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2021 (2) TMI 452 - Tri - Insolvency and BankruptcySeeking approval of the Resolution Plan - Section 30(6) of the Insolvency and Bankruptcy Code, 2016 - HELD THAT - In K. SASHIDHAR VERSUS INDIAN OVERSEAS BANK OTHERS 2019 (2) TMI 1043 - SUPREME COURT the Hon ble Apex Court held that if the CoC had approved the Resolution Plan by requisite percent of voting share, then as per section 30(6) of the Code, it is imperative for the Resolution Professional to submit the same to the Adjudicating Authority (NCLT). On receipt of such a proposal, the Adjudicating Authority is required to satisfy itself that the Resolution Plan as approved by CoC meets the requirements specified in Section 30(2) of the Code. The Hon ble Court observed that the role of the NCLT is no more and no less . The Hon ble Court further held that the discretion of the Adjudicating Authority is circumscribed by Section 31 and is limited to scrutiny of the Resolution Plan as approved by the requisite percent of voting share of financial creditors. Even in that enquiry, the grounds on which the Adjudicating Authority can reject the Resolution Plan is in reference to matters specified in Section 30(2) when the Resolution Plan does not conform to the stated requirements. The instant Resolution Plan meets the requirements of Section 30(2) of the Code and Regulations 37, 38, 38(1A) and 39(4) of the Regulations. The Resolution Plan is not in contravention of any of the provisions of Section 29A of the Code and is in accordance with law. The same needs to be approved. Application allowed - moratorium declared.
Issues Involved:
1. Approval of the Resolution Plan under Section 30(6) of the Insolvency and Bankruptcy Code, 2016. 2. Compliance with the provisions of the Insolvency and Bankruptcy Code, 2016 and related regulations. 3. Distribution of the resolution amount among creditors. 4. Management and control of the Corporate Debtor post-approval. 5. Supervision and implementation of the Resolution Plan. 6. Reliefs, concessions, and waivers sought by the Resolution Applicant. Issue-wise Detailed Analysis: 1. Approval of the Resolution Plan: The application under Section 30(6) of the Insolvency and Bankruptcy Code, 2016 was filed by the Resolution Professional seeking approval of the Resolution Plan submitted by the Consortium led by Onkar Sakhar Karkhana Private Limited. The Corporate Insolvency Resolution Process (CIRP) was initiated on 14.01.2019, and the Resolution Professional conducted the CIRP in compliance with the Code and Regulations. After multiple attempts and extensions, the Resolution Plan was finally submitted on 06.06.2020 and approved by the Committee of Creditors (CoC) with 100% votes on 07.11.2020. 2. Compliance with Provisions: The Resolution Plan was checked for compliance with Section 30(2) of the Code and Regulations 38 and 39. The Plan provided for the priority payment of CIRP costs, payment to Operational Creditors, and was found to be in compliance with the mandatory contents under the Code and CIRP Regulations. The Resolution Applicant was not found ineligible under Section 29A of the Code. 3. Distribution of Resolution Amount: The total resolution amount of ?23,00,00,000/- was divided into owned funds and loan funds. The distribution among creditors was as follows: - Financial Creditors: ?22,48,85,000/- to be paid in full and final settlement. - Operational Creditors: ?8,10,000/- in priority over Financial Creditors. - Statutory Dues: ?1,05,000/- to be paid within 30 days from the receipt of the order. The Plan also provided for the settlement of all contingent liabilities and claims. 4. Management and Control Post-Approval: The management and control of the Corporate Debtor were to be handed over to the Board of Directors of the Resolution Applicant. Key managerial personnel were identified, and the Monitoring Committee was constituted to supervise the implementation of the Resolution Plan. The Monitoring Committee would be dissolved upon the first anniversary of the approval or full settlement of claims. 5. Supervision and Implementation: The Resolution Professional was tasked with supervising the implementation of the Resolution Plan and filing status reports with the Tribunal. The Monitoring Committee, consisting of the Resolution Professional, Managing Director of the Corporate Debtor, and a representative of the Secured Financial Creditors, would oversee the implementation. 6. Reliefs, Concessions, and Waivers: The Resolution Applicant sought certain reliefs, concessions, and waivers, which the Tribunal did not grant. The Applicant was directed to approach the concerned authorities for permits/approvals, which would be considered on merits by the authorities in accordance with the law. Conclusion: The Tribunal approved the Resolution Plan submitted by the Consortium led by Onkar Sakhar Karkhana Private Limited, making it effective from the date of the order. The Plan was binding on all stakeholders, including the Corporate Debtor, its employees, members, creditors, and government authorities. The moratorium under Section 14 of the Code ceased to have effect, and the Resolution Professional was to supervise the implementation and report to the Tribunal periodically. The approval did not waive any statutory obligations, and necessary approvals were to be obtained by the Resolution Applicant as required by law.
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