25th October, 2024 Approval of Resolution Plan - MYP Enterprises Limited [IA- 23-2024 in CP (IB)-96-MB-IV-2023] (1.15 MB)
IN THE NATIONAL COMPANY LAW TRIBUNAL
MUMBAI BENCH-IV
IA-23/2024
Under Section 60(5) & 30(6) of Insolvency &
Bankruptcy Code, 2016
Mr. Gaurang Shah
Resolution Professional/
…Applicant
In the matter of
CP (IB) No.96/MB/C-IV/2023
MYP Enterprises Limited
…Applicant/Corporate Applicant
Order Pronounced on: 16.10.2024
Coram:
Ms. Anu Jagmohan Singh
Mr. Kishore Vemulapalli
Hon’ble Member (Technical)
Hon’ble Member (Judicial)
For the Applicant/RP : CA Sanat R. Jariwala a/w Adv. Ami Jain.
ORDER IA-23/2024
This Application has been filed on 08.02.2024 by the Resolution Professional under Section 30(6) of the Insolvency and Bankruptcy Code, 2016 on behalf of the Committee of Creditors seeking approval of the Resolution Plan submitted by the Successful Resolution Applicant and approved by 100% of the voting share of the members of the Committee of Creditors (hereinafter referred to as ‘CoC’) of the Corporate Applicant viz. MYP Enterprises Limited (hereinafter referred to as ‘Corporate Applicant’).
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The brief facts of the Application are as follows:
2.1
Corporate Insolvency Resolution Process (CIRP) of the
Corporate Debtor was initiated vide an order dated
09.05.2023 of this Court in C.P.(IB)-96(MB)/2023 on an
application filed by MYP Enterprises Limited (Corporate
Applicant) under Section 10 of the Insolvency and
Bankruptcy Code 2016. Mr. Gaurang Shah (Reg. No.:
IBBI/IPA-002/IP-N00947/2019-2020/13002)
was
appointed as Interim Resolution Professional (IRP).
Subsequently, made a public announcement in the
newspapers (in Mumbai) in Form-A on 12.05.2023
inviting claims from the creditors, workers/employees
of the Corporate Debtor and from government bodies.
IRP constituted the Committee of Creditors (CoC) based
on the claims received by him and the Interim
Resolution Professional was confirmed as Resolution
Professional of the Corporate Debtor on 08.06.2023.
2.2
Form G was published on 30.06.2023 and the last date
for submission of the resolution plan was on
04.09.2023. In Response, the Resolution Professional
received only one Resolution Plan from D.H Exports
Private Limited which got approved in E-voting held
pursuant to 7th CoC Meeting held on 24.01.2024.
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2.3 The Applicant RP submits that Application were filed for Extension during the CIRP period, and the same have been duly tabulated herein-under:
2.4
The Resolution Plan submitted by the Resolution
Applicant viz. D.H Exports Private Limited was
approved by the CoC in the 7th meeting held on
24.01.2024 through e-voting by 100% of the CoC
member voting in favor of the Resolution Plan. The
resolution is reproduced below -
“RESOLVED THAT pursuant to Section 30(4) of
Insolvency and Bankruptcy Code, 2016 read with
Regulation 39 of the Insolvency and Bankruptcy Board
of India (Insolvency Resolution Process for Corporate
Persons) Regulations, 2016 and in accordance with any
other
provisions,
rules
and
regulations
made
thereunder, approval of the members of the Committee
of Creditors of MYP Enterprises Limited be and is hereby
accorded to the Resolution Plan dated 4th September,
2023 read with addendums and the annexures
submitted by M/s D.H Exports Private Limited”.
2.5
The Applicant submits that the Successful Resolution
Applicant has deposited the Performance Security of Rs.
S.
No.
I.A. No.
