2023 (10) TMI 1096 - AT - Insolvency and Bankruptcy

Existence of vested right to file a Resolution Plan pursuant to the process in published Form G - approval of Resolution Plan - HELD THAT - The Appellant does not have any vested right in submitting the Resolution Plan in the absence of filing one Plan pursuant to Form G, and taking the right steps at the appropriate time, specifically keeping in view that the Appellant had attended the 5th CoC Meeting when the entire contours of the Resolution Plan was discussed. Reliance on the Judgment of the Hon ble Apex Court in the matter of MAHARASHTRA SEAMLESS LIMITED VERSUS PADMANABHAN VENKATESH OTHERS 2020 (1) TMI 903 - SUPREME COURT in which the Hon ble Apex Court has held Certain allegations were made by the MSL over failure on the part of the Resolution Professional in taking possession of the assets of the corporate debtor and subsequently in their failure in handing over the same to MSL. These issues are factual. The ratio of the aforenoted Judgment directly contradicts the contention of the Appellant that the bid value has to match the liquidation value. It is significant to mention that the Resolution Plan has already been implemented and we do not wish to set the clock back. This Tribunal is of the considered view that there is no illegality in the Order of the Adjudicating Authority dismissing the Intervention Application - Appeal dismissed.

Summary

Issues involved:
The judgment involves issues related to intervention in the resolution process, approval of resolution plans, rights of operational creditors, compliance with insolvency regulations, and the authority of the Adjudicating Authority.

Intervention Application Dismissal:
The Appellant challenged the dismissal of the Intervention Application seeking to intervene in the resolution process. The Appellant argued that the Resolution Plan undervalued assets, violated regulations, and excluded them from crucial meetings, thus breaching the Code. The Appellant contended that their claim was admitted belatedly, affecting their rights as a representative nominee of operational creditors.

Challenging Resolution Plan:
Another issue involved the Appellant's challenge to the Resolution Plan approved by the CoC. The Appellant sought to submit a better Plan after the CoC's approval, claiming the approved Plan did not adequately cover operational creditors' claims. The Adjudicating Authority dismissed the Appellant's challenge on grounds of lack of locus standi and untimeliness.

Vested Rights and Timelines:
The judgment addressed whether the Appellant had a vested right to submit a Resolution Plan after the CoC's approval. It was noted that the Appellant's delayed intervention and failure to participate in key meetings impacted their ability to challenge the approved Plan. Legal precedents highlighted the importance of timely submissions and the binding nature of approved Plans.

Final Decision:
The Tribunal upheld the Adjudicating Authority's dismissal of the Intervention Application and the challenge to the Resolution Plan. It emphasized the commercial wisdom of the CoC in approving the Plan and the lack of grounds to interfere with the approved Plan. The Appellant's contentions regarding asset maximization and Plan valuation were deemed insufficient to overturn the decisions. The Company Appeals were dismissed without costs, and all related Interlocutory Applications were closed.