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TMI Blog2019 (11) TMI 1660X X X X Extracts X X X X X X X X Extracts X X X X ..... justifications for approval of the Resolution Plan that the Liquidation Value is less compared to the Resolution proposals made in the Resolution Plan is satisfied. The Resolution Applicant has sought extinguishment of all claims along with abatement of any related legal proceeding including criminal proceedings. Furthermore, the Resolution Applicant seeks waiver of outstanding statutory dues and other claims as on the date of approval of the Resolution Plan. The exemption is also sought from the statutory dues of the Central Board of Direct Taxes (CBDT) and under the Stamps Act, from the levy of stamp duty and fees applicable in relation to this plan and its implementation The Resolution Plan in hand satisfies the minimum threshold of approval by 66% majority of the CoC. The Resolution Applicant is not barred under section 29A of the I B Code to file the resolution plan. The plan stands the requirement of being viable and feasible for revival of the Corporate Debtor. By and large, all the compliances have been done by the RP and the Resolution Applicant for making the plan effective after approval by this Bench. The Resolution Plan as approved by CoC is hereby approved - ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ted by the RP. Further, in the meeting of the CoC held on 11.09.2018, with e-voting on 14.09.2018, the extension of CIR period by another 90 days beyond the period of 180 days was decided to be sought from NCLT. 5. An extension of 90 days was granted by this Bench to complete the CIRP of the Corporate Debtor vide order dated 15.10.2018, thus extending the CIR period till 15.01.2019. The Applicant submits that two Resolution plans were received as on 24.11.2018, from Royal Partners Investment Fund Limited (RPIFL) and Arcelor Mittal India Private Limited (AMIPL). 6. On 30.11.2018, the Resolution Plan of RPIFL was rejected as it failed to submit Earnest Money Deposit of (Rs.) 5 Crore along with the Resolution Plan. Hence, the CoC did not consider its Resolution Plan as it was considered non-responsive. Thereafter, negotiations were initiated on the Resolution Plan of AMIPL. On 24.12.2018, the Resolution Plan of AMIPL was also considered unsatisfactory and CoC resolved to invite afresh resolution plans from those eligible resolution applicants who had submitted their Expression of Interests with the Applicant. The submission date for such Resolution Plans was extended until 27.12 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vit dated 04.01.2019 confirming its eligibility to submit a Resolution Plan for the Corporate Debtor under Section 29A of the I B Code. 11. The Applicant has duly submitted Form H stating that the resolution plan is compliant of the provisions of the code. The Applicant has preferred the present application for approval of Resolution Plan by this Adjudicating Authority. The Resolution Plan as approved by CoC is incorporated herein: RESOLUTION PLAN FOR EPC CONSTRUCTIONS INDIA LIMITED ( RESOLUTION PLAN ) 8 January 2019 Submitted by: Royale Partners Investment Fund Limited DEFINITIONS AND INTERPRETATIONS: In this Resolution Plan, capitalized terms defined by inclusion in quotations and/or parenthesis shall have the meanings so ascribed and additional capitalized terms shall have the following meanings assigned to them in Annexure 1 hereto. EXECUTIVE SUMMARY: Royale Partners Investment Fund Limited established as a Category 1 Global Business Company limited by shares under the Mauritius Companies Act 2001 and having its registered office at C/o SGG Fund Services (Mauritius) Limited, 33, Edith Cavell Street, Port Louis 11324, Mauritius ( RPIF or th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lution Plan will create a sustainable capital structure that will enable the Company to continue as a going concern . Accordingly, we are very keen to work with the stakeholders of the Company and are confident of delivering on this Resolution Plan in an expeditious and time-bound manner after receiving necessary approvals. Further, we believe the following factors uniquely position the Resolution Applicant in making this Resolution Plan successful for the stakeholders: Availability of sufficient funds to implement the Resolution Plan Strategic presence and deep connect of the sponsors in UAE which will serve as an additional market for winning new projects in future, helping in the revival of the Corporate Debtor's business going forward RPIF is strategically looking at further investments in the EPC and infrastructure sector in India. Consolidation of all the group interests that will be acquired in due course, will be with the objective to build synergies to further improve operational efficiencies across all businesses including that of the Corporate Debtor. Financial Assessment of the Company's Operations The Resolution Applicant has done an analysis ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the Resolution Applicant for successfully running the Company and creating value for all the stakeholders. The Resolution Applicant is also committed to completing this transaction in an expeditious manner. RESOLUTION PLAN This Resolution Plan is proposed by Royale Partners Investment Fund Limited, a Category I Global Business Company limited by shares under the Mauritius Companies Act, 2001 and having its registered office at C/o SGG Fund Services (Mauritius) Limited, 33, Edith Cavell Street, Port Louis 11324, Mauritius ( Resolution Applicant ) or ( RPIF ), pursuant to the IBC, IM and Process Document. 1. Overview 1.1. The National Company Law Tribunal, Mumbai ( NCLT ), through its order ( Order ) dated 20 April 2018 ( Insolvency Commencement Date ), admitted the application for initiation of corporate insolvency resolution process ( CIRP ) filed by the IDBI Bank Limited in respect of EPC Constructions India Limited (formerly known as Essar Projects (India) Limited) ( Company or Corporate Debtor or EPCCIL ) in accordance with Section 7 of the IBC. Pursuant to the Order, Mr. Abhijit Guhathakurta, was appointed as the interim resolution professional and thereafte ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by the Resolution Professional, in running the operations of the Company as a going concern. ii. The CIRP Costs will be paid in full and in priority to any other creditor of the Company upon the Resolution Plan becoming effective, first from out of the available cash balances in the Corporate Debtor and thereafter the remaining CIRP Cost i.e. Balance CIRP Costs, if any, from out of the Upfront Consideration. 3.2. Proposal for Financial Creditors: i. As per the List of Creditors, Workmen and Employees' dues amounting to INR 4.57 Crores have been filed. Out of which INR 0.68 Crores have been verified and admitted by the Resolution Professional and form part of the Admitted Debt. Such Admitted Workmen and Employee Dues shall be treated pari-passu with Financial Creditors and shall be paid in full in the manner as specified in Section 3.4 below. In the event any additional workmen dues are admitted until the Approval Date, to the extent they ascribe to a period of 24 months preceding the Insolvency Commencement Date ( Potential Workmen's Dues ) such Potential Workmen Dues shall form part of Admitted Workmen and Employee Dues and be paid out of the Upfront Consideration ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... led to receive Total Consideration comprised as follows: (a) Upfront Consideration of INR 420 Crores (Indian Rupees Four Hundred Twenty Crores) (b) Deferred Consideration of INR 480 Crores (Indian Rupees Four Hundred Eighty Crores) as secured and unlisted NCDs, to be paid over a period 5 years at a coupon of 8% p.a., as shown in Annexure 2. It is clarified that: A. The Resolution Applicant shall have the right to voluntarily prepay/redeem the entire Deferred Consideration to the Financial Creditors, in part or in full, at any time during the tenor of the NCDS, provided that an IRR of 8% p.a. is maintained; B. Notwithstanding anything contained in this Resolution Plan, the aggregate of Upfront Consideration and Deferred Consideration ( Total Consideration ) shall be the full and final discharge provided to the claims of the Financial Creditors, upon receipt of which all claims of Financial Creditors in relation to