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TMI Blog2020 (1) TMI 1458X X X X Extracts X X X X X X X X Extracts X X X X ..... mandatory requirement of filing the certificate that the accounting treatment contained in the revised/ amended resolution plan, is in conformity with the accounting standards prescribed under section 133 of the Companies Act, 2013. As to post-dated cheques issued by the liquidator while running the hospital, the liquidator and the resolution applicant shall have reconciliation over the cheques issued by the liquidator. After reconciliation, the resolution applicant is bound to pay all post-dated cheques issued by the liquidator - Application disposed off - M. A. Nos. 1425, 1370, 1030 and 697 of 2019 in C. P. No. 698/IB/CB/2017 - - - Dated:- 8-1-2020 - B. S. V. Prakash Kumar (Judicial Member) And S. Vijayaraghavan (Technical Member) For the Applicant : Ramakrishnan Viraraghavan , Senior Advocate, T. Ravichandran , Ms. Elavarsi and K. Deva Dakshan For the Resolution Applicant : South Indian Bank Ltd. Anirudh Krishnan , S. Kavshik Ramaswamy , Ms. Vaidehi Menon and Varsha Manoj For the Liquidator : C. Mohan and Ms. V. Ponnappa Bharathi for the SBI. B. Dhanaraj , Ms. Deepa Marriappan , K. Mohammed Umar , D. Vinod and S. Rajagopal ORDER B. S. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... editor is entitled to proceed against the personal guarantor for this scheme cannot be seen as standalone arrangement without any bearing of section 31 of the Insolvency and Bankruptcy Code, 2016 over section 230 of the Companies Act, 2013 because this scheme is part of the proceedings under the Code. 6. As to this point, the respondents in this application, i. e., the liquidator, resolution applicant and other assenting financial creditors-State Bank of India and Bank of Baroda have collectively argued that this scheme has to be seen in the light of section 230 of the Companies Act, 2013, alone but not in the light of section 31 of the Code as mentioned by the dissenting financial creditor counsel. 7. Here the point to be looked into is, whether restructuring arrangement set out under section 230 can be seen as discharge of loan of the creditors because when rearrangement or restructuring of the Companies Act or compromise happens, it will be treated as a compromise under section 230, not as discharge of loan payable to the creditors, of course, the concept of discharge will no doubt come into picture when proceeding is initiated against the debtor, then creditor is enti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e guarantors, whereby whenever the CIRP is initiated against the principal borrower, the arrangement under the Code is, the creditor is given liberty to initiate the CIRP against the guarantors as well so that rights and liabilities of the parties with regard to loan transactions could be dealt with comprehensively and in totality. The right to proceed against the individual guarantor has also been notified. 12. Though it has not been fully used as of now, over a period of time, whenever a case is filed against the corporate debtor as per law, creditors will initiate proceedings against individual guarantors as well. But as to section 230 is concerned, since such an arrangement has not been made, we doubt as to whether we can venture into a situation which has not been envisaged under law. 13. In this back drop, we are of the view that this applicant has no right to proceed against the guarantor with regard to the loan restructuring that has been taken place under section 230 of the Companies Act, 2013. It is also pertinent to mention that when section 230 has been made applicable to the Code as well, the only rider that has been riveted is, the person who is hit by secti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iness is run by association of persons, it is not that hundred per cent. consensus could be arrived at in all cases. In view of the same, these thresholds that have been arranged either under the Code under the Companies Act, all these arrangements are embodied in the averments for upholding the democratic set up prevalent in a progressive society. Of course, to balance this majority rule, provisions are carved out to ensure that majority rule is not misused solely to cause prejudice to a minority. 16. The applicant counsel has raised another objection stating that this creditor has to be seen as a class because unlike other two creditors, i. e., State Bank of Baroda and Bank of Baroda who have security over the immovable properties of the corporate debtor, the applicant has no security over immovable property of the corporate debtor company therefore to be seen as a class different from other financial creditors-State Bank of India and Bank of Baroda. 17. The society will run upon the expectations. When a person comes out at the beginning saying that he is a secured financial creditor and filed an application as a secured financial creditor, now it is not open to him ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt had filed M. A. No. 1030/IB/2019 with the proposed resolution plan as submitted by the resolution applicant M/s. First Step Ventures Ltd., praying for the direction of this Tribunal for convening the meeting of all the creditors (secured/ unsecured) and shareholders in order to ascertain their consent to the sanction. 21. This Bench, on October 14, 2019 and October 25, 2019 in M. A. No. 697of 2019 passed an order directing this applicant to convene the meetings of the secured and unsecured creditors on November 25, 2019 and November 26, 2019 respectively. In compliance of the directions of the Tribunal, the applicant had convened the meetings of the secured and unsecured creditors on the schedule dates, whereby the amended scheme proposed by the M/s. First Step Ventures Ltd., for a total investment of ₹ 75 crores has been duly voted in favour by both secured and unsecured creditors, complying with threshold limit prescribed under the Companies Act, 2013. 22. That the report of the Chairperson dated December 3, 2019 and scrutinizer report dated November 25, 2019 reveals that the revised/amended resolution plan dated November 25, 2019 submitted by M/s. First Step V ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Tranche-IV (within 6 months of Tranche-III payment date) 20.00 Total 75.00 Source of funds From own contribution of resolution applicant/its affiliate : Upfront infusion-First Tranche (timelines as stated above) 5.00 Upfront infusion-Second Tranche (timelines as stated above) 30.00 Third Tranche (timelines as stated above) 20.00 Fourth Tranche (timelines as stated above) 20.00 Total 75.00 Amendment : Amount of INR 75 crores shall be payment of one-time settlement immediately upon receiving adjudication order. 26. In continuation to the order dated December 18, 2019 in M. A. No. 1370 of 2019, one of the financial creditors State Bank of India is about to comply with the order since this scheme has come before this Bench for approval, for the resolution applicant ..... X X X X Extracts X X X X X X X X Extracts X X X X
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