9911796707
TMI Blog2022 (7) TMI 299X X X X Extracts X X X X X X X X Extracts X X X X ..... ying that the Resolution Plan is in accordance with sections 30 and 31 of the IBC and also complies with regulations 38 and 39 of the IBBI (Insolvency Resolution Process for Corporate Persons) Regulations, 2016. Seeking grant of time to comply with the statutory obligations/seeking sanctions from governmental authorities - HELD THAT:- The Resolution Applicant is directed to do the same within one year 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 invoke the Performance Bank Guarantee furnished by the Resolution Applicant. The Resolution Plan is binding on the Corporate Debtor and other stakeholders involved so that revival of the Debtor Company shall come into force with immediate effect - Moratorium imposed under section 14 shall cease to have effect from the date of this order - Application allowed. X X X X Extracts X X X X X X X X Extracts X X X X ..... ng 07.07.2020 7th CoC Meeting 14.08.2020 8th CoC Meeting 09.09.2020 9th CoC Meeting 09.10.2020 10th CoC Meeting 19.11.2020 11th CoC Meeting 10.12.2020 12th CoC Meeting 15.12.2020 13th CoC Meeting 24.12.2020 14th CoC Meeting 30.12.2020 15th CoC Meeting 28.01.2021 16th CoC Meeting 12.02.2021 17th CoC Meeting 23.02.2021 8. The Applicant submits that as per the requirements of Section 25(2)(h) of the IBC,2016 read with regulation 36A(1) of the CIRP Regulations, 2016, invitations in Form 'G' for Expression of Interest (EoIs) from potential resolution applicants were issued on 11.02.2020 in Financial Express (in English) and Aajkal (in Bengali) Newspapers. The publication for EoIs have been issued a number of times including extensions on various such dates such as 11.02.2020; 07.03.20202; 08.08.2020 and 01.10.2020. As per the latest Form-G, the last date for receipt of the EOI was 27.09.2020, and last date for submission of resolution plan was 08.11.2020 which was extended upto 26.11.2020. 9. The Applicant/RP submits that up till the last date of submission of EoIs i.e., 26.11.2020, the Resolution Professional did not receive any EoI from prospective resolution ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lication being I.A. (IB) No. 64 of 2021 before this Tribunal for inter alia seeking submission of their EoI in the CIR Process of corporate debtor. However, such application was never pursued by the said applicant and consequently, the said application was dismissed by this Tribunal vide its order dated 24.08.2021. 15. It is also noteworthy to mention here that the Applicant/ RP has sought exclusion and extension of time on numerous occasion in the CIR Process of Sri Balaji Forest Products Private Limited as under: Date Timeline 18.10.2019 Admission of Corporate Insolvency Resolution Process of Sri Balaji Forest Products Private Limited 15.04.2020 Completion of 180 days 14.07.2020 Completion of 270 days' time 09.12.2020 Exclusion of time sought in I.A. (IB) No. 630/KB/2020 07.01.2021 Exclusion of time sought in I.A. (IB) No. 1290/KB/2020 28.02.2021 Exclusion of time sought in I.A. (IB) No. 30/KB/2021 10.03.2021 An Application for seeking extension of 10 days' time in computation of CIR Process period being I.A. (IB) No. 256/KB/2021 16. The Successful Resolution Applicant presented the entire resolution plan, including the feasibility and viability and other requir ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er as may be specified by the Board which shall not be less than the amount payable to them in the event of liquidation u/s 53; or (ii) Plan must provide for repayment of debts of OCs in such manner as may be specified by the Board which shall not be 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, which ever is higher and (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 (V) (5) (c) of the Resolution Plan (c) Management of the affairs of the Corporate Debtor after approval of the Resolution Plan. Clause (VIII) (C) of the Resolution Plan (d) Implementation and Supervision of the Resolution Plan. Clause (VIII) of the Resolution Plan (e) Plan does not contravene any of the provisions of the law for the time being in force. Clause (IX) of the Resolution Plan (f) Confirms to such other requirements as may be specified by the Board. The Resolution Applicant declares and confirms that the present ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... from the Corporate Debtor Clause (IX) @ pg. 155 Regulation 37 (h) Amendment of the constitutional documents of the Company Constitutional documents of Company are proposed to be amended appropriately as per requirements of Resolution Plan. Clause (VI) (5) @ pg. 143 Regulation 37 (i) Issuance of securities of the Company, for cash, property, securities, or in exchange for