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TMI Blog2023 (5) TMI 1159X X X X Extracts X X X X X X X X Extracts X X X X ..... IVATE LIMITED [ 2022 (1) TMI 1370 - NATIONAL COMPANY LAW TRIBUNAL, MUMBAI] filed by the RP seeking liquidation, Adjudicating Authority has passed an order on 20th January, 2022 which has been brought on record at page 393 of the Appeal paper Book by the Appellant himself. The order dated 20.01.2022 having not been challenged has attained finality. The Corporate Debtor is in the Liquidation and Liquidation Process has commenced subsequent to the Order dated 20th January, 2022. Liquidation Process having commenced there is no occasion for issuing any direction for consideration of the Resolution Plan of the Appellant. It is also relevant to notice that according to the Regulation 2B, compromise or arrangement proposed under Section 230 has to be completed within 90 days of order of liquidation. But we having by this order held that order of identification committee declaring the promoters/directors as willful defaulter is not in operation which we have found by order of the date, ends of justice will be served if 90 days period is allowed to the Appellant to submit a compromise or arrangement to the Liquidator. The order of the Adjudicating Authority dated 20th January, 2022 u ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s not eligible to submit a Resolution Plan. Resolution Professional was authorized to check the eligibility of the Resolution Applicant and inform the same. Resolution Professional on 08.10.2020 conveyed to the Appellant that Resolution Plan submitted by the Appellant is not being considered since the Union Bank of India has declared the account as fraud. In the 8th CoC meeting dated 09.11.2020 it was noted that Appellant is not eligible under Section 29A of the Code to submit the Resolution Plan. It was resolved that there is no need to send a separate communication for disapproval of the plan to the Appellant. CoC in its Meeting dated 09.11.2020 resolved that there is no requirement of making any application seeking extension of the Corporate Insolvency Resolution Process (CIRP in short). (v) The Resolution Professional filed an I.A. No. 173 of 2021 seeking direction for liquidation. (vi) The Union Bank of India issued an Order dated 25.05.2021 declaring Borrower, Promoter and Directors as willful defaulter. An application to review the Order dated 25.05.2021 passed by the Identification Committee was filed by the Appellant. The Review Committee vide its order dated 01.07.2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Union Bank of India declaring willful defaulter is not operative as on date. 5. Learned Sr. Counsel appearing for the Union Bank of India submits that before issuing show cause notice dated 13.11.2019 to the Appellant, Identification Committee held its meeting on 15.10.2019 where decision was taken that Appellant is willful defaulter. It is submitted that the Corporate Debtor who had availed credit facility from the Union Bank of India has committed default in payment of total outstanding due to the Corporate Debtor on 13.09.2022 is Rs. 110,57,00,000/-. Letter dated 13.11.2019 issued to the Appellant is reporting the fact of willful defaulter. Learned Sr. Counsel further submitted that Corporate Debtor is at present under liquidation and Liquidation Order dated 20th January, 2022 passed in I.A. No. 173 of 2021 has not been challenged by the Appellant. The Liquidation Proceeding is going on hence rejection of the Resolution Plan submitted by the Appellant in CIRP is inconsequential. It is submitted that the Liquidator has in fact issued e-Auction Notice which e-Auction Notice were not proceeded with due to Interim Order passed by this Tribunal on 06.03.2023. 6. We have con ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ubmitted a Reply to the communication of Identification Committee vide Letter dated 27.11.2019 and ultimately the order was passed by Identification Committee on 25th May, 2021. By order dated 25th May, 2021, the Identification Committee directed as under: Hence, the committee concluded that the said borrower/its promoters/directors/guarantors be declared as willful defaulters. The Committee directed that the order be served on the borrower/promoters/whole time directors/guarantors allowing them to file appeal against the order of Identification Committee within 15 days to place the same before Review Committee for final view. Ordered accordingly. Sd/- M. Ravindra Babu (Convener for Identification Committee on willful defaulter) 10. Thus for the first time identification committee declared promoters including the Appellant as willful defaulter by order dated 25.05.2021. There was no order in existence prior to 25th May, 2021 declaring the Appellant as willful defaulter. Appellant applied for review of the order which review was also rejected by Letter dated 01st July, 2021. 11. The Appellant has further stated that against the order dated ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dated 20.01.2022 having not been challenged has attained finality. The Corporate Debtor is in the Liquidation and Liquidation Process has commenced subsequent to the Order dated 20th January, 2022. Liquidation Process having commenced there is no occasion for issuing any direction for consideration of the Resolution Plan of the Appellant. However, the Appellant if so advised can submit a scheme for compromise or arrangement with creditors as contemplated by Section 230 of the Companies Act, 2013 and Regulation 2B of Insolvency and Bankruptcy Board of India (liquidation process) Regulations, 2016. It is also relevant to notice that according to the Regulation 2B, compromise or arrangement proposed under Section 230 has to be completed within 90 days of order of liquidation. But we having by this order held that order of identification committee declaring the promoters/directors as willful defaulter is not in operation which we have found by order of the date, ends of justice will be served if 90 days period is allowed to the Appellant to submit a compromise or arrangement to the Liquidator. We having permitted the Appellant to submit a compromise or arrangement by this Order, ends ..... X X X X Extracts X X X X X X X X Extracts X X X X
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