Filed
by
Relief Sought
Status
01
I.A. 5259/2023 RP Extension of 90 days Allowed vide Order dt. 21.11.2023
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4,00,000/- in the Bank account of the Corporate Debtor. 2.6 The Resolution Professional states that the Resolution Plan approved by the CoC is in compliance with the requirements of Section 30(2) of the Code. In compliance of Section 30(2) of IBC, 2016, the Resolution Professional has examined the Resolution plan of the Successful Resolution Applicant and confirms that this Resolution Plan: a. Provides for payment of Insolvency Resolution Process cost in a manner specified by the Board in the priority to the payment of other debts of the corporate debtor; b. Provides for management of the affairs of the Corporate Debtor after approval of Resolution Plan; c. The implementation and supervision of Resolution Plan; d. Does not prima facie contravene any of the provisions of the law for time being in force, e. Conforms to such other requirements as may be specified by the Board. f. As per the Affidavit received and the further documents submitted, the Resolution applicants are not covered under 29A.
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2.7 In compliance of Regulation 38 of CIRP Regulations, the Resolution Professional confirms that the Resolution plan provides that: i. The amount due to the Operational Creditors under resolution plan shall be given priority in payment over Financial Creditors. ii. It has dealt with the interest of all Stakeholders including Financial Creditors and Operational Creditors of the CD. iii. A statement that neither the Resolution Applicants nor any related parties have failed to implement nor have contributed to the failure of implementation of any other Resolution Plan approved by the AA in the past. iv. The terms of the plan and its implementation schedule. v. The management and control of the business of the CD during its term. vi. Adequate means of Supervising its implementation. vii. The Resolution Plan Demonstrates that it addresses a. The cause of the Default b. It is feasible and viable c. Provision for effective implementation d. Provisions for approvals required and the time lines for the same. e. Capability to Implement the Resolution Plan
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2.8 The Resolution Applicant viz. D.H Exports Private Limited is a Company involved in the Principal business activities of Exporter and Manufacturer, having office at 6th Floor, 621, Arun Chamber, Tardeo Road, Mumbai- 400034, Maharashtra, India. The Resolution Applicant confirmed that it is eligible to submit Resolution Plan as per Section 29A of Insolvency and Bankruptcy Code. 2.9 The Resolution Applicant has confirmed that - i. its connected persons are not convicted for any offence during the preceding five years and no criminal proceedings are pending against any person. ii. not disqualified under Companies Act, 2013 to act as a Director. iii. not identified as a wilful defaulter by any bank of financial institution or consortium thereof in accordance with the guidelines of the Reserve Bank of India. iv. not debarred from accessing to, or trading in securities markets under any order or directions of the Securities and Exchange Board of India. 2.10 The Applicant submits that the Successful Resolution Applicant has tendered an Addendum on 09.11.2023 stating that:
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i. A scheme of amalgamation is proposed between MYP Enterprises Limited and D.H Exports Private Limited as a result of which MYP Enterprises Limited will merge with D.H Exports Private Limited. The Resolution Plan period will range from 01.04.2023 through 31.03.2028; ii. The proposal total shareholding in the amalgamated company shall be 33,005 shares, i.e. 5 shares for MYP Enterprises Limited shareholders and 35,000 for D.H. Exports Private Limited (SRA). 2.11 The Successful Resolution Applicant i.e. D.H Exports Private Limited herein submits and clarifies with reference to the Addendum to the Resolution Plan that “Pursuant to the approval of the above referred merger of MYP Enterprises Limited with D.H Exports Private Limited, if and when accorded by Hon’ble Adjudicating Authority, the merged entity shall continue as a private limited company as also not avail any of the benefits, exemptions or concessions available to a public limited company and it would be complying with all the provisions of statute/law including those of Companies Act, 2013, in terms of the Scheme as a private limited company post-merger as a sequel to approval of the Resolution Plan”. 2.12 As per the RP the Fair Value and Liquidation Value determined by the registered Valuer are as follows:
