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2023 (12) TMI 958 - AT - Insolvency and BankruptcyApproval of Resolution Plan - Scope of the remand back proceedings - The Adjudicating Authority on 06.09.2022 while disposing off application u/s 30(6) allowed the Resolution Professional to accept new Resolution Plans from unsuccessful Resolution Applicants and even previously non-participating entities who may want to submit a Resolution Plan for the Corporate Debtor. - HELD THAT - The opinion of all member of the CoC as were represented in meeting dated 13.12.2023 in the minutes of meeting was also noticed, no useful purpose shall be served in issuing notice to other members of the CoC for the purposes of this appeal - liberty reserved to any of the member of CoC who may feel necessity to file an application, if so advised. The order of this Tribunal dated 09.02.2023 noticed, where this Court has disapproved the request to send matter again to CoC to reconsider the Resolution Plans. This Tribunal has directed the Adjudicating Authority to consider the plan approval application and decide the same within a period of three months. The impugned order has directed the matter to be taken before the CoC, which was not approved by this Tribunal in order dated 09.02.2023. Insofar as merits of the plan, it was to be examined by the Adjudicating Authority and take a decision in accordance with law. It is further observed that no purpose shall be served in prolonging the matter by the Adjudicating Authority by sending the matter to CoC and obtain opinion of CoC. The order impugned is unsustainable and is set aside. In result of setting aside the impugned order all consequential actions are also unsustainable. Subsequent actions including meeting of CoC conducted in consequence to the impugned are set aside - appeal allowed.
Issues Involved:
1. Approval of the Resolution Plan by the CoC. 2. Adjudicating Authority's direction to accept new Resolution Plans. 3. Impact of the Rainbow Papers judgment on the Resolution Plan. 4. Convening of the CoC meeting to discuss the implications of the Rainbow Papers judgment. 5. Adjudicating Authority's reconsideration of the Resolution Plan. Summary: 1. Approval of the Resolution Plan by the CoC: The Appellant, a Successful Resolution Applicant, had its Resolution Plan approved by the CoC on 05.11.2020, and a letter of intent was issued on 07.11.2020. The Resolution Professional filed an application for approval of the Resolution Plan on 26.11.2020. 2. Adjudicating Authority's direction to accept new Resolution Plans: The Adjudicating Authority, on 06.09.2022, allowed the Resolution Professional to accept new Resolution Plans from unsuccessful applicants and previously non-participating entities. This order was challenged and set aside by the Tribunal on 09.02.2023, which held that after CoC's approval, the matter could not be reopened for fresh Resolution Plans. 3. Impact of the Rainbow Papers judgment on the Resolution Plan: The Adjudicating Authority, on 28.11.2023, directed the Resolution Professional to convene a CoC meeting to appraise members of the Rainbow Papers judgment and its implications on the Resolution Plan. The Appellant contended that the impact of the Rainbow Judgment was already explained and that the Adjudicating Authority should have considered the application as directed by the Tribunal. 4. Convening of the CoC meeting to discuss the implications of the Rainbow Papers judgment: The CoC meeting held on 13.12.2023 recorded the views of its members regarding the Rainbow Papers judgment. Most members agreed with the opinion given by the Resolution Professional's legal advisor, while some suggested fresh voting or inviting new plans. 5. Adjudicating Authority's reconsideration of the Resolution Plan: The Tribunal noted that the Adjudicating Authority's direction to take the matter before the CoC was not approved and that it should decide the plan approval application in accordance with the law. The impugned order and all consequential actions, including the CoC meeting, were set aside. The Adjudicating Authority was directed to decide the application expeditiously, preferably within one month from the next fixed date. Conclusion: The appeal was allowed, setting aside the Adjudicating Authority's impugned order and subsequent actions. The matter was remitted to the Adjudicating Authority to decide the application I.A. No. 851 of 2020 in accordance with the law, without expressing any opinion on its merits.
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