22nd August, 2024 Approval of Resolution Plan- Hogar Controls India Private Limited [IA(IBC)(Plan) 18/2024 in CP(IB) No.65/9/HDB/2022] (6.56 MB)

Lumi Vietnam Joint Stock Company versus M/s Hogar Controls India Private Limited In the matter of: Manjeet Bucha, Resolution Professional, Hogar Controls India Private Limited 5-9-91&93, D.No. 204, 2nd Floor, Shakti Sai Complex, Beside Udai Clinic, Chapel Road, Abids, Hyderabad, Telangana — 500001 .... Applicant/ Resolution Professional Date of order: 14.08.2024 Coram: Dr. N. Venkata Ramakrishna Badarinath, Hon’ble Member (Judicial) Shri Charan Singh, Hon’ble Member (Technical) Appearance: For Applicant: Shri Shaik Gouse, PCS

2.1 Ze under Section 30(6) read with Regulation 39 (4) of IBBI (CIRP) Regulations 2016, seeking approval of the Resolution Plan submitted by M/s. Antra Info Solutions Private Limited as approved by the Committee of Creditors (COC) with 100% of voting share. To put concisely, this Tribunal on 16.02.2024 admitted the petition filed under Section 9 by the Overefional Creditor, i.e., Lumi Vietnam Joint Stock Company and ordered commencement of Corporate Insolvency Resolution Process (CIRP) against the Corporate Debtor i.e. Hogar Controls India Private Limited and appointed Mr. Manjeet Bucha as Interim Resolution Professional (“IRP”) who was later confirmed as _ Resolution Professional in the meeting held on 15.03.2024. Pursuant to his appointment, the Applicant issued a public announcement on 22 February 2024 in the Financial Express (English Language) and Nava _ Telangana (Telugu Language), inviting claims from the Stakeholders.

1, Union Bank of India -| 7,46,39,232.53 | 98.10% Balanagar Branch 2. ICICI Bank Ltd.

14,49,103.18| 1.90% Begumpet Branch Total 7,60,88,335.71| 100% — 2.4 The valuers have submitted their reports as per details mentioned below: 5 Name of Name of | Fair Value Liquidation Valuer the Value Assets Valued | Plant and Machiner 1. |GMR Plant and | 6,26,73,900 4,38,71,730 Sreekanth Machinery Babu 2. | Capt. Plant and |6,20,00,000 | 4,22,00,000 Ramesh Machinery Kumar Pattisapu उ. Average Value of 6,23,36,950 | 4,30,35,865 Plant & Machinery (1+2)/2 Financial Assets 4. | Dilip Kumar Financial 9,55,06,000 5,91,38,000 Agarwal Assets

2-5 2.6 2.7 The Applicant apprised the COC in its 3rd meeting held on 15 May 2024 that the claim of Lumi Vietnam JSC an operational creditor amounting to Rs. 3,76,94,275/- was admitted as against the claim of Rs. 4,73,79,933 /-. However, there was no change in the constitution of the CoC. According to the Applicant, 12 claims have been admitted. The Applicant averred that, in pursuance of invitation of Expression of Interest issued by the Resolution Professional on 08.04.2024, the Resolution Professional received Expression of Interest from one Prospective Resolution Applicant i.e. Antra Info Solutions Private Limited. The Applicant stated that the Corporate Debtor is an MSME bearing UDYAM-TS-02-0029124. Therefore, as per Section 29A and Section 250A of IBC, 2016, the Suspended Director is eligible to submit the Resolution

2.9 2.10 2.11 said resolutio p p g pp submits that the Resolution Plan submitted by Antra Info Solutions Private Limited meets all the requirements of the Code and CIRP Regulations and does not contravene any of the provisions of Law. It is submitted that the Resolution Plan submitted by Antra Info Solutions Private Limited was put to vote and the COC approved the said Resolution Plan with 100% votes. Pursuant thereto, the Resolution Professional issued Letter of Intent (Lol) on 24.02.2023 which was accepted by the Successful Resolution Applicant on 24.02.2023. The Resolution Professional has received two cheques amounting to Rs. 25,00,000/- (Rupees Twenty-Five Lakhs Only) and Rs.1,54,58,643/- dated 20.06.2024 and 18 July 2024 respectively (total Rs. 1,79,58,643/-), in favour of the Corporate Debtor, in lieu of performance bank guarantee, as per the terms of RFRP and the

(A) any provisions made thereunder. A copy of the Compliance Certificate from the Resolution Professional in Form H is annexed as Annexure-7. CONTOUR OF RESOLUTION PLAN Profile of M/s. Antra Info Solutions Private Limited The resolution applicant is a Company incorporated on 17.11.2005, providing RPO services since 2008 for project hiring, start-up operations, expansion of existing and business operations. The Company is led by Mr. Vishnu Vardhan Malikireddy and Santhamma Malikireddy. The CoC comprises of the following financial creditors and distribution of voting share among them is as under: Sl. No. Name of Creditor Voting Share Voting for Resolution Plan (%) (Voted for / Dissented / Abstained) Union Bank of India 98.10 Assented ICICI Bank 1.90 Assented Total 100

