2023 (5) TMI 1082 - AT - Insolvency & Bankruptcy

Implementation of the approved Resolution Plan - exclusion of three years and nine months (after resolution plan approved) - no interim order passed by the Hon’ble Supreme Court staying the implementation of the Plan - HELD THAT:- Even before approval of the Resolution Plan by the CoC, the issue of ineligibility of Resolution Applicant was raised and against the order of the Adjudicating Authority, declaring the Resolution Applicant eligible, Appeals were filed by Punjab National Bank and RBL Bank, which Appeals were withdrawn on 23.03.2018 by an order of the Appellate Tribunal. Thereafter, Plan was approved on 18.04.2018. After approval of the Plan by the Adjudicating Authority, again a set of litigation was initiated by the Lenders, including the SBI. Four Appeals were filed challenging the Plan approval order. In the Appeal, which was filed by the Lenders against the Plan approval order, there was order passed by this Appellate Tribunal that decision regarding approval or rejection of the Plan, shall not be taken without leave of the Appellate Tribunal. Ultimately, the Appeals were dismissed by the Appellate Tribunal on 16.08.2019.

The fact that the Financial Creditors right from the very beginning, even before approval of the Resolution Plan have been raising ineligibility issue in respect of the Resolution Applicant and after approval of the Plan several Appeals were been filed by the Lenders themselves, challenging the approval order contending that Resolution Applicant is ineligible. When Lenders themselves were challenging the approval of the Plan, it is reasonable to comprehend that Lenders were not keen to implement the Plan. The Resolution Applicant has initiated contempt proceedings in which also subsequently the Adjudicating Authority while disposing of the contempt application directed the SBI to implement the Resolution Plan.

The Hon’ble Supreme Court in its order dated 18.01.2022 [2022 (1) TMI 811 - SUPREME COURT] made it clear that Resolution Plan has to be implemented as the Corporate Debtor being a on-going concern and Promoters have infused over Rs.63 crores. The Hon’ble Supreme Court also noticed that interest of over 23,000 shareholders and thousands of employees have to be taken care of. The observations made by the Hon’ble Supreme Court is clear and categorical that Plan is required to be implemented.

Present is not a case where Resolution Plan has been modified by the Adjudicating Authority. The Adjudicating Authority vide order dated 11.03.2022 has already granted extension by the impugned order for the period from 18.04.2018 to 18.01.2022, which period was taken in the litigation initiated by the Lenders themselves. It is also relevant to notice that while approving the Resolution Plan on 18.04.2018, the Adjudicating Authority has granted exclusion of 106 days. The Hon’ble Supreme Court in its judgment has approved the exclusion on account of litigation and proceedings.

In the Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) Regulations, 2016, under Regulation 39, sub-regulation (9), a creditor is allowed to apply to Adjudicating Authority for direction in case there is any non-implementation of the Resolution Plan. At no point of time, the Appellant made an application praying for any direction to the Resolution Applicant towards implementation of the Plan alleging any non-implementation - The Lenders and Banks are obliged to discharge their obligations as per the Resolution Plan. The fact that directions have been issued to the Appellant, cannot mean that Resolution Applicant is not to perform its obligation as per the Resolution Plan.

The learned Counsel for the Resolution Applicant has undertaken to perform all its obligations under the Plan as and when it arises according to the Resolution Plan. Recording the aforesaid statement of the Resolution Applicant, there is no ground to interfere with the impugned order passed by the Adjudicating Authority, which order is clearly in aid of implementation of the Resolution Plan. The implementation of the Resolution Plan being obligation and duty of all stake holders as per the scheme of the IBC, as observed above, the Resolution Applicant shall also carry out its obligation under Resolution Plan promptly, while the Lenders will discharge their obligations in the Plan and as per directions issued in the impugned order by the Adjudicating Authority.

Appeal dismissed.