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2022 (12) TMI 729 - AT - Insolvency and BankruptcyValidity of approval of Resolution plan - home buyers - Authorized Representative who is said to have voted has not obtained instructions and approval of the home buyers with regard to different items of the Agenda. - It is submitted that in the 6th CoC meeting several items were deferred without obtaining any opinion of the home buyers which has vitiated the entire process. - no opinion was obtained on feasibility and viability. HELD THAT - The judgment of PIYA PURI, PRADEEP ARORA, SATYADEEP BISHNOI VERSUS MR. DEBHASHISH NANDA RESOLUTION PROFESSIONAL OF VENTA REALTECH PRIVATE LIMITED, ADANI INFRASTRUCTURE DEVELOPERS PVT. LTD., MR. G. SATYA NARAYANA GUDDETI AUTHORISED REPRESENTATIVE OF FINANCIAL CREDITORS IN CLASS OF VENTA REALTECH PRIVATE LIMITED 2022 (8) TMI 1111 - NATIONAL COMPANY LAW APPELLATE TRIBUNAL , PRINCIPAL BENCH , NEW DELHI which is was relied by the Adjudicating Authority was also judgment of this Tribunal where one set of home buyers were challenging the various procedures adopted while approving the Resolution Plan and objections were raised by the home buyers. This Tribunal relying on the judgment of Hon ble Supreme Court in JAYPEE KENSINGTON BOULEVARD APARTMENTS WELFARE ASSOCIATION ORS. VERSUS NBCC (INDIA) LTD. ORS. 2021 (3) TMI 1143 - SUPREME COURT has held that the democratic principles of the determinative role of the opinion of the majority have been duly incorporated in the scheme of the code and the minority homebuyers have to necessarily sail with the majority within the class. When the majority has approved the Resolution Plan which approval was sought to be challenged by one set of home buyers that has been repelled by this Tribunal in Priya Puri s case, the objection raised in the present Appeal are another set of objections raising similar issues regarding voting and other issues. Regarding the issue of viability and feasibility of the resolution plan, when the CoC approved the Resolution Plan in its commercial wisdom, it is presumed that the approval was given to a viable and feasible plan. The Resolution Plan being approved, this Tribunal also cannot interfere with the commercial wisdom. Approval of the CoC suggest that the plan is viable and feasible. Appeal is dismissed.
Issues:
1. Rejection of application by Adjudicating Authority filed by 68 home buyers. 2. Challenge against rejection based on objections raised by the appellants. 3. Applicability of earlier judgment "Priya Puri & Ors." in the present case. 4. Validity of objections raised by the appellants regarding the resolution plan. 5. Role of Authorized Representative in obtaining instructions from home buyers. 6. Feasibility and viability of the resolution plan approved by CoC. 7. Decision of the Appellate Tribunal on the appeal. Analysis: 1. The Adjudicating Authority rejected the application filed by 68 home buyers against the order approving the resolution plan in the Corporate Insolvency Resolution Process. The appellants sought the replacement of the resolution professional and rejection of the revised resolution plan, challenging its compliance with the Insolvency and Bankruptcy Code. 2. The appellants argued that their objections were distinct from those in a previous case and should have been considered separately. They contended that the Authorized Representative did not obtain proper instructions from home buyers on different agenda items, affecting the decision-making process of the CoC. 3. The Adjudicating Authority relied on the judgment of "Priya Puri & Ors." to dismiss the appellants' objections, citing the principle that minority home buyers must abide by the majority decision of the CoC. The Appellate Tribunal upheld this principle, emphasizing the democratic nature of the approval process under the Code. 4. Regarding the objections raised by the appellants, the Tribunal noted that the issues raised were similar to those in the previous case and did not present sufficient grounds to challenge the CoC's decision. The Tribunal emphasized the importance of majority rule in the approval of resolution plans. 5. The Tribunal addressed the role of the Authorized Representative, stating that they must represent the interests of the CoC and obtain instructions to vote on agenda items where voting occurs. However, the Representative's opinion can be considered in CoC meetings where no voting takes place. 6. On the feasibility and viability of the resolution plan, the Tribunal deferred to the commercial wisdom of the CoC, presuming that their approval indicated a viable and feasible plan. The Tribunal declined to interfere with the CoC's decision, as the plan had been approved based on its commercial viability. 7. Ultimately, the Tribunal found no substantial grounds to entertain the appeal and dismissed it, upholding the decision of the Adjudicating Authority regarding the rejection of the appellants' objections to the resolution plan.
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