claims or interests Shares of any kind as permitted under the law shall be issued. Annexure 1 @ pg. 167 or other appropriate purpose. Regulation 37 (j) Change in portfolio of goods or services produced or rendered by the corporate debtor The Resolution Plan does not envisage any change in portfolio of goods or services produced or rendered by the corporate debtor. Post Submission and approval of the Resolution Plan, the RA shall have the right to make change in portfolio of goods or services produced in any manner as they desire Clause (IX) @ pg. 156 Regulation 37 (k) Change in technology used by the corporate debtor The Resolution Plan does not envisage any change in technology used by the corporate debtor. Post Submission and approval of the Resolution Plan, the RA shall have the right to make cha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r the same; and Clause (VIII) (B) & Clause (XI) (B) of the Resolution Plan (e) the Resolution Applicant has the capability to implement the resolution plan Clause (III) of the Resolution Plan IV. Mandatory contents of Resolution Plan in terms of Regulation 39 of CIRP Regulations Reference to relevant Regulation Requirement How dealt with in the Plan 39 (1) (a) An affidavit stating RA is eligible under section 29A to submit resolution plans; Refer Affidavit of resolution applicant declaring eligibility under Section 29A of the I & B Code, 2016 39 (1) (c) An undertaking by the prospective resolution applicant that every information and records provided in connection with or in the resolution plan is true and correct and discovery of false information and record at any time will render the applicant ineligible to continue in the corporate insolvency resolution process, forfeit any refundable deposit, and attract penal action under the Code. Clause (IX) of the Resolution Plan 22. Applicant submits that the Successful Resolution Applicant has submitted an affidavit of eligibility under Section 29A of the Code, which has been annexed as to the Application. 23. Applicant su ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y, M/s. Sri Balaji Logs Products Private Limited. 29. The Ld. Senior Counsel further contended that Sri Balaji Logs Products Private Limited was also being controlled and managed by the same family group of Promoters of Corporate Debtor. Mr. Om Prakash Pandey, the Promoter and Director of Corporate Debtor was also the Director of Sri Balaji Logs Private Limited. 30. It was apprised by the Ld. Senior Counsel for the RP that since Corporate Insolvency Resolution Process of Sri Balaji Logs Products Private Limited has also been commenced by order dated 17.07.2019 in C.P. (IB) No. 66/KB/2018, the Resolution Professional of the corporate debtor requested the Resolution Professional of Sri Balaji Logs Products Private Limited to clarify on the rights of the corporate debtor on the approach road owned by Sri Balaji Logs Products Private Limited by emails dated 22.11.2020 and 23.11.2020. The Resolution Professional of Sri Balaji Logs Products Private Limited expressed his inability to locate any agreement with respect to right of usage of the land of Sri Balaji Logs Products Private Limited by the corporate debtor. 31. It was further apprised that the plant and factory premises of the c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... HEREIN ABOVE (UNDER SL 3. RESOLUTION PLAN AMOUNT AND PAYMENT THEREOF) STARTING FROM S.N. 1 TO 40 WHICH HAS BEEN MADE PART OF THE ASSETS OF THE CD IN THE IM AS STATED IN DETAIL HEREIN ABOVE: A. Upon approval of the plan by the Hon'ble Adjudicating Authority, such land shall stand transferred to the Corporate Debtor and the Corporate Debtor shall be vested to be in possession of and have absolute, good and marketable title, rights and interest in the said landed premises and without any further documentary filing registration, permission, approval or other requirement to be effected by the Corporate Debtor and the personal guarantees given by Satyaprakash Pandey and Murlidhar Pandey in respect of the landed premises as mentioned in the table herein above (under SL 3. Resolution Plan Amount and Payment Thereof starting from S.N. 1 to 40, shall also be transferred in the name of the Corporate Debtor. B. The approval of the resolution plan by the Hon'ble Adjudicating Authority will be binding on the personal guarantors pursuant to Section 31(1) of the Code and the personal guarantors Mr. Satyaprakash Pandey and Mr. Murlidhar Pandey as stakeholders in respect of landed pre ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the same land which has been mortgaged to the financial creditors and owned by the suspended board of directors and guarantors to the corporate debtor. It is also an admitted fact that the corporate debtor had an unfettered right to use the plant and factory established at the land of the suspended board of directors and guarantors of the corporate debtor. 