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TMI Blog2021 (10) TMI 1329X X X X Extracts X X X X X X X X Extracts X X X X ..... as prescribed under section 31(4) of the Code - In case of non-compliance of this order or withdrawal of Resolution Plan, the CoC shall forfeit the EMD amount already paid by the Resolution Applicant. The Resolution Plan in question is hereby approved. - I.A. (IB) No. 479/KB/2021 In C.P. (IB) No. 832/KB/2019 - - - Dated:- 8-10-2021 - Shri Rajasekhar V.K. Member (Judicial) And Shri Harish Chander Suri, Member (Technical) For the Applicant : Mr. Anuj Singh, Advocate, Ms. Urmila Chakraborty, Advocate, Ms. Rashmi Singhee, Advocate, Ms. Madhuja Barman, Advocate, Mr. Arun Kumar Singh, Advocate and Mr. Bijay Murmuria, Resolution Professional ORDER Per: Rajasekhar V.K., Member (Judicial) 1. This Court convened through video conferencing. Preliminary 2. This Application IA (IB) No.479/KB/2021 was moved on behalf of Mr. Bijay Murmuria, Resolution Professional ( RP ) of Dimension Steel Alloys Private Limited (CIN: U27109WB2005PTC100957), by Mr Anuj Singh, learned counsel appearing for the RP, invoking the provisions of section 30(6) of the Insolvency Bankruptcy Code, 2016 [hereinafter referred to as the Code or IBC ] read with regulation 39(4) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ,432 37% 2. Punjab National Bank 63,60,44,045 63,60,06,695 26% 3. West Bengal Financial Corporation 46,83,82,967 46,83,82,967 19% 4. Karnataka Bank 44,54,74,153 44,02,09,996 18% Total 2,45,55,28,598 2,45,02,27,092 100% 10. The RP submits that a total of fifteen CoC meetings have been held during CIRP period as follows: Particulars Date of CoC meeting 1st CoC Meeting 16.11.2019 2nd CoC Meeting 09.12.2019 3rd CoC Meeting 24.12.2019 4th CoC Meeting 18.01.2020 5th CoC Meeting 14.02.2020 6th CoC Meeting 12.03.2020 7th CoC Meeting ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Enterprises Limited and RKG Asset Management LLP were eligible to submit Resolution Plan. The last date for submission of Resolution Plan as per latest revised EOI was 10.12.2020, which was later extended till 20.12.2020 on the request of the Prospective Resolution Applicants and as approved by the members of the Committee of Creditors vide email dated 09.12.2020. However, the last date for submission of Resolution Plan i.e., 20.12.2020 being a holiday the undersigned had further extended the last date for Submission of Resolution Plan for a period of further two days i.e. till 22.12.2020 post approval from the CoC. Further the applicant on 22.12.2020 filed an interlocutory application for extension of 60 days over and above the period of 270 days at the behest of the decision of the CoC and the same was approved vide order dated 12.02.2021. In compliance with the said Order, 330 days of the Corporate Insolvency Resolution Process of the Corporate Debtor expired on 27.02.2021. 13. In the meantime, as no resolution plan was received till the cut-off date of 22.12.2020, the agenda for liquidation of the Corporate Debtor was put for voting in the 10th meeting of CoC convened on 04 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in question Adroit (1st registered valuer) LSI (2nd registered valuer) Average liquidation value (INR) Average fair value (INR) Liquidation Value (INR) Fair Value (INR) Liquidation Value (INR) Fair Value (INR) Land Building 4,19,03,990 5,09,12,259 2,59,78,000 3,71,11,000 33,94,099 4,40,11,629 Plant Machinery 12,13,82,517 17,23,86,163 12,76,39,000 18,23,41,000 12,45,10,758 1,77,36,358 S FA 7,48,244 7,48,244 1,22,590 1,36,408 4,35,417 4,42,326 Total 15,88,87,170 22,18,17,537 19. The Committee deliberated on the resolution plan in terms of s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... an. (ii) Plan must provide for repayment of debts of OCs in such manner as may be specified by the Board which shall not be not less than amount that would have been paid to such creditors, if the amount to be distributed under the resolution plan had been distributed in accordance with the order of priority in sub-section (1) of section 53, whichever is higher and Clause 7(d) at Page 6 of the Resolution Plan. (iii) provides for payment of debts of financial creditors who do not vote in favour of the resolution plan, in such manner as may be specified by the Board. Clause 8(i) at Page 11 of the Resolution Plan. (c) Management of the affairs of the Corporate Debtor after approval of the Resolution Plan. Clause 17(f) at Page 22 of the Resolution Plan. (d) Implementation and Supervision. Clause 17(g) to (o) at Pages 22-23 of the Resolution