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TMI Blog2020 (3) TMI 92X X X X Extracts X X X X X X X X Extracts X X X X ..... Adjudicating Authority) Rules 2016. 3. After considering the merits of the case, the said Petition was admitted vide an Order dated 18.05.2018 (CP No.1658/I&BP/NCLT/MB/2017). Mr. Santanu T. Ray was appointed as the Interim Resolution Professional (IRP). The said IRP was confirmed as the Resolution Professional (RP) in the first CoC meeting dated 14.08.2018. 4. In the Second CoC meeting dated 5th September, 2018, wherein the reporting of the Action taken like Arranging the Factory Visit, Preparation of Information Memorandum, Appointment of Forensic Auditor was intimated to CoC. The Resolution for following agendas were passed : (i) Approval of eligibility criteria, bid evaluation matrix, bidding process of Resolution Plan. (ii) Approval of Form G for invitation of Expression of Interest and date of Publication of the same. (iii) Approval and Ratification of CIRP Cost and its funding. 5. The RP published the invitation for Expression of Interest (hereinafter referred to as "EoI") in terms of Section 25(2)(h) of the I&B Code in English Newspaper 'Financial Express' and local newspaper 'Loksatta' in Mumbai on 10.09.2018, wherein the last date for submission o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Process for Corporate Persons) Regulations, 2016 to determine the Fair Value and Liquidation Value of the Corporate Debtor. The RP has further appointed Batliboi & Purohit as the Forensic Auditor for the purpose of conducting a transactional Forensic Audit of the Corporate Debtor. As per the reports submitted by the valuers, the average Liquidation Value of the Corporate Debtor is Rs. 83,50,981 and the average Fair Market Value is Rs. 1,04,38,726/-. 11. In the seventh CoC meeting dated 09.01.2019, the modified Resolution Plan submitted by the Resolution Applicant, M/s. Euro Pratik Ispat (India) Private Limited along with an undertaking under section 29A of the I&B Code was submitted. The CoC, containing only one Financial Creditor, considered the same and passed the Resolution by 100% voting share, approving the Resolution Plan. It is also stated that the Resolution Applicant furnished a demand Draft of Rs. 30 lakh being 10% of the amount offered in the Resolution Plan. SUMMARY OF THE RESOLUTION PLAN 12. The Resolution Applicant, in consideration to acquire and take over the 100% ownership and management of corporate debtor as "Going Concern" i.e. 100% equity shares of existing ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ove the resolution amount. A. Resolution Plan shall be implemented in following manner: (i) Cost of CIRP It is presumed that as the company is not under operation during the CIRP period, therefore, there are no cash flows generated by the Company to pay the CIRP Costs and the Resolution Professional. The CIRP Costs estimated by the Resolution Applicant are approximately Rs. 35,00,000 (Rupees Thirty Five Lakhs Only) and will be paid in full and in priority to any other creditor of the Company. In case the actual CIRP costs are lower than that estimate, the balance provision towards CIRP costs shall be allocated towards payment to financial creditors. In case the CIRP costs exceed the estimate, the extra costs shall be adjusted out of payment proposed for Financial Creditors such that the Total Upfront (Full & Final) Payment (including CIRP costs) proposed by the Resolution Applicant does not exceed the total resolution amount of Rs. 3,01,00,000/- (Rupees Three Crores and One Lakh only). (ii) Amount Due to Financial Creditors (Secured) - Admitted Claim According to List of Creditors of the Company as provided in the information memorandum ("List of Creditors"), total claims ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y) and one representative of the Resolution Applicant. During this period: (i) the existing board of directors of the Company (the "Existing Board") shall stand vacated and be replaced by the members of the Monitoring Committee ("Reconstituted Board"); and (iii) the Monitoring Committee shall, subject to the provisions of this Resolution Plan, be deemed to have the same rights, powers and privileges which the Resolution Professional has during the CIRP. E. Reliefs Sought Under Resolution Plan Resolution Applicant has requested following reliefs under the Resolution Plan: (i) Licenses, Consents and Approvals The Resolution Applicant has also considered that by virtue of the order of the Adjudicating Authority approving this Resolution Plan and since the Resolution Applicant would acquire the Company on a 'going concern' basis, all consents, licenses, approvals, rights, entitlements, benefits and privileges whether under law, contract, lease or license, granted in favour of the Company or to which the Company is entitled or accustomed to shall, notwithstanding any provision to the contrary in their terms and notwithstanding that they may have already lapsed or e ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pt in abeyance and that no coercive action be taken against the Company. It is currently expected that a period of 18 months from the NCLT Approval Date will be required for the Resolution Applicant to cause the Company to remedy such underlying breaches (if found to be true). The liabilities which occurs by way of any order, judgments, decisions passed by any competent authority in respect of any application, petition, complaint filed by any person in the matter of transactions entered