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TMI Blog2018 (8) TMI 1617X X X X Extracts X X X X X X X X Extracts X X X X ..... fied under Section 30(2) of the I & B Code the Adjudicating Authority has no other alternative other than to approve the Resolution Plan which shall be binding on the corporate debtor and its employees, members, creditors, guarantors and other stakeholders involved in the Resolution Plan. Accordingly, the Resolution Plan is approved upon the following orders:- (i) The Resolution Plan of Liberty House Group Pte. Ltd., which is approved by the CoC with 99.94% voting percentage, is hereby approved under provisions of Section 31(1) of the Insolvency and Bankruptcy Code, 2016, which will be binding on the Corporate Debtor, its employees, members, creditors, guarantors and other stakeholders involved in the Resolution Plan. (ii) The revival plan of the company in accordance with the approved Resolution Plan shall come into force with immediate effect. (iii) The moratorium order passed under Section 14 shall cease to have effect. (iv) The Resolution Professional shall forward all records relating to the conduct of the Corporate Insolvency Resolution Process and the Resolution Plan to the Insolvency and Bankruptcy Board of India to be recorded on its database. (v) Before par ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... solution Plan from Edelweiss Asset Reconstruction Company Ltd. upon the basis of issuance of publication of an advertisement for expression of interest The said Resolution Plan has been taken into consideration by the CoC at the 8th meeting held on 18/02/2018 but after deliberation and discussions with the Edelweiss Asset Reconstruction Company Ltd. the CoC being not satisfied with the plan, directed the Resolution Professional to call for fresh Resolution Plan. The Resolution Professional thereby initiated a fresh process for invitation of Resolution Plan and a fresh advertisement was issued inviting Resolution Plan from prospective resolution applicants and in response to the publication the Resolution Professional was in receipt of 2(two) Resolution Plans. One by Liberty House Group Pte. Ltd. and another from Maharashtra Seamless Limited. According to the Resolution Professional as per the evaluation and scoring of the said two plans Liberty House Group Pte. Ltd. s Resolution Plan was considered by the CoC as H1 applicant. After several deliberations and discussions with the Liberty House Group Pte. Ltd. the CoC satisfied with the H-1 Resolution Applicant and while Plan was unde ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1 crores having procured subsequent to the Insolvency Commencing Date (in short, ICD). Statement of stock is produced along with the petition. The applicant also contends that they have incurred additional expenses of ₹ 14.33 crores and the applicant claim a total of ₹ 113.64 crores as the insolvency resolution process costs. It is submitted on the side of the applicant that amount claimed by the applicant as a resolution process cost and not as an operational creditor as the applicant is not the operational creditor and the Resolution Professional in violation of the Circular dated 12/06/2018 excluded the claim from the purview of the resolution costs and therefore, the non-consideration of the claim of the applicant violates the Section 30(2) of the I B Code. Upon the said contentions the applicant prays for directing the Resolution Professional to disburse payment of ₹ 113. 64 crores as Insolvency Resolution Process costs. 7. The 2nd objector is allegedly a recognised Trade Union of the corporate debtor representing 578 workmen of the corporate debtor company filed the application CA(IB) No. 595/KB/2018 under Sub-section (5) of Section 60 of the I B Code ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... workmen and, therefore, there is no merit in contending on the side of the workmen that wages has to be disbursed before the approval of the Resolution Plan. According to him considering the availability of the fund with the corporate debtor he has disbursed wages as far as possible by giving priority and since the CIRP period expires and the Plan is submitted before the Adjudicating Authority for its approval, the arrears wages, if any, cannot be disbursed as prayed for want of sufficient fund. Regarding the claim for increment the Resolution Professional submits that it being accrued during the CIRP period and for shortage of funds with the corporate debtor it cannot be considered. It is significant to note that corporate debtor being unable to pay all its debts the financial creditor has approached this Adjudicating Authority for having a resolution of the corporate debtor. Truly arrears wages of the workmen seen not cleared and demand for increment during the CIRP period was not sanctioned by the RP. But non-consideration being on justifiable reasons the relief sought for by the workmen cannot be entertained before the approval of the resolution Plan. Upon approval of the Pl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... its that in order to ensure continued supply of goods through MSTC Limited an advance amounting to a total of INR 56.72 crores out of the their admitted claim of INR 146.59 crores was made which now stood at ₹ 108.36 crores as on date. The Resolution Professional further submits that MSTC is demanding to treat their outstanding claim of ₹ 108.36 crores prior to the ICD as CIRP process cost, which cannot be entertained by the Resolution Professional and the claim has been rejected as it is not a CIRP process cost. Ld. Resolution Professional reiterated that ₹ 181.56 crores was incurred by the corporate debtor during the CIRP period by procuring goods from the MSTC and no goods procured during the CIRP period valuing more than ₹ 181.56 crores and the value of the said procured goods during the CIRP period have been paid in full by the Resolution Professional and therefore the claim of the applicant is not sustainable under law and it is liable to be rejected. 12. Ld. Sr. Counsel appearing for the MSTC submit that the submissions of the ld. Resolution Professional is incorrect and according to him whatever payment made by the Resolution Professional is appro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in possession of the corporate debtor held under trust or under contractual arrangements including bailment; 15. Referring to Explantion of Section 18 an attempt was made on the side of the applicant that the property lifted from the applicant, MSTC is the property of the applicant and, therefore, moratorium u/s. 14 of I B Code does not apply in regards to appropriation made by the Resolution Professional towards the past dues. The said submissions on the side of the ld. Sr. Counsel also is found devoid of any merit because admittedly the applicant MSTC is a facilitator. The corporate debtor is the buyer of the goods. The invoices are issued to the buyer by the vendor. However, the MSTC being a facilitator upon keeping the stock of goods entitled to claim the payment of cost paid to the vendor plus facilitation charges. So being the facilitator the applicant does not acquire any ownership over the goods which the applicant stored for the purpose of delivery to the corporate debtor as its imported from abroad from the selective vendors. In the aforesaid background the claim of the applicant seems to be unsustainable and devoid of any merit. 16. A copy of the MSTC s balanc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rovisions of the Code and Regulation and conforms to all the requirements as have been specified in the I B Code. 19. The Resolution Applicant namely Liberty House Group Pte. Ltd. is a company incorporated under the laws of Singapore is a part of the Gupta Family Group Alliance. It is submitted by the applicant that it is a fast growing international group of businesses founded and owned by British Gupta Family. According to the applicant it is an integrated international metals and industrial group, specialising in commodities, metals recycling, manufacturing of steel, aluminium and engineering products. The above description about the resolution applicant proves that the identification of resolution applicant who can take care of the assets of the corporate debtor is reasonable and justifiable. So the stressed assets of the corporate debtor is going to the hand of a safer resolution applicant. An affidavit swearing that the applicant is not disqualified as per the amended section 29A of the I B Code though seen not annexed by filing supplementary affidavit it has been annexed. The Resolution Professional also certified that the Resolution Applicant is not ineligible to submi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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