Admitted Debt shall stand extinguished; C. Notwithstanding anything in this Plan, on and from the Effective Date, all the guarantors/third party security providers who have provided/issued any guarantees/security (on their assets) for and on behalf and in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ate of implementation of the Plan, i.e., till the date of payment of the Upfront Consideration. ix. Other than as specified in Section 3.2. ii to vi above and except for the payment of the Total Consideration, any and all other Claims or demands made by or liabilities or obligations owed or payable to (including any demand for any losses or damages, principal, interest, compound interest, penal interest, liquidated damages, notional or crystallized mark to market losses on derivatives and other charges already accrued/accruing or in connection with any Third Party Claims) any actual or potential Financial Creditors of the Company or in connection with any debt of the Company (including any transactions in derivatives), whether admitted or not, due or contingent, asserted or unasserted, crystallized or uncrystallised, known or unknown, disputed or undisputed, present or future, whether or not set out in the Provisional Balance Sheet, the balance sheets of the Company or the profit and loss account statements of the Company or the List of Creditors, in relation to any period prior to the Effective Date or arising on account of the acquisition of control by the Resolution Applicant ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... inancial Creditor, Operational Creditor or otherwise) shall be required to implement the Resolution Plan. xi. Subject to Section 3.2.x above, any Encumbrance, or any other form of collateral (whether over immovable, movable assets, fixed deposits or cash or any other rights or privileges and including without limitation, any guarantee, security, letter of credit or pledge provided by the Existing Promoters of the Company that was created/granted/arranged in connection with any Financial Debt or Operational Debt or any other debt or obligation of the Company, at any time prior to the Effective Date, shall automatically be released and all liabilities and obligations of the Company and any Third Party on behalf of the Company in relation to such Encumbrance or other form of collateral shall stand permanently extinguished on the approval of this Resolution Plan by the NCLT and payment of the Total Consideration as specified here (including those created/arranged by the Company as a guarantor or a third party security provider in relation to its subsidiaries, joint ventures, related parties or associates, if any, but without prejudice to the primary obligations of such parties to th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... charge of the obligations of such subsidiaries, joint ventures or associates; (C) all the outstanding negotiable instruments, corporate guarantees issued by the Company or by any Person on behalf of the Company including demand promissory notes, post-dated cheques and letters of credit, shall stand terminated and the Company's liability under such instruments shall stand extinguished; (D) all notifications with regards to defaults filed with Credit Information Bureau (India) Limited ( CIBIL ), any Information Utility, RBI or any other regulatory authority shall be withdrawn by the respective Financial Creditors; (E) Bank guarantees which are already issued on behalf of the Corporate Debtor will continue till their expiry and devolve as per the terms of their issuance. These bank guarantees already form a part of the Admitted Debt and the Corporate Debtor will not incur any further liability upon their devolvement or invocation. Any margin money in relation to such bank guarantees shall be to the credit of the Financial Creditors and shall be appropriated by them upon refund of such margin for any reason whatsoever and neither the Resolution Applicant nor the Corporate ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ands made by, or liabilities or obligations owed or payable to (including but not limited to any Operational Debt including any advances payable to any Operational Creditor under any contract, any demand for any losses or damages, indemnification, principal, interest, compound interest, penal interest, liquidated damages, and other charges already accrued/accruing or in connection with any Third Party Claims) any actual or potential Creditor, vendor, contracting counterparty, Governmental Authority, claimant or any other person whatsoever (including but not limited to the Operational Creditors and its promoters, directors and other related parties of the Company and/or the Existing Promoters) (singular as Third Party and collectively as Third Parties ), whether admitted or not, due or contingent, asserted or unasserted, crystallized or uncrystallised, known or unknown, secured or unsecured, disputed or undisputed, present or future, whether or not set out in the Provisional Balance Sheet, the balance sheets of the Company or the profit and loss account statements of the Company or the List of Creditors, in relation to any period prior to the Effective Date or arising on account ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fessional ( Admitted Workmen and Employees Dues ), the same shall be discharged from the funds brought in, directly or indirectly, by the Resolution Applicant. Any Potential Workmen Dues shall be paid out of the Upfront Consideration, after payment of any Balance CIRP Costs, in terms of Annexure 2. ii. Other than the Admitted Workmen and Employees Dues, any and all Claims or demands made by, or liabilities or obligations owed or payable to, (including any demand for any losses or damages, or interest, back wages, compensation, penal interest, liquidated damages already accrued/accruing or in connection with any Claims) any present or past, direct or indirect, permanent or temporary employee and/or workman of the Company, whether admitted or not, due or contingent, asserted or unasserted, crystallized or uncrystallised, known or unknown, secured or unsecured, disputed or undisputed, present or future, whether or not set out in the Provisional Balance Sheet, the balance sheets of the Company or the profit and loss account statements of the Company or the List of Creditors, in relation to any period prior to the Effective Date or arising on account of the acquisition of control by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ect or indirect, penalties, fees, interest, fines, levies, cesses, assessments or additions or any other charges or payments whatsoever (including without limitation any Taxes, Claims, liabilities or dues set out in Annexure 3 and Annexure 5 and any liabilities in relation to any consent, permission, privilege, entitlement, exemption, benefit, license or approval granted to the Company or in relation to the Company, whether or not such consent, permission, privilege, entitlement, exemption, benefit, license or approval is subsisting, lapsed or expired), whether admitted or not, due or contingent, asserted or unasserted, crystallized or uncrystallised, known or unknown, secured or unsecured, disputed or undisputed, present or future, whether or not set out in the Provisional Balance Sheet, the balance sheets of the Company or the profit and loss account statements of the Company or the List of Creditors, in relation to any period prior to the Effective Date or arising on account of the acquisition of control by The Resolution Applicant over the Company pursuant to this Resolution Plan, will be written off in full and will be deemed to be permanently extinguished by virtue of the ord ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... regulations, directions, notifications, circulars, guidelines, policies, licenses, approvals, consents or permissions; (C) change of control, transfer charges, unearned increase, compensation, or any other such liability whatsoever under any contract, agreement, lease, license, approval, consent or permission to which the Company are entitled; (D) any leasehold rights or freehold rights to movable or immovable properties in the possession of the Company (including but not limited to the leases, letter of intent or other agreements/contracts/arrangements for immovable property entered into by the Company with the Central Government and State Government