Plan. (e) Plan does not contravene any of the provisions of the law for the time being in force. Cl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al documents of the corporate debtor Clause 23l-m at Page 33 of the Resolution Plan (k) issuance of securities of the corporate debtor, for cash, property, securities, or in exchange for claims or interests, or other appropriate purpose; Not proposed by the Resolution Applicant. (l) change in portfolio of goods or services produced or rendered by the corporate debtor; Clause 12(e) at Page 17 of the Resolution Plan. (m) change in technology used by the corporate debtor; and Not proposed by the Resolution Applicant. (n) obtaining necessary approvals from the Central and State Governments and other authorities. Clause 18 at Page 24 of the Resolution Plan Mandatory contents of Resolution Plan in terms of regulation 38 of CIRP Regulations: Ref. to relevant Reg. Requirement How dealt with in the Plan 38(1) The amount due to the operational creditors under a resolution plan shall be given priority in payment o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng at pages 235 to 237 of the Application. 24. The Applicant has filed a Compliance Certificate in prescribed form, i.e., Form H in compliance with regulation 39(4) of the Insolvency Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) Regulations, 2016, which has been annexed as Annexure N1 at pages 257 to 273 of the Application. 25. The RP issued the Letter of Intent to the successful Resolution Applicant on 23.04.2021 and as required under Regulation 39(4), payment through RTGS of INR 1,00,00,000 (Rupees One Crore Only) already made to the RP shall be extended as the Performance Guarantee in compliance to the RFRP issued and as decided by CoC members in this matter, which has been annexed as Annexure M and M1 at pages 241 to 245 of the Application. Details of Resolution Plan/Payment Schedule 26. The Applicant submits the relevant information with regard to the amount claimed, amount admitted and the amount proposed to be paid by the Resolution Applicant, i.e., C.P. Ispat Private Limited, under the said Resolution Plan is tabulated as under: ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or any other applicable Adjudicating Authority. Details on Management/Implementation and Reliefs as per the Resolution Plan Salient Features 29. The Resolution Plan also provides for a. Management of Company after resolution in Clause 17 at pages 21-23 of the Resolution Plan; b. Term of the resolution plan in Clause 17 at pages 21-23 of the Resolution Plan; and c. Implementation and Supervision of the resolution plan in Clause 17 at pages 21-23 of the Resolution Plan. Waivers, Reliefs and Exemptions 30. Relief and Concessions: Sl. No. Relief and/or Concessions Sought Orders Thereon 1. In the Resolution plan there is express provision that the Resolution Applicant shall not be responsible for any previous liability i.e. before the approval of Resolution plan by the Adjudicating Authority except those of which claim has been admitted by the RP. The payment of old dues shall be to the extent as proposed by the RA in the Resolution plan. In Ghanshyam Mishra Sons Pvt Ltd v. Edelweiss Asset Reconstruction Company Ltd, [2021 SCC OnLine SC 313 decide ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... be available for setoff against any credits, gains, write backs if any in the future. This is for the income tax authorities to consider. 5. The available GST credit in the account of the Corporate Debtor shall be carried forward in accounts. Granted. 6. On approval of the Resolution Plan by the NCLT, it shall be deemed that all and any Government approvals required by the Resolution Applicant for the purpose of implementing this Resolution Plan have been granted. This shall have to be in conformity with section 31(4) of the IBC, which stipulates that the resolution applicant shall, pursuant to the resolution plan approved under sub-section (1), obtain the necessary approval required under any law for the time being in force within a period of one year from the date of approval of the resolution plan by the Adjudicating Authority under sub-section (1) or within such period as provided for in such law, whichever is later. 7. The Resolution Applicant further undertakes that any relevant approval which may be required from any ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... C will also apply. Therefore, the reliefs sought for are granted, in terms of the judgment of the Hon'ble Supreme Court in so far as extinguishment of liabilities that are not part of the resolution plan are concerned. 