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TMI Blog2021 (6) TMI 279X X X X Extracts X X X X X X X X Extracts X X X X ..... initiation of Corporate Insolvency Resolution Process against M/s. Pawan Impex Private Limited ("Corporate Debtor"). The Company Petition (IB)-1396 (PB)/2019 was admitted on 25.07.2019 imposing moratorium under Section 14 of the Code and by initiating Corporate Insolvency Resolution Process ("CIRP"), against the Corporate Debtor. Further, Mr. Mahender Kumar Khandelwal, was appointed as the Interim Resolution Professional ("IRP"). 3. The IRP convened the first meeting of the CoC on 30.08.2019, wherein the CoC resolved to appoint the IRP as the Resolution Professional ("RP"), of the Corporate Debtor. 4. The Applicant states that in the second meeting of the CoC held on 27.09.2019, the Applicant proposed discussion on the minimum eligibility criteria for inviting expressions of interest from prospective resolution applicants for the Corporate Debtor. Consequently, a resolution for approval of the minimum eligibility criteria was put to vote of the CoC, the said resolution was approved by the CoC by voting percentage of 100%. In the said meeting, the Applicant also presented the draft advertisement/Form G for inviting expression of Interest ("Eols") from eligible resolution applican ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... solution applicants: a. Consortium of Minico Insulated Wires LLP, Elita Capital Advisors LLP, Sahney Kirkwood Private Limited ("Consortium of MES"); b. Consortium of DMI Alternative Investment Fund, Fact Software Private Limited and Yash Gupta ("Consortium of DYF"/"Successful Resolution Applicant"); and c. Amrit Bottlers Private Limited ("ABPL"). 9. It is stated that while opening the resolution plans in the seventh meeting of the CoC held on 15.06.2020, it was noted that the Consortium of MES had failed to provide a bid bond as mandatorily required to be provided under the request for resolution plan. However, post various reminders being sent by the RP to the consortium of MES, it had failed to submit the bid bond. The RP on consultation with the CoC and the legal advisors of the RP and CoC, sent out an email communication on 17.10.2020 to the consortium of MES that pursuant to the failure of it to furnish the mandatory bid bond, it shall not be allowed to participate in the CIRP of the Corporate Debtor. 10. That post many rounds of negotiations with both the Successful Resolution Applicant and ABPL, both the resolution applicants had submitted final resolution plans (inc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... unt Admitted Amount provided under the Plan Amount provided the amount claimed Secured Financial creditor a) Creditors not having a right to vote under sub-section 2 of section 21 b) Other than above:- i) who did not vote in favour of the resolution plan ii) who voted in favour of the resolution plan Total (a+b) NIL NIL 19485.6 19485.61 NIL NIL 19485.6 19485.61 NIL NIL 14766 14766 NIL NIL 75.8% 75.8% Un-Secured Financial Creditors a) Creditors not having a right to vote under sub-section 2 of Section 21 b) Other than above:- i. who did not vote in favour of the resolution plan ii. who voted in favour of resolution plan Total (a+b) 1275.72 NIL NIL 1275.72 1070.04 NIL NIL 1070.04 25 NIL NIL 25 2.33% NIL NIL 2.33% Operational creditors a) Related Party of Corporate Debtor b) Other than above:- i) Government Dues ii) Workmen iii) Employees iv) Others (Other than Government and Workmen & Employees) Total (a+b) NIL 7.27 NIL NIL 141.94 149.21 NIL 7.27 (out of this 3.79 is contingent) NIL NIL 119.06 126.33 NIL 7.27 NIL NIL 119.06 126.33 NIL 100% 100% ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... brought in by the RA. The Resolution Professional has also confirmed in the compliance certificate given in Form H that the Resolution Plan provides for the payment of Insolvency Resolution Process costs. Be that as it may it is made clear that Insolvency Resolution Process cost shall be paid in its entirety by the resolution applicant in priority to other debts of the corporate debtor. 24. As regards compliance of clause (b) of Section 30(2) of the Code, the Resolution Professional has certified that the resolution plan provides for the payment of the debts of operational creditors in such manner as may be specified by the Board which shall not be less than the amount to be paid to the operational creditors in the event of a liquidation of the corporate debtor under Section 53. 25. There appears to be no discrimination in the resolution plan in respective class of creditors, as same treatment is provided to similarly situated each class of creditors. 26. Besides, the resolution plan provides for the payment of the debts of operational creditors in such manner as may be specified by the Board which shall not be less than the amount to be paid to the operational creditors in the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to submit the Resolution Plan. At para 4(ii) of Form H Resolution Professional has also certified that the Resolution Applicant, confirmed that the Resolution Applicant is eligible to submit a resolution plan and does not fall under any of the categories as mentioned in Section 29A of the Code. 33. Regulation 36B(4A) of the CIRP Regulations requires that the Resolution Applicant shall provide a performance security. Resolution professional has certified that the Resolution Applicant has made RTGS payment in the account of Corporate Debtor in compliance of Regulation 36B(4A) of the Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) Regulations, 2016. 34. As to the Reliefs and Concessions stated in Chapter IX of the Resolution Plan, the exemption as sought for in relation to the payment of registration charges, stamp duty, taxes and fees arising out of the implementation of the Resolution Plan is not granted. As regards the other reliefs and concessions as sought for, which exempts the Corporate Debtor from holding them liable for any offences committed prior to the commencement of CIRP and as stipulated under Section 32A of IBC, 2016 is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e present case the resolution plan has been unanimously approved with 100% voting share much above the statutory requirement of 66% in terms of Section 30(4) of the Code and has the requisite statutory voting share. Besides the decision of CoC is a reasoned and self-speaking one as required under proviso to Regulation 39(3) of the CIRP Regulations, 2016. Needless to state here that the Resolution Plan cannot take care of total outstanding dues of the creditors in its entirety. It is however seen that the resolution applicant proposes to pay the total consideration amount of Rs. 14,917.33 Lakhs within 24 months from the date of approval of the resolution plan, which is higher than the liquidation value of Rs. 1,438 Lakhs. 41. It is a well settled proposition of law that commercial and business decisions of CoC are not open to judicial review. Adjudicating Authority cannot enquire into the commercial wisdom of CoC. The ground for rejection is limited to the matter specified under Section 30(2). It is however reiterated that the resolution plan in question meets the requirements specified in Section 30(2) of the Code and the reasoned commercial decision of CoC is neither discriminato ..... X X X X Extracts X X X X X X X X Extracts X X X X
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