Regulation 39 - Approval of resolution plan. - Insolvency and Bankruptcy Board of India (Insolvency Resolution Process For Corporate Persons) Regulations, 2016

Approval of resolution plan. 39. 5 [ (1) A prospective resolution applicant in the final list may submit resolution plan or plans prepared in accordance with the Code and these regulations to the resolution professional electronically within the time given in the request for resolution plans under regulation 36B along with (a) an affidavit stating that it is eligible under section 29A to submit resolution plans; 8 [****] (c) an undertaking by the prospective resolution applicant that every information and records provided in connection with or in the resolution plan is true and correct and discovery of false information and record at any time will render the applicant ineligible to continue in the corporate insolvency resolution process, forfeit any refundable deposit, and attract penal action under the Code. 15 [ (1A) The resolution professional may, if envisaged in the request for resolution plan- (a) allow modification of the resolution plan received under sub-regulation (1), but not more than once; or (b) use a challenge mechanism to enable resolution applicants to improve their plans. (1B) The committee shall not consider any resolution plan- (a) received after the time as specified by the committee under regulation 36B; or (b) received from a person who does not appear in the final list of prospective resolution applicants; or (c) does not comply with the provisions of sub-section (2) of section 30 and sub-regulation (1). ]] 2 [(2) The resolution professional shall submit to the committee all resolution plans which comply with the requirements of the Code and regulations made thereunder along with the details of following transactions, if any, observed, found or determined by him:- (a) preferential transactions under section 43; (b) undervalued transactions under section 45; (c) extortionate credit transactions under section 50; and (d) fraudulent transactions under section 66, and the orders, if any, of the adjudicating authority in respect of such transactions. ] 13 [ (3) The committee shall- (a) evaluate the resolution plans received under sub-regulation (2) as per evaluation matrix; (b) record its deliberations on the feasibility and viability of each resolution plan; and (c) vote on all such resolution plans simultaneously. (3A) Where only one resolution plan is put to vote, it shall be considered approved if it receives requisite votes. (3B) Where two or more resolution plans are put to vote simultaneously, the resolution plan, which receives the highest votes, but not less than requisite votes, shall be considered as approved: Provided that where two or more resolution plans receive equal votes, but not less than requisite votes, the committee shall approve any one of them, as per the tie-breaker formula announced before voting: Provided further that where none of the resolution plans receives requisite votes, the committee shall again vote on the resolution plan that received the highest votes, subject to the timelines under the Code. Illustration . - The committee is voting on two resolution plans, namely, A and B, simultaneously. The voting outcome is as under: Voting outcome % of votes in favour of Status of approval Plan A Plan B 1 55 60 No Plan is approved, as neither of the Plans received requisite votes. The committee shall vote again on Plan B, which received the higher votes, subject to the timelines under the Code. 2 70 75 Plan B is approved, as it received higher votes, which is not less than requisite votes 3 75 75 The committee shall approve either Plan A or Plan B, as per the tie-breaker formula announced before voting. ] 7 [ (4) The resolution professional shall endeavour to submit the resolution plan approved by the committee to the Adjudicating Authority at least fifteen days before the maximum period for completion of corporate insolvency resolution process under section 12, along with a compliance certificate in 10 [ Form H of the 16 [ Schedule-I ] and the evidence of receipt of performance security required under sub-regulation (4A) of regulation 36B ] . ] (5) The resolution professional shall forthwith send a copy of the order of the Adjudicating Authority approving or rejecting a resolution plan to the participants and the resolution applicant. 