39. It is pertinent to mention that Regulation 37 (B) of the Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) Regulation, 2016 provides that "a Resolution Plan shall provide for the measures, as may be necessary for Insolvency Resolution of the Corporate Debtor for maximisation of value of its assets, including but not limited to the sale of all or part of the assets whether subject to any security interest or not." 40. As per Section 31 of the Insolvency and Bankruptcy Code, 2016, the approved Resolution Plan binds all the stakeholders, including the Corporate Debtor's Guarantors. Thus, the suspended board of directors and guarantors to the corporate debtor are bound by the approved resolution plan. In light of the above discussion, we believe that the objections rais ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tions, exemptions as per the relevant provisions of the applicable law which the CD was entitled to as on the Plan Effective Date for the balance period as per the relevant provisions of the Applicable Law. Granted, subject to the law and applicable Regulations. 3 All licenses and Government Approvals held by the CD, which expire prior to the Plan Effective Date or within a period of twelve (12) months thereafter, shall be renewed/extended by the relevant Governmental Authorities, and the CD shall be permitted to continue to operate its business and assets in the manner. operated prior to submission of this Resolution Plan until renewal/extension of such licenses and approvals. The relevant Governmental Authorities will provide a reasonable period of time after the Plan Effective Date in order for the RA to assess the status of the licenses and Governmental Approvals required by the CD and to procure that the CD applies for the same. Granted, subject to the law and applicable Regulations. 4 The Collector of Stamps, Revenue Department, of any State Government and the Ministry of Corporate Affairs to exempt the RA and the CD, from the levy of stamp duty and fees applicable in r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... out requiring compliance with the provisions of Section 66(1) and (2) of the Companies Act, 2013. Granted. 11 The CBDT to provide relief to the CD from all direct Tax litigations pending at different levels and provide waiver from all Tax dues including interest and penalty on such litigations. Granted, subject to the law and applicable Regulations. 12 The Central Board of Excise and Customs / respective value-added Tax / entry Tax authorities/director general of foreign trade to provide relief to the CD from all litigations pending at different levels and provide waiver from tax dues including interest and penalty on such litigations. Granted. 13 All Governmental Authorities to waive the Non-Compliances of the CD prior to the Plan Effective Date, including but not limited to Companies Act 2013, the Industrial Disputes Act, 1947, and the relevant shops and establishment acts and rules, circulars and regulations of each of the above legislations Granted. 14 All non-compliances under the Companies Act 2013 (including but not limited to dematerialisation of shares by the CD and transfer of shares by the CD to the resolution applicant in physical form be permitted) of the C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ligation as envisaged In the resolution plan without any other financial obligation. Granted. 22 All the liabilities of the corporate debtor which are not part of this resolution plan shall be annulled. Insulation/protection against any criminal proceedings under any applicable law/ regulation/statute that may arise due to any offenses committed by suspended board/ promoters/ corporate debtors/ any of its officials. Granted in terms of the Ghanashyam Mishra and Sons Pvt Ltd v Edelweiss Asset Reconstruction Company Ltd, wherein the Hon'ble Supreme Court has held in para 95(i) that once a resolution plan is duly approved by the Adjudicating Authority under subsection (1) of section 31, the claims as provided in the resolution plan shall stand frozen and will be binding on the Corporate Debtor and its employees, members, creditors, including the Central Govt, any State Govt or any local authority, guarantors and other stakeholders. 