by company prior to NCLT approval date shall be borne by the previous management, promoters, their officer in default or any other person related to them and no criminal action shall be taken against Resolution Applicant, the SPV and the Company in relation to any breach of law committed by previous management or promoters and other persons related to them. (iv) All domain names, servers, being currently used by the Company to the extent not owned shall continue to be available for use by the Company for a period of 3 months from the NCLT Approval Date. (v) There shall be no adverse effect on the rights of the Company over its immoveable properties. (vi) On and from the Effective Date, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... xempt from levying any type of Taxes and stamp duty, if any, arising on account of transactions consummated or actions undertaken pursuant to the approval of the Resolution Plan by the NCLT in accordance with the Code and not initiate any proceedings there under the provisions of Income Tax Act, 1961 with respect to the transaction, since such taxes and duties, if required to be paid, will render the Plan unviable. Further, the Waiver of principal Loan amount/and/or waiver of any other creditors as well as waiver of Interest as appearing in the books of accounts of the Corporate Debtor as on the date of NCLT order and written back in the books of account following NCLT order shall not be taxed as perquisite or benefits under section 28(iv) and cessation of liability under section 41(1) or any other relevant sections/rules/regulations of the Income Tax Act. 14. The Applicant has duly submitted Form H stating that the resolution plan is complaint of the provisions of the code. The Applicant has preferred the present application for approval of the resolution plan by this Adjudicating Authority. 15. The total payment under the resolution plan shall be made within 30 months f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... an is a confidential document and contains confidential information about the Resolution Applicant. The CoC and the Resolution Professional shall maintain the confidentiality of all information and material provided by us in this Resolution Plan or in relation thereto, or in relation to the Resolution Applicant, and such information and material shall not be disclosed in whole or in part to any person without our prior written consent, provided that it may be disclosed by the Resolution Applicant to the CoC and its and their employees, consultants or professional advisers on a strictly need to know basis subject to equivalent obligations of confidentiality. (b) We will not be held liable for any actions, inquiries, proceedings initiated or threatened against the CoC, the Resolution Professional or any of their respective employees, agents, consultants or advisors in relation to any matter in connection with the CIRP that has been commenced against the Company. (c) The Resolution Plan is a complete plan and shall be accepted as a whole. Any part acceptance, negotiation or modification of the plan will be valid only when accepted by us in writing. Subject to satisfaction of con ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... editors, the amounts claimed by them, the amount of their claims admitted and the security interest, if any, in respect of such claims As per Information Memorandum. Particulars of a debt due from or to the corporate debtor with respect to related parties As per Audited Financial Statement 31.03.2017, there is no debt due to related parties. Details of guarantees that have been given in relation to the debts of the corporate debtor by other persons, specifying which of the guarantors is a related party As per Information Memorandum, personal guarantees have been provided by - 1. Rahul J Singhvi 2. Gaurav J Singhvi 3. Nenshi L Shah 4. Dhawal S Shah 5. ShakuntalaSinghvi The names and addresses of the members or partners holding at least one per cent stake in the corporate debtor along with the size of stake As per list provided in Information Memorandum. Details of all material litigation and an ongoing investigation or proceeding initiated by Government and statutory authorities As per Information Memorandum. The number of workers and employees and liabilities of the corporate debtor towards them On the basis of information pro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... inancials as per last three years Audited Financials Annexure3 15. Relationship if any with Corporate Borrower The Resolution Applicant do not share any relationship with the Corporate Debtor. C. DETAILS OF THE RESOLUTION PLAN On the basis of information memorandum, documents available in the public domain and additional information provided by the resolution professional, we hereby submit the following resolution plan: Sl.No. ITEM PARTICULARS 1. Main strategy proposed in the Resolution Plan Schedule 3 (Steps for Implementation of the Plan) 2. Specify procedure for payment of dues towards resolution process costs/financial creditors/operational creditors/government dues etc. Schedule 4 (Financial Proposal for all stakeholders) 3. Proposal for capital and Financial Restructuring Schedule 4 (Financial Proposal for all stakeholders) (a) Details of the creditors along with details of such debt and amount of debt. (b) The structure and method of payment to each of the creditor. (c) Provision, if any, for making repayment to dissenting minority creditors. 