of Maharashtra); and (F) any contracts, agreements or commitments made by the Company, in each of the foregoing cases whether admitted or not, due or contingent, asserted or unasserted, crystallized or uncrystallised, known or unknown, secured or unsecured, disputed or undisputed, present or future, whether or not set out in the Provisional Balance Sheet, the balance sheets of the Company or the profit and loss account statements of the Company or the List of Creditors, in relation to any period prior to the Effective Date or arising ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt, crystallized or uncrystallised, known or unknown, secured or unsecured, disputed or undisputed, present or future, whether or not set out in the Provisional Balance Sheet, the balance sheets of the Company or the profit and loss account statements of the Company or the List of Creditors, and all inquiries, investigations or proceedings in relation to the foregoing, whether civil or criminal, in relation to any period prior to the Effective Date or arising on account of the acquisition of control by the Resolution Applicant over the Company pursuant to this Resolution Plan, shall be settled at NIL value at par with Claims of Operational Creditors as set out in Section 3.3. ii of this Resolution Plan. iii. All liabilities in relation to any letters of credit, letters of undertaking, guarantees, counter guarantees, corporate guarantees, bank guarantees, performance guarantees or other contingent or future Claims, liabilities and/or commitments of any nature whatsoever (including without limitation the Taxes, Claims, liabilities or dues set out in Annexure 3 and Annexure 5), issued by, or on behalf of, or at the behest of, the Company, or incurred or undertaken by the Company (a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , investigations, notices, causes of action, suits, claims, disputes, litigation, arbitration or other judicial, regulatory or administrative proceedings against, the Company or the affairs of the Company, pending or threatened, present or future and the proceedings (under Section 138 of the Negotiable Instruments Act, 1881 and the Tax related Claims or liabilities specifically set out in Annexure 3 and Annexure 5 hereto) in relation to any period prior to the Effective Date or on account of acquisition of control by the Resolution Applicant over the Company pursuant to this Resolution Plan, shall be settled at NIL value at par with the treatment accorded to the Operational Creditors of the Company as set out in Section 3.3. ii of the Resolution Plan. ii. It is clarified that the Existing Promoters and existing shareholders, managers, directors, officers, employees, Workmen or other personnel of the Company shall continue to be liable for all the Claims, demand, obligations, penalties etc. arising out of any (i) proceedings, inquiries, investigations, orders, show causes, notices, suits, litigation etc. (including those arising out of any orders passed by the NCLT pursuant to Se ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er the instructions, control and management of the Steering Committee. II. All fees payable to the Monitoring Agency (including any legal costs which have arisen or may arise out of or in connection with the corporate insolvency resolution process of the Company) and Steering Committee shall be met out of the accruals of the Company and to the extent the internal accruals are not sufficient to meet the aforesaid costs and expenses, the same shall be accrued as CIRP Cost and be paid by the Resolution Applicant as CIRP cost on the Effective Date, as consideration for fulfilling their respective obligations during this Interim Period. III. It is clarified that the decisions which could otherwise have been taken by the Company's Board shall be taken by the Monitoring Agency and the Steering Committee (until reconstitution of Board by the Resolution Applicant/SPV) and that the Company's Board shall have no authority whatsoever to conduct the business of the Company. The Steering Committee shall comprise of 5 members which shall include 3 authorized representatives of the Committee of Creditors and 2 nominees of the Resolution Applicant subject to Applicable Law. Any decisi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d have the effect of reorganisation of capital of the Company; and (C) not alter or substantially expand the Company's business, or undertake (i) any material decision in relation to its business and affairs and operations other than that in the ordinary course of business; (ii) any agreement or transaction (other than an agreement or transaction in the ordinary course of business); and (iii) any new business, or discontinue any existing business or change the capacity of facilities other than that in the ordinary course of business; V. It is further proposed that upon the Resolution Applicant and/or the SPV acquiring control over the Company on the Transfer Date, the existing Board and the Monitoring Agency and the Steering Committee will be replaced by a new Board constituted with adequate representation from the members of the Resolution Applicant and independent directors in compliance with Applicable Law. The day to day operation and maintenance of the Company after change of control is proposed to be handled by a dedicated project procurement and implementation team of the Resolution Applicant under the supervision of the new Board of Directors of the Company. VI ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of provisions of the law for the time being in force and is in strict compliance with the IBC and the CIRP Regulations: The Resolution Applicant declares that this Resolution Plan is not in contravention of the provisions of any applicable laws. 3.12. Statement in relation to how the Resolution Plan has dealt with interests of all stakeholders, including financial and operational creditors of the Company: As set out above in Sections 3.1 to 3.8 of the Resolution Plan, the Resolution Plan for the Company has dealt with the interests of all the stakeholders in the Company, including the Financial Creditors (whether consenting, dissenting or abstaining) and Operational Creditors of the Company. Unless otherwise expressly stated in this Resolution Plan, no creditor, existing shareholder or any other stakeholder of the Company shall be entitled to receive any settlement more than the proportionate settlement payable to a similarly placed class of creditors, shareholders or stakeholders, as stated in this Resolution Plan. 3.13. Statement in compliance of Section 29A of the IBC: The Resolution Applicant confirms that, as on the date of this Resolution Plan and on the bas ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... this Resolution Plan shall prevail for all purposes and to all intents. iii. Entire Resolution Plan The Resolution Plan along with its Annexures constitutes the entire resolution plan of the Resolution Applicant within the meaning of Section 30 of the IBC and Regulation 38 of the CIRP Regulations and supersedes and cancels any prior oral or written plan, agreement or understanding in this regard. iv. Parity in Settlement The Resolution Professional issued a notice dated 26 April 2018 inviting all potential claimants to submit their proofs of Claim. This was published in newspapers in accordance with Applicable Law. The Resolution Applicant shall treat all creditors of the Company, that have any Claims against the Company but who have neither filed their Claims nor disputed as on the date of this Resolution Plan and whose names do not appear in the Information Memorandum or List of Creditors as of the date of this Resolution Plan, on par with their respective class as set out in this Section 3. Accordingly, the Claims shall be settled at the value specified to be payable to such class in this Resolution Plan and any amount already paid to such class shall be proportionat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... persons who will be promoters or in the management or control of the business of the Company during the implementation of the Resolution Plan; (c) holding company, subsidiary company, associate company and related party of the persons referred to in (a) and (b)). In relation to the disclosure regarding persons who will be promoters or in the management or control of the business of the Company during the