( ) (1) (2) (3) (S) (6) (7) 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 (ii) who voted in of the resolution plan favour 746.39 746.39 746.39 100% Total[(a) + (b)] 746.39 746.39 746.39 | 100% Unsecured Financial Creditors (a) Creditors not having a right to vote under sub- section (2) of section 21 1105.83 1105.83 10.00 0.009% (b) Other than (a) above: (i) who did not

| p () y| Debtor (b) Other than (a) above: ()Government® | 197.36 | 127.36 | 127.36 | 100% (ii)Workmen __ __ __ (iii) Employees

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(iv) Other than | 483.54 | 386.68 | 4.02 1.29% Government Due, Workmen and Employees Total[(a) + (b)] 697.32 | 600.46 132.36 | 18.98% 4 Other debts S| ~ | | P| == and dues 5. CIRP Cost | 892.61 | 892.61 892.61 | 100% Grand Total | -- 3456.55 | 3359.69 | 1795.86 | 51.95% (1+2+3+4) (D) Details of Resolution amount: A total consideration of Rs.19,95,86,437/- (Rupees ' Nineteen Crores Ninety-Five Lakhs Eighty-Six Thousand
Four Hundred and 7 oth eo Pm कि
© Thirty-Seven only) (“Total

Thirty Seven only) shall b of stakeholders including CIRP Cost, Secured and Unsecured Financial Creditors, Operational Creditors, and other Statutory dues. Timelines for payment: The timelines for the payment of the above-mentioned debts of the Corporate Debtor are as follows: SL.No. rete sd Amount 1. No. of Days from Date of Approval of 30 days Resolution Plan by the Adjudicating Authori 2. CIRP Expenditure 8,92,61,111 3. Operational Creditors (Employees / “- workmen 4. Operational Creditors (Statutory dues 1,27,36,990 5. Operational Creditors (other than 5,00,000 Statutory & workmen / employees 6. | Secured Financial Creditors 7 ,46,39,233 ve Unsecured Financial Creditors 24,49,103 Related and Unrelated Parties eB IBBI towards fees @0.25% on realizable 2,66,460 value to creditors प्रज्ञा 17,98,52,897

StNo. | Particulars Amount 1. Upfront Cash | Rs.17,95,86,437 Recove 2. Fresh infusion of] An estimated amount of Rs. Funds for improving | 2,00,00,000/- (Rupees Two Crores only] operations is proposed towards the working capital requirements of the Corporate Debtor on a need-only basis Total funds Rs. 19,95,86,437 (G) MONITORING COMMITTEE As per Section 30(2)(d) of the Code, a Committee comprising of Resolution Professional, one representative from the Secured Financial Creditor and Two representatives from the Resolution Applicant will be constituted for monitoring the Resolution Plan during the period of 45 days or till the payment to financial creditors as provided in the plan, whichever is earlier. The Monitoring Committee shall cease to exist on the date of the final payment to the financial creditors by the

Code as well as Regulations 38 & 39 of the Insolvency and Bankruptcy Board of India (Corporate Insolvency Resolution Process) Regulations, 2016 and has filed Form ‘H’ prescribed under Regulation 39(4) of Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) Regulations, 2016. The fair value and Liquidation value as submitted in Form-H is Rs. 15,69,26,387/- and Rs. 9,56,13,210/- respectively. In the above backdrop we heard Shri Bendi Raviteja, Ld. Counsel for the Resolution Professional. He submits that the Resolution Plan meets the requirement of Section 30 (2) of the Code, as under: - a. Compliance of Section 30 (2) (a): (Clause-8 of the Resolution Plan). The Resolution Plan considers payment of the CIRP Costs of Rs. 8,92,61,111/- on priority to all other payments. b. Compliance of Section 30 (2) (b): (Clause-12.2.1 of the Resolution Plan). The Resolution Applicant proposes to pay an amount of Rs. 1,27,36,990/- to ee

d. Compliance of Section 30 (2) (f): Declaration by the Resolution Applicant that the plan does not contravene any of the provisions of the applicable laws for the time being in force. (Clause 21 of the Resolution Plan). छ. The Resolution Plan is in compliance of Regulation 38 of the Regulations in the following manner: a. Compliance of Regulation 38(1)(a) of the CIRP Regulations 2016: The Plan provides for payment of Rs. 8,92,61,111/-towards CIRP Cost, which will be paid in priority to all other creditors. Further the plan provides for payment of Rs. 1,27,36,990/- to the operational creditors other than workmen and employees (Government dues). The Plan further provides that in case any amount is payable to such operational creditors over and above such amount, towards the minimum amount as may be required to be paid to them under the Code, the Resolution Applicant shall pay the same on priority.

