal emphasized that the CoC had no role in this matter as the agreement was based on the tribunal's direction. 3. Jurisdiction of the Dutch Court in the corporate insolvency resolution process of Jet Airways (India) Limited: The tribunal set aside part of the impugned order dated 20th June 2019 by the National Company Law Tribunal (NCLT), Mumbai Bench, which stated that the Dutch Court had no jurisdiction over the corporate insolvency resolution process of Jet Airways (India) Limited. The tribunal clarified that the Dutch Trustee, equivalent to the RP in India, has the right to attend CoC meetings and work in cooperation with the RP of India. The tribunal's direction mandates compliance with the Cross Border Insolvency Protocol, subject to the procedures under the Insolvency and Bankruptcy Code, 2016. 4. Continuation of the joint Corporate Insolvency Resolution Process (CIRP): The tribunal made it clear that it did not interfere with the order admitting the application under Section 7 of the Insolvency and Bankruptcy Code, 2016, filed by the State Bank of India against Jet Airways (India) Limited. The joint Corporate Insolvency Resolution Process will continue in accordance with the Insolvency and Bankruptcy Code, 2016. The appeal was disposed of with the tribunal's observations and directions, ensuring no costs were imposed. Conclusion: The judgment underscores the importance of international cooperation in cross-border insolvency cases, ensuring that the Dutch Trustee can participate as an observer in CoC meetings, and reaffirms the jurisdiction and cooperation between the Indian and Dutch courts in the insolvency resolution process of Jet Airways (India) Limited. The joint CIRP will proceed under the established legal framework, with the Cross Border Insolvency Protocol serving as a guiding document for coordination and cooperation between the involved parties.
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