9911796707
TMI Blog2023 (8) TMI 548X X X X Extracts X X X X X X X X Extracts X X X X ..... Advocates. For the Respondents : Mr. Abhijeet Sinha, Mr. Anand Varma, Ms. Apoorva Pandey and Mr. Ayush Gupta, Advocates for R-1. Mr. Ankit Raj and Mr. Piyush Beriwal, Advocates for R-4. Mr. Aditya Kumar, Advocate for R-5. JUDGMENT ASHOK BHUSHAN, J. This Appeal has been filed by the Successful Resolution Applicant challenging the order dated 18.04.2023 passed by the Adjudicating Authority (National Company Law Tribunal), Cuttack Bench by which order the application filed by the Resolution Professional for approval of the Resolution Plan of the Appellant has been rejected and the IAs filed by the Dissenting Financial Creditors objecting the plan have been allowed. Brief facts of the case necessary to be noticed for deciding the Appeal are ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e up in this Appeal. 2. We have heard learned counsel for the parties. 3. Shri Arun Kathpalia, learned senior counsel appearing for the Appellant submits that in the Resolution Plan relevant clause which provide for assignment of security interest in favour of the Appellant was voted upon by the CoC and no objection was raised at any point of time by the Dissenting Financial Creditors about the aforesaid. It is submitted that plan also includes additional payment of Rs.40 Crores for assignment of securities. Shri Kathpalia, however, submits that in any view of the matter the Successful Resolution Applicant has filed an undertaking by an affidavit on 20.02.2023 that securities of the Dissenting Financial Creditors shall not be assigned and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iced in detail by the Adjudicating Authority. The submission on behalf of the Resolution Applicant to modify the plan and not to demand release of the Personal and Corporate Guarantees of dissenting and absenting financial creditors has also been noted in Para 35 of the judgment, which is to the following effect: "35. On the Resolution Applicant side during the hearing expressed that the Resolution applicant has agreed to modify the plan and not to demand release of the personal and Corporate Guarantees of dissenting and absenting financial creditors viz. Punjab National Bank, Bank of India, and Kotak Mahindra, affidavit dated 20.02.2022 also filed in this regard. On the Kotak Mahindra side argued that once the plan is approved by COC the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... approved plan cannot be altered merely on the basis of an affidavit of Successful Resolution applicant, if any amendment/modification needs to be carried out, the plan should be remitted to the CoC for further consideration and opposed to act upon the affidavit of Resolution applicant." 8. The Adjudicating Authority after noticing the aforesaid submission proceeded to reject the Resolution Plan observing that once the Resolution Plan has been approved by the CoC, the Adjudicating Authority has either to approve the plan or reject the plan and there is no other alternative to approve the plan with modification. The reasons have been also given by the Adjudicating Authority for rejection of the plan in Para 38, which is to the following eff ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ur of Successful Resolution Applicant. Clause 2.2 of the Resolution Plan which is relevant in the present case needs to be extracted: "2.2 Payment to financial creditor who are members of the CoC- (d) The entire outstanding debt due to the financial creditors as on the CIRP initiation date shall stand satisfied, settled and extinguished, and no claims whatsoever, of any nature, either towards the principal dues, interest or penalty, shall subsist against the Company post payment of the same by the Resolution Applicant and assignment of the Debt to RA. (e) Upon payment of Financial Creditors, the Financial Creditors shall severally and/for jointly assign the entire security interest (which inclues by not limited to the items specified ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s also relevant to notice that the Appellant's Resolution Plan value is Rs.432.90 Crore where the liquidation value of the Corporate Debtor was only Rs.147.11 Crores. The Successful Resolution Applicant has proposed an excess amount of Rs.285.79 Crores. The Resolution Applicant having himself expressed not insist for assignment of Personal and Corporate Guarantees and to be continued with the Dissenting Financial Creditors, the Adjudicating Authority ought not to have rejected the Resolution Plan and accepting the request of the Dissenting Financial Creditor ought to have remitted the plan to the CoC for reconsideration. 13. We have already observed that ends of justice be served in permitting the Successful Resolution Applicant to prepare ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
