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TMI Blog2024 (9) TMI 1422X X X X Extracts X X X X X X X X Extracts X X X X ..... ity (National Company Law Tribunal, NCLT Mumbai Bench, Court - III) by which I.A. No. 124/2024 filed by Sandeep Jayantilal Vadodria and Ors. has been rejected and I.A. No. 5826/2023 filed by the Resolution Professional (`RP') for approval of the Resolution Plan has been allowed. 2. The aforesaid two Orders passed on the same date in I.A. No. 124/2024 and I.A. No. 5826/2023, have been challenged in these Appeals. 3. Brief facts of the case necessary to be noticed for deciding the Appeal are; i. Corporate Insolvency Resolution Process (`CIRP') against the Corporate Debtor, Adico Forge Pvt. Ltd. commenced by the Order dated 23.06.2023 passed on an Application filed under Section 9 of the Insolvency and Bankruptcy Code, 2016, (for short `The IBC' or `The Code') by an Operational Creditor. ii. On 17.07.2023, Interim Resolution Professional (`IRP') made Public Announcement inviting claims. `Form-G' was published in response to which, two Resolution Plans were received one by M/s. Saverni Neutech Pvt. Ltd. (submitted by consortium of three persons.) and another by M/s. Trinity India Forgetech Pvt. Ltd. iii. 13.11.2023 was fixed date for submission of Resolution Plan, which was ext ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... td. xv. The RP acting on the oral direction convened the Meeting of the CoC on 05.01.2024. xvi. On 05.01.2024, Learned Counsel for the Successful Resolution Applicant (`SRA') made a mention on basis of which the Application I.A.5826/2023 was listed on 05.01.2024, on which date, Adjudicating Authority was informed that CoC Meeting has been called on 05.01.2024 at 06:30 P.M. on the ground that oral direction was issued by Court on 01.01.2024 to consider the new Resolution Plan of the Applicant. xvii. Adjudicating Authority passed an Order 05.01.2024 directed the Resolution Professional not to conduct the CoC Meeting for consideration of any fresh Resolution Plan and the Application was directed to be listed on 10.01.2024. xviii. In view of the Order of the Adjudicating Authority dated 05.01.2024, no Meeting of the CoC was held on 05.01.2024, nor Resolution Plan or Applicant M/s. Saverni Neutech Pvt. Ltd. was considered. xix. Both the Applications I.A.124/2024 and I.A. 5826/2023 were heard by the Adjudicating Authority and by Impugned Order Application filed by the Applicant Sandeep Jayantilal Vadodria was rejected and Application filed by the RP for approval of the Plan has ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n the ground that he is co-Resolution Applicant and there being conflict of interest. It is submitted that Financial Creditor, the Appellant was entitled to cast his vote on the Resolution Plan. Hence the Order approving the Resolution Plan deserves to be rejected. 7. Learned Counsel for the RP refuting the submissions of the Appellant submits that 15.12.2023 was last date of submitting revised Resolution Plan and the Appellant Sandeep Jayantilal Vadodria failed to submit the revised Resolution Plan within the time allowed. In the Meeting held on 15.12.2023, both the Plans, submitted by Sandeep Jayantilal Vadodria and 2 Ors. as well Plan submitted by M/s. Trinity India Forgetech Pvt. Ltd. were considered deliberated and put to vote. The Resolution Plan submitted by M/s. Trinity India Forgetech Pvt. Ltd. was approved with 92.87% vote and other Plan submitted by M/s. Saverni Neutech Pvt. Ltd. was disapproved with 92.87% vote shares. It is submitted that Resolution Plan having approved on 15.12.2023 Minutes of which Meeting were also circulated by RP on 16.12.2023, the Resolution Applicant M/s. Saverni Neutech Pvt. Ltd. sent an email on 18.12.2023, asking for refund of the EMD, which ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Pvt. Ltd. was Plan submitted by Consortium of three Applicants namely; i. Sandeep Jayantilal Vadodria. ii. Vishal Prakashchandra Modha. iii. Rakesh Chaganlal Patel. 11. Plan was submitted by both the Resolution Applicant by 17.11.2023. In the 6th CoC Meeting held on 28.11.2023, and the 7th CoC Meeting held on 02.12.2023 Members of the CoC suggested certain modifications and directed both the Resolution Applicant to submit a revised Resolution Plan. Meeting of the CoC was held on 12.12.2023, where in Item No. 2, the CoC extended the time for submission of Resolution Plan till 13.12.2023 at 5:00 PM. Item No. 2, following was resolved: "ITEM NO : 2 To discuss regarding Resolution Plans to be received from Resolution Applicants vs., M/s. Saverni Neutech & Others and Trinity India Forgetech Pvt. Ltd. Resolution Professional apprised to the members of the CoC that the Prospective Resolution Applicants (PRAs) ask to extend the time for submission of Resolution Plan even though they were well informed in advance regarding the date of submission of Final Resolution Plan and the current status of CIRP end date. Further, after deliberation CoC has decided to extend the time by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt through Video conference (for agenda no.1,6,7 and 8) Note: Mr. Rakesh Patel was present in the meeting for discussion and voting only on agenda no.1,6,7 and 8 and thereafter exited the meeting, since he is participating in the EOI process as co-resolution applicant with M/s. Saverni Neutech." 