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Fair Value
Rs. 17,59,600/-
Liquidation Value
Rs. 17,59,465/- 2.13 Resolution Plan for the Corporate Debtor (the key features of the Resolution Plan submitted by for D.H. Exports Private Limited is summarized below): 3.1 The said Resolution Plan provides for the payments towards the CIRP cost, payment to Financial Creditors, Operational Creditor & Employees and the summary of payment is enumerated below: Sr. No Particulars Amount (Rs. In Lakhs) Payment date 1 Corporate Insolvency Resolution Process Cost 15.00 Immediate on approval of plan i.e. within 7 days from effective date of merger as per clarification approved by CoC on 27.09.2024 2 Financial Creditor 637.00 40% to be paid immediate on approval of plan i.e. within 7 days from effective date of merger as per clarification approved by CoC on 27.09.2024;
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Balance 60% to be paid in four equal annual instalments, carrying interest @ 10% p.a. 3 Operational Creditors- Traders & Ors 3.58 Immediate on approval of plan i.e. within 7 days from effective date of merger as per clarification approved by CoC on 27.09.2024 4. Payment to the Operational Creditor- Statutory dues 1.83 Immediate on approval of plan i.e. within 7 days from effective date of merger as per clarification approved by CoC on 27.09.2024 5 Payment to the Operational Creditor- Workers/Employees 11.46 Immediate on approval of plan i.e. within 7 days from effective date of merger as per clarification approved by CoC on 27.09.2024
Total 668.87
It is submitted by the Applicant in the Resolution Plan that a monitoring Committee shall be constituted on the approval of the Resolution Plan by the Adjudicating Authority. The new board of directors of the Corporate Debtor shall take over immediate charge of affairs of
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Corporate Debtor from the Resolution Professional and
form a Management Committee (MC) comprising: (a) one
representative of leader of consortium of Financial
Creditors; (b) one woman director, if required; (c) one
representative of Key Managerial Personnel and (d) in
order to facilitate the smooth implementation of the
Resolution Plan, the financial lenders of the Corporate
Debtor shall immediately constitute one or more
creditor/s among them to act as monitoring agent.
4.
Ld. Counsel for the Resolution Professional has annexed a
certificate of the Form-H to the Application under Regulation
39(4) In Form-H of the CIRP Regulations, 2016 to certify that the
Resolution Plan has approved by the CoC meets all the
requirements of the IBC and its Regulations.
FORM H
COMPLIANCE CERTIFICATE
(Under Regulation 39(4) of the Insolvency and Bankruptcy Board of India (Insolvency
Resolution Process for Corporate Persons) Regulations, 2016
I, Gaurang C Shah, an insolvency professional enrolled with ICSI IPA and registered with the Board with registration number IBBI/IPA-002/IP-N00947/2019-2020/13002, am the Resolution Professional (RP) for the corporate insolvency resolution process (CIRP) of MYP Enterprises Limited (Corporate Debtor/CD/ MYP)
- The details of the CIRP are as under:
Sl. No.
Particulars
Description
1 Name of the CD
MYP Enterprises Limited
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2
Date of Initiation of CIRP
9th May 2023
3
Date of Appointment of IRP
11th May, 2023 (Date of receipt of Order)
4
Date of Publication of Public
Announcement
12th May, 2023
5
Date of Constitution of CoC
2nd June, 2023
6
Date of First Meeting of CoC
8th June, 2023
7
Date of Appointment of RP
8th June, 2023
8
Date of Appointment of Registered
Valuers
9th June, 2023
9
Date of Issue of Invitation for EoI
30th June, 2023
10
Date of Final List of Eligible
Prospective Resolution Applicants
10th August, 2023
11
Date of Invitation of Resolution Plan
30th June, 2023
12
Last Date of Submission of Resolution
Plan
4th September, 2023
13
Date of Approval of Resolution Plan by
CoC
24th January, 2024
14
Date of Filing of Resolution Plan with
Adjudicating Authority
15 Date of Expiry of 180 days of CIRP 7th November, 2023 16 Date of Order extending the period of CIRP 90 days Extension vide Hon’ble NCLT’s order dated 21st November, 2023 17 Date of Expiry of Extended Period of CIRP 5th February, 2024 18 Fair Value Rs.17,59,600/- 19 Liquidation value Rs.17,59,465/-
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-
I have examined the Resolution Plan received from Resolution Applicant – M/s.D.H.Exports Private Limited and approved by the Committee of Creditors (CoC) of M/s. MYP Enterprises Limited.
