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TMI Blog2019 (7) TMI 1603X X X X Extracts X X X X X X X X Extracts X X X X ..... y is also bound by this order. In view of the above order this Adjudicating Authority cannot again go in to the question whether Liberty House Group can be allowed to not to make upfront payment because Committee of Creditors/Monitoring Committee did not give them offer letter. In this case, the Committee of Creditors while approving the Resolution Plan of Liberty House Group, did not ask them to give performance security for successful implementation of the Resolution Plan. Moreover, this provision is added in Regulation by Amendment dated 24.04.2019. If this provision is to be used against Liberty House Group by forfeiting their amount treating as performance's security, it would be nothing but penalising them at this stage. Such provision cannot be used retrospectively. Their Plan is approved almost year ago before the amendment. Hence, the prayer of Committee of Creditors to allow them to forfeit sum of ₹ 50 Crore deposited by Liberty House Group treating it as a performance's Security cannot be allowed. e submissions of learned Senior Counsel though appears to be attractive, but cannot be accepted. Committee of Creditors had an opportunity to consider the P ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Resolution Professional, by Liberty House Group (For short LHG) the successful Resolution Applicant, by workmen of the Corporate Debtor, by MSTC one of the Operational Creditor of the Corporate Debtor etc. State Bank of India/Committee of Creditors and the Resolution Professional have filed application for direction to the Liberty House Group - the successful Resolution Applicant to act as per the approved Resolution Plan. Later on, State Bank of India/Committee of Creditors filed application to cancel the Resolution Plan of Liberty House Group stating that they committed breach in implementation of Resolution Plan. State Bank of India/Committee of Creditors stated that this authority may not pass order of Liquidation of the Corporate Debtor but to pass order of the revival of the Corporate Insolvency Resolution Process by excluding period wasted by the Successful Resolution Applicant by not implementing the Resolution Plan. They also requested this authority to allow them to consider the Resolution Plan which was submitted by earlier H2 bidder M/S Maharashtra Seamless Limited. They also requested this authority to allow them to forfeit sum of ₹ 50 Crore which the Successful ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Resolution Professional later on he was confirmed as Resolution Professional. 8. During Corporate Insolvency Resolution Process, the Resolution Professional called for Resolution Plan from prospective Resolution Applicant. In pursuant thereto, Liberty House Group submitted the Resolution Plan. The Committee of Creditors by 99.94 % votes approved the Resolution Plan of Liberty House Group. The Adjudicating Authority at Kolkata by order dated 17.07.2018 approved that Plan and thereby Corporate Insolvency Resolution Process of the Corporate Debtor was successfully completed. However, while passing approval of the Resolution Plan of Liberty House Group, the Adjudicating Authority at Kolkata rejected M/S MSTC Limited's contention of settling their claim of ₹ 108.36 Crore. Feeling aggrieved of rejection of their claim MSTC Limited filed appeal bearing number 519 of 2018. That appeal was dismissed by Hon'ble NCLAT vide order dated 15.03.2019. Thereafter, MSTC Limited filed second appeal against the order of dismissal of first appeal by the Hon'ble NCLAT, Hon'ble Supreme Court rejected their second appeal also by. In view of this now MSTC's application bearing ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... avour offer letter of equity shares of the Corporate Debtor. Unless such offer letter is issued, it is difficult for them to invest the funds as per the Plan. 13. At the outset, it is made clear that Hon'ble NCLAT passed the order dated 15.03.2019 directing Liberty House Group to make upfront payment within 30 days. It is as follows: Having rejected the prayer, as made by both the Appellants, to give one opportunity for the purpose of compliance of this order and implementation of the plan, we allow the Appellant - 'Liberty House Group' another 30 days to make upfront payment in terms of the 'Resolution Plan'. On failure, it will be open to the Adjudicating Authority, Kolkata Bench to pass the appropriate order in accordance with law . 14. All parties in the appeal before Hon'ble NCLAT are bound by this order unless it is set aside or varied by the Appellate Tribunal/Court. This Adjudicating Authority is also bound by this order. In view of the above order this Adjudicating Authority cannot again go in to the question whether Liberty House Group can be allowed to not to make upfront payment because Committee of Creditors/Monitoring Committee did ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... The amount deposited as the part of upfront payment cannot be forfeited treating the same as the performance's security. 18. It is seen from the record that Liberty House Group did not make upfront cash payment within 57 days of approval of the Resolution Plan. Not only that, firstly this authority and thereafter Hon'ble NCLAT extended time to make upfront payment but they did not make. By filing various applications now, they raised the point that as per Resolution Plan it was for Committee of Creditors/Monitoring Committee to give them an offer letter about equity shares of the Corporate Debtor. I hold that this contention of Liberty House Group cannot be accepted mainly for two reasons; (i) It is raised deliberately at belated stage. They could have raised this issue of Offer Letter at earlier point of time and not after almost one year after the approval of their Resolution Plan and; (ii) The word upfront payment used in the Resolution Plan cannot be qualified by any condition as sought to be attached subsequently by them. 19. The word upfront payment has not been defined in the Insolvency and Bankruptcy Code. But its dictionary meaning is very plain an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rore deposited by Liberty House Group treating it as a performance's Security cannot be allowed. Since the Liberty House Group did not demand back that sum of amount, I am not passing any order thereto at this stage. 21. In this case, the situation that has arisen is that Successful Resolution Applicant Liberty House Group is not in position to implement the Resolution Plan. Corporate Insolvency Resolution Process period of 270 days has already been over along back. In such a situation this authority has no option but to pass order of liquidation of the Corporate Debtor as per Section 33 of Insolvency and Bankruptcy Code, 2016. However, learned Senior Counsel Mr. Saha submitted that this authority can passed order of liquidation of the Corporate Debtor only in two contingencies as stated under Section 33 (l) (a) and (b) of Insolvency and Bankruptcy Code, 2016. He submitted that; (i) Contingencies are that the Adjudicating Authority does not receive any Resolution Plan during 180 or 270 days or (ii) The Adjudicating Authority rejects the Resolution Plan under Section 3 1 of Insolvency and Bankruptcy Code, 2016. According to learned Senior Counsel there is no any othe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eby appoint Mr. Sumit Binani Resolution Professional as the Liquidator. With this all application stand disposed off and I proceed to pass the following order - ORDER (i) Corporate Debtor Adhunik Metaliks Limited, a company incorporated under the provisions of the Companies Act, 1956, having its registered office at Chadri, Hariharpur, P.O. Kuarmunda, Sundargarh, Orissa 770039 Zion Steel Limited, a company incorporated under the provisions of the Companies Act, 1956, having its registered office at Gobira, P.O. Kuarmunda, P.S. Birmitrapur, Sundargarh, Orissa, India 770039 is admitted in process of liquidation. (ii) Mr. Sumit Binani, Resolution Professional having Registration No. IBB1/1PA-001/1P-N00005/2016-17/10025 of 2A, Ganesh Chandra Avenue, Commerce House, Room No. 6, 4th Floor, Kolkata - 700013 and Email-id [email protected] is appointed as the Liquidator in cp (IB) No. 373/KB/2017 renumbered as TP No. 44/CTB/2019 CP (IB) No. 372/KB/2017 renumbered as TP No. 29/CTB/2019. (iii) Mr. Sumit Binani is directed to issue public announcement stating that the Corporate Debtor is in liquidation, in one of the leading English newspaper as well as in one Oriya ne ..... X X X X Extracts X X X X X X X X Extracts X X X X
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