2022 (8) TMI 1203 - Tri - Insolvency and Bankruptcy

Seeking dissolution of the monitoring Committee of the Corporate Debtor - Section 60(5) of the Insolvency and Bankruptcy Code, 2016 read with Rule 11 of the NCLT Rules, 2016 - HELD THAT - The Supplementary Affidavits filed by the Resolution Applicant- BRS Ventures Investment Limited are taken on record. It is found that on the assurance given by the Resolution Applicant, BRS Ventures Investment Limited for undertaking and declaration, the Members of the Monitoring Committee have unanimously agreed for dissolution of the Monitoring Committee on 18.05.2022 and subsequently the Resolution Applicant, BRS Ventures Investment Limited has provided the said declaration and undertaking on 06.06.2022. The Monitoring Committee is dissolved with effect from the date of this Order - application allowed.

Issues:
1. Application for dissolution of the monitoring committee of the Corporate Debtor under Section 60(5) of the Insolvency and Bankruptcy Code, 2016.
2. Approval and implementation of the Resolution Plan by the successful Resolution Applicant.
3. Disputes regarding the increase in authorized share capital and infusion of funds.
4. Decision on the dissolution of the Monitoring Committee based on undertakings and declarations by the Resolution Applicant.

Analysis:
1. The Applicant filed an Interlocutory Application seeking dissolution of the monitoring committee under Section 60(5) of the Insolvency and Bankruptcy Code, 2016. The Monitoring Committee had decided on dissolution after completion of pending matters. The Tribunal dissolved the Monitoring Committee based on the Resolution Applicant's assurances and undertakings.

2. The Resolution Plan submitted by the successful Resolution Applicant was approved by the Tribunal, leading to the infusion of funds to pay off creditors and stakeholders. The Resolution Plan distribution included amounts for employees, secured and unsecured creditors, and public shareholders. The Applicant also delisted its equity shares post the Resolution Plan approval.

3. Disputes arose regarding the increase in authorized share capital and infusion of funds as per the Resolution Plan. The Registrar of Companies disallowed waiver of fees for share capital increase, leading to multiple applications and appeals. The Resolution Applicant had already infused a significant amount and intended to infuse more based on business needs.

4. The Monitoring Committee meetings discussed the infusion of funds and increase in authorized share capital. The Resolution Applicant provided declarations and undertakings regarding the need-based infusion of funds and share capital increase. The Committee unanimously agreed for dissolution based on these assurances, leading to the Tribunal's decision to dissolve the Monitoring Committee.

This judgment highlights the process of dissolution of the Monitoring Committee post-Resolution Plan approval, addressing disputes related to share capital increase and fund infusion. The Tribunal's decision was based on the Resolution Applicant's commitments and the Monitoring Committee's agreement, ensuring compliance with the Code's provisions and resolving the matter effectively.

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