-
I hereby certify that- (i) the said Resolution Plan complies with all the provisions of the Insolvency and Bankruptcy Code 2016 (Code), the Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) Regulations, 2016 (CIRP Regulations) and does not contravene any of the provisions of the law for the time being in force.
(ii) the Resolution Applicant - M/s. D.H. Exports Private Limitedhas submitted an affidavit pursuant to Section 30(1) of the Code confirming its eligibility under Section 29A of the Code to submit resolution plan. The contents of the said affidavit are in order.
(iii) the said Resolution Plan has been approved by the CoC in accordance with the provisions of the Code and the CIRP Regulations made thereunder. The Resolution Plan has been approved by 100%of voting share of financial creditors after considering its feasibility and viability and other requirements specified by the CIRP Regulations.
(iv) The voting was held by way of ballot after the meeting of the CoC on 24th January, 2024 Or I sought vote of members of the CoC by electronic voting system which was kept open at least for 24 hours as per the regulation 26.
- The list of financial creditors of the MYP Enterprises Limited being members of the CoC and distribution of voting share among them is as under:
S. No.
Name of Creditor
Voting
Share
)%(
Voting for Resolution Plan
)Voted for / Dissented /
Abstained(
1
Steelage Overseas Private Limited
76
Voted for
2
Surjeet Kumar Singh
13
Voted for
3
Pratap Credit Co-operative Society
Limited
11
Voted for
TOTAL
100%
20 Number of Meetings of CoC held 7 (Seven)
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- The Resolution Plan includes a statement under Regulation 38(1A) of the CIRP Regulations as to how it has dealt with the interests of all stakeholders in compliance with the Code and regulations made thereunder.
6A. Minutes of the Committee Meeting relating to discussion and decisions about resolution plan are attached with this certificate.
- The amount provided for the stakeholders under the Resolution Plan is as under:
(Amount in Rs. lakh) Sl. No. Category of Stakeholder * Sub-Category of Stakeholder Amount Claimed Amount Admitted Amount Provided under the Plan# Amount Provided to the Amount Claimed (%) (1) (2) (3) (4) (5) (6) (7) 1 Secured Financial Creditors
(a) Creditors not having a right to vote under sub- section (2) of section 21
(b) Other than (a) above:
(i) who did not vote in favour of the resolution Plan
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(ii) who voted in favour of the resolution plan
Total[(a) + (b)]
2 Unsecured Financial Creditors
(a) Creditors not having a right to vote under sub- section (2) of section 21
(b) Other than (a) above:
(i) who did not vote in favour of the resolution Plan
(ii) who voted in favour of the resolution plan
637
637
637
100% Total[(a) + (b)] 637 637 637 100.00% 3 Operational Creditors
(a)
Related
Party
of
Corporate
Debtor
356.11
356.11
3.56
1%
(b) Other than
(a) above:
183.36
183.36
1.83
1%
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(i)Government
(ii)Workmen
(iii)Employees
(iv)Other
Operational
Creditors
11.45 1.59
11.45 1.59
11.45 0.02
100% 1% Total[(a) + (b)] 552.51 552.51 16.86 3.05% 4 Other debts and dues Other Creditors
Grand Total
1189.51 1189.51 653.86 54.97%
*If there are sub-categories in a category, please add row for each sub-category. #Amount provided over time under the Resolution Plan and includes estimated value of non-cash components. It is not NPV.
- The interests of existing shareholders have been altered by the Resolution plan as under:
Sl. No Category of Share Holder No. of Shares held before CIRP No. of Shares held after the CIRP Voting Share )%( held before CIRP Voting Share )%( held after CIRP 1 Equity 5,06,100 5 100 0.02 2 Preference NA NA NA NA
- The compliance of the Resolution Plan is as under:
Section of the
Code
/
Regulation
No.
