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TMI Blog2020 (10) TMI 1279X X X X Extracts X X X X X X X X Extracts X X X X ..... ion process . It rather facilitates and encourages resolution in several ways. The Adjudicating Authority is of the opinion that not allowing the Clause 19(xv) i.e. Reliefs and Concessions sought by the Resolution Applicants of the Resolution Plan, is not going to make any hindrance for proper implementation of the Resolution Plan as those are the subject matter of the concerned /appropriate Competent Authorities - the Adjudicating Authority, is of the considered opinion and also being satisfied that the Resolution Plan as approved by the Committee of Creditors (CoC) meets the requirements as referred to under section 30(2) of the Code. Resolution plan approved - application allowed. - (MP) IA 96 of 2020 in TP 229 of 2019 [CP(IB) 29 of 2018] - - - Dated:- 23-10-2020 - Ms. Manorama Kumari, Member (Judicial) ORDER Per se: Ms. Manorama Kumari, Member (J) IA 280 of 2019 1. The instant case is assigned to the undersigned by the Hon ble President, NCLT for disposal vide order dated 11.03.2020 having file no. 10/03/2020-NCLT as there is difference of opinion while passing the order by Hon'ble Member (Judicial), Mr. Harihar Prakash Chaturvedi and Hon'ble Member ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 71 of the application. Pursuant to the approval of the Resolution Plan by the CoC under Section 30(4) of the IB Code (as amended upto date) as the successful Resolution Plan, RP filed the instant application being IA No. 280 of 2019 under Section 31 of the Code. 3.7 It is pertinent to mention herein that the Corporate Debtor is a MSME which is reflected from the additional affidavit filed by the Applicant on 27.07.2019, wherein the Applicant has annexed the copy of Udyog Aadhaar acknowledgment issued by Government of India, Ministry of Micro, Small and Medium Enterprises showing the date of filing as 03.08.2016. 3.8 Accordingly, the RP filed an application under Section 30(6) of the IB Code. The matter has been taken up for hearing on 07.07.2020 and is reserved for passing order. 4. The present application has been filed for approval of the Resolution Plan under Section 31 of the IB Code (as amended upto date) submitted by RP in respect of the Corporate Debtor being MSME. The Applicant/ Resolution Professional, deliberating the sequence of events right from calling of Eol up to approval of the Resolution Plan by the CoC in its Fifth meeting held on 10.05.2019 submitted the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e end of the CIRP process. However, Resolution Process Cost to be met out of the amount offered to Secured Financial Creditors and accordingly, payment to Secured Creditors shall be reduced to that extent. the resolution applicant proposes a sum of ₹ 6,79,22,000/- (Rupees Six Crore Seventy Nine Lakhs Twenty Two Thousand Only) for the entire Resolution Plan costs, including CIRP Cost and all other liabilities, claims, dues or other demands against the Corporate Debtor to be unconditionally written off/waived. The amount payable to the Secured Creditors may vary as per the terms of the Resolution Plan. 7. The Applicant also submitted the summary of source of funds as given below: Particulars Amount Fresh Infusion by Resolution Applicants 1,89,22,000/- Sale proceeds of Land and Building 4,75,00,000/- Sale of old unsalable spares and plant machineries 15,00,000/- Total 6,79,22,000/- 8. In view of the above, Section 30(2) and 30(4) is applicable in the instant case. For ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ovides for the management of the affairs of the Corporate debtor after approval of the resolution plan; (d) the implementation and supervision of the resolution plan; (e) does not contravene any of the provisions of the law for the time being in force; (f) conforms to such other requirements as may be specified by the Board. [Explanation. - For the purposes of clause (e), if any approval of shareholders is required under the Companies Act, 2013(18 of 2013) or any other law for the time being in force for the implementation of actions under the resolution plan, such approval shall be deemed to have been given and it shall not be a contravention of that Act or law.] FINDINGS: 9. Looking to the entire facts of the case, it is found that the COC has approved the plan with 100% voting in favour of the plan. More so, the Resolution Applicant fulfils the mandatory contents of the Resolution Plan as provided under Regulation 38 of Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Person) Regulations, 2016. Regulation 38 is reproduced herein under- 38. Mandatory contents of the resolution plan. (1) A resolution pl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aking any modification in the notification, the notification shall not be issued or shall be issued only in such modified form as may be agreed upon by both the Houses, as the case may be. (5) The period of thirty days referred to in sub-section (3) shall not include any period during which the House referred to in sub-section (4) is prorogued or adjourned for more than four consecutive days. (6) Every notification issued under this section shall be laid, as soon as may be after it is issued, before each House of Parliament. Explanation.- For the purposes of this section, the expression micro, small and medium enterprises means any class or classes of enterprises classified as such under subsection (1) of section 7 of the Micro, Small and Medium Enterprises Development Act, 2006 (27 of 2006).] 11. Further, from the object of the IBC, it is amply clear that the Resolution is Rule and the Liquidation is an Exception . Liquidation brings the life of a corporate to an end. It destroys organizational capital and renders resources idle till reallocation to alternate uses. Further, it is inequitable as it considers the claims of a set of stakeholders only, if there ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iefs and Concessions sought by the Resolution Applicants of the Resolution Plan, is not going to make any hindrance for proper implementation of the Resolution Plan as those are the subject matter of the concerned /appropriate Competent Authorities. The Resolution Applicant(s) has/have liberty to approach Competent Authorities for any concession, relief or dispensation, as the case may be, as and when required for proper and effective implementation of the Plan. relying on the judgement passed by the NCLT Mumbai Bench in BMSS Steel Industries Pvt. Ltd vs. Shrid Metal Technologies Pvt. Ltd., it is observed that Resolution Applicant has to act in accordance with the existing law of the land and no special concessions can be given by the Tribunal. The Bench further clarified that the Resolution Applicant is only liable to make payments to the creditors included in the Resolution Plan and not otherwise. 13. It is needless to mention herein that approval of the Resolution Plan does not mean automatic waiver or abetment of legal proceedings, if any, which are pending by or against the Company/Corporate Debtor, as those are the subject matter of the concerned Competent Authorities havi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ents No. 2 to consider the modified resolution plan as per letter at Annexure C and vote afresh on the same; c) direct the Respondent No. 1 to provide an updated Information Memorandum providing financial condition of the Corporate Debtor as on 01.07.2020; d) during the hearing of this Application, stay the implementation, operation and execution of the Resolution Plan dated 13.03.2020 of the Applicant; 18. It is the matter of record that the instant application was filed subsequent to the filling of the above stated IA i.e. IA 280 of 2019 filed under Section 30(6) of the IB Code. It is stated by the Applicant that the Resolution Plan, so submitted by the Applicant, is based on the Information Memorandum which was published two years ago. Considering the time of two years and outbreak of Covid-19, the Applicant is not aware of the current financial condition of the Corporate Debtor and is now not in a position to bear the costs/losses of the Corporate Debtor and hence, is seeking for withdrawal of the Resolution Plan. This story is not believable as the Corporate Debtor, being a MSME, has filed the plan considering the financial condition of the Corporate Debtor and have s ..... X X X X Extracts X X X X X X X X Extracts X X X X
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