4. Proposal for operating restructuring Schedule 5 (Business ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... due from the Company Yes. See Schedule 4 (f) Reduction in the amount payable to the creditors Yes. See Schedule 4 (g) Extension of a maturity date or a change in interest rate or other terms of a debt due from the corporate debtor No (h) Amendment of the constitutional documents of the corporate debtor Yes (i) Issuance of securities to the Company, for cash, property, securities, or in exchange for claims or interests or other appropriate purpose No (j) Change in portfolio of goods or services produced or rendered by the Company No (k) Change in technology used by the Company No. (l) Obtaining necessary approvals from the Central and State Governments and other authorities Yes. E. AS PER SUB-REGULATION (3) OF REGULATION 38 OF INSOLVENCY & BANKRUPTCY BOARD OF INDIA (INSOLVENCY RESOLUTION PROCESS FOR CORPORATE PERSONS) REGULATIONS, 2016 PROVIDE FOLLOWING DETAILS IN RELATION OF RESOLUTION APPLICANT AND CONNECTED PERSONS. SL.NO. ITEM PARTICULARS 1. Conviction for any offence, if any, during the preceding five years No 2. Criminal proceedings pending, if any; No 3. Disqualifications, if any, under Companies Act, 2013, to act as director No 4. Ident ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... her information as may be requested by them. Capitalized terms used but not defined herein shall have the meaning given to the term in the Process Document and Information Memorandum. Yours faithfully Surendra Singh Saluja Director Date:07.01.2019 Place: Raipur Euro Pratik Ispat (INDIA) Private Limited has been affixed in my presence pursuant to the resolution of the board of directors of Euro Pratik Ispat (INDIA) Private Limited, dated 12.12.2018. WITNESS 1 : WITNESS 2 : Mr. Lalit Pandey Mr. Mineswar Diwan Date:07.01.2019 Date:07.01.2019 SCHEDULE 1 LIST OF HEFINED TERMS Abbreviation/Capitalised Terms Description Assets All assets (tangible and intangible), properties, goods, rights,benefits and privileges of the Company. Adjudicating Authority The adjudicating authority required to approve the Resolution Plan in accordance with the provisions of S. 31 of the IBC. Authorisation means: (a) an organization, consent, approval, resolution,licence,exemption, filing, lodgement or registration; and (b) in relation to anything which will be fully or partly prohibited or restricted by law or regulation if a Governmental Agency intervenes or acts in any way with ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eredintobytheCompanywithvariouscounterpartiesidentifiedby the Resolution Applicant prior to the NCLT Approval Date and shared with the Resolution Professional which are required for the Company to continue as a going concern. Operational Creditors 'Operational Creditors' shall have the meaning ascribed to such term under the IBC. Operational Debt 'Operational Debt' shall have the meaning ascribed to such term under the IBC. PAN Permanent Account Number Process Document Bidding Process Document of Euro Pallets Pvt Ltd Resolution Plan means this insolvency resolution plan in relation to the Company submitted by the Resolution Applicant RBI The Reserve Bank of India ROC Registrar of Companies UPFRONT PAYMENT/UPFRONT (FULL & FINAL PAYMENT) It shall mean UPFRONT CASH RECOVERY amount and complete resolution amount of Rs. 3.01 Crores (inclusive of CIRP costs) which shall be paid FINAL within 30 days from the date of order of adjudicating authority or such period as may be extended at the discretion of the CoC. SCHEDULE 2 DETAILS OF THE RESOLUTION APPLICANT The Resolution Applicant proposes to implement the Resolution Plan in accordance with the provisio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed persons eligible under Section 29A of the Code as key managerial personnel to supervise operations of the Corporate Debtor. E. (A) Holding company, subsidiaries companies and associate companies of the person who is the promoter or in management or in control of the Resolution Applicant - None (B) Holding company, subsidiaries companies and associate companies of any person who shall be the promoter or in management or control of the business of the corporate debtor during the implementation of the resolution plan - None; F. Related party of Mr. Surendra Singh Saluja and Mr. Harneet Singh Lamba (being the person who is the promoter or management or in control of the Resolution Applicant) 1. Mr. Surendra Singh Saluja: Sl.No. Relations Relative Name (a) Wife Sarabjeet Kour Saluja (b) Father Sampooran Singh Saluja (c) Mother Preetam Kour Saluja (d) Son Sirjan Sing Saluja (e) Daughter Rashmint Kour Saluja 2. Mr. Harneet Singh Lamba Sl.No. Relations Relative Name (a) Wife Gurmeet Kaur Lamba (b) Mother Jasbir Kaur Lamba (c) Father Krishan Dev Singh Lamba (d) Sister Damanjeet Kaur Chabra (e) Sister's Husband Manjeet Singh Chabra G. Re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (a) The Resolution Applicant, may consent on behalf of all persons concerned, to any modifications or amendments of the provisions of this Schedule or to any conditions which the Adjudicating Authority and/or any other authorities under law may deem fit to approve of or impose or which may otherwise be considered necessary or desirable for settling any question or doubt or difficulty that may arise in carrying out the provisions of this Schedule and do all acts, deeds and things as may be necessary, desirable or expedient for giving effect to the terms hereof. (b) To the extent any secretarial filings, corporate actions and/or any other actions filings, intimations, etc. are required to be made in connection with any step set forth in this Schedule before the NCLT Approval Date, the Resolution Professional shall be deemed to be fully authorized to act on behalf of the Company and to undertake all such actions. (c) To the extent any secretarial filings, corporate actions and/or any other actions filings, intimations, etc are required to be made in connection with any step set forth in this Schedule after the NCLT Approval Date and before the Effective Date, the Monitoring Com ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng Authority approving this Resolution Plan and the Company and the Resolution Applicant shall at no point of time be, directly or indirectly, held responsible or liable in relation thereto. 