Requirement with respect to Resolution Plan Clause of Resolution Plan Compliance )Yes / No( Section 25)2()h( Whether the Resolution Applicant meets the criteria approved by the CoC having regard to the complexity and scale of operations of business of the CD? Page 11 – Point 2.4
Annexure 2 – Page No.53 Yes Section 29A
Whether the Resolution Applicant is eligible to Received Yes
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submit resolution plan as per final list of
Resolution Professional or Order, if any, of the
Adjudicating Authority?
with
the
EoI
Documents
Annexure 4
– Page No.
64
Section 30)1(
Whether
the
Resolution
Applicant
has
submitted an affidavit stating that it is eligible?
Received
with
the
EoI
Documents
Annexure 4
–
Page
No.64
Yes
Section 30)2(
Whether the Resolution Plan-
(a) provides for the payment of insolvency
resolution process costs?
(b) provides for the payment to the operational creditors?
(c) provides for the payment to the financial creditors who did not vote in favour of the resolution plan?
Chapter V, Point 10.6 – Page No.39
Chapter VI, Point 9.1 – Page No. 32
Chapter III, Point 3.8, Page No.16
Chapter IV, Point 9.1, Page No.32
Chapter V, Point 10.8, Page No. 39 Yes
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(d) provides for the management of the affairs of the corporate debtor?
(e) provides for the implementation and supervision of the resolution plan? (f) contravenes any of the provisions of the law for the time being in force?]
Chapter III, Point 5.0, Page No.24
Chapter III, Point 6.0, Page No.24
Chapter IV,
Point 9.1,
Page
No.
34
Section 30)4(
Whether the Resolution Plan
)a( is feasible and viable, according to the CoC?
)b( has been approved by the CoC with 66%
voting share?
As per the
voting
results
of
Seventh
CoC
Meeting
Yes
Yes
Section 31)1(
Whether the Resolution Plan has provisions for
its effective implementation plan, according to
the CoC?
Chapter III,
Point 5.1,
Page 24
Yes
Regulation38
)1(
Whether the amount due to the operational
creditors under the resolution plan has been
given priority in payment over financial
creditors?
Chapter IV,
Point 9.2,
Page No.35
Yes
Regulation
38)1A(
Whether the resolution plan includes a
statement as to how it has dealt with the interests
of all stakeholders?
Chapter IV,
Point 9.2,
Page No.34
Yes
Regulation
38(1B)
(i) Whether the Resolution Applicant or any of
its related parties has failed to implement or
contributed to the failure of implementation of
any resolution plan approved under the Code.
(ii) If so, whether the Resolution Applicant has submitted the statement giving details of such non-implementation?] Page 1 of Addendum received on 09.11.2023
Yes
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Regulation
38)2(
Whether the Resolution Plan provides:
(a) the term of the plan and its implementation schedule?
(b) for the management and control of the business of the corporate debtor during its term?
)c( adequate means for supervising its implementation?
Chapter V, Point 11.1, Page 40
Chapter V, Point 12.0, Page 40
Chapter V, Point 13.0, Page 41
Chapter V, Point 9.1, Page 34 Yes Regulation 38)3( Whether the resolution plan demonstrates that –
Chapter III, Point 4.1, Page 24
Chapter III, Point 4.1, Page 24
Chapter III, Point 5.1, Page 24
Page 2 of Addendum received on Yes
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)a( it addresses the cause of default?
)b( it is feasible and viable?
)c( it has provisions for its effective implementation?
)d( it has provisions for approvals required and the timeline for the same?
)e( the resolution applicant has the capability to implement the resolution plan? 09.11.2023
Chapter III, Point 3.11, Page 19 Regulation 39)2( Whether the RP has filed applications in respect of transactions observed, found or determined by him?
