9911796707
TMI Blog2019 (5) TMI 1815X X X X Extracts X X X X X X X X Extracts X X X X ..... Authority. It is also settled position of law that Court/Tribunal, in the normal circumstances, would not interfere over the decision taken by the concerned authority, basing on their commercial wisdom. The Resolution Plan submitted by the Akashika Foods Private Limited is eligible to be approved, and thus the Resolution Plan was approved - The Applicant cannot seek any special treatment in comparison with other Resolution Applicants and the Applicant was admittedly given all the information uniformly to all those participating Resolution Applicants. The Applicant has not offered higher bid than the successful Resolution Applicant except raising un-tenable grounds. And the facts and circumstances as mentioned above shows that the applicant was afforded reasonable opportunity. Application disposed off. - I.A. No. 125 of 2019 & 221 of 2019 - - - Dated:- 10-5-2019 - Rajeswara Rao Vittanala , Member ( J ) For Appearing Parties: Aditya Sondhi, Sr Counsel, Nakul Sachdeva, Priyanka Prasad, Ashish Kanodia, RP, V. Srinivasa Raghavan, Sr. Counsel, Sanjay Sethiya, B.R.Vyasa Kiran Upadhya, Udaya Holla, Sr. Counsel, Adarsh Gangal and G. Sridhar ORDER Rajeswara Rao Vitta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ucts manufactured by the Corporate Debtor were sold through MRPL. iv. The assets of the Corporate Debtor will double from ₹ 15,29,000,000/- in the year 2016 to ₹ 32,03,000,000/- in the year 2020. v. The Corporate Debtor will have a profit of ₹ 23,900,000/- in the year 2018, a profit of ₹ 25,24,00,000/- in the year 2019 and a profit of ₹ 60,46,00,000/- in the year 2020. vi. MRPL will have a profit of ₹ 95,00,000/- in the year 2018, a profit of ₹ 20,00,00,00/- in the year 2019 and a profit of ₹ 30,80,00,00/- in the year 2020. vii. That an amount of ₹ 8,00,00,000/- was recoverable by the Corporate Debtor from MRPL. viii. The Promoters of the Corporate Debtor specifically assured the Applicant that no business of the Corporate Debtor including MRPL would be sold and/or divested without the prior written consent of the Applicant. (3) The Applicant based on the abovementioned assurances made by the Promoters of the Corporate Debtor, entered into a Share Subscription and Purchase Agreement ('SSPA') on 29th April, 2016 with the Promoters of the Corporate Debtor and UTI. Pursuant to the said SSPA, a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed that the Promoters of the Corporate Debtor had laid the road map to defraud its shareholders including the Applicant to illegally enrich themselves. The initiation of the CIRP itself appears to be a collusive act between the Promoters of the Corporate Debtor and the Operational Creditor. It is alleged that the Promoters of the Corporate Debtor have taken several actions in complete breach of Share Holders Agreement in question. (6) It is alleged that the Criminal complaint was also filed by the Applicant against the Promoters of the Corporate Debtor, FIR was also registered and investigation is going on. It is also stated that they have filed an Application under Section 213 of the Companies Act, 2013 before this Tribunal for investigating into the affairs of the M/s.Maiyas Restaurants Private Limited (MRPL). As per law, a Forensic Audit has to be conducted on the affairs of the Corporate Debtor and a report in this regard has to be submitted by the Resolution Professional on or before seventy fifth date of the insolvency commencement date. However, no such report was made by the Resolution Professional giving rise to collusion between the Resolution Professional and the Co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 35... (2) After the receipt of the resolution plans in accordance with the Code and these regulations, the resolution professional shall provide the fair value and the liquidation value to every member of the committee in electronic form, on receiving an undertaking from the member to the effect that such member shall maintain confidentiality of the fair value and the liquidation value and shall not use such values to cause an undue gain or undue loss to itself or any other person and comply with the requirements under sub-section (2) of section 29. (3) The resolution professional and registered valuers shall maintain confidentiality of the fair value and the liquidation value. However, the Resolution Professional has incongruously in the Information Memorandum provided the Fair Value and Liquidation Value of the Corporate Debtor, thereby committing a serious violation of the Code and the Regulations. (10) The details to be provided in the Information Memorandum are exhaustively enumerated in Regulation 36 of the Regulations. It is pertinent to mention that prior to the Fourth Amendment to the Regulations, Regulation 36 entailed a sub clause whereby fair value ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Investment