2. The Capital Reduction shall not require the Consents of any of the creditors of the Company or approval of any of the shareholders of the Company, or any other person having any security interest over such shares and the approval of the Adjudicating Authority to the reduction of share capital and shall be binding on the Company and its stakeholders (including its creditors and shareholders). 3. The share certificates held by the shareholders of the Corporate Debtor shall stand cancelled without any further act, instrument or deed and the shares of the Corporate Debtor held by any of the shareholders in shall stand cancelled by appropriate corporate action. III. INFUSION BY RESOLUTION APPLICANT 1. As an integral part of the Resolution Plan and simultaneous with the Capital Reduction, the Resolution Applicant (either by itself or through an SPV) shall infuse the Capital Commitment in the manner provided in this Paragraph III ("Capital Infusion"). 2. The Resolution Application shall i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2. The Capital Infusion in the manner stated in Paragraph III shall be undertaken. 3. The existing board of directors of the Company shall be reconstituted with the existing board of directors deemed to have resigned on the Effective Date without any further action and the nominees of the Resolution Applicant nominated to the Board of the Company; 4. All powers of management, control and operation of the Company granted to the erstwhile Promoters and Promoter Group of the Company, and/or their nominees shall be withdrawn, revoked, terminated and rescinded. 5. The moratorium order passed by the Adjudicating Authority under section 14 shall cease to have effect. 6. The Memorandum of Association and the Articles of Association of the Company shall be automatically, without any further act or deed, be substituted and replaced with the form of memorandum of association and articles of association (the "New Charter Documents as Annexure-9").It is clarified that the approval of the Adjudicating Authority pursuant to Section 31 of the IBC shall constitute adequate approval for the adoption of the New Charter Documents, in accordance with all provisions of Applicable Law. According ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt deposited in the form of EMD shall not be forfeited & refunded to Resolution Applicant by the CoC/Financial Creditors and the Resolution Applicant shall not be liable to pay any amount to Resolution Professional and CoC/Financial Creditors. VI. SUPERVISION OF THE IMPLEMENTATION On and from the NCLT Approval Date, the Monitoring Committee shall constitute the board of the Company and be responsible for the implementation of this Resolution Plan along with the Resolution Applicant until the Effective Date. On and from the NCLT Approval Date and until the Effective Date, it is proposed that the Company will continue to be managed and controlled by the Resolution Professional under the guidance of a Monitoring committee (the "Monitoring Committee"), comprising of 1 representative of Approving Financial Creditor, the Resolution Professional (in professional capacity) and 1 representative of the Resolution Applicant. During this period: (i) the existing board of directors of the Company (the "Existing Board") shall stand vacated and be replaced by the members of the Monitoring Committee ("Reconstituted Board"); and (iii) the Monitoring Committee shall, subject to the provisions ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ("Implementation Schedule"): Step Action Time Step 1 NCLT Approval Date T - Reconstitution of the Board of the Company - Continuation of Moratorium under Section 14 of the IBC Step 2 Effective Date - The Capital Reduction shall become effective - The Resolution Applicant (either by itself or SPV) shall infuse the Equity Commitment in the manner specified in Paragraph III of this Schedule - Other actions specified in Paragraph- IV of this Schedule shall take effect. T+30 Step 3 Payment to Creditors: - Payment of the CIRP Costs - Payment of the Upfront (FULL & FINAL)Payment Amount to the Approving Financial Creditors. T+30 VIII. IMPLEMENTATION OF THE RESOLUTION PLAN 1. Right to Receivables Nothing in this Resolution Plan shall affect the rights of the Company to recover any amounts due to the Company from any third party including any Related Parties of the Company and there shall be no set-off of any such amounts recoverable by the Company against any amount paid by the Company or any liability extinguished pursuant to this Resolution Plan. H ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... T Approval Date. 5. Filing of approved plan with relevant authorities and forums On and from the Effective Date, necessary steps will be taken by the Resolution Applicant to file the same with various governmental authorities, including tax authorities/department, other government departments, and also before the various Courts, Tribunals and regulatory authorities where proceedings with respect to the Company are pending, for disposal of all such proceedings. 