No
Regulation
39(4)
Provide
details
of
performance
security
received, as referred to in sub-regulation (4A) of
regulation 36B.]
Yes (The Resolution Applicant has deposited the Performanc e Security of Rs.4,00,000 in the bank account of the Corporate Debtor) 10. The CIRP has been conducted as per the timeline indicated as under:
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- The time frame proposed for obtaining relevant approvals is as under:
Sl. No.
Nature of Approval
Name
of
applicable Law
Name
of
Authority who
When
to
be
obtained
Section of the
Code / Regulation
No.
Description of Activity
Latest
Timeline under
regulation 40A
Actual Date
Section 16)1(
Commencement of CIRP and
Appointment of IRP
T
T
Regulation 6)1(
Publication of Public Announcement
T+3
12-05-2023
Section 15)1()c(
/Regulation 12 )1(
Submission of Claims
T+14
25-05-2023
Regulation 13)1( Verification of Claims
T+21
01-06-2023
Section 26)6A( /
Regulation 15A
Application for Appointment of
Authorised Representative, if necessary
T+23
NA
Regulation 17)1( Filing of Report Certifying Constitution
of CoC
T+23
02-06-2023
Section 22)1(
and regulation
17)2(
First Meeting of the CoC
T+30
08-06-2023
Regulation 35A
Determination of fraudulent and other
transactions
T+115
Regulation 27
Appointment of two Registered Valuers
T+47
09-06-2023
Regulation 36
)1(
Submission of Information Memorandum
to CoC
T+95
30-06-2023
Regulation 36A
Invitation of EoI
T+60
30-06-2023
Publication of Form G
T+60
30-06-2023
Provisional List of Resolution Applicants
T+85
29-07-2023
Final List of Resolution Applicants
T+100
10-08-2023
Regulation 36B
Issue of Request for Resolution Plan,
which includes Evaluation Matrix and
Information Memorandum to Resolution
Applicants
T+90
03-08-2023
Section 30)6( /
Regulation 39)4(
Submission of CoC approved Resolution
Plan
T+165*
Section 31)1(
Approval of Resolution Plan
T=180*
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will grant Approval 1 Resolution Applicant has mentioned that the approvals required will be arranged within 365 days from the order passed by Hon’ble NCLT.
-
The Resolution Plan is not subject to any contingency.
-
Following are the deviations / non-compliances of the provisions of the Insolvency and Bankruptcy Code, 2016, regulations made or circulars issued thereunder (If any deviation/ non-compliances were observed, please state the details and reasons for the same): NA
-
The Resolution Plan is being filed before the expiry the period of CIRP provided in section 12 of the Code. An Application for extension of 90 days beyond the CIRP period was filed with Hon’ble National Company Law Tribunal, Mumbai (NCLT) on 07.11.2023. The NCLT on 21.11.2023 approved the extension of CIRP period by 90 days starting form 07.11.2023 vide order dated 21.11.2023.
14A. Whether the resolution professional has, in accordance with regulation 35A,- (a) applied to the Adjudicating Authority on or before the one hundred and thirty- fifth day of the insolvency commencement date: No
(b) filed Form CIRP 8 with the Board on or before the one hundred and fortieth day of the insolvency commencement date: Yes
- Provide details of section 66 or avoidance application filed / pending.
Sl.
No.
Type of Transaction Date of Filing with Adjudicating Authority Date of Order of the Adjudicating Authority Brief of the Order 1 Preferential transactions under section 43
2 Undervalued transactions under section 45
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3 Extortionate credit transactions under section 50
4 Fraudulent transactions under section 66
15A. The committee has approved a plan providing for contributioni under regulation 39B as under: (Contribution for Liquidation is for liquidation of Company as a whole)
a. Estimated liquidation cost: Rs. 19.05 Lakhs
b. Estimated liquid assets available: NIL
c. Contributions required to be made: Rs.19.05 Lakhs
d. Financial creditor wise contribution is as under:
Sl. No. Name of financial creditor Amount to be contributed (Rs. In lakhs) 1 Steelage Overseas Private Limited 14.478 2 Surjeet Kumar Singh 2.4765 3 Pratap Credit Co-operative Society Limited 2.0955
TOTAL 19.05
15B. The committee has recommended under regulation 39C as under: a. Sale of corporate debtor as a going concern:
Yes / No
b. Sale of business of corporate debtor as a going concern:
Yes / No
The details of recommendation are available with the resolution professional.
