IN FORCE undated

06th November, 2023 Approval of Resolution Plan - SN Engineering Services Private Limited [IA 4200 of 2023 in CP (IB) 1152-MB-C-IV-2020] (355.56 KB)

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IN THE NATIONAL COMPANY LAW TRIBUNAL, MUMBAI BENCH – IV

IA 4200 of 2023 IN CP (IB) 1152/MB/C-IV/2020

Under Section 30 (6) of the Insolvency and Bankruptcy Code, 2016 (“code”) r/w Regulation 39(4) of the IBBI (Insolvency Resolution Process for Corporate Persons) Regulations, 2016 for seeking approval of the resolution plan under the provisions of Section 31(1) of the code.
In the Application of
Mr. Amit Vijay Karia,

Resolution Professional of “SN Engineering Services Private Limited”
...Applicant/Resolution Professional

In the matter of WAM India Private Limited
…Petitioner
Versus SN Engineering Services Private Limited
…Corporate Debtor

Order Delivered on : 20.10.2023
Coram:
Hon’ble Member (Judicial) : Mr. Kishore Vemulapalli
Hon’ble Member (Technical) : Ms. Anu Jagmohan Singh Appearances: For the Applicant : Mr. Amir Arsiwala a/w Ms. Nupur Shah, Advocates.

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For the Resolution Applicant : Mr. Kunal Kanungo a/w Ms. Tanushree Sogani and Mr. Atishay Jain, Advocates.
ORDER
Per: Anu Jagmohan Singh, Member (Technical) 1. The present application is moved by Resolution Professional Mr. Amit Vijay Karia (hereinafter called as “the Applicant”) under section 30 (6) of the Insolvency and Bankruptcy Code, 2016 (“code”) r/w Regulation 39(4) of the IBBI (Insolvency Resolution Process for Corporate Persons) Regulations, 2016 for seeking approval of the resolution plan of Land-Marine Engineering and Port Solutions LLP under the provisions of Section 31(1) of the code, for the Corporate Debtor SN Engineering Services Private Limited (hereinafter called as the “Corporate Debtor”) and for passing order/appropriate direction that this Tribunal may deem fit in the present matter.
2. The CIRP was initiated against the Corporate debtor vide Order dated 17.03.2023 and Mr. Pradeep Kumar Chakravarty was appointed as the Interim Resolution Professional (hereinafter referred to as the IRP). IRP made a public announcement in Form A on 26.03.2023. The Committee of Creditors (hereinafter referred to as the CoC) of the Corporate Debtor constituted on 11.04.2023. Subsequently, the First CoC meeting took place on 21.04.2023 wherein the Applicant Mr. Amit Vijay Karia was appointed as the

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Resolution Professional with 100% CoC voting. This Bench vide order dated 01.05.2023 in IA No: 1680 of 2023 allowed the replacement of the Resolution Professional, certified copy of the said order received on 10.05.2023.
3. Thereafter, the Second meeting of the COC was held on 06.06.2023 wherein the CoC members ratified the expenditure to be incurred for the purpose of conducting valuation of the assets of the Corporate Debtor. The members of the CoC approved the Resolution for publication of notification/advertisement in ‘Form G’.
4. The Form G was published on 08.06.2023, inviting expressions of interest from prospective resolution applicants. Pursuant to Form G publication 3 expression of interests were received from prospective resolution applicants.
5. The members of the CoC along with the Applicant in the 3rd meeting of the CoC discussed and finalised the Evaluation Matrix for considering the resolution plans which would be received. The Resolution Applicant sought 10 days for submitting the Resolution Plan which was duly accepted by the members of the CoC.
6. In the 4th Meeting of CoC of the Corporate Debtor the Applicant opened the sealed envelope containing the hard copy of the resolution plan submitted by Land-Marine Engineering and Port

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Solutions LLP along with covering letter and present to the members of the CoC.
7. In the 5th and final meeting of the CoC was held on 01.09.2023, wherein the CoC resolved under Section 30(4) of IBC to approve the Resolution Plan submitted by the Land-Marine Engineering and Port Solutions LLP. The Resolution Plan was approved by 100% voting share.
Section 30(2) of the Code
8. In compliance of Section 30(2) of IBC, 2016, the Resolution Professional has examined the Resolution plan of the Successful Resolution Applicant Land-Marine Engineering and Port Solutions LLP 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.

