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TMI Blog2023 (12) TMI 1075X X X X Extracts X X X X X X X X Extracts X X X X ..... ful Resolution Applicant. The impugned order fully protects the interests of the Appellant since it has directed the amount proceeds from the sale to be kept in escrow account. Approval of the Resolution Plan - HELD THAT:- The Adjudicating Authority in the impugned order while considering the rival submission of the parties has come to the conclusion that the sale process with regard to which LoI was issued on 19.10.2022 had concluded in view of the performance on the part of the Ace Aviation. Submission of the Successful Resolution Applicant for re-bidding insofar as three aircrafts was concerned was not accepted. With regard to other two aircrafts whose process was halted on 11.11.2022, direction was issued to reinitiate the process and conclude the sale of aircrafts after considering the Ace Aviation as one of the eligible bidders. The Adjudicating Authority did not commit any error in directing to conclude the sale agreement of three aircrafts for which LoI was already issued - there are no good ground to interfere with the order passed by the Adjudicating Authority in IA No.3747 of 2022. The interests of the Successful Resolution Applicant are also protected since the Adj ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r R-2 (SRA). JUDGMENT Ashok Bhushan, J. These Appeals have been filed against the order dated 17.10.2023 passed by the Adjudicating Authority (National Company Law Tribunal), Mumbai Bench-I in IA No.3747 of 2022 and IA No.883 of 2023 respectively. Company Appeal (AT) (Insolvency) No. 1517 of 2023 has been filed against the impugned order dated 17.10.2023 passed in IA No.3747 of 2022 whereas Company Appeal (AT) (Insolvency) No.1595 of 2023 has been filed against the order dated 17.10.2023 passed in IA No.883 of 2023. Appellants aggrieved by the aforesaid orders has come up in these Appeals. 2. Brief facts of the case necessary to be noticed for deciding these Appeals are:- 2.1. The Corporate Insolvency Resolution Process (CIRP) was initiated against the Corporate Debtor- Jet Airways (India) Limited in which a Resolution Plan filed by the Successful Resolution Applicant i.e. The Consortium of Mr. Murari Lal Jalan and Mr. Florian Fritsch was approved by the Adjudicating Authority vide order dated 22.06.2021. Order of the Adjudicating Authority approving the Resolution Plan was challenged in several Appeals. One of the Appeals filed was Company Appeal (AT) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... any such order as this Hon'ble Tribunal may deem fit and proper in the facts and circumstances of the present case in the interest of justice. 2.2. In IA No. 3747 of 2022, Successful Resolution Applicant filed an intervention application seeking leave of the Court to be heard in IA No.3747 of 2022. All India Jet Airways Officers and Staff Association Appellant in Company Appeal (AT) (Insolvency) No.1595 of 2023 filed IA No.883 of 2023 seeking stay of the sale of the Corporate Debtor s assets and also sought direction to the Resolution Professional to state on record the total amount of fund and gratuity and Successful Resolution Applicant to pay the same in full. Prayers made in the IA No.883 of 2023 were to the following effect:- a. Issue appropriate directions to the Respondent Authorities that until such time the workmen and employees of the Corporate Debtor receive their outstanding provident fund and gratuity dues, no assets of the Corporate Debtor can be sold/alienated by the Respondents to any party, including Ace Aviation VIII Limited, unless such sale is being effectuated for the purpose of the recovery of the provident fund and gratuity dues of the emplo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ror in allowing the IA filed by Ace Aviation . It is submitted that the prayers made in the application being IA No.3747 of 2022 were in fact direction for specific performance of letter of intent which could not have been directed. It is submitted that the lot of issues have been raised by lenders with regard to effective date. The case of the Appellant is that the effective date has already been arrived on 22.05.2022 which is contested and Appeals have been filed before this Tribunal and the Hon ble Supreme Court by the lenders. It is submitted that the sale of assets be undertaken only once dispute between the Successful Resolution Applicant and MC lenders are resolved regarding the effective date. Till date the question as to whether effective date is achieved or not is pending adjudication before this Tribunal and the Hon ble Supreme Court. MC lenders has now challenged the implementation of the Resolution Plan. Issuance of LoI does not create a binding contractual relationship. It is submitted that the impugned order passed by the Adjudicating Authority suffers from lack of jurisdiction. It is submitted that the application was not maintainable under sub-section (5) of Secti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ues. Conducting an auction sale in respect of the Corporate Debtor s assets by the Monitoring Committee to recover its own debts first by selling the Corporate Debtor s assets over which, the workmen and employees of the Corporate Debtor had a lien on account of their unpaid statutory dues. In the application which was filed by the Appellant, Adjudicating Authority ought to have stopped the sale of aircrafts and directed for payment of unpaid dues of the Appellant. There was attachment order passed on aircrafts which has been vacated by the impugned order. Adjudicating Authority did not consider the details of the dues of the Appellant. The order passed by this Tribunal dated 21.10.2022 and 02.12.2022 were also upheld by the Hon ble Supreme Court vide its order dated 30.01.2023. 