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2024 (3) TMI 291 - NATIONAL COMPANY LAW APPELLATE TRIBUNAL , PRINCIPAL BENCH , NEW DELHIRejection of application filed u/s 54C of the Insolvency and Bankruptcy Code, 2016 (IBC) read with Rule 4 of the Insolvency and Bankruptcy (Pre-Packaged Insolvency Resolution Process) Rules, 2021 - rejection of application by entering into base Resolution Plan - HELD THAT:- On looking into sub-section (4) of Section 54C, it provides that Adjudicating Authority shall, within a period of fourteen days of the receipt of the Application, by an order - (a) admit the application, if it is complete; or (b) reject the application, if it is incomplete. Further, the proviso provides that the Adjudicating Authority shall, before rejecting an Application, give notice to the Applicant to rectify the defect in the Application within seven days. The Adjudicating Authority in the impugned order itself has noticed the details of the Application and statutory compliances of the Application. The provisions of Section 54A and 54C, where under Section 54C, sub-section (4), the Adjudicating Authority is required to admit the Application, if it is complete or reject the Application, if it is incomplete. In paragraphs 10 to 16 of the impugned order, the Adjudicating Authority itself has noticed that all necessary compliances are fulfilled by the Corporate Debtor in filing Application under Section 54C. Thus, when accordingly to the Adjudicating Authority itself, all necessary compliances have been completed by the Corporate Applicant, whether the Adjudicating Authority could have entered into issue of Base Resolution Plan and reject the Application on the ground that Base Resolution Plan is not acceptable is a question to be answered. In the present case, the Adjudicating Authority has rejected 54C Application after entering into the merits of the Base Resolution Plan, which is not contemplated by statutory Scheme. The order of Adjudicating Authority, thus, rejecting the Application under Section 54C entering into Base Resolution Plan, is thus, contrary to the statutory Scheme of Chapter III-A and on this ground itself the order becomes unsustainable. Whether M/s WZ Enterprises Pvt. Ltd. could not have submitted the Base Resolution Plan along with the Corporate Applicant? - HELD THAT:- Base Resolution Plan can very well be submitted by a Corporate Applicant individually or jointly with any other person. Thus, there are no illegality in submission of Resolution Plan by Corporate Applicant along with M/s WZ Enterprises Pvt. Ltd. – the Financial Creditor of the corporate applicant. The Adjudicating Authority committed error in rejecting Application filed under Section 54C and the impugned order is unsustainable - appeal allowed.
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