6. Any stamp duty liabilities or Tax liability arising pursuant to the transactions contemplated under this resolution plan shall be exempted or waived off. 7. Severability and compliance with law In the event it is determined that any provisions of the Resolution Plan is unenforceable and/or in the event any provision of the Resolution Plan becomes invalid for reasons other than by breach by the Resolution Applicant of the terms of the Resolution Plan, the Resolution Applicant reserves the right to apply to the Adjudicating Authority for appropriate modification of such provisions of the Resolution Plan, with the prior approval of the CoC, and such invalidity and/or unenforceability of the provision of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... icant over and above the resolution amount. CIRP Costs It is presumed that as the company is not under operation during the CIRP period, therefore, there are no cash flows generated by the Company to pay the CIRP Costs and the Resolution Professional ..The CIRP Costs estimated by the Resolution Applicant are approximately Rs. 35,00,000 (Rupees Thirty Five Lakhs Only) and will be paid in full and in priority to any other creditor of the Company. In case the actual CIRP costs are lower than that estimate, the balance provision towards CIRP costs shall be allocated towards payment to financial creditors. In case the CIRP costs exceed the estimate, the extra costs shall be be adjusted out of payment proposed for Financial Creditors such that the Total Upfront (Full & Final) Payment (including CIRP costs) proposed by the Resolution Applicant does not exceed the total resolution amount of Rs. 3,01,00,000/- (Rupees Three Crores and One Lakh only). Proposal for Financial Creditors i. According to List of Creditors of the Company as provided in the information memorandum ("List of Creditors"), total claims filed by the 'financial creditors' of the Company(the "Financial Cred ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... yment of CIRP Costs, the Admitted Financial Debt owing to the Approving Financial Creditors (the "Approving Financial Creditor Debt") will be dealt with in the following manner: (a) The difference between (i) Capital Commitment and (ii) the CIRP Costs shall be paid to the Approving Financial Creditor within a period of 30 days from the NCLT Approval Date, i; (b) An additional amount of Rs. 189905/- towards the PF dues of the erstwhile workers of the company shall be paid by the Resolution Applicant over and above the amount of 3.01 crores. v. For the avoidance of doubt, all accrued or unpaid interest, including penal interest, fees, commission, charges etc. in relation to the Financial Debt of the Company, arising on or after commencement of the CIRP in respect of the Company and until the NCLT Approval Date will by virtue of the order of the Adjudicating Authority approving this Resolution Plan be: (I) written off in full and shall, in accordance with Regulation 37 of the CIRP Regulations, be deemed to be permanently extinguished by virtue of the order of the Adjudicating Authority approving the resolution plan and with effect from the date of Upfront (Full & Final) Payment. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Plan, or on account of the measures contemplate under this Resolution Plan shall, in accordance with Regulation 37 of the CIRP Regulations, be deemed to be permanently extinguished, and all the contracts entered into by the Company with such creditors will be deemed to be terminated without any liabilities, claims or obligations whatsoever arising out of or in relation to such contracts, after the receipt of Upfront payment by the Financial Creditor by virtue of the order of the Adjudicating Authority approving this Resolution Plan and the Company and the Resolution Applicant shall at no point of time, directly or indirectly, have any obligation, liability or duty in relation thereto. viii. Any security, indemnity, pledge, charge, encumbrance, or any other form of collateral (whether over immovable, movable assets, fixed deposits, margin money, cash collateral or any other rights or privileges at any time prior to NCLT Approval Date shall, in accordance with Regulation 37 of the CIRP Regulations, stand permanently extinguished on and with effect from the date of Upfront Payment pursuant to the approval of this Resolution Plan by the Adjudicating Authority. All title deeds and oth ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ounts received pursuant to exercise of powers and obligations by the Resolution Professional under Sections 43 to 51 (both inclusive) and Section 66 of the Code shall, without requiring any action on the part of the Resolution Applicant or the Corporate Debtor, be vested in the Secured Financial Creditor and applied by the Resolution Professional in the same manner as the rest of the financial settlements in this Plan towards the Secured Financial Creditor, subject to any orders passed by the NCLT. PROPOSAL FOR OPERATIONAL CREDITORS i. As per the List of Creditors: (a) total claims filed by Operational Creditors (excluding workmen and govt dues & taxes) amounts to NIL which have been verified and admitted for the purposes