Advisory Services Limited A/c Ascent India Fund ('UTI') had invested approximately ₹ 120,00,00,000/- (Rupees One Hundred and Twenty Crores Only) prior to the year 2016 and yet again invested a sum of ₹ 20,00,00,000/- (Rupees Twenty Crores Only) in the year 2016 thereby holding 31.01% of the shareholding of the Corporate Debtor and the remaining 37.99% of retained by the shareholding in equity shares of the Corporate Debtor was Promoters of the Corporate Debtor. Therefore, it is clear that the value of the Corporate Debtor and MRPL (jointly) in the year (i.e. 2016) was, at the very least approximately ₹ 420,00,00,000/- (Rupees Four Hundred and Twenty Crores)etc. (14) They have also pointed some instances of undervalued transactions in relations to hiving off of MRPL and assignment of Maiyas Brand to Mr.P.SadanandaMaiya. The Corporate Debtor has also entered into a Trademark and IP Assignment Agreement' dated 13th June 2018 and a subsequent Amendment Deed dated 16th July 2018 (Assignment Agreement') whereby the Corporate Debtor has absolutely assigned its rights in the Brand to MRPL in so far as it related to its hotel and restaurant ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Resolution Professional is answerable only to the Committee of Creditors and not to any of the Resolution Applicants. The acts of the Applicant clearly brings out mala fide intention to reduce the value of the Corporate Debtor and to wipe out the competition. It is further declared that the Applicant has been provided all the information as per law excluding the proprietary information of the Corporate Debtor and the Applicant also visited the factory of the Corporate Debtor and has scrutinized all the documents. Therefore, the Application is liable to be dismissed. 6. The instant application is also opposed by the Karnataka Bank Limited by filing Statement of Objections dated 11.04.2019, by inter alia contending as follows: (1) It is stated that Mr.Kiran Gupta is not authorized to represent the Applicant in the above proceedings. On a perusal of the letter of authorization produced by the Applicant, it appears that Mr.Kiran Gupta is authorized to represent the Applicant only for the breach of the provisions of Investment and Shareholders Agreement and in no other circumstances. Hence the above application is liable to be rejected on this ground alone. (2) It is st ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tor has also filed Preliminary-Objections dated 25.03.2019, by inter alia contending that Application itself is not maintainable as per law. So far as the allegations with regard to the preferential/undervalued transactions, it is the exclusive right of the Resolution Applicant to examine the transactions in light of the provisions of the Code. Moreover, the issue has been considered by the Committee of Creditors. Therefore, it is contended that the application is liable to be dismissed. 8. Heard Dr. Aditya Sondhi, learned Senior Counsel for the Applicant, Shri Ashish Kanodia, learned Resolution Professional for the Respondent, Shri V.SrinivasaRaghavan, learned Senior Counsel for Resolution Professional, Shri Udaya Holla, learned Senior Counsel along with Shri AdarshGangal, learned Counsel for Karnataka Bank Ltd., Shri G.Sridhar, learned Counsel for Promoters of Corporate Debtor. I have carefully perused the pleadings of both the parties and extant provisions of the Code. 9. It is a settled position of law that proceedings are under provisions of Code are summary in nature, and those proceedings would not dwell upon/enter into serious disputed questions of fact of the case. I ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in I.A. No.98 of 2019 I.A. No.222 of 2019; And I.A. No.210 of 2019 C.P. (IB) No.121/BB/2018. The Adjudicating Authority has considered various allegations against the affairs of Company and found that those are allegations are not substantiated. On being found that the Resolution Plan dated 30th March, 2019 submitted by the Akashika Foods Private Limited satisfied all the requirements as contemplated under the provisions of the Code and the Rules made there under. Therefore, the Successful Resolution plan in question was approved by the Adjudicating Authority. Therefore, there is no necessity to advert again all similar allegations now. Since the Resolution Plan in question was already approved as per the order dated 10th May, 2019 in C.P. (IB) No.121/BB/2018 and I.A. No.210 of 2019, the question of changing the Resolution Professional does not arise. Therefore, both I.A. No. 125 of 2019 and I.A. No.221 of 2019 are liable to be rejected. 12. For the aforesaid reasons and circumstances and the law on the issue, both I.A. No. 125 of 2019 and I.A. No.221 of 2019 in C.P. (IB) No.121/BB/2018 are hereby rejected. No order as to costs. - - TaxTMI - TMITax - Insolvency & Bankrupt ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