14 [ (5A) The resolution professional shall, within fifteen days of the order of the Adjudicating Authority approving a resolution plan, intimate each claimant, the principle or formulae, as the case may be, for payment of debts under such resolution plan: Provided that this sub-regulation shall apply to every corporate insolvency resolution process ongoing and commencing on or after the date of commencement of the Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) (Fifth Amendment) Regulations, 2020; ] (6) A provision in a resolution plan which would otherwise require the consent of the members or partners of the corporate debtor, as the case may be, under the terms of the constitutional documents of the corporate debtor, shareholders agreement, joint venture agreement or other document of a similar nature, shall take effect notwithstanding that such consent has not been obtained. (7) No proceedings shall be initiated against the interim resolution professional or the resolution professional, as the case may be, for any actions of the corporate debtor, prior to the insolvency commencement date. (8) A person in charge of the management or control of the business and operations of the corporate debtor after a resolution plan is approved by the Adjudicating Authority, may make an application to the Adjudicating Authority for an order seeking the assistance of the local district administration in implementing the terms of a resolution plan. 11 [ (9) A creditor, who is aggrieved by non-implementation of a resolution plan approved under sub-section (1) of section 31, may apply to the Adjudicating Authority for directions. ] ******************** Notes:- 1. Substituted vide Notification No. IBBI/2017-18/GN/REG22. Dated 31-12-2017, before it was read as, (1) A resolution applicant shall endeavour to submit a resolution plan prepared in accordance with the Code and these Regulations to the resolution professional, thirty days before expiry of the maximum period permitted under section 12 for the completion of the corporate insolvency resolution process. 2. Substituted vide Notification No. IBBI/2017-18/GN/REG019. Dated 07-11-2017, before it was read as, (2) The resolution professional shall present all resolution plans that meet the requirements of the Code and these Regulations to the committee for its consideration. 3. Inserted vide No. IBBI/2017-18/GN/REG024 - Dated 06-02-2018 4. Substituted vide No. IBBI/2017-18/GN/REG024 - Dated 06-02-2018 , before it was read as, (4) The resolution professional shall submit the resolution plan approved by the committee to the Adjudicating Authority with the certification that: (a) the contents of the resolution plan meet all the requirements of the Code and the Regulations; and (b) the resolution plan has been approved by the committee. 5. Substituted vide Notification No. IBBI/2018-19/GN/REG031 dated 03-07-2018 before it was read as 1 [(1) A resolution applicant shall submit resolution plan(s) prepared in accordance with the Code and these regulations to the resolution professional within the time given in the invitation made under clause (h) of sub-section (2) of section 25.] 6. Substituted vide Notification No. IBBI/2018-19/GN/REG031 dated 03-07-2018 before it was read as (3) The committee may approve any resolution plan with such modifications as it deems fit. 7. Substituted vide Notification No. IBBI/2018-19/GN/REG031 dated 03-07-2018 before it was read as 4 [(4) The resolution professional shall submit the resolution plan approved by the committee to the Adjudicating Authority, at least fifteen days before the expiry of the maximum period permitted under section 12 for the completion of the corporate insolvency resolution process, with the certification that- (a) the contents of the resolution plan meet all the requirements of the Code and the Regulations; and (b) the resolution plan has been approved by the committee: Provided that the timeline specified in this sub-regulation shall not apply to an ongoing corporate insolvency resolution process which has completed 130th day from its commencement date.] 8. Omitted vide Notification No. IBBI/2018-19/GN/REG032 dated 05-10-2018 before it was read as (b) an undertaking that it will provide for additional funds to the extent required for the purposes under sub-regulation (1) of regulation 38; and 9. Omitted vide Notification No. IBBI/2018-19/GN/REG032 dated 05-10-2018 before it was read as 3 [(3A) The committee shall, while approving the resolution plan under sub-section (4) of section (30), specify the amounts payable from resources under the resolution plan for the purposes under sub-regulation (1) of regulation 38.] 10. Substituted vide Notification No. IBBI/2019-20/GN/REG040 dated 24-01-2019 before it was read as Form H of the Schedule 11. Inserted vide Notification No. IBBI/2019-20/GN/REG040 dated 24-01-2019 12. Substituted vide NOTIFICATION No. IBBI/2019-20/GN/REG048 dated 25-07-2019 before it was read as Provided that the committee shall record the reasons for approving or rejecting a resolution plan. 13. Substituted vide Notification No. IBBI/2020-21/GN/REG064 dated 07-08-2020 before it was read as 6 [ (3) The committee shall evaluate the resolution plans received under sub-regulation (1) strictly as per the evaluation matrix to identify the best resolution plan and may approve it with such modifications as it deems fit: 12 [ Provided that the committee shall record its deliberations on the feasibility and viability of the resolution plans. ] ] 9 [****] 14. Inserted vide NOTIFICATION NO. IBBI/2020-21/GN/REG 066 dated 13-11-2020 15. Substituted vide Notification No. IBBI/2021-22/GN/REG078 dated 30-09-2021 before it was read as (1A) A resolution plan which does not comply with the provisions of sub-regulation (1) shall be rejected. 16. Substituted vide Notification No. IBBI/2022-23/GN/REG091 dated 13-09-2022 before it was read as, Schedule