15C. The committee has fixed, in consultation with the resolution professional, the fee payable to the liquidator during the liquidation period under regulation 39D.]
The CoC in the 9th CoC meeting had decided that the Liquidator’s fee shall be decided in consultation with the Liquidator proposed to be appointed in case the Resolution Plan is not approved by the Adjudicating Authority.
- I, Gaurang Chhotalal Shah, hereby certify that the contents of this certificate are true and correct to the best of my knowledge and belief, and nothing material has been concealed therefrom.
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Name of the Resolution Professional: Gaurang Chhotalal Shah IP Registration No: IBBI/IPA-002/IP-N00947/2019-2020/13002 Address as registered with the Board: Flat 204 A Wing Raj Vaibhav 1 CHS, Dahanukar Wadi, Mahavir Nagar, Kandivali (W), Mumbai - 400067 Email id as registered with the Board:fcsgaurang.shah@gmail.com
In the circumstances mentioned hereinabove, the Applicant has filed Application seeking approval of this Tribunal on the Resolution Plan, submitted by the Resolution Applicant i.e. D. H. Exports Private Limited stating that the plan is in accordance with the Section 30(2) and other provisions laid down under the code. 6. On perusal of the Resolution Plan, it is observed that the Resolution Plan provides for the following: a. Payment of CIRP Cost as specified u/s 30(2)(a) of the Code. b. Repayment of Debts of Operational Creditors as specified u/s 30(2)(b) of the Code. c. For management of the affairs of the Corporate Debtor, after the approval of Resolution Plan, as specified U/s 30(2)(c) of the Code. d. The implementation and supervision of Resolution Plan by the RP and the CoC as specified u/s 30(2)(d) of the Code. 7. The RP has complied with the requirement of the Code in terms of Section 30(2)(a) to 30(2)(f) and Regulations 38(1),
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38(1)(a), 38(2)(a), 38(2)(b), 38(2)(c) & 38(3) of the
Regulations.
8.
The RP has filed Compliance Certificate in Form-H along
with the plan. On perusal the same is found to be in order.
The Resolution Plan has been approved by the CoC in the
7th meeting held on 24.01.2024 with 100% (Hundred
Percent).
9.
There is no such pending proceedings u/s 66(1) r/w 43(1)
and 44(1) of the Code.
10. The Bench takes notes of the submissions of the
Successful Resolution Applicant i.e. D.H Exports Private
Limited that pursuant to merger of the Corporate Debtor
with D.H Exports Private Limited, the merged entity shall
not avail any of the benefits, exemptions or concessions
available to a public limited company and it would be
complying with all the provisions of statute/law including
those of Companies Act, 2013, in terms of the Scheme as
a private limited company post-merger as a sequel to
approval of the Resolution Plan. In consonance with the
same, we make it expressly clear that all requisite
processes and/or procedural rigors, as laid down by
Registrar of companies (RoC), and more specifically so,
with reference to the payment(s) of any fee/ expenses etc.
shall be borne by the Successful Resolution Applicant, as
per the extant provisions of law.
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- We make it categorically clear that approval of this Resolution Plan does not tantamount to allowance of any relief(s), concession(s) or dispensation(s) that fall within the domain of any government department(s) and/or authorities thereto. The reliefs, concessions and dispensations that pertain to other governmental authorities and/or departments shall be dealt with by the respective competent authorities/fora/offices, Government (State or Central) with regard to the respective reliefs, if any.
