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2022 (2) TMI 18 - AT - Insolvency and BankruptcySeeking Liquidation of Corporate Debtor - Section 34(1) of the Insolvency and Bankruptcy Code, 2016 - Corporate Debtor’ falls into the new classification criteria of MSME - benefit of exemption under Section 240A - Commercial Discussion of CoC - justifiable or not - Eligibility under the amended MSME Act 2006, Notified on 26.06.2020 - time limitation - HELD THAT:- The contention of the Learned Counsel for the Appellant that the date of NPA is 30.03.2015 and Section 7 Application was filed on 03.07.2018 and hence is ‘barred by Limitation’, is unsustainable as the material on record evidences the revival letters, written by the ‘Corporate Debtor’, the last one being 28.11.2015. It is seen that the Bank has enclosed these revival letters duly acknowledged and signed by the ‘Corporate Debtor’ from time to time and the Section 7 Petition filed on 06.07.2018, cannot be said to be ‘barred by Limitation’. Commercial Discussion of CoC - justifiable or not - HELD THAT:- The Hon’ble Supreme Court in ‘Jaypee Kingston Boulevard Apartments Welfare Association & Ors.’ [2021 (3) TMI 1143 - SUPREME COURT] has observed that ‘there is an intrinsic assumption that Financial Creditors are fully informed about the viability of the ‘Corporate Debtor’ and feasibility of the proposed Resolution Plan. They act on the basis of thorough examination of the proposed Resolution Plan and assessment made by their team of experts. The opinion on the said matter expressed by them after due deliberations in the CoC Meeting through e-voting, as per voting shares, is a collective business decision. The Legislature, consciously, has not provided any ground to challenge the ‘commercial wisdom’ of the individual Financial Creditors or their collective decisions before the Adjudicating Authority that has made it non-justiciable - In the instant case, the Appellants have failed to establish by means of any documentary evidence that there was any material irregularity under Section 30(2) of the Code in the Order of the Liquidation passed by the Adjudicating Authority. Eligibility under the amended MSME Act 2006, Notified on 26.06.2020 - HELD THAT:- It is an admitted fact that the registration itself of the Appellant Company under MSME has not taken place. Further, it is subsequent to the initiation of the CIRP and therefore the Appellant is ineligible to take the benefits of Section 240A under the Code. The eligibility to be a Resolution Applicant is tested on the date of submission of the Plan. In the instant case, that stage of submission of Resolution Plan was completed and subsequently the CoC has decided by a vote of majority of 88.44% to liquidate the Company. It is significant to mention that the eighth CoC Meeting was held on 20.04.2020 which was attended by the Appellant wherein the status of the Liquidation Application was discussed - In the instant case, the MSME Act, 2006, was amended with effect from 01.07.2020 whereas the CIRP Admission Order was passed on 26.04.2019. After going through the contents of the Notification, dated 26.06.2020, under the MSME Act, 2006, this Tribunal arrives at a definite conclusion that the said notification is only ‘Prospective in nature’ and not a ‘Retrospective’ one because the said notification does not in express terms speak about the applicability of retrospective operation. The relevant words are conspicuously absent besides there being no implicit reference to be drawn for such a construction. Appeal dismissed.
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