implementation of the Resolution Plan , please note that until the acquisition of control by the Resolution Applicant over the Company, the Monitoring Agency will monitor the management or control of the business of the Company under the guidance of the Steering Committee. The Resolution Applicant will also have representation in the Steering Committee to ensure that no actions are taken which are not in compliance with the Resolution Plan or which are against the strategy of the Resolution Applicant. After the acquisition of control over the Company by the Resolution Applicant in the manner set out in Annexure 2, the Resolution Applicant will implement the Resolution Plan and become the promoter of the Company and be in control of the management of the Company. Information ab ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as an additional market for the Company to win new projects to help revive its business. In addition, it has plans to make further investments in the EPC and infrastructure sector in India with the objective of having synergies across operations in the businesses being acquired. In this regard, the Resolution Applicant has already signed a binding term sheet to acquire a majority stake in a leading EPC company in India. In addition, the Resolution Applicant has the mandate to invest in a large spectrum of sectors, including but not limited to real estate development, oil blocks, financial services, technology, sports, entertainment, online portals, etc. To give a perspective, the Resolution Applicant has already completed or is in the process of completing some prominent deals in these sectors, as highlighted in Item 3 of Annexure 9. One of the board members of the Resolution Applicant and member of the core investment advisory team, H.E. Sultan Ali Manea Mufreh Al Ahbabi, has more than 15 fifteen years of rich experience in this sector and has been an administrator with the Government of Abu Dhabi, Ministry of Presidential Affairs as Head of Project Management and Chairman of R ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 0 million (equivalent and in excess of INR 2100 Crores) for its investments, which is more than sufficient for implementing the Resolution Plan. Proof of funds is enclosed in Annexure 8. (G) Record of regulatory compliance and corporate governance: The Resolution Applicant has never defaulted on any regulatory compliances and is in strict compliance of applicable regulatory provisions. (H) Know Your Customer (KYC) Details of the Resolution Applicant and its Parent Company Please refer Annexure 6. 5. BUSINESS PLAN FOR THE COMPANY The Resolution Applicant has prepared a business plan for the Corporate Debtor based on information available in the data room, market information and technical/operating/commercial expertise of the Resolution Applicant. With operational improvements, revenue is expected to grow gradually. In the FY 2020, which will be the first year of operations, the revenue is estimated at INR 660 crores. The revenues will gradually increase to around INR 3,400 crores and EBITDA of around INR 400 crores reflecting operational improvement capability of the Corporate Debtor, thereby aligning the Corporate Debtor with its competitors. Such an approa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h the Corporate Debtor has track record and further develop capabilities in new areas such as Nuclear Power, Irrigation and Defence. Several steps shall be taken to ensure timely recovery of dues and maintain a steady working capital cycle. The Resolution Applicant shall also tie up with international technology licensors so as to enable the company to bid for green-field and up-gradation work as well as niche projects. (B) Proposal for execution of the sale arrangement, if any. Not applicable (C) Action plan for building the capability required (technical, financial, manpower etc.) to ramp up the scale of operations Technical - The Resolution Applicant will build capabilities to focus on core sectors such as Hydrocarbons, Pipelines (Water as well as Oil Gas), Offshore, Marine and Power and further develop capabilities in new areas such as Nuclear Power, Irrigation and Defense. Resolution applicant shall also tie up with international technology licensors so as to enable the company to bid for green-field and up-gradation work as well as niche projects. Financial - In order to augment the working capital of the company, the Resolution Applicant would request the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ation and maintenance of the facilities. In order to augment the working capital of the company, the Resolution Applicant would require NFB limits on conditions already specified above to enable the Company to bid for new projects and build the order book. The operational costs are estimated in the financial projections which are provided in Annexure 10. 6. FINANCIAL PROPOSAL FOR THE COMPANY The financial proposal is set out in section 3 and annexure 2 of the resolution plan. Indicative timeline of events for implementation of the Resolution Plan is set out below. Obtaining of approvals for Implementation of the Resolution Plan: On and from the date of the approval of the Resolution Plan by the NCLT, the obligation of the Resolution Applicant to implement the Resolution Plan shall be subject to receipt by the Resolution Applicant or the Company, as the case may be, of the requisite consent, approval or permission of the CCI for the effective implementation of the Resolution Plan, if applicable. The Resolution Applicant shall bear all costs and expenses in respect of obtaining the aforesaid consents, approvals or permissions. It is further clarified that if the a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e) shall be made prior to Approval Date (and shall be obtained on a best effort basis within 15 (fifteen) days from the issuance of LOI), subject to the COC and the RP providing all necessary information to Resolution Applicant. 3. The implementation timelines indicated above may accordingly change and this Resolution Plan will be implemented in accordance with such approvals and changed timelines. 4. The Resolution Applicant shall be vested with complete control and ownership of all the cash flows/receivables including cash accruals (arising after the date of payment of Upfront Consideration), bank accounts of the Corporate Debtor as soon as the Financial Creditors are paid the Upfront Consideration. 7. MANAGEMENT OF THE COMPANY 7.1. Implementation and Supervision of the Resolution Plan after the Effective Date After the Effective Date, the implementation of the Resolution Plan will be supervised by a suitable management team deployed by the Resolution Applicant. 7.2. Appointment of Turnaround Experts The Resolution Applicant intends to bring on board the best talent from its already existing pool of management personnel and also envisages hiring professional ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... be binding on employees/workmen/consultants of the Company on and from the Effective Date. The Resolution Applicant would not be liable to honor any commitment made by the erstwhile management of the Company or the Existing Promoters in respect of employees/workmen/consultants or their union in so much as it refers to continued employment and perquisites for employees unless required under Applicable Law and specifically mentioned in the new contracts of the continuing workforce. The Resolution Applicant have the right to rationalise the employment force and change the terms of the employment conditions of the employees of the Corporate Debtor subject to Applicable Law. The Resolution Applicant will, at all times during the implementation of Plan and thereafter ensure compliance with Applicable Laws with respect to labor and employment in the concerned jurisdiction. 