of CIRP by the Resolution Professional ("Admitted Operational Creditor Debt "). (b) no claims in relation to workmen's dues have been received by the Resolution Professional and consequently the workmen's dues as verified and admitted by the Resolution Professional is nil. ii. The Liquidation Value is insufficient for payment to the Operational Creditors of the Company as the Liquidation Value is insufficient to satisfy the claims of even the Sec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r arising on account of the acquisition of control by the Resolution Applicant over the Company pursuant to this Resolution Plan or on account of the measures contemplated under this Resolution Plan, shall, in accordance with Regulation 37 of the CIRP Regulations, be deemed to be permanently extinguished by virtue of the order of the Adjudicating Authority approving this Resolution Plan and the Company, the Resolution Applicant and the Resolution Professional shall at no point of time, directly or indirectly, have any obligation, liability or duty in relation thereto. iv. Accordingly, (a) Upon payment of the Upfront (Full & Final) Payment, the contracts relating to: (I) the Dissenting Financial Creditors shall be terminated immediately (and without any further notice) on and from the date of payment of the Liquidation Value owing to such Dissenting Financial Creditors; (II) the Approving Financial Creditors shall be terminated against the Resolution Applicant and the Corporate Debtor (and without any further notice) on and from the date of payment of Upfront (Full & Final) Payment Amount in accordance; and (b) The Operational Contracts for conduct of the business of the C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... emed to be permanently extinguished by virtue of the order of the Adjudicating Authority approving this Resolution Plan and the Company and the Resolution Applicant shall at no point of time be, directly or indirectly, held responsible or liable in relation thereto. iii. Upon approval of this Resolution Plan by Adjudicating Authority and implementation of the Resolution Plan in accordance with the provisions of this Resolution Plan, the employee and workmen policies of the Resolution Applicant shall be applicable to the employees and workmen of the Company and to the extent there is any inconsistency between the employee and workmen policies of the Resolution Applicant and the Company, the terms of the employee and workmen policies of the Resolution Applicant shall be applicable. Such change in the terms and conditions of the employee and workmen policies shall not be considered as terms less than favorable to the and no retrenchment compensation shall be payable under the Industrial Disputes Act, 1947 or any other law or contract. OUTSTANDING GOVT. DUES, TAXES, ETC. i. Total claims filed and admitted of Government and Statutory Authority dues amounts to INR Nil for the purpo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... unknown, secured or unsecured, disputed or undisputed, present or future, whether or not set out in the balance sheets of the Company or the profit and loss account statements of the Company or the List of Creditors, in relation to any period prior to the NCLT Approval Date or arising on account of the acquisition of control by the Resolution Applicant over the Company pursuant to this Resolution Plan or on account of the measures contemplated under this Resolution Plan, shall be written off in full and shall, in accordance with Regulation 37 of the CIRP Regulations, be deemed to be permanently extinguished by virtue of the order of the Adjudicating Authority approving this Resolution Plan and the Company, the Resolution Applicant and shall at no point of time be, directly or indirectly, held responsible or liable in relation thereto. All notices, assessments, appellate or other proceedings pending or threatened in relation to the Company, in relation to any period prior to the NCLT Approval Date or arising on account of the acquisition of control by Resolution Applicant over the Company pursuant to this Resolution Plan, or on account of the measures contemplated under this Resolut ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Plan, will be written off in full and shall, in accordance with Regulation 37 of the CIRP Regulations, be deemed to be permanently extinguished on and from the date of payment of Upfront Payment by the Resolution Applicant by virtue of the order of the Adjudicating Authority approving this Resolution Plan and all such investigations, inquiries or show-cause, whether civil or criminal in relation to the foregoing shall be disposed of, and the Company and the Resolution Applicant shall at no point of time be, directly or indirectly, held responsible or liable in relation thereto. Proposal for other stakeholders (including other creditors) i. In relation to any other person (including creditors and/or stakeholders (who is entitled to receive any amounts under Section 53 of the IBC)) whose claims have not been covered above or who makes any claims in the future, there will be no funds available for payment to them as the Liquidation Value is insufficient. Therefore, NIL payment has been proposed under the Resolution Plan towards payment to such creditors and/or stakeholders and no source has been identified for such payment under this Resolution Plan. ii. Any and all claims or de ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or at the behest of, the Company, or incurred or undertaken by the