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f) As per the Affidavit received and the further documents submitted, the Resolution applicants are not covered under 29A. 9. In compliance of Regulation 38 of CIRP Regulations, the Resolution Professional confirms that the Resolution plan provides that a) The amount due to the Operational Creditors under resolution plan shall be given priority in payment over Financial Creditors. b) It has dealt with the interest of all Stakeholders including Financial Creditors and Operational Creditors of the CD. c) 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. d) The terms of the plan and its implementation schedule. e) The management and control of the business of the CD during its term.
f) Adequate means of Supervising its implementation.
g) The Resolution Plan Demonstrate that it addresses
i. The cause of the Default ii. It is feasible and viable iii. Provision for effective implementation iv. Provisions for approvals required and the time lines for the same. v. Capability to Implement the Resolution Plan

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  1. The Resolution Professional has annexed a certificate at Page 411- 421 of the Application under Regulation 39(4) In FORM H of the CIRP Regulations to certify that the resolution plan as 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, Amit Vijay Karia, an insolvency professional enrolled with the Indian Institute of Insolvency Professionals of ICAI and registered with the Board with registration number IBBI/IPA-001/IP-P02600/2021-2022/13969, am the resolution professional for the corporate insolvency resolution process (CIRP) of SN Engineering Services Private Limited.

  1. The details of the CIRP are as under: Sl. No. Particulars Description
    1 Name of the CD
    SN Engineering Services Private Limited U45200MH2007PTC167672 2 Date of Initiation of CIRP
    March 17, 2023 (Copy of the Admission order was received by the erstwhile IRP on March 24, 2023) 3 Date of Appointment of IRP March 17, 2023 4 Date of Publication of Public Announcement March 26, 2023 (within 3 days of the receipt of admission order by the erstwhile IRP) 5 Date of Constitution of CoC April 11, 2023 6 Date of First Meeting of CoC April 21, 2023

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7 Date of Appointment of RP May 01,2023 (Copy of the order was received by the RP on May 10, 2023) 8 Date of Appointment of Registered Valuers May 15, 2023 9 Date of Issue of Invitation for EoI June 08, 2023 10 Date of Final List of Eligible Prospective Resolution Applicants July 18, 2023 11 Date of Invitation of Resolution Plan July 08, 2023 12 Last Date of Submission of Resolution Plan
August 17, 2023 (The original last date of August 7, 2023 was extended by 10 days based on express directions by the COC) 13 Date of Approval of Resolution Plan by CoC September 01, 2023 14 Date of Filing of Resolution Plan with Adjudicating Authority September 8, 2023 15 Date of Expiry of 180 days of CIRP September 13, 2023 [An application for exclusion of 16 (sixteen) days has been filed with the Adjudicating Authority which is pending adjudication 16 Date of Order extending the period of CIRP N.A. 17 Date of Expiry of Extended Period of CIRP N.A.

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18 Fair Value • Plant and Machinery: Valuer 1:
INR 76,64,000/-

Valuer 2:
INR 93,00,000/-

• Securities or Financial Assets Valuer 1: INR 1,39,87,692/-

Valuer 2:
INR 1,51,51,824/- 19 Liquidation value • Plant and Machinery: Valuer 1:
INR 65,14,000/-

Valuer 2:
INR 65,10,000/-

• Securities or Financial Assets Valuer 1: INR 70,18,341/-

Valuer 2:
INR 65,60,157/- 20 Number of Meetings of CoC held 5 (Five)

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  1. I have examined the Resolution Plan received from Resolution Applicant Land- Marine Engineering and Port Solutions LLP and approved by Committee of Creditors (CoC) of SN Engineering Services Private Limited.

  2. 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 Land-Marine Engineering and Port Solutions LLP has submitted an affidavit pursuant to section30(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 in the meeting of the CoC on September 1, 2023 where all the members of the CoC were present.

  1. The list of financial creditors of the CD SN Engineering Services Private Limited being members of the CoC 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) 1 International Asset Reconstruction Company Private Limited 100% VOTED FOR

  2. 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 - YES

  3. The amounts 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 Admitte d Amount Provide d under Amount Provide d to the

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the Plan# 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

(ii) who voted in favour of the resolution plan

111.015 31

111.015 31

75.00

67.56% Total[(a) + (b)] 111.015 31 111.015 31 75.00 67.56% 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

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(ii) who voted in favour of the resolution plan

Total[(a) + (b)]

3 Operational Creditors

(a) Related Party of Corporate Debtor

--

-- (b) Other than (a) above:

(i)Government (ii)Workmen
(iii)Employees
(iv) ………

196.088 13

135.331 33

25.00

12.75%

Total[(a) + (b)] 196.088 13 135.331 33 25.00 12.75% 4 Other debts and dues CIRP Cost

Grand Total 307.103 44 246.346 64 100.00 32.56% *If there are sub-categories in a category, please add rows for each sub-category.