7.8. Other key terms pertaining to the acquisition of Control of the Company (i) Maintenance of the Company by the Monitoring Agency as a going concern: The Monitoring Agency will on a best effort basis take all such actions and execute all such documents/agreements as may be required to maintain the Company ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cies, directions, directives and orders of any Governmental Authority or any licenses, consents or approvals granted by any Governmental Authority, and any modifications or re-enactments of each thereof. Approval Date shall mean the date on which the approval of the NCLT is received. Board/Board of Directors Board of directors of the Company Business Day shall mean a day (other than a Saturday or Sunday or public holiday) on which banks are open for general business in Mumbai. CA 2013 The Companies Act, 2013 (as amended from time to time) and or Companies Act, 1956 (to the extent applicable) Capital Reduction shall have the meaning ascribed to such term in Annexure 2 of this Resolution Plan Claim(s) A right to payment, right to remedy arising pursuant to a contract, under any law for the time being in force, if such breach gives rise to a right to payment, whether or not such right is reduced to judgment, fixed, disputed, undisputed, legal, equitable, mature ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... underlying Encumbrances and/or pledges created to secure the Loans, and/or guarantees issued in respect of the Loans, which the Financial Creditors are entitled to, but excluding the Identified Excluded Collateral. Deferred Consideration Has the meaning given to it in paragraph F of Annexure 2. EBITDA The earnings of the Company, before exceptional and extra ordinary items, interest expense, taxes, depreciation and amortization, calculated as per Indian generally accepted accounting principles. Effective Date Such date as may be agreed between the Resolution Applicant and the COC, on which the Resolution Plan shall become operative or the date of (a) approval of the Resolution Plan by the NCLT; (b) receipt of CCI Approval (if applicable) for the implementation of the Resolution Plan, whichever is later. Reference in this Resolution Plan to the date of 'coming into effect of this Resolution Plan' or the 'Resolution Plan becoming effective' or 'Resolution Plan being made effective' shall mean the 'Effective Date'. Enc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mean the rights, title and interest in the underlying collateral/Encumbrance on third party assets created on behalf of the Corporate Debtor to secure any Loans availed by the Corporate Debtor, which the Financial Creditors shall remain entitled to and will not be assigned to the SPV, and which are more particularly identified in Annexure 11 hereto. Identified Subsidiaries and Investments shall mean overseas subsidiaries and investments of the Corporate Debtor, which are directly held by the Corporate Debtor and are identified by the Resolution Applicant for hiving off/writing off any investment as envisaged in the relevant step in Annexure 2. IM or Information Memorandum Information memorandum dated July 2018 issued for the CIRP of the Company by the Resolution Professional, as amended or modified from time to time. Monitoring Agency shall mean the Monitoring Agency identified by CoC in consultation with the Resolution Applicant and appointed on such terms and conditions mutually agreed between the parties thereto. It is hereby clarified that the Monitoring Agency may ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a wholly owned subsidiary incorporated in Mauritius by the Resolution Applicant as a special purpose vehicle for the purpose of implementing this Resolution Plan. Merger shall have the meaning ascribed to such term under Step 6 of Annexure 2 of the Resolution Plan. MCA Ministry of Corporate Affairs. Monitoring Agency shall mean the Monitoring Agency identified by CoC in consultation with the Resolution Applicant and appointed on such terms and conditions mutually agreed between the parties thereto. It is hereby clarified that the Monitoring Agency may also be the Resolution Professional and his team of experts. NCDs shall mean the SPV NCDs and/or the New NCDs (as applicable). NCLT or Adjudicating Authority The National Company Law Tribunal as constituted under Section 408 of the CA 2013 New NCDs shall mean the secured unlisted redeemable non-convertible debentures issued by the Company to the secured Financial Creditors, as more particularly set out in parag ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s mean collectively, the Financial Creditors of the Corporate Debtor against whom a description of their respective security interest has been set out in the 'List of Creditors' as uploaded on the website of the Corporate Debtor. ROC Registrar of Companies SPV NCDs shall mean the secured unlisted redeemable non-convertible debentures issued by the SPV to the secured Financial Creditors, as more particularly set out in paragraph (E) of Annexure 2 of this Resolution Plan Stock Exchanges BSE Limited and National Stock Exchange Limited Taxation or Tax or Taxes All forms of taxes and statutory, governmental, state, provincial, local governmental or municipal impositions, duties, contributions and levies and whether levied by reference to income, profits, book profits, gains, net wealth, asset values, turnover, goods, services, stamp duty, added value or otherwise and shall further include payments in respect of or on account of Tax, whether by way of deduction at source, advance tax, minimum alternate tax or otherw ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s or her respective legal representative, administrators, executors and heirs and in case of trust shall include the trustee(s) for the time being and from time to time. The term 'Persons' shall be construed accordingly; (vi) Capitalised terms defined by inclusion in quotations and/or parenthesis have the meanings so ascribed; and (vii) All terms and words not defined in this Resolution Plan shall, unless repugnant or contrary to the context or meaning thereof, have the same meaning ascribed to them under the IBC, the CIRP Regulations, the CA 2013, the Securities Contracts (Regulation) Act, 1956, the Depositories Act, 1996, the Income-Tax Act, 1961 ( IT Act ) and other Applicable Law, rules, regulations, bye laws, as the case may be, including any statutory modification or re-enactment thereof from time to time. (viii) Any statement in the Resolution Plan in relation to The Resolution Applicant's financial information (including but not limited to EBITDA, revenues, sales turnover, cash, cash equivalents, bank balance and Net Debt) shall be considered on a consolidated basis. Annexure 2: Structure for Acquisition of Control over the Company by the Resolution ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... apitalisation of the SPV and the Company (a) SPV shall be funded adequately by the Resolution Applicant or any of its Affiliates, by infusing equity by subscribing to equity shares, subordinated debt and/or convertible debt (whereby interest shall accrue but will not be paid until complete redemption of NCDs) and/or preference shares of SPV, to an extent of an upfront amount of INR 420 Crores in order to undertake the transactions contemplated in this Plan, i.e. towards settlement of CIRP Costs (to the extent unmet from out of the Company's available cash balances), Employee and Workmen Dues and Financial Creditors as envisaged in this Resolution Plan. (b) The Resolution Applicant may after implementation of steps set out in this Annexure 2 (and prior to 31 March 2020), further would request for NFB Limits of INR 400 Crores on conditions mentioned above to meet the working capital requirements of the Company. (c) The authorized share capital of the Company shall stand increased to such an amount as may be required by the Resolution Applicant, to accommodate the issuance of new equity shares to SPV in the manner set out below, and the capital clause of the memorandum ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hall be issued on the terms prescribed below. The SPV shall execute a Debenture Trust Deed in favour of the Debenture Trustee which will contain the broad terms set out below and no additional restrictions. TERMS DESCRIPTION Principal Amount of NCDs (In Crores) INR 480 crores Deemed Date of Allotment Within 7 days of the Approval Date Coupon Rate 8% p.a. Coupon Payment Frequency Annual Day Count Basis Actual/Actual basis at the end of the year. Coupon will be computed on an actual basis. Where the period for which such amounts are to be calculated (start date to end date) includes February 29, coupon shall be computed on 366 days a year basis Tenor 5 years Redemption schedule Principal moratorium of 1 year from the date of allotment. At the end of 12 months 24 months 36 months 48 months ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n