Company (as the case may be), in relation to any period prior to the NCLT Approval Date or arising on account of the acquisition of control by Resolution Applicant over the Company pursuant to this Resolution Plan, whether asserted or unasserted, whether admitted or not, crystallised or uncrystallised, known or unknown, secured or unsecured, disputed or undisputed, whether or not set out in the balance sheets of the Company or the profit and loss account statements of the Company or List of Creditors, will be written off in full and shall, in accordance with Regulation 37 of the CIRP Regulations, be deemed to be permanently extinguished, by virtue of the order of the Adjudicating Authority approving this Resolution Plan and the Company, the Resolution Applicant and the shall at no point of time be, directly or indirectly, held responsible or liable in relation thereto. It is clarified that the beneficiary of any guarantees issued on behalf of the Company and the guarantor thereof will do all acts and execute all agreements/documents as may be necessary to give effect to the extinguishment of the subrogation rights ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rity. On and from the NCLT Approval Date, the rights relating to all shares (where equity, preference or any instrument convertible into equity shares) of the Company shall come into effect without any further deed, action or thing to be done, which rights shall be exercisable in accordance with the terms of such shares (where equity, preference or any instrument convertible into equity shares) and applicable law. v. Upon approval of this Resolution Plan by Adjudicating Authority, any agreement executed between the Company and its shareholders shall stand terminated without any further action or deed and all liabilities and obligations of the Company under such agreements executed between the Company and its shareholders and their respective successors assigns, transferees shall stand extinguished and cancelled for no consideration. vi. All present and future, claims, dues, liabilities, amounts, arrears, dividends or obligations owed or payable by the Company to the Existing Promoters or any subsidiary, associate company, related party, joint ventures, affiliate of the Company or any such entity or person controlled by the Existing Promoters (or any lenders or financial credito ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or instituted post the approval of the Resolution Plan by the Adjudicating Authority on account of any transactions entered into, or decisions or actions taken by, such existing promoters, shareholders, managers, directors, officers, employees, workmen or other personnel of the company, and the Company, the Resolution Applicant and the Resolution Professional shall at no point of time be, directly or indirectly, held responsible or liable in relation thereto. For avoidance of any doubt, any proceedings, inquiries, investigations, orders, show cause, notices, suits, litigation etc., whether civil or criminal, that are initiated or instituted pre or post of the approval of the Resolution Plan by any person on account of any transactions entered into, or decisions or actions taken by, such existing promoters, shareholders, managers, directors, officers, employees, workmen or other personnel of the company with the said person, in such circumstances, the Resolution Applicant or the Company shall not be held liable in any manner and the previous promoters, management, officer, employees and any person related to previous promoters shall be held liable for the same. Statement in rel ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e resolution applicant, possess adequate knowledge of the industry and are therefore, competent to undertake manufacturing activity in the same industry through assets of Corporate debtor. Post NCLT approval date and taking over management of Corporate Debtor, the resolution applicant will make market study of the Iron & Steel product and viability of the manufacturing it with respect to Government guidelines & policies. Being in the same field, the resolution applicant can bring in experts in order to commence commercial operations of the unit. With a strong net-worth of Rs. 71 Crores, the resolution applicant can infuse required working capital in order to sustain the unit. The resolution applicant also has ready suppliers and customers on account of its existing business operations in the same area. The resolution applicant proposes to upgrade and modernize the plant & machinery acquired under CIRP for future sustainability depending on the viability study undertaken. However, in case of unfavourable market conditions of the industry, the resolution applicant may decide to liquidate the assets acquired in part or lump-sum transfer. Assets of the Company Notwithst ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (ii) Consents and Permits Upon approval of this Resolution Plan by Adjudicating Authority, all actions stated in this Resolution Plan shall be deemed to be approved. Accordingly, any action or implementation of this Resolution Plan shall not be a ground for termination of any Clearances or the like that has been granted to the Company or for which the Company has made an application for renewal or grant. (iii) Licenses, Consents and approvals The Resolution Applicant has also considered that by virtue of the order of the Adjudicating Authority approving this Resolution Plan and since the Resolution Applicant would acquire the Company on a 'going