Amount provided over time under the Resolution Plan and includes estimated

value of non-cash components. It is not NPV.]

  1. The interests of existing shareholders have been altered by the Resolution plan as under: As per Clause 8 (ii) of the Resolution plan the existing entire pre-CIRP shareholding in the Corporate Debtor, of all existing shareholders in the Corporate Debtor shall stand cancelled and extinguished for NIL consideration or adjusted against losses by the virtue of the order of the NCLT approving this Resolution Plan.

  2. The compliance of the Resolution Plan is as under: Section of the Code / Requirement with respect to Resolution Plan Clause of Resolutio Complianc e (Yes /

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Regulation No.
n Plan No) 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?

Yes Section 29A
Whether the Resolution Applicant is eligible to submit resolution plan as per final list of Resolution Professional or Order, if any, of the Adjudicating Authority? Attached as Form III with the resolution Plan Yes Section 30(1) Whether the Resolution Applicant has submitted an affidavit stating that it is eligible? Attached as Form III with the resolution Plan 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?

(d) provides for the management of the affairs of the corporate debtor?

Clause 5 (A) (i) of the Resolutio n plan

Clause 5 (B) (ii) and (v) of the Resolutio n plan

Clause 5 (C) (vii) of the Resolutio n plan

Clause 7 and 9.2 of the Resolutio n Plan

Yes

Yes

Yes

Yes

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(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?]

Clause 7 of the Resolutio n Plan

Clause 4 (xi) of the Resolutio n Plan

Yes

Yes 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?

Yes Section 31(1) Whether the Resolution Plan has provisions for its effective implementation plan, according to the CoC?

Yes Regulation3 8 (1) Whether the amount due to the operational creditors under the resolution plan has been given priority in payment over financial creditors?] Clause 5 B (vi) of the Resolutio n Plan

Yes Regulation 38(1A)
Whether the resolution plan includes a statement as to how it has dealt with the interests of all stakeholders? Clause 5 of the Resolutio n Plan 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?]

Clause 4 (xii) of the Resolutio n Plan

Yes 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?

Clause 7 of the Resolutio n Plan

Yes

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(d) provides for the manner in which proceedings in respect of avoidance transactions, if any, under Chapter III or fraudulent or wrongful trading under Chapter VI of Part II of the Code, will be pursued after the approval of the resolution plan and the manner in which the proceeds, if any, from such proceedings shall be distributed:

Clause 5 (C) (xix) of the Resolutio n Plan

Yes 38(3) Whether the resolution plan demonstrates that – (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?

Clause 2 (F) of the Resolutio n Plan

Clause 7 (D) of the Resolutio n Plan

Clause 6, 7 read with 9 of the
Resolutio n Plan

Yes

Yes

Yes

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Clause 9 of the Resolutio n Plan

Clause 3, 6, 7 and 9 of the Resolutio n Plan

Yes

Yes 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.] The performa nce security of Rs 25 lakhs (Rupees Twenty Five Lakhs Only) has been provided by way of a bankers cheque dated Septembe r 5, 2023 numbered 000857 drawn on ICICI Bank

The CIRP has been conducted as per the timeline indicated as under:

Section of the Code / Regulation No.
Description of Activity Latest Timeline under regulation 40A Actual Date

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Section 16(1) Commencement of CIRP and Appointment of IRP T March 17, 2023 (Copy of the admission order was received by the erstwhile IRP on March 24, 2023) Regulation 6(1) Publication of Public Announcement T+3 March 26, 2023 (within 3 days of the receipt of admission order by the erstwhile IRP) Section 15(1)(c) /Regulation 12 (1) Submission of Claims
T+14 April 06, 2023 Regulation 13(1) Verification of Claims T+21 April 11, 2023 Section 26(6A) / Regulation 15A Application for Appointment of Authorised Representative, if necessary T+23 Not Applicable Regulation 17(1) Filing of Report Certifying Constitution of CoC T+23 April 11, 2023 Section 22(1) and regulation 17(2) First Meeting of the CoC T+30 April 21, 2023 Regulation 35A Determination of fraudulent and other transactions T+115 August 2, 2023
Regulation 27 Appointment of two Registered Valuers T+47 May 15, 2023 Regulation 36 (1) Submission of Information Memorandum to CoC T+54] June 21, 2023 Regulation 36A Invitation of EoI T+75 June 08, 2023 Publication of Form G T+75 June 08, 2023 Provisional List of Resolution Applicants T+100 July 03, 2023 Final List of Resolution Applicants T+115 July 18, 2023 Regulation 36B Issue of Request for Resolution Plan, which includes Evaluation Matrix and Information Memorandum to Resolution Applicants T+105 July 08, 2023 Section 30(6) / Regulation 39(4) Submission of CoC approved Resolution Plan T+165 September 8, 2023 [If the exclusion of 16 days applied for is granted, then the date shall be September 24, 2023]

