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TMI Blog2019 (6) TMI 1639X X X X Extracts X X X X X X X X Extracts X X X X ..... olution professional, Mr. Sanjay Gupta ("RP") has submitted the progress reports from time to time and the meetings of the CoC were held as prescribed under the Code. The present resolution professional was appointed in the 1st meeting of the CoC held on 15.05.2018 and the appointment was confirmed by the Tribunal. The RP prepared the Information Memorandum and published the Expression of Interest. In the 12th CoC meeting held on 26.12.2018 the resolution plan submitted by the resolution applicant Jyoti Strips Ltd. ("RA") was approved by the CoC with 100% votes in favour of the resolution plan. 3. The CD is involved in the manufacturing of steel and steel products. The probable reason for insolvency of the CD was that during the period 200 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... time of completing the acquisition. iv. Future Sale Agreements - The RA plans to continue with the existing sales arrangements of the CD, however, the RA would review the sales arrangements as and when required post-Closing Date and implement the necessary changes. v. The RA plans to achieve saleable steel capacity of 90,000 TPA of CRC.A. The RA proposes to infuse approximately Rs. 5 Crores for revamping of the existing facilities and improving the safety, environmental and other operating norms. A year on year maintenance capital expenditure is also proposed. 5. The financial proposal made by the RA is as follows: i. First, the actual CIRP cost up to Rs. 3.75 crores plus any taxes thereon, as certified by the RP and CoC will be pai ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... i. Within 15 days from Effective Date, the financial creditors shall invoke the pledge created in their favour over the pledged shares. The financial creditors are required to allocate nominal amount of Rs. 100/- only as value of such pledged shares. ii. On or before Closing Date the CD shall undertake a capital reduction whereby all the equity shares of the CD which are held by persons other than the financial creditors shall stand cancelled and extinguished. No consideration shall be payable to any shareholders. iii. On or before Closing Date the RA shall infuse the funds for payment of CIRP costs and claims. iv. Within 20 days from Effective Date the payment towards the CIRP costs, full and final discharge of employee and workmen d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e with the terms of the Monitoring Agency Agreement. The fees of the Monitoring Agency shall be mutually discussed and finalized and shall be met from the internal accruals of the CD. If internal accruals are not sufficient then the RA shall infuse funds to meet the same. ii. On and After Closing Date - On Closing Date, 100% of the issued and paid up equity share capital of the Company shall be held by the RA, and the RA shall acquire control over the CD. On the Closing Date, the suspended Board of Directors of the CD shall be deemed to have resigned and the Board of Directors shall be reconstituted by the RA. The reconstituted board shall take control of the CD. 8. The mandatory requirements that the resolution plan has to comply with u ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he affairs of the CD after approval of the resolution plan The management of the CD has been provided for as stated in para 7 above. S.30(2)(d) - The implementation and supervision of the resolution plan The implementation and supervision of the plan has been provided for as stated in para 6 above. Regulation 38(3); (a) addresses the cause of default; (b) feasible and viable; (c) has provisions for its effective implementation; (d) has provisions for approvals required and the timeline for the same; (e) resolution applicant has the capability to implement the resolution plan Provided for as stated in paras 4-7 above. S.30(2)(e) - does not contravene any of the provisions of the law for the time being in force Complied with. S.30(4) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt to the Closing Date. Section 115JB of the Income Tax Act, 1961 already provides relief to companies against whom an application for CIRP has been admitted under the Code by allowing the deduction of unabsorbed depreciation and loss brought forward from the book profit of the company for calculating the minimum alternate tax. Since the legislature in its wisdom has already provided adequate reliefs in the Income Tax Act, 1961, we do not feel it is necessary to provide any further reliefs to the CD under Section 115JB or any other provisions of the said Act. ii. The Department of Registration and Stamps of the relevant State (including Rajasthan and Delhi) and the Ministry of Corporate Affairs shall exempt the RA and the Company, from ..... X X X X Extracts X X X X X X X X Extracts X X X X
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