14. Item No. 3 of the Minutes was "to discuss on the Resolution Plan to be received from Resolution Applicant, namely; M/s. Saverni Neutech Pvt. Ltd. and M/s. Trinity India Forgetech Pvt. Ltd.". In Item No. 2, brief on Resolution Plan of M/s. Saverni Neutech Pvt. Ltd. as well as M/s. Trinity India Forgetech Pvt. Ltd. were noticed total amount of Resolution Plan which was offered by M/s. Saverni Neutech Pvt. Ltd. Rs.19,29,76,000/- whereas total amount of the Plan which was offered by M/s. Trinity India Forgetech Pvt. Ltd. Rs.26,86,00,000/-. In the discussion of Item No. 2, following was noticed: "ITEM NO: 2 To discuss on the Resolution Plans to be received from Resolution Applicants (PRAs) namely M/s. Saverni Neutech & Others and Trinity India Forgetech Pvt Ltd. The RP informed the members of the CoC that after giving several opportunities for submission of Final Resolution ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... MD amount of Rs.5 Crore to be submitted as per the minimum eligibility criteria was submitted late on 22.11.2023. 3. The Resolution Plan do not comply with Sec.30 (2)(a) and 30 (2)(b) of the Code. 4. The source of funds is mentioned as bank finance which indicates they have low financial independence to commit with resolution plan amount offered. 5. Provision with regards to PF dues and gratuity in the resolution plan as per the provisions of the code. 6. Even the time period for payment is 3 months from the effective date which is far more than time period of 15 days offered by Trinity India Forgetech Pvt. Ltd. 7. The plan amount offered is also on the lower side. The RP further stated that even after several opportunities were given by the CoC members for timely submission of the final resolution plan through various email on 08.12.2023, 11.12.2023, 12.12.2023 and 14.12.2023, no Resolution Plan is received till date from M/s. Saverni Neutech with any revise offer amount and compliances as discussed during the negotiation process. The Authorised Representative of HDFC Bank agreed and stated that in view of the fact that CIRP period is ending on 20.12.2023, we cannot wa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ordance with Section 30 of the Insolvency and Bankruptcy Code, 2016; c) Your Lordship may be pleased to direct the Respondent No. 1 i.e. Resolution Professional of Adico Forge Private Limited and Respondent No. 2 i.e. Committee of Creditors of Adico Forge Private Limited to consider the Revised Resolution Plan in accordance with Section 30 of the Insolvency and Bankruptcy Code, 2016 as submitted by the Applicant; d) Pending the hearing of the present application, this Hon'ble Tribunal may be pleased to not approve any application for approval of resolution plan if filed by the Respondent No. 1 under Section 30(6) of the Insolvency and Bankruptcy Code, 2016; e) Your Lordship may be pleased to grant any other relief or relief as may deem fit in the interest of justice;" 19. The Applicant Sandeep Jayantilal Vadodria was well aware that Resolution Plan has already been approved by the CoC on 15.12.2023, and they could not file their revised Plan in time. When the Resolution Plan has been approved by the CoC contents of the Application itself notices that Resolution Applicant was well aware that Plan has to be submitted till 15.12.2023, but the ground given was that one of the Jo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... plan in contravention of the CIRP Regulations. It appears that there was some confusion during the hearing on 01.01.2024. We direct the Resolution Professional not to conduct the CoC meeting for consideration of any fresh Resolution Plan. List this matter on 10.01.2024." 22. When we look into the Order of the Adjudicating Authority passed on 05.01.2024, it is clear that the Adjudicating Authority itself has recorded that there was some confusion during the hearing on 01.01.2024. The Order dated 01.01.2024 has also been brought on record by the SRA along with its Affidavit in Reply, which Order reads as follows: "I.A 5826/2023 1. Adv. Dipti Mundra for the applicant is present. 2. List this matter on 10.01.2024." 23. The Order passed on 01.01.2024 contained a direction to list the Application on 10.01.2024. The case of the Appellant is based on some oral Order passed on 01.01.2024 by the Court to consider the Resolution Plan of the Resolution Applicant, Sandeep Jayantilal Vadodria. When Order dated 05.01.2024 was passed by the Adjudicating Authority in I.A. No. 5826/2023, directing that Resolution Professional not to conduct the CoC Meeting for consideration of any fresh Res ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . Suffice it to say that Authorised Representative of the Appellant Prem Trading Company, Rakesh Patel was present in the CoC Meeting, which is recorded in the Minutes as noted above. It has been noted that Rakesh Patel has voted only on the agenda 1, 6, 7 & 8, and thereafter he exited, he having participated in the EOI process as co- Resolution Applicant in M/s. Saverni Neutech Pvt. Ltd. and Rakesh Patel who was Authorised Representative of Financial Creditor was participating in EOI. He was rightly not permitted to vote. He rightly exited from the voting which was held on Item No. 2. 28. In any view of the matter, vote share of the Prem Trading Company is only 2.48% and vote share for Prem Trading Company was not considered in favour of the approval of the Plan and the Plan was approved by 92.87% vote shares of HDFC Bank Ltd. the largest Financial Creditor. 29. We do not find any merit in the Appeal filed by Prem Trading Company. In the CoC Meeting held on 15.12.2023, Prem Trading Company was represented by its Authorised Representative and the grounds which are sought to be raised in the Appeal are without any substance. 30. In result of above discussion, we do not find any e ..... X X X X Extracts X X X X X X X X Extracts X X X X
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