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TMI Blog2021 (4) TMI 673X X X X Extracts X X X X X X X X Extracts X X X X ..... Plan as approved by the requisite percent of voting share of financial creditors. Even in that enquiry, the grounds on which the Adjudicating Authority can reject the Resolution Plan is in reference to matters specified in Section 30(2) when the Resolution Plan does not conform to the stated requirements. In CoC of Essar Steel [ 2019 (11) TMI 731 - SUPREME COURT ] the Hon ble Apex Court clearly laid down that the Adjudicating Authority would not have power to modify the Resolution Plan which the CoC in their commercial wisdom have approved. The Resolution Plan as approved by the CoC under Section 30(4) of the Code meets the requirements of Section 30(2) of the Code and Regulations 37 to 39 of the Regulations. The Resolution Plan is not in contravention of any of the provisions of Section 29A of the Code and is in accordance with law - Application allowed. - Janab Mohammed Ajmal , Hon ble Member ( Judicial ) And Shri V. Nallasenapathy , Hon ble Member ( Technical ) For the Resolution Professional : Mr. Saahil Memon i/b Link Legal India Law Services ORDER Per : V. Nallasenapathy , Member ( Technical ) This is an Application under Section 30(6) of the Insolvency and Bankruptcy Code, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 9th meeting of the CoC held on 06.08.2020, the Applicant and the CoC discussed the only Resolution Plan received. The CoC negotiated with the Resolution Applicants with regard to the pay-out to secured creditor. The Resolution Applicants agreed to increase the pay-out from ₹ 10 Crore to ₹ 10.5 Crore out of the overall plan outlay of ₹ 15 Crore. The CoC also requested the Resolution Applicants to provide source of fund document for obtaining internal sanction. The Resolution Applicants obtained the source of fund document on 26.11.2020 and the same was favourably considered by the CoC. vi. In 12th meeting of the CoC held on 27.11.2020, the Resolution Applicant informed that he had deposited part of the amount towards performance security and will arrange for the remaining funds within 7 days. Accordingly, the final Resolution Plan submitted by the Resolution Applicants was put up before the CoC for voting. The CoC in the same meeting unanimously (100% voting share) approved the Resolution Plan. vii. Subsequently, the Applicant issued a letter of intent to the Resolution Applicants dated 30.11.2020. 3. Salient features of the Resolution Plan are as under: a. RESOLU ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... onths 12 Months Total 1. CIRP (Going Concern cost to extent unpaid) {Note 1} - 125 100% 125 125.00 2. Financial Creditors: {Note 2} a. Secured 1914.1 1050 55% 696.69 356.31 1050.00 b. Unsecured - - - Sub Total 2 1914.1 1050 55% 696.69 356.31 1050.00 3. Workmen and Employees Dues {Note 3} a. Salary Wages (claim submitted) 3.09 3.09 100% 3.09 b. Salary and Wages (claim not submitted) - 12.62 100% 12.62 c. PF and EPF Dues - 1.69 100% 1.69 Sub Total 3 3.09 17.40 100% 17.40 17.40 4. Operational Creditors: {Note 4} a. Creditors (other than below b to f ) 752.76 90.33 12% 90.33 b. Creditors (Claim not received) - 36.51 12% 36.51 c. DC of Central Tax Div 184.6 22.15 12% 22.15 III d. Dept of GST 326.1 39.13 12% 39.13 e. TDS 22.04 2.64 12% 2.64 f. Income Tax 0 4.75 12% 4.75 Sub Total 4 1285.5 195.52 12% 195.52 195.52 5. Contingent Liabilities - 12.08 - 12.08 12.08 6. Working Capital - 100.00 - 50.00 50.00 100.00 Total Amount 3202.69 1500.00 1096.69 403.31 1500.00 Note 1 - CIRP Costs: The CIRP costs as proposed (₹ 125 Lakhs) subject to actual outstanding dues will be fully paid by the RA in priority of all other creditors within first 3 to 6 months. Note 2 - Financial Creditors: Payment ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... an amount of ₹ 75,00,000/- as required in terms of the Code and the Regulations. Bank of India vide its email dated 04.12.2020 has confirmed receipt of the said amount from Resolution Applicant. 4. The Applicant submits that the Resolution Plan meets the requirements of Section 30(2) of the Code in the following manner: a. Plan provides for the priority payment of CIRP costs in full from the fund to be infused by the Resolution Applicant. b. To pay the Operational Creditors of the Corporate Debtor in the manner indicated supra. It is submitted that the Liquidation Value of the Corporate Debtor is ₹ 6,11,64,690/- and Fair Market Value is ₹ 10,54,78,384/-. The estimates of liquidation value made by the Resolution Applicant do not provide full recovery to the Financial Creditors, and there is no amount, as such, available for the Operational creditors out of the liquidation value. However, the Resolution Applicant has provided an amount of ₹ 195.52 Lakhs to all the Operational Creditors (including Operational Creditors who have not submitted their claims in view of the fact that they are going to be future suppliers). c. Plan provides for the management of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ommittee of Creditors of Essar Steel India Limited Vs. Satish Kumar Gupta Ors.:(2019) SCC OnLine SC 1478 as under: 67. A successful resolution Applicant cannot suddenly be faced with undecided claims after the Resolution Plan submitted by him has been accepted as this would amount to a hydra head popping up which would throw into uncertainty amounts payable by a prospective resolution Applicant who successfully take over the business of the corporate debtor. All claims must be submitted to and decided by the resolution professional so that a prospective resolution Applicant knows exactly what has to be paid in order that it may then take over and run the business of the corporate debtor. This the successful resolution Applicant does on a fresh slate, as has been pointed out by us hereinabove. 9. In view of the above ruling of the Apex Court, the Resolution Applicant takes over the Corporate Debtor with all its assets and liabilities as specified in the Resolution Plan subject to orders passed herein. As already indicated the Resolution Plan has been approved by the CoC in its meeting held on 27.11.2020 with 100% votes. 10. In K.Sashidhar v. Indian Overseas Bank Others: 2019 SCC Onl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... shall become effective from this date and shall form part of this order. It shall be binding on the Corporate Debtor, its employees, members, creditors, including the Central Government, any State Government or any local authority to whom a debt in respect of the payment of dues arising under any law for the time being in force is due, guarantors and other stakeholders involved in the Resolution Plan. (ii) The Memorandum of Association (MoA) and Articles of Association (AoA) of the Corporate Debtor shall accordingly be amended and filed with the Registrar of Companies (RoC), concerned for information and record. The Successful Resolution Applicant, for effective implementation of the Plan, shall obtain all necessary approvals, under any law for the time being in force, within such period as may be prescribed. (iii) Henceforth, no creditors of the erstwhile Corporate Debtor can claim anything other than the liabilities referred to above. (iv) The moratorium under Section 14 of the Code shall cease to have effect from this date. (v) The Applicant shall supervise the implementation of the Resolution Plan and shall file periodical Status Report of its implementation before this Author ..... X X X X Extracts X X X X X X X X Extracts X X X X
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