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2020 (3) TMI 1104 - Tri - Insolvency and BankruptcyApproval of Final Resolution Plan - section 31 of the IBC - extension of CIRP period - HELD THAT - The resolution professional has examined the modified plan and has found it to be in compliance with section 30(2) of the IBC read with regulation 38 of the CIRP Regulations. The provision regarding waiver of any liability accruing in respect of minimum alternate tax (MAT) kept in resolution plan originally has been deleted in modified plan. The term of plan is increased from three years to seven years without affecting the feasibility and viability of the plan. The resolution professional Mr. Vikram Bajaj will be the monitoring and supervising agency for implementation of the plan. The remuneration of the monitoring agency shall be ₹ 1,50,000 plus taxes and out of pocket expenses at actual - The corporate debtor will stand amalgamated with the resolution applicant as per the scheme of amalgamation. It is stated that the scheme of amalgamation between Swadisht Oils Pvt. Ltd. (transferor company) and Rajasthan Liquors Ltd. (transferee company) as given in annexure B to modified resolution plan at pages 153-168 is to facilitate the insolvency resolution of transferor company and shall enable continuity of operations of SOPL and enhance its viability, apart from saving employment of existing employees and works. The modified resolution plan submitted by Atyant Capital India Fund-1 is found in conformity of section 30(2) of the Code and the same is approved.
Issues Involved:
1. Approval of the resolution plan under sections 30(6) and 31(1) of the Insolvency and Bankruptcy Code, 2016 (IBC). 2. Rejection of Exim Bank's claim as a financial creditor. 3. Reconstitution of the Committee of Creditors (CoC) including Exim Bank. 4. Exclusion of time consumed in litigation from the CIR process. 5. Evaluation and negotiation of revised resolution plans. 6. Compliance of the resolution plan with IBC and CIRP Regulations. Issue-wise Detailed Analysis: 1. Approval of the Resolution Plan: The application was filed under sections 30(6) and 31(1) of the IBC, seeking approval of the resolution plan submitted by "Atyant Capital India Fund-1." The resolution professional confirmed that the plan complied with section 30(2) of the IBC and regulation 38 of the CIRP Regulations. The plan was approved by the CoC with a 100% voting share. The resolution plan met all statutory requirements, including payment of insolvency resolution process costs, repayment of debts to operational creditors, management of the corporate debtor, and compliance with existing laws. 2. Rejection of Exim Bank's Claim: During the CIR process, the resolution professional rejected Exim Bank's claim as a financial creditor. This decision was upheld by the Adjudicating Authority and subsequently challenged by Exim Bank before the National Company Law Appellate Tribunal (NCLAT). The NCLAT recognized Exim Bank as a financial creditor and directed the reconstitution of the CoC to include Exim Bank. 3. Reconstitution of the CoC: Following the NCLAT's decision, the CoC was reconstituted to include Exim Bank. The CoC was directed to reconsider the resolution plans already submitted, without going for rebidding, as the plans had already been opened. The Adjudicating Authority noted the resignation of the erstwhile resolution professional and directed Exim Bank to call for a CoC meeting to appoint a new resolution professional. 4. Exclusion of Time Consumed in Litigation: The CoC decided to authorize the resolution professional to file an application for the exclusion of the time period consumed in litigation. This was necessary due to the extensive litigations that marred the CIR process. An application was filed before the NCLAT seeking clarification on whether resolution applicants could submit revised plans to maximize the value of assets. 5. Evaluation and Negotiation of Revised Resolution Plans: The resolution professional sought confirmation from both Atyant Capital and Hindustan Oil Exploration Co. Limited (HOEC) regarding their interest in participating in the resolution process. Both applicants submitted revised plans, which were evaluated by the CoC. Atyant Capital was declared the highest bidder (H1), while HOEC was the second highest bidder (H2). HOEC declined to outbid Atyant Capital, leading to further negotiations with Atyant Capital, resulting in an improved financial proposal. 6. Compliance with IBC and CIRP Regulations: The resolution professional certified that the resolution plan met all requirements of the IBC and CIRP Regulations. The plan provided for the payment of IRP costs, repayment of operational creditors, management of the corporate debtor, and supervision of the plan implementation. The plan also identified specific sources of funds for these payments and included a scheme of amalgamation to enhance the viability of the corporate debtor. Conclusion: The modified resolution plan submitted by "Atyant Capital India Fund-1" was approved by the Adjudicating Authority. The plan was found to be in conformity with section 30(2) of the IBC. The approval of the resolution plan was binding on all stakeholders, and the moratorium order ceased to have effect. The resolution professional was directed to forward all records relating to the CIR process and the resolution plan to the Insolvency and Bankruptcy Board of India (IBBI). The application was disposed of accordingly.
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