Applicant and the Financial Creditors (to whom such NCDs are to be issued). Form of Issuance Dematerialised Purpose of the Issue For assignment of the entire Admitted Debt of secured Financial Creditors Depositories National Securities Depository Limited/Central Depository Services Limited Business Day Convention Means a day (other than a Saturday, Sunday and any day which is a public holiday for the purpose of Section 25 of the Negotiable Instruments Act, 1881 or a bank holiday) on which banks are open for general business in Mumbai. If the Coupon Payment Date and/or Redemption Date falls on a non-Business Day, the payment shall be made by the Company on the immediately preceding Business Day, which becomes the Coupon Payment Date for that Coupon payment. Governing Law Indian law The SPV NCD issuance documents will be approved by the Steering Committee within 5 Business Days of approval of the Plan by the NCLT. Steering Committee and Monitoring Agency shall facilitate all fil ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ity and New NCD Security. (D) Selective Capital Reduction (i) Under this step equity shares of the Corporate Debtor held by the existing shareholders of the Corporate Debtor (except those held by Resolution Applicant or SPV, as applicable) to be cancelled without any consideration. (ii) The issued, subscribed and paid-up share capital of the Company i.e. 123,998,028 equity shares of par value of INR 10 (Rupees Ten each), which is the existing share capital of the Company before infusion of funds by the Resolution Applicant and/or the SPV and issuance of New Equity Shares, shall be entirely reduced/extinguished/cancelled without any consideration payable to such existing shareholders. The equity shareholding of the Corporate Debtor post capital reduction shall be as follows: (iii) Upon issuance of the new Equity Shares as contemplated in Step 2(a) above, the entire issued, subscribed and paid-up equity and preference share capital of the Company (excluding the shares held by the Resolution Applicant/the SPV) shall stand extinguished in full. (iv) Subsequent to the cancellation of the existing share capital, the entire share capital of Corporate Debtor will be held b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pon implementation of the aforesaid steps and as an integral part of the Resolution Plan, the SPV (transferor company) will merge with the Company (transferee company) ( Merger ). Below are the broad contours of the scheme of amalgamation: - Any and all assets, liabilities, rights and obligations of the SPV, as the transferor company, will be transferred to and vested in the Company, as the assets, liabilities, rights and obligations of the SPV, as the transferee company, will become the assets, liabilities, rights and obligations of the Company, as the transferee company. - The authorized share capital of the SPV, as the transferor company, will be merged with the authorized share capital of the Company, as the transferee company. The Company will be entitled to take the benefit of the stamp duty and registration fees already paid by the SPV, as the transferor company, on its authorized share capital. - the SPV, as the transferor company, will stand dissolved without winding up. - In consideration of the merger, the Company, as the transferee company shall issue its equity shares to the equity shareholders of the SPV in accordance with the following share exchange rati ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... basis. Where the period for which such amounts are to be calculated (start date to end date) includes February 29, coupon shall be computed on 366 days a year basis Tenor 5 years Redemption schedule Principal moratorium of 1 year from the date of allotment. At the end of 12 months 24 months 36 months 48 months 60 months Total % to INR 480 Crores 0% 5% 20% 35% 40% 100% Redemption of NCDs at the end of 24, 36, 48 and 60 months from the date of allotment. Security The SPV NCDs shall be secured by a charge on all existing assets of the Company including charge on the Existing Receivables and current assets as of the date when Upfront Consideration is received and SPV NCDs are issued(whichever is later), but excluding any New Receivables. The New Receivables and the current assets ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Date and/or Redemption Date falls on a non-Business Day, the payment shall be made by the Company on the immediately preceding Business Day, which becomes the Coupon Payment Date for that Coupon payment. Governing Law Indian law The New NCD issuance documents will be in the same format as agreed between the Steering Committee and the Resolution Applicant for SPV NCDs. (iv) The Debenture Trustee shall release the SPV NCD Security and file all necessary forms with the ROC for recording such release immediately upon creation of the New NCD Security. (v) Within 30 (thirty) days from the Merger becoming effective, the Financial Creditors and/or their security trustee/agents shall first file necessary filings/forms with such Governmental Authority as may be required to reflect the aforesaid assignment and record issuance of New NCDs, creation of new charge for New NCD Security and release of charge of SPV NCD Security, including with the Registrar of Companies. It is clarified that the charge created for SPV NCD Security shall be released immediately (and no later than one 1 (one) business day) after the charge for New NCD S ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... arising out of assessment claims) including interest and penalty on such litigations and proceedings. (e) The respective authorities to consider providing relief from applicability of and payment of Taxes including under the provisions of the Goods and Services Taxes Act, 2017 which may arise as a result of implementation of the Plan either on the Resolution Applicant or the Corporate Debtor or any other Person who is likely to be impacted due to implementation of the Plan. (f) All Governmental Authorities to waive the non-compliances of the Corporate Debtor prior to the Effective Date, including but not limited to the Companies Act, 2013, Foreign Exchange Management Act, 1999 and Income Tax Act 1961 and all proceedings pending before judicial/quasi-judicial/administrative authorities to be withdrawn. (g) Upon approval of the Plan by the NCLT, all claims and proceedings initiated by the Financial Creditors against the Corporate Debtor and its officers/directors (including the winding up petitions filed against the Corporate Debtor and recovery proceedings initiated under the SARFAESI Act) shall stand abated and extinguished. (h) Dispensation from any approval required f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (n) Notwithstanding the terms of any relevant agreements with third parties, the prior approval of such counterparties shall not be required to be obtained for change in control/constitution of the Corporate Debtor pursuant to the terms of this Plan and such counterparties: (i) shall waive all objections/liabilities of the Corporate Debtor arising out of the initiation of corporate insolvency resolution/bankruptcy proceedings involving the Corporate Debtor, appointment of the Resolution Professional and in respect of the implementation of this Plan; (ii) shall waive the right to suspend these agreements due to any previous delays/failures by the Corporate Debtor to make payments under such agreements; and (iii) shall not terminate the relevant agreements or take any adverse actions against the Corporate Debtor. (o) All Permits and licenses of the Corporate Debtor which are due to expire before the Effective Date or within 5 months thereafter, shall be renewed without any further charges being payable by the Corporate Debtor or the Resolution Applicant. The Governmental Authorities shall provide reasonable time to the Resolution Applicant to determine which licences may expire ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the same, any procedural requirements required to be fulfilled solely by the Company (and not by any of its successors), shall be deemed to be fulfilled by the Company. The aforesaid is without prejudice to the right of termination available with each of the contracting parties under the respective contracts or Applicable Law. (r) Each asset (including properties, whether freehold, leasehold or license basis) of the