7. Submissions raised on behalf of the Counsel for the Appellant have been refuted by Counsel appearing for the Resolution Professional. It is submitted that the PF and gratuity dues of the employees and workmen have been dealt with in accordance with the approved Resolution Plan and the Code. Impugned order does not alter the position which is attained after the NCLAT order in any manner. Adjudicating A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t seek the refund of the EMD, the funds remitted by you will be kept earmarked for this purpose in the special purpose account. Further, in such a scenario, you may also continue with the process from the present state/status, as and when the process is resumed. For any clarifications in this regard, please feel free to get in touch. 10. It was after the sale process was kept in abeyance, IA No.3747 of 2022 was filed by the Respondent No.1 giving details of all sequence of the events and various steps taken in the sale process. We have already extracted above the prayers made in IA No.3747 of 2022. 11. In IA No.3747 of 2022, the Successful Resolution Applicant sought intervention. One of the submissions which has been raised by Counsel for the Appellant is that the Adjudicating Authority had no jurisdiction to entertain the application filed by Ace Aviation under sub-section (5) of Section 60. Learned Counsel for the Appellant has relied on the judgments of the Hon ble Supreme Court in Gujarat Urja Vikas Nigam vs. Amit Gupta Ors.- (2021) 7 SCC 209 and Tata Consultancy Services Limited vs. Vishal Ghisulal Jain- Civil Appeal No. 3045 of 2020 . 12. The sale pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (c) any question of priorities or any question of law or facts, arising out of or in relation to the insolvency resolution or liquidation proceedings of the corporate debtor or corporate person under this Code. 14. Sub-section (5) of Section 60 uses two expressions arising out of and in relation to . The application which was filed by the Respondent No.1- Ace Aviation clearly arose out of insolvency process since the sale by Monitoring Committee was initiated as per the Resolution Plan and it was the Monitoring Committee which has kept it in abeyance by issuing a letter dated 11.11.2022. Prayers which were made in IA No.3747 of 2022, as noted above, were to declare the communication dated 11.11.2022 issued by Monitoring Committee as wrongful, arbitrarily and void and direct the Respondents in the application who were none other than Monitoring Committee of JET Airways to conduct the sale process in an expeditious and time bound manner, in accordance with the schedule and timeline set forth in the assets sale process document. The application, thus, clearly arose out of insolvency process and we do not find any substance in the submission of the Counsel for the Appellant ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... onetary value entirely depleted. Furthermore, the aircraft will lose all ability to be brought to an airworthy condition again in a manner that is commercially viable. The Adjudicating Authority in the impugned order while considering the rival submission of the parties has come to the conclusion that the sale process with regard to which LoI was issued on 19.10.2022 had concluded in view of the performance on the part of the Ace Aviation. Submission of the Successful Resolution Applicant for re-bidding insofar as three aircrafts was concerned was not accepted. With regard to other two aircrafts whose process was halted on 11.11.2022, direction was issued to reinitiate the process and conclude the sale of aircrafts after considering the Ace Aviation as one of the eligible bidders. We are of the view that the Adjudicating Authority did not commit any error in directing to conclude the sale agreement of three aircrafts for which LoI was already issued. 19. Learned Counsel for the Respondent also submitted that no material was produced nor any offer was pointed out by the Successful Resolution Applicant higher to the one which has already been received in the sale process. We find ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in accordance with the approved Resolution Plan. In paragraph 8 of the impugned order, following has been held by the Adjudicating Authority:- 8. An Application IA 883/2023 has been filed by All India Jet Airway Officers and Staff Association impleading the Resolution Professional as a Respondent. The Applicant therein has sought the stay/alienation of the aircrafts to Applicant in IA 3747/2022, besides seeking affidavit on calculation of provident fund and gratuity dues and payment of wages from the Resolution Professional. We feel that the proceeds of the sale of aircrafts is to be deposited in the Escrow Account and dealt with in accordance with the approved Resolution Plan, which considers the claim of workman/staff, including gratuity and PF dues, in accordance with the law, accordingly, we do not find merit in the prayer for stay of sale and alienation of assets of the Corporate Debtor in the manner set out in the approved Resolution Plan. However, we direct the Resolution Applicant to ensure that the provident fund and gratuity dues of workman and employee in accordance with the judgment of Hon'ble NCLAT dated 21.10.2022, as modified by the Hon'ble Superior Cou ..... X X X X Extracts X X X X X X X X Extracts X X X X
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