- In the case of “K Sashidhar v. Indian Overseas Bank & Others” (in Civil Appeal No.10673/2018 decided on 05.02.2019) the Hon’ble Apex Court held that if the CoC had approved the Resolution Plan by requisite percent of voting share, then as per section 30(6) of the Code, it is imperative for the Resolution Professional to submit the same to the Adjudicating Authority (NCLT). On receipt of such a proposal, the Adjudicating Authority is required to satisfy itself that the Resolution Plan as approved by CoC meets the requirements specified in Section 30(2). The Hon’ble Court observed that the role of the NCLT is ‘no more and no less’. The Hon’ble Court further held that the discretion of the Adjudicating Authority is circumscribed by Section 31 and is limited to scrutiny of the Resolution Plan “as approved” by the requisite percent of voting share of financial creditors. Even in that enquiry, the grounds
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on which the Adjudicating Authority can reject the Resolution Plan is in reference to matters specified in Section 30(2) when the Resolution Plan does not conform to the stated requirements. 13. In CoC of Essar Steel (Civil Appeal No. 8766-67 of 2019 decided on 15.11.2019) the Hon’ble Apex Court clearly laid down that the Adjudicating Authority would not have power to modify the Resolution Plan which the CoC in their commercial wisdom have approved. In para 42 Hon’ble Court observed as under:
“Thus, it is clear that the limited judicial review available, which can in no circumstance trespass upon a business decision of the majority of the Committee of Creditors, has to be within the four corners of section 30(2) of the Code, insofar as the Adjudicating Authority is concerned, and section 32 read with section 61(3) of the Code, insofar as the Appellate Tribunal is concerned, the parameters of such review having been clearly laid down in K. Sashidhar(supra).”
- In view of the discussions and the law thus settled, the instant Resolution Plan meets the requirements of Section 30(2) of the Code and Regulations 37, 38, 38 (1A) and 39 (4) of the Regulations. The Resolution Plan is not in contravention of any of the provisions of Section 29A of
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the Code and is in accordance with law. The same needs to be approved. Hence ordered. ORDER 15. The Application IA-23/2024 in CP(IB)/96/(MB-IV)/2023 is allowed. The Resolution Plan annexed to the Application is hereby approved. It shall become effective from this date and shall form part of this order. 15.1 It shall be binding on the Corporate Debtor, its employees, members, creditors, including the Central Government, any State Government or any local authority to whom a debt in respect of the payment of dues arising under any law for the time being in force is due, guarantors and other stakeholders involved in the Resolution Plan. 15.2 The approval of the resolution plan shall not be construed as waiver of any statutory obligations of the Corporate Debtor and shall be dealt by the appropriate authorities in accordance with law. Further in terms of the judgment of Hon’ble Supreme Court in the matter of “Ghanshyam Mishra And Sons Private Limited V/S Edelweiss Asset Reconstruction Company Limited”, on the date of approval of the Resolution Plan by the adjudicating authority, all such claims which are not a part of Resolution Plan, shall stand extinguished
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and no person will be entitled to initiate or continue any proceedings in respect to a claim which is not a part of the Resolution Plan. 15.3 The Memorandum of Association (MoA) and Articles of Association (AoA) shall accordingly be amended and filed with the Registrar of Companies (RoC), Mumbai, Maharashtra for information and record. The Resolution Applicant, for effective implementation of the Plan, shall obtain all necessary approvals, under any law for the time being in force, within such period as may be prescribed. 15.4 The moratorium under Section 14 of the Code shall cease to have effect from this date. 15.5 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 quarter. 15.6 The Applicant shall forward all records relating to the conduct of the CIRP and the Resolution Plan to the IBBI along with copy of this Order for information. 15.7 The Applicant shall forthwith send a certified copy of this Order to the CoC and the Resolution Applicant, respectively for necessary compliance.
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- The Interlocutory Application i.e. IA-23/2024 in CP(IB)/96(MB)/2023 is allowed accordingly disposed of.
Sd/-
Sd/- Anu Jagmohan Singh
Kishore Vemulapalli Member (Technical)
Member (Judicial)
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