Company shall be vested in the Company free and clear of all Encumbrances from the Effective Date. (s) With effect from the Effective Date, all the Permits held or availed of by, and all rights and benefits that have accrued to, the Company shall without any further act, instrument or deed be transferred to, and vest in, or be deemed to have been vested in, and be available to, the Company so as to become as and from the Effective Date, the Permits, estates, assets, rights, title, interests and authorities of the Company and shall remain valid, effective and enforceable on the same terms and conditions to the extent permissible in Applicable Laws. (t) From the date of NCLT according its approval to the Plan and until reconstitution of the Board by the Resolut ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... new orders a) EMD requirement 50% of these EMD's will get released in the same financial year and balance 50% will get released in the next financial year. Released EMDs will be further utilized for bidding for new order book. b) ABG requirement This ABG will be released over four years. (1st year - 20%, 2nd year - 35%, 3rd year - 30% and fourth year - 15%). All Advance Bank guarantees have been considered to be released and utilized for the new projects c) PBG requirement Performance Guarantee in the form of Bank Guarantee for an amount equivalent to 10% of the Contract Price. d) Mobilization Advance Mobilization Advance, not exceeding 10% of contract value shall be provided to the Contractor subject to furnishing the Performance 3. Other Profit and Loss and Balance Sheet Assumptions: a) The overall EBITDA margin of 12% between FY20 to FY24 b) Operating cost has been assumed at 79% c) Office Employee and Admin expenses has been assumed at 5% and 4% of revenue respectively. d) BG Commission cost - 1% p.a. e) Maintenance capex is assumed as 5% of net WDV value of Plant and Machinery FY21 onwards. 4. Worki ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... with the Transferee Company and the consideration thereof; PART III deals with the reorganization of share capital of the Transferee Company; and PART IV deals with the general terms and conditions applicable to this Scheme and the dissolution of the Transferor Company. In terms of the effectiveness of the scheme it shall be deemed that Part II will be deemed to be effective prior to Part III of the scheme. Further, the aforesaid parts of the scheme are not to be treated as independent and severable. 4. OPERATION OF THE SCHEME The reduction of share capital of the Transferee Company, prior to the amalgamation will cancel the shareholding of the existing shareholders of Transferee Company and the subsequent amalgamation of the Transferor Company with Transferee Company will combine the business activities and operations of the Transferor Company and the Transferee Company into a single company with effect from the Scheme Appointed Date (defined hereinafter) and shall be in compliance with the provisions of the Income Tax Act, 1961, including Section 2(1B) or any amendments thereto. Pursuant to the amalgamation, Transferee Company shall issue and allot shares to the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cable laws. 6. Interpretation 6.1 In this Scheme, unless the context otherwise requires: 6.1.1 words denoting singular shall include plural and vice versa; 6.1.2 headings and bold typeface are only for convenience and shall be ignored for the purposes of interpretation; 6.1.3 references to the word include or including shall be construed without limitation; 6.1.4 a reference to an article, clause, section, paragraph or schedule is, unless indicated to the contrary, a reference to an article, clause, section, paragraph or schedule of this Scheme; 6.1.5 unless otherwise defined, the reference to the word days shall mean calendar days; 6.1.6 references to dates and times shall be construed to be references to Indian dates and times; 6.1.7 reference to a document includes an amendment or supplement to, or replacement or novation of, that document; and 6.1.8 word(s) and expression(s) elsewhere defined in the Scheme will have the meaning(s) respectively ascribed to them. 7. SHARE CAPITAL 7.1 The authorised, issued, subscribed and paid-up share capital of the Transferee Company as on 31st March 2018 is as under: 7.2 The authorised, issued, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... order of the NCLT sanctioning the Scheme, in accordance with the Act and the Code, as appropriate to the nature of the movable property vested. The title to such property shall be deemed to have been mutated and recognised as that of the Transferee Company; 9.1.2 all other movable properties of the Transferor Company, including investments in shares (including subsidiaries), mutual funds, bonds and any other securities, sundry debtors, outstanding loans and advances, if any, recoverable in cash or in kind or for value to be received, bank balances and deposits, if any, with Government, semi-Government, local and other authorities and bodies, customers and other persons, shall without any further act, instrument or deed, pursuant to the order of the NCLT and by operation of law become the property of the Transferee Company, and the title thereof together with all rights, interests or obligations therein shall be deemed to have been mutated and recorded as that of the Transferee Company. All investments of the Transferor Company shall be recorded in the name of the Transferee Company by operation of law as transmission in favour of the Transferee Company as a successor in interest ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eligible or entitled, and subsisting or being effective on or immediately before the Scheme Effective Date (collectively referred to as Agreements ) and all such Agreements and all interests therein shall remain in full force and effect against or in favour of the Transferee Company and shall be binding on and be enforceable by and against the Transferee Company as fully and effectually as if the Transferee Company had at all material times been a party thereto. The Transferee Company, if so required, shall provide certified copies of the order of NCLT sanctioning the Scheme to the counter parties to the Agreements for information purposes and such party or authority shall make and duly record the necessary substitution or endorsement in the name of the Transferee Company as successor, pursuant to such orders without any break in the validity and enforceability of such Agreement. However, till the time such substitution/endorsement is effected, the Transferee Company shall always be deemed to a party to all such Agreements and be allowed to operate in the name and style of the Transferor Company. It is hereby clarified that all rates, fees, etc. paid by the Transferor Company till ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g jurisdiction, to give formal effect to the above provisions, if required. It is clarified that upon the Scheme becoming effective, the Transferor Company shall stand dissolved in terms of clause 21 of the Scheme and that the Transferee Company shall for the limited purpose of this clause be authorised to execute any instruments or documents or do all the acts and deeds as may be required in the name of the Transferor Company. 9.5 Notwithstanding any provision to the contrary, until any property, asset, license, approval, permission, contract, agreement and rights and benefits arising therefrom are transferred, vested, recorded, effected and/or perfected, in the records of the Trade Marks Registry or with the relevant Government agencies, regulatory bodies or otherwise, in favour of the Transferee Company, the Transferee Company is deemed to be authorized to enjoy the property, asset or the rights and benefits arising from the license, approval, permission, contract or agreement as if it were the owner of the property or asset or as if it were the original party to the license, approval, permission, contract or agreement. 9.6 Notwithstanding any provision to the contrary, up ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y amendment or any enactment thereof. Such modification will, however, not affect the other parts of the Scheme. 