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2022 (4) TMI 309 - AT - Insolvency and BankruptcySeeking a direction to the Resolution Professional to place the Resolution Plan submitted by the Appellant before the Committee of Creditors (CoC) - HELD THAT - The ratio of the judgment of the Hon ble Supreme Court in ARCELORMITTAL INDIA PRIVATE LIMITED VERSUS SATISH KUMAR GUPTA ORS. 2018 (10) TMI 312 - SUPREME COURT as is culled out from paras 80 81 is that the Resolution Professional is not to take a decision regarding the ineligibility of the Resolution Applicant. It has only to form its opinion because it is the duty of the Resolution Professional to find out as to whether the Resolution Plan is in compliance of the provisions of the Code or not the Resolution Professional can give his opinion with regard to each plan before the CoC and it is for the CoC to take a decision as to whether the plan is to be approved or not. In para 5 of the impugned order, it is noticed that the direction has been issued to the Resolution Professional to place all the Resolution Plans along with his opinion on the contravention or otherwise of the various provisions of law. The aforesaid direction clearly indicates that the Resolution Professional is free to submit his opinion with regard to contravention or otherwise of the various provisions of law. The aforesaid observations take care of the duties and responsibilities of the Resolution Professional. The Resolution Professional can give his opinion with regard to each Resolution Applicants and further steps are to be taken for the CoC as per the direction issued by the Adjudicating Authority. Thus, various issues regarding ineligibility or eligibility need not be gone into in this Appeal. It is only after the CoC s decision if any question arise regarding eligibility that can be gone into before the Adjudicating Authority in accordance with the law - appeal dismissed.
Issues:
1. Whether the Adjudicating Authority's direction to the Resolution Professional was appropriate. 2. Whether the Resolution Professional can withhold a resolution plan from the Committee of Creditors. 3. The role and responsibilities of the Resolution Professional in the corporate insolvency resolution process. Analysis: Issue 1: Adjudicating Authority's Direction The Adjudicating Authority directed the Resolution Professional to place all Resolution Plans before the Committee of Creditors (CoC) along with his opinion on compliance with various provisions of law. The Appellant challenged this order, arguing that the plan submitted by Ms. Upma Jaiswal was not eligible under Section 29A of the Code. However, the Authority's direction was based on the principle that the Resolution Professional is a facilitator, not a gatekeeper, and the CoC should make the final decision. The Tribunal upheld the Authority's direction, emphasizing that the Resolution Professional's role is to provide opinions on compliance, leaving the decision to the CoC. Issue 2: Withholding of Resolution Plan The Resolution Professional contended that they were unable to place Ms. Upma Jaiswal's plan before the CoC due to eligibility concerns. The Respondent argued that the Resolution Professional cannot unilaterally withhold a plan and must present all plans to the CoC for consideration. The Tribunal clarified that the Resolution Professional's duty is to ensure completeness and compliance of plans, providing opinions to the CoC for approval. The Resolution Professional's role is not to decide plan eligibility, but to facilitate the CoC's decision-making process. Issue 3: Role and Responsibilities of Resolution Professional Referring to the Supreme Court judgment, the Tribunal highlighted that the Resolution Professional's duty is to confirm plan compliance with legal provisions and conduct due diligence. The Resolution Professional must present complete plans to the CoC, appending due diligence reports. The Tribunal emphasized that the Resolution Professional's duty is not to decide plan eligibility but to assist the CoC in making informed decisions. Any disputes regarding eligibility should be addressed post-CoC decision before the Adjudicating Authority. In conclusion, the Tribunal dismissed both Appeals, emphasizing the Resolution Professional's role as a facilitator in the insolvency resolution process. The Resolution Professional's responsibility is to provide opinions on plan compliance, leaving the final decision to the CoC. Any disputes on plan eligibility should be addressed post-CoC decision in accordance with the law.
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