23 Any other relief can be added based on any specific issue of the corporate debtor that may arise during the process, before the plan is being approved. We hereby clarify that the same is not conditional and subject to approval from NCLT. Grant ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... be deemed to have waived all the procedural requirements in terms of Section 66, Section 42 and Section 62(1)(c) of the 2013 Act, and the NCLT (Procedure for Reduction of Share Capital) Rules, 2016 for reduction of share capital and issuance of equity shares and Preference shares to the Resolution Applicant and/or the Financial Creditors. Granted, subject to the law and applicable Regulations. 29 An approval with regards to the right of way ("Right of Way) for an unfettered access to the plant. Granted. 30 The relevant Governmental Authorities shall not initiate any Investigations, actions or proceeding in relation to any noncompliances with Applicable Law by the Company during the period prior to the Closing Date. Neither shall the Resolution Applicant, nor the Company, nor their respective directors, officers and employee appointed on and as of the Closing Date be liable for any violations, liabilities, penalties or fines with respect to or pursuant to the Company not having in place requisite licenses and approvals required to undertake its business as per Applicable Law, or any non-compliances of Applicable Law by the Company. Further, the relevant Governmental Auth ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ecord, document, statement, statutory or otherwise, arising prior to or after the Effective Date, but pertaining to period prior to the Effective Date, and/or arising in connection with Assignment or acquisition of shares of the company by the investors or conversion of the Conversion Debt into Equity or restructuring of the Assigned Debt or in any other manner as a result of or in connection with this Plan, shall be deemed to have been irrecoverably waived and permanently extinguished and written off in full with effect from the Effective Date. To give effect to such waiver and extinguishment, any contract, agreement, deed or document, whether oral or written, expressed or, implied, statutory or otherwise, pursuant to which any such dues, liabilities, obligations, claims, counterclaims, demands, actions, penalties, right, title or interest in claimed (other than as specifically mentioned herein) shall stand modified with effect: from the Effective Date without any further act, deed and approval of the Resolution Plan by Adjudicating Authority shall be deemed to be sufficient notice which may be required to be given to any person for such matters and no further notice shall be requ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... orate Debtor stands terminated immediately on reduction/transfer of shares to RA. Granted. 38 All the lenders(secured or unsecured) whether present or past shall inform the CIBIL for removal of name of CD from the list of defaulters, if already informed and shall also issue "NO DUES CERTIFICATE immediately on payment of amount as proposed/finalised at the time of approval of Resolution Plan. Granted. 39 RA. is seeking disposal of all application including section 43,44,46, 49 and 66 and all other application which are filed by RP and pending for adjudication prior to approval of plan by the Hon'ble Adjudicating Authority considering the Judgment of the Hon'ble Delhi High Court in the case of M/s. Venus Recruiters Pvt Ltd Vs Union of India & others passed in case No. WP (C) 8705 of 2019 & CM (Appeal) 36029 of 2019. Granted. 40 LAND OF THE PERSONAL GURANTOR AS MENTIONED IN THE TABLE HEREIN ABOVE (UNDER SL 3. RESOLUTION PLAN AMOUNT AND PAYMENT THEREOF) STARTING FROM S.N. 1 TO 40 WHICH HAS BEEN MADE PART OF THE ASSETS OF THE CD IN THE IM AS STATED IN DETAIL HEREIN ABOVE: A. Upon approval of the plan by the Hon'ble Adjudicating Authority, such land shall stan ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by the Ld. Senior Counsel for the Resolution Professional, and perusing the record, we find that the Resolution Plan has been approved with 93.46% voting share. As per the CoC, the plan meets 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. 46. On perusal of the documents on record, we are also satisfied that the Resolution Plan is in accordance with sections 30 and 31 of the IBC and also complies with regulations 38 and 39 of the IBBI (Insolvency Resolution Process for Corporate Persons) Regulations, 2016. 47. As far as the question of granting time to comply with the statutory obligations/seeking sanctions from governmental authorities is concerned, the Resolution Applicant is directed to do the same within one year as prescribed under section 31(4) of the Code. 48. In case of non-compliance of this order or withdrawal of Resolution Plan, the CoC shall invoke the Performance Bank Guarantee furnished by the Resolution Applicant. 49. Subject to the observations made in this Order, the Resolution Pla ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