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Section 31(1) Approval of Resolution Plan T=180

  1. The time frame proposed for obtaining relevant approvals is as under:
    Mentioned in Clause 10 (i) of the Resolution Plan

  2. The Resolution Plan is not subject to any contingency.

  3. 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(: Not Applicable

  4. The Resolution Plan is being filed 5 days before the expiry of the period of CIRP provided in section 12 of the Code. If the exclusion of 16 days applied for is granted by the hon’ble NCLT, then the resolution plan is being filed 21 days before the expiry of the period of CIRP.

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:

                                       Not Applicable

(b) filed Form CIRP 8 with the Board on or before the one hundred and fortieth day of the insolvency commencement date:

                       Yes
  1. 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

3 Extortionate credit transactions under section 50

4 Fraudulent transactions under section 66

15A. The committee has approved a plan providing for contribution under regulation 39B as under: Not Applicable

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a. Estimated liquidation cost:
b. Estimated liquid assets available:
c. Contributions required to be made:

d. Financial creditor wise contribution is as under: Sl. No. Name of financial creditor Amount to be contributed (Rs.) Not Applicable

Note: The undersigned had placed the matter for approval of the estimated liquidation cost before the members of the Committee of Creditors in its 5th meeting held on September 01, 2023. However, the same was REJECTED by the members of the CoC.

15B. The committee has recommended under regulation 39C as under: Not Applicable a. Sale of corporate debtor as a going concern:
No
b. Sale of business of corporate debtor as a going concern:
No The details of recommendation are available with the resolution professional.

Note: The undersigned had placed the matter for approval under Regulation 39C of the CIRP Regulations, before the members of the Committee of Creditors in its 5th meeting held on September 01, 2023. However, the same was REJECTED by the members of the CoC.

15C. The committee has fixed, in consultation with the resolution professional, the fee payable to the liquidator during the liquidation period under regulation 39D.] Note: The Resolution Professional had placed the matter for approval for fixing the fees payable to the liquidator during the liquidation period under Regulation 39D, before the members of the Committee of Creditors in its 5th meeting held on September 01, 2023. However, the same was REJECTED by the members of the CoC.

  1. I, Amit Vijay Karia 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.

Amit Vijay Karia
Resolution Professional
SN Engineering Services Private Limited
Reg. No: IBBI/IPA-001/IP-P02600/2021-2022/13969 AFA No. AA1/13969/02/241223/105303 is valid till December 24, 2023

Address & email id registered with IBBI: 405, Hind Rajasthan Building, Dadasaheb Phalke Road, Gautam Nagar, Dadar (East), Mumbai - 400014 (Maharashtra)
Contact: 9029210069 | amit.karia@yahoo.co.in

Process specific email id for correspondence: 2023.snengineering@gmail.com

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Date: September 8, 2023

Place: Mumbai

  1. The RP with the approval of the COC appointed Independent valuers registered with IBBI, to ascertain the Liquidation value and Fair value of the Corporate Debtor.
    Class of Asset Name of the Registered Valuer
    Professional Fees (INR) Plant and Machinery
    Treu Valuation Services Pvt Ltd (IBBI/RV-E/02/2023/181) Rs.30,000/- +GST + OPE Plant and Machinery Mr. Sanjay Dayal
    (IBBI/RV/02/2018/10502) Rs.30,000/- +GST + OPE Secured or Financial Assets Mr. Manish M. Jaju
    (IBBI/RV/06/2019/10947) Rs.50,000/- +GST + OPE Secured or Financial Assets Mr. Pravin R. Navandar
    (IBBI/RV/06/2019/11318) Rs.50,000/- +GST + OPE

As stated above, the Applicant appointed four valuers to conduct the exercise of valuation of the assets of the Corporate Debtor divided into two assets class being plant and machinery and Secured or Financial Assets. The average liquidation value of the Corporate Debtor and the average Fair value is as follows:
Sr. No.
Asset Class Valuer Valuation I. Fair Value
1.
Plant and Machinery Treu Valuation Services Pvt Ltd 76,64,000/-