9.9 On the approval of this Scheme by the National Company Law Tribunal, shareholders and creditors of both the companies shall be deemed to have resolved and accorded all relevant consents under the Act or the Code or other applicable laws or otherwise to the same extent applicable in relation to this Scheme and all related matters set out hereto. 10. EMPLOYEES 10.1 On the Scheme becoming effective, all employees of the Transferor Company in service on the Scheme Appointed Date shall be deemed to have become employees of the Transferee Company without any break in their service and on the basis of continuity of service and the terms and conditions of their employment with the Transferee Company shall not be less favorable than those applicable to them with reference to the Transferor Company on the Scheme Appointed Date. It is hereby clarified that the accumulated balances, if any, standing to the credit of the employees in the existing provident fund, gratuity fund and superannuation fund of which the employees of the Transferor Company are members shall be tr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ts or entitlements whatsoever, schemes, arrangements and other instruments, permits, rights, entitlements, licenses (including the licenses granted by any Governmental, statutory or regulatory bodies) for the purpose of carrying on the business of the Transferor Company, and in relation thereto, and those relating to tenancies, privileges, powers, facilities of every kind and description of whatsoever nature in relation to the Transferor Company, or to the benefit of which the Transferor Company may be eligible and which are subsisting or having effect immediately before this Scheme coming into effect, shall by endorsement, delivery or recordal or by operation of law pursuant to the order of the NCLT sanctioning the Scheme, and on this Scheme becoming effective be deemed to be contracts, deeds, bonds, Agreements, indemnities, guarantees or other similar rights or entitlements whatsoever, schemes, arrangements and other instruments, permits, rights, entitlements, licenses (including the licenses granted by any Governmental, statutory or regulatory bodies) of the Transferee Company. Such properties and rights described hereinabove shall stand vested in the Transferee Company and shal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the NCLT: 13.1 The unutilized credits relating to Good and Service tax paid on inputs/services lying to the account of the Transferor Company shall be transferred to the Transferee Company automatically without the requirement of any specific approval or permission as an integral part of the Scheme. 13.2 Income taxes of whatsoever nature including advance tax, self-assessment tax, regular assessment taxes, tax deducted at source, dividend distribution tax, minimum alternative tax, wealth tax, if any, paid by The Transferor Company shall be treated as paid by the Transferee Company and it shall be entitled to claim the credit, refund, adjustment for the same as may be applicable. Minimum alternative tax credit available to the Transferor Company under the Income-tax Act, 1961, if any, shall be available to the Transferee Company. 13.3 The Transferee Company is expressly permitted to revise and file its income tax returns and other statutory returns, including tax deducted/collected at source returns, service tax returns, excise tax returns, sales tax/goods and services tax returns, as may be applicable and has expressly reserved the right to make such provision in its ret ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ted as provided in this Scheme, all shares of the Transferor Company, whether in dematerialized or physical form, shall be deemed to have been automatically cancelled and be of no effect. Wherever applicable, the Transferee Company may, instead of requiring the surrender of the share certificates of the Transferor Company, directly issue and dispatch the new share certificates of the Transferee Company. 15. ACCOUNTING TREATMENT Upon the coming into effect of this Scheme, the amalgamation of the Transferor Company with the Transferee Company shall be accounted for by the Transferee Company with effect from the Scheme Appointed Date by applying the guidance for Reverse Acquisition as specified in Indian Accounting Standard 103: Business Combinations notified under section 133 of the Companies Act 2013, read with Rule 7 of the Companies (Indian Accounting Standard) Rules, 2015. For the purpose of reverse acquisitions, Transferor Company will be regarded as the acquirer ( Accounting Acquirer ) and Transferee Company will be regarded as Accounting Acquirer. All assets and liabilities of the Transferee Company shall be recorded in the books of account of Transferee Compa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... olution Applicant understands that the Admitted Debt for Financial Creditors also includes all un-invoked/invoked bank guarantees, which will continue until their expiry. Out of this aggregate amount of Admitted Debt, the Resolution Applicant has proposed to pay the following consideration to the Financial Creditors for full and final discharge of the Financial Creditors and for assignment of entire Claims and Admitted Debt of Financial Creditors to the Indian SPV: a. Upfront Consideration equivalent to INR 420 Crores (Indian Rupees Four Hundred Twenty Crores) (less payment towards (i) Balance CIRP Costs; and (ii) Potential Workmen's Dues, if any) within 30 Business Days; and. b. Deferred Consideration equivalent to INR 480 Crore (Indian Rupees Four Hundred Eighty Crores) in the form of unlisted NCDs. 16. It is further submitted that the Deferred Consideration of INR 480 Crores (Indian Rupees Four Hundred Eighty Crores) as secured and unlisted NCDs are to be paid over a period 5 years at a coupon of 8% p.a., as shown in Annexure 2 of the resolution plan which has been produced at page 54 of this order. 17. As far as the dues of Operational Creditors are concer ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and Regulation 38 of CIRP Regulations, that the plan deals with interests of all stakeholders. 22. The Resolution Applicant has produced on record an affidavit stating the details of the Indian SPV being Roypar Constructions Private Limited which is required to be created in terms of Resolution Plan. It states that in accordance with Annexure 2 (Structure of Acquisition of Control over the Company by the Resolution Applicant) and Annexure 12 (Scheme of Amalgamation), Roypar Constructions Private Limited has to be merged with the Corporate Debtor as contemplated. The details of the SPV are set out below: 23. The Resolution Applicant has sought extinguishment of all claims along with abatement of any related legal proceeding including criminal proceedings. Furthermore, the Resolution Applicant seeks waiver of outstanding statutory dues and other claims as on the date of approval of the Resolution Plan. The exemption is also sought from the statutory dues of the Central Board of Direct Taxes (CBDT) and under the Stamps Act, from the levy of stamp duty and fees applicable in relation to this plan and its implementation. 24. The relief sought is hereby allowed by this Benc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... orporate debtor on fulfilling certain conditions including payments to the Financial Creditors as agreed upon and the plan must be implemented free of any such conditions. 35. In view of the above discussion, the Resolution Plan Annexure A-25 stands approved granting waiver in respect of the past tax dues to the Government which may arise in future and exempt the Resolution Applicant from the export obligations, which the corporate debtor had entered. The relevant extract from the judgment of Chennai Bench is given below: 22. The Corporate Debtor shall be entitled to carry forward all accumulated business losses and unabsorbed depreciation as set out in the resolution Plan. All the statutory duties including taxes/cess/interest/penalty and other liabilities due to the operational creditors shall stand satisfied/waived off. The reason for these waivers and abatement is that the Operational Creditors and Financial creditors except those in whose favour the provision is made in the 'Resolution Plan' would not get anything in the event of liquidation of the Corporate Debtor, as per the waterfall mechanism provided under Section 53 of the I B Code, 2016. Moreove ..... X X X X Extracts X X X X X X X X Extracts X X X X
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