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2022 (3) TMI 700 - AT - Insolvency and BankruptcyValidity of Resolution Plan - inadequate allocation for salary, pension and gratuity amounts of workmen/employees in the approved Resolution Plan or not - HELD THAT:- The resolution plan envisages that the financial creditors are being paid 21.6 % of the total financial debt whereas the operational creditors are being paid 12.6% of the total verified operational debt. The financial creditor Bank of India has been paid 28% and workmen dues of past 24 months has also been made 28% in view of the calculation in a previous paragraph. Creditors in the same class should be treated equally and hence such apportionment of the amount to be paid to the financial creditors and the operational creditors is the business decision in accordance with the commercial wisdom of the CoC. The Successful Resolution Plan has been considered by the CoC and approved by a majority of 100% of members’ voting share in the CoC. This approval is according to the provisions of Section 30(4) where the CoC has to approve a Resolution Plan by a vote of not less than 66 % of voting share of the financial creditors after considering its feasibility and viability, the manner of distribution proposed which would take into account order of priority amongst the creditors as laid down in sub-section 1 of Section 53. The constitution of COC has been done by taking the claim of Bank of India (Financial Creditor) as ₹ 41.50 Crores. It is seen that the Competent Authority of Bank of India vide OTS Letter dated July, 29 2017 approved a OTS of the Corporate Debtor at ₹ 19.30 Crores, against which the Corporate Debtor paid an amount of ₹ 9,70,21,000/- to the Bank of India. Despite such a payment having been made, the representative of Bank of India continued to claim that the amount proposed by the Bank of India at ₹ 41.49 Crores be included as due as financial debt due from the Corporate Debtor, there are a series of communication (attached at PP. 126 – 135 of the Appeal Paperbook) which culminated in this issue being discussed in the first meeting of the CoC held on December, 22 2017 - since the voting share of Bank of India even with the reduced claim shall be around 80% we do not think it would affect the overall voting pattern in the CoC when the resolution plan was approved with a 100% vote share, since any percentage of voting for approval more than 66% would have achieved the same result. In the matter of Venus Recruiters (P) Ltd. v. Union of India [2020 (11) TMI 850 - DELHI HIGH COURT] Hon’ble Delhi High Court has emphasised on the strict timeline provided under the IBC and relied on Hon’ble Supreme Court’s judgement in Innoventive Industries case to state that “Certainty and timeliness is the hallmark of the Insolvency and Bankruptcy Code, 2016” and therefore, since avoidance proceedings are time barred, they cannot be entertained after the completion of the CIRP. Therefore the pendency of avoidance applications while the resolution plan is approved does not vitiate the approval of the plan. The approved resolution plan complies with the provisions of the IBC with slight modification in the amounts proposed to be paid to the workmen and employees in relation to their dues including provident fund - the workmen should get an additional payment of ₹ 0.1652 crores – ₹ 0.09 crores = ₹ 0.8834 crores to be distributed among them as per their proportionate shares. With the above-stated modifications in the Resolution Plan, the Resolution Plan is approved by the Adjudicating Authority - appeal disposed off.
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