9. The Resolution Applicant will acquire control over the Company pursuant to the order of the NCLT and not pursuant to the usual acquisition process which would ordinarily include a detailed due diligence and representation, warranties and indemnities in relation to the affairs of the Company from its Existing Promoters. The Resolution Applicant may take some time to discover all the non-compliances that may exist in relation to the Company on the date of acquisition of control by the Resolution Applicant over the Company. As such the Resolution Applicant may take some time to identify such noncompliances and to address them. In light of this, the Resolution Applicant prays to the NCLT to grant it immunity from any actions and penalties (of any nature) under any laws for any non-compliance of laws in relation to the Company or by the Company, which was existing as on the date of acquisition of control by the Resolution ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Resolution Applicants over the Company or on account of the acquisition of control by the Resolution Applicants over the Corporate Debtor pursuant to this Resolution Plan. There are two parts to this: (1) Liability for prior offences: This is covered by section 32A of the IBC, which lays down that the liability of a corporate debtor for an offence committed prior to the commencement of CIRP shall cease, and the corporate debtor shall not be prosecuted for such an offence from the date the resolution plan has been approved by the Adjudicating Authority under section 31, if the resolution plan results in change in the management or control of the corporate debtor. (2) Liabilities in existence prior to the commencement of CIRP: These will be covered by the resolution plan itself. In Ghanshyam Mishra Sons Pvt Ltd v. Edelweiss Asset Reconstruction Company Ltd , the Hon'ble Supreme Court held that once a Resolution Plan is approved, a creditor cannot initiate proceedings for recovery of claims which are not part of the Resolution Plan. 11. The Resolution Applicant also prays to the NCLT to gran ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Company Ltd , the Hon'ble Supreme Court held that once a Resolution Plan is approved, a creditor cannot initiate proceedings for recovery of claims which are not part of the Resolution Plan. This is binding law under Article 141 of the Constitution. 16. All proceedings against the Corporate Debtor by an operational creditor in any court of law/forum/panel of arbitrators or any other adjudicating authority in India or elsewhere shall stand dismissed and no fresh/further proceedings can be commenced against the company for any cause of action occurring on or before the date of approval of the Resolution Plan. In Ghanshyam Mishra Sons Pvt Ltd v. Edelweiss Asset Reconstruction Company Ltd , the Hon'ble Supreme Court held that once a Resolution Plan is approved, a creditor cannot initiate proceedings for recovery of claims which are not part of the Resolution Plan. This is binding law under Article 141 of the Constitution. 17. Any pledges, guarantees, securities created by the Corporate Debtor created for securing the debt of any other entity except mentioned specifically in t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... issued on demand to the concerned parties, upon due compliance. 40. Liberty is hereby granted for moving any application if required in connection with implementation of this Resolution Plan. 41. A copy of this Order shall be filed with the Registrar of Companies, West Bengal. 42. The Resolution Professional shall stand discharged from his duties with effect from the date of this Order, save and except those duties that are enjoined upon him for implementation of the approves Resolution Plan. 43. The Resolution Professional is further directed to hand over all records, premises/ factories documents to the Resolution Applicant to finalise the further line of action required for starting of the operation. The Resolution Applicant shall have access to all the records and premises through the Resolution Professional to finalise the further line of action required for starting of operations of the Corporate Debtor. 44. IA (IB) No.479/KB/2021 and the main Company Petition, i.e., CP (IB) No.832/KB/2019 shall stand disposed of accordingly. 45. The Registry is directed to send e-mail copies of the order forthwith to all the parties and their Ld. Counsel for information ..... X X X X Extracts X X X X X X X X Extracts X X X X
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