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TMI Blog2022 (2) TMI 1483X X X X Extracts X X X X X X X X Extracts X X X X ..... ,83,34,076/- - The Resolution Plan proposes to pay Rs. 5 lakhs to the Secured Financial Creditor Rs. 0.54 lakhs to the workmen and employees, the resolution plan proposes that the dues payable to the unsecured financial creditors shall be entirely paid/ written off, the plan also provides that 5% of statutory dues will be paid i.e. 0.86 lakhs will be paid and the balance will be waived off, the operational creditors would be paid an amount of Rs. 6.7 lakhs within a period of 60 days. The existing equity shares shall get written off and 10 lakhs new equity shares of Rs. 10 each for cash at par shall be issued to resolution applicant. Reliance placed on the judgement of the Hon ble Supreme Court in case of K. Shashidhar Vs IOB [ 2019 (2) TMI 1043 - SUPREME COURT] , wherein it was held inter alia that no corresponding provision has been envisage by the legislature to empower the Resolution Professional, Adjudicating Authority, of that matter NCLAT to reverse the commercial decision of the CoC. It is also held that the commercial decision of Financial Creditor are not open for judicial review by Adjudicating authority and by Appellate Authority. Therefore, in view of the above discussi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... me buyers 3,55,93,85,894/- 100% 5. The first CoC meeting was held on 20.05.2021 wherein the IRP was confirmed as an RP. The IRP prepared the Initial information memorandum as per regulation 36(1)(a) of IBBI. 6. The second CoC meeting was held on 28.05.2021. The RP appointed two values in accordance with the regulation. The RP circulated Expression of Interest (EoI), Form G and evaluation matrix on 29.05.2021 and the last date of EOI was 13.06.2021, in response to Form G the RP received one Expression of Interest (EoI) within the period set out in Form G. 7. The RP presented the provisional list of applicants to the CoC in its third meeting dated 23.06.2021 after verification of final list of prospective resolution applicant was presented to the COC in its 4th meeting. In the 4th CoC held on 19.07.2021. Further the RP pointed out in the 4th COC meeting that he had received more claims from 12 home buyers, 9 suppliers 3 financial Creditors towards the unsecured loan given by the company. The RP further informed the CoC that the verification of claims have been completed. 8. The CoC approved the evaluation matrix as presented by the RP in the second CoC meeting. The RP shared draft of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n Housing Financial Corporation has not filed claims under the CIRP process and is not a member of CoC. d. The details of other creditors including other Operational Creditors is as below; e. Key financial indicators f. Reasons for losses incurred as per the Information Memorandum Enforcement Directorate, Jaipur had attached the properties and bank accounts of the Corporate Debtor by a PAO dated 02.04.2019. The PAO was confirmed by Learned Adjudicating Authority PMLA. An appeal against the same has been filed by the Corporate Debtor which is pending with the Appellate Tribunal PMLA. g. Overview of the Projects of the Corporate Debtor. Corporate Debtor is involved in the real estate project in two distinct set of projects, RRV and Phase 2 (Royal Raj Villas EWS/LIG). Both sets are buildings are to be dealt differently as RRV is a project which is to be sold by the Corporate Debtor and Phase 2 (Royal Raj Villas EWS/LIG) to be constructed and handed over to Urban Improvement Trust for allotment to EWS/LIG section of society. RRV can be bifurcated into two sets of buildings i.e. one is Residential Portion and, the other is Commercial Portion. Seven Residential Towers B1- B7) are being d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Allottees would definitely be received as per the agreed schedule. The Resolution Applicant shall be completing the B1-B7 Tower and handing it over to the Allottees in the manner prescribed under RERA and as set out in this Plan. 2.5 With respect to RRV, the CoC has been unequivocal that its resolution can only be achieved through the completion of the construction work and fulfilment of the obligations under the various agreements between the Allotee(s) and the Corporate Debtor. The Resolution Applicant shall be entitled to deal with any of the RRV Assets, which shall be utilized for the purpose of completing RRV project and handing it over to the Allottees in the manner prescribed under RERA and this Plan 15. Liabilities forming part of Resolution Plan This Plan is only for the purpose of resolving the debts of the Corporate Debtor and restoring it as a going concern as entailed by the provisions of Section 5(26) of the Code. For the purpose of consideration of this Plan, the following liabilities are considered as they relate to the Corporate Debtor. (a) the debt owed by the Corporate Debtor to Dewan Housing Finance Limited; and (b) the obligations of the Corporate Debtor toward ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not have any security interest over any part of assets of corporate debtor on and from receipt of the settlement amount by Dewan Housing Finance Limited. On payment of first tranche, the security interest over the land shall be deemed to have been released. On payment of second tranche the security interest over the sold flats shall be deemed to have been released. On payment of third and final tranche, the security interest over the residual assets of corporate debtor, if any, shall be deemed to have been released in toto. The debt owed by the Corporate Debtor to Dewan Housing Finance Limited shall stand settled upon the approval of this Resolution Plan and payments made in accordance with it. -Upon the sanction of this Resolution Plan, Dewar Housing Finance Limited shall have no claim, no rights, no title, no interest in relation to the assets of the corporate debtor on and from receipt of the settlement amount as aforesaid. 