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2019 (12) TMI 629 - NATIONAL COMPANY LAW APPELLATE TRIBUNAL, NEW DELHIApproval of Resolution plan - Section 30(4) of the Insolvency and Bankruptcy Code, 2016 - whether the approved ‘Resolution Plan’ submitted by M/s. Dhanuka Laboratories Ltd. is viable and feasible or not? - HELD THAT:- The objective of the I&B Code, 2016 is ‘Resolution’ and not ‘Liquidation’. Further, the aim of the Code is to consolidate and amend the law relating to reorganization and insolvency resolution of corporate persons, partnership firms and individual persons in a time bound manner for maximization of the value of assets of such persons (Corporate persons herein), to promote entrepreneurship availability of credit and balance interest of such persons (Creditors)/ stakeholders. The maximization of value of assets of the ‘Corporate Debtor’ as also the maximization of the assets of the ‘Financial Creditors’ and the ‘Operational Creditors’, are the basic essence of the I&B Code - Even if the earlier unamended Section 30(2)(b) is considered, the basic feature of the I&B Code was that an ‘Operational Creditor’ cannot be paid anything less than the ‘Liquidation Value’ and the basic principle is the maximization of the assets of the ‘Corporate Debtor’, balancing all the stakeholders by maximization of their assets, no ‘Resolution Plan’ can offer any amount upfront or by other way, which is less than the ‘Liquidation Value’. It will be against the object of the Code as also the provisions of Section 30(2) of the I&B Code. Infusions of fund for maximization of the assets of the ‘Corporate Debtor’ cannot be counted for the purpose of the amount, which is being kept for distribution amongst the stakeholders, including the ‘Financial Creditors’ and ‘Operational Creditors’, if it is less than the ‘Liquidation Value’, such ‘Plan’ cannot be upheld, being against the object of the I&B Code and Section 30(2) of the said Code - Admittedly, the amount offered in favour of stakeholders including the ‘Financial Creditors’ and the ‘Operational Creditors’ is being much less than the ‘Liquidation Value’, such ‘Plan’ cannot be accepted. The impugned order dated 25/27th June, 2019 ordering approval the ‘Resolution Plan’ is set aside - matter stands remitted to the Adjudicating Authority for decision in accordance with law.
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