Plant and Machinery Mr. Sanjay Dayal 93,00,000/- 2.
Secured or Financial Assets Mr. Manish M. Jaju 1,51,51,824/-

Secured or Financial Assets Mr. Pravin R. Navandar 1,39,87,692/-

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II. Liquidation Value 1.
Plant and Machinery Treu Valuation Services Pvt Ltd 65,14,000/-

Plant and Machinery Mr. Sanjay Dayal 65,10,000/- 2.
Secured or Financial Assets Mr. Manish M. Jaju 65,60,157/-

Secured or Financial Assets Mr. Pravin R. Navandar 70,18,341/-

  1. During the course of CIRP, the Applicant appointed a Transaction Auditor for conducting a Transaction Audit, as aforementioned. The Transaction Auditor i.e., M/s GMCS & Co., Chartered Accountants submitted the final Transaction Audit Report on 30.08.2023 and based on the said report, the Applicant has formed an opinion that there have not been any preferential, undervalued, fraudulent or extortionate credit transactions, in relation to the Corporate Debtor.
  2. The summary of claims and its proposed payment under the Resolution Plan is as follows:
    Sr. No.
    Category
    Treatment

CIRP Cost Unpaid CIRP cost as approved to be paid in full and in priority. The payment shall be made within 20days of sanction of the Resolution Plan by the Adjudicating Authority.
2.
Operational Creditors (Workmen/Employees and Statutory Dues)
No Claims received.
3.
Operational Creditors (other than Workmen/Employees and Statutory Dues)
Claims received:
Rs.1,96,08,813/-

Claims admitted:

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Rs.1,35,33,133/-

Treatment:
Rs.25,00,000/- to be paid against admitted claims of Rs.1,35,33,133/- (18.47%)

Timeline:
Payment to be made within 20days of saction of the Resolution Plan by the Adjudicating Authority.
4.
Secured Financial Creditors
Claims received:
Rs.1,11,01,531/-

Claims admitted:
Rs.1,11,01,531/-

Treatment:
Rs.75,00,000/- to be paid against admitted claims of Rs.1,11,01,531/- (67.56%)

Timeline: Payment to be made as followings:
Rs.50,00,000/- within 21 days of sanction of the Resolution Plan by the Adjudicating Authority and Rs.25,00,000/- on Transfer Date, shall stand adjusted against EMD i.e. within 30 days.
5.
Unsecured Financial Creditors
The Applicant has not received or admitted any claim falling in this category.
6.
Other Creditors The Applicant has not received or admitted any claim falling in this category.

  1. The Financial Offer under the Approved Resolution Plan is Total disbursement of Rs 145.00 Lacs which is as follows:

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Sr. No.
Particulars
Amount (in Rs.)

  1. Amount payable for claims
    1,00,00,000/-

  2. CIRP Cost (estimated) Entire unpaid CIRP Costs and expenses as approved by the CoC and the NCLT till approval of the plan by the NCLT.
    [Rs.45,00,000/- has been provided in the plan subject to actuals]

  3. Amount proposed to be paid to all Stakeholders under the Plan 1,45,00,000/- + Unpaid CIRP Costs & Expenses as approved by the CoC/this AA till date of approval of Resolution Plan.

  4. 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.

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  1. 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), 38(1)(a), 38(2)(a), 38(2)(b), 38(2)(c) & 38(3) of the Regulations.

  2. 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 5th meeting held on 01.09.2023 with 100% (Hundred percent).

  3. In 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 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.

  4. 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

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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).”

  1. 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 the Code and is in accordance with law. The same needs to be approved. Hence ordered.
    ORDER The Application IA No. 4200 of 2023 in CP 1152 of 2020 be and the same 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.
    i. 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.

MUMBAI BENCH - IV Page 25 of 26

ii. 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 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.
iii. 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.
iv. The moratorium under Section 14 of the Code shall cease to have effect from this date.
v. 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.
vi. 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.

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vii. The Applicant shall forthwith send a certified copy of this Order to the CoC and the Resolution Applicant, respectively for necessary compliance.
viii. The Interlocutory Application No. 4200 of 2023 in CP 1152 of 2020 is accordingly allowed and disposed of.

Sd/- Sd/- ANU JAGMOHAN SINGH KISHORE VEMULAPALLI
Member (Technical)

Member (Judicial)
20.10.2023

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