concern' basis, all consents, licenses, approvals, rights, entitlements, benefits and privileges whether under law, contract, lease or license, granted in favour of the Company or to which the Company is entitled or accustomed to shall, notwithstanding any provision to the contrary in their terms and notwithstanding that they may have already lapsed or expired due to any non-compliance or efflux of time, be deemed to continue without disruption for the benefit of the Company and the Resolution Applicant for a pe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d other persons related to them. (vi) All domain names, servers, being currently used by the Company to the extent not owned shall continue to be available for use by the Company for a period of 3 months from the NCLT Approval Date. (vii) There shall be no adverse effect on the rights of the Company over its immoveable properties. (viii) On and from the Effective Date, the Resolution Applicant shall have the right to replace the existing auditors of the Company and appoint new auditors as deemed fit by the Resolution Applicant. (ix) Any right of subrogation, reimbursement, recompense, under any corporate guarantee, letters of comfort or similar instruments of debt or any obligation provided by any promoter, affiliate or Related Party of the Company shall stand extinguished and become null and void as of the NCLT approval date, on and from the date of Upfront Payment. (x) Each of the directors whose offices are being vacated pursuant to the provisions of the Resolution Plan, the Related Parties whose Contracts are being terminated pursuant to this Resolution Plan shall have no claim against the Company either in law or tort including on account of any loss of office, profi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is withdrawn, the amount deposited in the form of EMD shall not be forfeited by the CoC/Financial Creditors and the Resolution Applicant shall not be liable to pay any amount to Resolution Professional and CoC/Financial Creditors (xv) Clean Titles on movable and immoveable property All rights, titles and benefits relating to the movable and immovable properties of the Corporate Debtor after receipt of full Resolution Amount by Financial Creditors as per Resolution Plan shall be vested in the Corporate Debtor free of any title defects or Encumbrances. Resolution Applicant shall have "no recourse" against the Financial Creditor regardless of grant of such reliefs, concessions and entitlements. In avoidance of doubt, in case the resolution plan is withdrawn, the amount deposited in the form of EMD shall not be forfeited by the CoC/Financial Creditors and the Resolution Applicant shall not be liable to pay any amount to Resolution Professional and CoC/Financial Creditors (xvi) RBI confirmation on status of Account: From the date of Upfront Payment of 3.01 crore by the Resolution Applicant to the Financial Creditor, status of accounts of the Corporate Debtor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... olution plan is withdrawn, the amount deposited in the form of EMD shall not be forfeited by the CoC/Financial Creditors and the Resolution Applicant shall not be liable to pay any amount to Resolution Professional and CoC/Financial Creditors (xix) Submission of Documents with competent authority In future any notice is issued against the Company by any authority to produce the documents pertaining to period prior to NCLT Approval Date and such documents are not provided by Corporate Debtor to the Resolution Applicant, under such circumstances, the Resolution Applicant and the company shall not be liable to produce those documents & details before the competent authority and no penalty or liability shall incur on Resolution Applicant and the company on non-submission of said details & documents and no claims pertaining to period prior to NCLT Approval Date shall be liable on the Resolution Applicant. Resolution Applicant shall have "no recourse" against the Financial Creditor regardless of grant of such reliefs, concessions and entitlements. In avoidance of doubt, in case the resolution plan is withdrawn, the amount deposited in the form of EMD shall not be forfei ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d against the erstwhile promoters/directors/guarantors in civil/criminal liabilities which shall not include corporate debtor (xxiii) Creditors to Withdraw all proceedings All creditors of the Corporate Debtor to withdraw all legal proceedings commenced against the Corporate Debtor in relation to Claims, including all criminal proceedings, proceedings under Section 138 of the Negotiable Instruments Act, 1881 and proceedings under SARFAESI and RDDBFI, after full and final payment made to the Financial Creditors as per Resolution Plan. However, it is clarified that all the liabilities, personal guarantee, corporate guarantee provided by the erstwhile promoters/directors/guarantors of the Corporate Debtor shall be in subsistence and financial creditors shall have the right to proceed against the erstwhile promoters/directors/guarantors which shall not include corporate debtor. FINDINGS 17. On hearing the submissions made by the Ld. Counsel for the Resolution Professional, the Resolution Plan in hand satisfies the minimum threshold of approval by 66% majority of the CoC. Hence, as per the CoC, the plan stands the requirement of being viable and feasible for revival of the C ..... X X X X Extracts X X X X X X X X Extracts X X X X
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