p g ( ) ( ) y the Resolution Applicant that neither the Resolution Applicant nor any of its related party has either failed or contributed to the failure of the implementation of any Resolution Plan approved under the Code. (Clause 21 (e) (ix) . In K. Sashidhar v. Indian Overseas Bank & Others (in Civil Appeal No. 10673/2018) 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. On receipt of such proposal, the Adjudicating Authority (NCLT) is required to satisfy itself that the resolution plan as approved by CoC meets the requirements specified in Section 30(2). No more and no less”. Ss. _

enquiry, the grounds on which the adjudicating authority can reject the resolution plan is in reference to matters specified in Section 303), when the resolution plan does not conform to the stated requirements. The Hon’ble Supreme Court in Committee of Creditors of Essar Steel India Limited Vs. Satish Kumar Gupta & Ors, held that “the limited judicial review available to AA has to be within the four corners of section 30(2) of the Code. Such review can in no circumstance trespass upon a business decision of the majority of the CoC. As such the Adjudicating Authority would not have power to modify the Resolution Plan which the CoC in their commercial wisdom have approved”. The Hon’ble Supreme Court of India, in the recent ruling in re Vallal RCK vs M/s Siva Industries and Holdings Limited & Ors, has held as under:- 21. This Court has consistently held that the commercial wisdom of the CoC has been given paramount status without any judicial intervention for ensuring completion of the stated

Creditors of Essar Steel India Limited through Authorised Signatory v. Satish Kumar Gupta and Others, Maharashtra Seamless Limited Dv. Padmanabhan Venkatesh and Others, Kalpraj Dharamshi and Another v. Kotak Investment Advisors Limited and Another, and Jaypee Kensington Boulevard Apartments Welfare Association and Others v. NBCC (India) Limited and Others. 27. This Court has, time and again, emphasized the need for minimal judicial interference by the NCLAT and NCLT in the framework of IBC. We may refer to the recent observation of this Court made in the case of Arun Kumar Jagatramka v. Jindal Steel and Power Limited and Another: “95. .... However, we do take this opportunity to offer a note of caution for NCLT and NCLAT, functioning as the adjudicatory authority and appellate authority under the IBC respectively, from judicially interfering in the framework envisaged under the IBC. As we have noted earlier in the judgment, the IBC was introduced in order to overhaul the insolvency and bankruptcy regime in India. As such, it is a carefully considered and well thought out piece of legislation which sought to shed away the practices of the past. The legislature has also been working hard to ensure that the efficacy of this legislation remains robust by constantly amending it based on

requirements of Section 30 (2) of the Code and Regulations 37, 38, 38 (1A) and 39 (4) of the Regulations. We also found that the Resolution Applicant is eligible to submit the Resolution Plan under Section 29A of the Code. We therefore, hereby approve the Resolution Plan submitted by M/s Antra Info Solutions Private Limited (“Successful Resolution Applicant”) along with annexures, Schedules forming part of the Resolution Plan annexed to the Application and order as under:- The Resolution Plan along with annexures and schedules forming part of the plan 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.

by the appropriate Authorities in accordance with law. Any waiver sought in the Resolution Plan, shall be subject to approval by the Authorities concerned as held by Hon’ble Supreme Court in the matter of Ghanashyam Mishra & Sons Private Limited Versus Edelweiss Asset Reconstruction Company Limited in CIVIL APPEAL NO.8129 OF 2019 dated 13.04.2021. (iv) It is hereby ordered that the deposit of Rs.1,79,58,643/- in lieu of Performance Bank Guarantee, made by the Resolution Applicant shall remain as performance Guarantee till the amount proposed to be paid to the creditors under the plan, is fully paid off and the plan is fully implemented. (v) The Memorandum of Association (MoA) and Articles of Association (AoA) shall accordingly be amended and filed with the Registrar of Companies (RoC) Hyderabad for information and record. The Resolution Applicant, for , effective implementation of the Plan, shall obtain all |

cease to have effect from this date. | (viii) 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. (ix). The Applicant shall forthwith send a copy of this order to the CoC and the Resolution Applicant. (x). The Registry is directed to furnish free copy to the parties as per Rule 50 of the NCLT Rules, 2016. (xi) The Registry is directed to communicate this order to the Registrar of Companies, Hyderabad for updating the master data and also forward a copy to IBBI. (xii). Accordingly, IA (plan) 18/2024 stands disposed of. (Charan Singh) (Dr. N. Venkata Ramakrishna Badarinath) Member (Technical) Member Judicial Binnu 7 3 CERTIFI 7४0६ cop ae eC, 7 Gao Leh rahe National Comnans ६ ७»... : कक्षा | Court Cicer ag S COPY MADE READ) rolel2, a, Hyderabad Bench cm ४