18. Payment of unsecured financial creditors The Resolution Applicant has proposal that unsecured financial creditors with respect to loans borrowed from the directors and other related parties shall stand waived and extinguished entirely on and from the date ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ine for completion is delayed or extended or is expected to be extended then the Resolution Applicant shall immediately inform the Resolution. Professional and Authorized Representative of Home Buyers about such extended / delayed timelines and submit revised estimates timeline with sufficient particulars justifying the extension of time. The Resolution Applicant arid Authorized Representative of Home Buyers shall scrutinize the same and revert within a period of ten (10) days either accepting or rejecting (partially or otherwise) the estimate furnished by the RRV Resolution Applicant. Upon being satisfied that the extension of timeline is necessary and inevitable the Authorized Representative shall inform the Allottees which the Allottees shall accept / agree to without any objection / delay or demur by giving their respective consent within three (3) days. If any Allottee fails to give his / her confirmation to the same within the stipulated timeline then it shall be considered that such Allottee has agreed the same and consented to the extension of time. It is hereby further clarified that, such extension of timeline due to the reasons set out in Clause 18.4 shall not be conside ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... settled for 500.00 lakhs. The balance due of secured financial creditors shall be waived in terms of regulation 37(f) of IBBI. The terms of payment of secured financial creditors is reproduced below; Extinguishment of claims of secured financial creditors all other claims other than those covered in the resolution plan of secured financial creditors as extinguished as per the extinguishment of claims. 29. Release of security on the assets of the Corporate Debtor. All Charge of Secured Financial Creditors will be automatically stand modified in terms of the Proposed Resolution Plan as envisaged in resolution plan w.e.f. effective date. All request documents as required by law will be executed by Resolution applicant to give effect to the Resolution plan once approved by the adjudicating authority within a period of 30 days from the effective date. Further necessary formalities for satisfaction of charge with a ROC and sub-registrar of assurances shall also be carried out within 30 days of the date of execution of documents. The resolution applicant will be entitled to raise fresh financial resources/debts for the revival/overhauling/ fresh Capex/ expansion off the corporate debtor f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... who have lodge the claims and also are part of the balance sheet That the amount received of Rs. 60.79 Lacs against booking of flat/units which have been cancelled by corporate debtor and Liability of Corporate Debtor and/or Resolution Applicant in respect of the amount due to customer against Booking cancellation as mentioned in information Memorandum. Al claim and booking other than mentioned in Information Memorandum shall be extinguished by paying off 10% of the total outstanding of the Booking Cancellation amount as per Resolution Plan and 90% of the total outstanding of Booking Cancellation amount shall be deemed to be waived. as per Extinguishment of Claim (Part K of Chapter IV *of this Resolution Plan) with no recourse to the Corporate Debtor and/or Resolution Applicant and/or past management personnel of Corporate Debtor 34. Proposal for Operational Creditors of Corporate Debtor Out of total outstanding of Rs. 21.38 lakhs, the Resolution Applicant is paying 5% of amount i.e. Rs. 6.07 lacks to the Operational Creditors. 35. Proposal for statutory dues of the Corporate Debtor A. The principal outstanding of Rs. 17.26 lacs of statutory dues, the Resolution Applicant proposes ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... guished in terms of the Resolution Plan, but however, the Resolution Plan provides for the payment of Rs. 5 crores towards full satisfaction of the Claim. Findings: 36. The approval of the resolution plan has been sought under Section 31 of the Code, we have carefully considered the submissions of the learned counsel for the RP and perused the records. The conditions provided under Section 31(1) are that the resolution plan is approved by Committee of Creditors under Section 30 (4) of the Code and that the resolution plan so approved meets the requirement of Section 30(2) and that the Resolution plan has provisions for its effective implementation. 37. The Corporate Debtor was incorporated on 25.01.2007. The admission order of the CIRP was passed on 16.04.2021 and the Resolution plan submitted by the JVD Life Space was approved by the COC on 29.07.2021 with 100 % voting. Thus, the provisions of Section 30 (4) are satisfied. The approval has been sought under the provision section 31(1) of the Code. The voting results of approval of resolution plan is as follows; 38. The provisions of Section 30(2) are as follow: The resolution professional shall examine each resolution plan receive ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... djudicating authority in an appeal and that the properties attached vide the order of Enforcement Directorate and PMLA are part of the properties under the Resolution Plan. This Bench is of the opinion that it is empowered to deal with the properties under Section 238 of the IB Code, which contemplates that the provisions of this Code shall have effect, notwithstanding anything inconsistent therewith contained in any other law for the time being in force or any instrument having effect by virtue of any such law. However, there was no application made by the RP seeking vacation of the order of attachment passed by PMLA. Further, this Bench in exercise of powers u/s. 238 of the Code r/w Rule 11 of NCLT Rules, vacates the order of attachment passed by PMLA, while approving the Resolution Plan u/s. 31 of the Code. 44. The Resolution Professional has filed the transaction audit report dated 20.07.2021 which confirmed that as the project was stalled due to attachment of enforcement directorate, and that from the review of books of accounts of the Corporate Debtor, it was noticed that there are no preferential/ undervalued transactions/ fraudulent transactions/ extortionate credit transac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d under section 14 shall cease to have effect from the date of this order. 52. The Resolution Professional shall stand discharged from his duties with effect from the date of this Order. However, he shall perform his duties in terms of the Resolution Plan as approved by this Adjudicating Authority. 53. The Resolution Professional is further directed to handover all records, and properties to the Resolution Applicant to finalize the further line of action required for starting of the operation. The Resolution Applicant shall have access to all the records and premises of the corporate debtor through the Resolution Professional to finalize the further line of action required for starting of the operation. 54. In case of non-compliance of this order or withdrawal of Resolution Plan, the performance security amount already paid by the Resolution Applicant shall be liable to be forfeited. 55. Liberty is hereby granted for moving any Application if required in connection with implementation of this Resolution Plan. 56. The Applicant shall supervise the implementation of the Resolution Plan and file status of its implementation before this Authority from time to time, preferably every qua ..... X X X X Extracts X X X X X X X X Extracts X X X X
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