2023 (5) TMI 1084 - AT - Insolvency and Bankruptcy

Seeking permission for appointment of Board of Directors of the Corporate Debtor - HELD THAT - The Application is not opposed by the SRA and it is stated that the appointment of Board of Directors to the Corporate Debtor is the step which is essential for taking various regulatory actions as part of general corporate compliances under law - the prayer is allowed. Seeking for exclusion of time prayed for in the Application from 16.11.2022 till the Company Appeal (AT) (Insolvency) Nos. 129 130 of 2023 is decided - HELD THAT - SRA is entitled for exclusion of period from 16.11.2022 till 03.03.2023 when this Tribunal in the present Appeal passed an order declining the interim relief as prayed by the MC Lenders. IA Nos.2028-2029 is thus allowed excluding the period from 16.11.2022 till 03.03.2023. As undertaken by the SRA the IA No.1863 of 2023 pending before the Adjudicating Authority shall be withdrawn - Application allowed. Invocation of performance Bank Guarantee - Seeking restraint/ injunction on the Respondents from encashing or appropriating the Performance Bank Guarantee and Ernest Money deposited by the Applicant/ SRA - HELD THAT - When the Resolution Plan of the Corporate Debtor has received approval up to Hon ble Supreme Court and the Monitoring Committee is constituted under the Plan to oversee implementation the Monitoring Committee has to act as a facilitator for implementation of the Resolution Plan instead of finding fault and taking steps which does not facilitate the implementation rather delay the implementation. There is no doubt that Performance Bank Guarantee can be invoked by the MC Lenders but the said invocation can only take place when SRA has failed to implement the Plan. Present is a case where directions have been issued to both MC Lenders and SRA to implement the Plan and the event of failure of the Plan has not yet arrived. When the Adjudicating Authority has directed on 13.01.2023 to take steps towards the implementation of the Plan and which order was not been stayed by this Tribunal on 03.03.2023 the steps ought to have been taken by the MC Lenders in furtherance of the implementation - The Resolution Plan has been approved with the intent and purpose to revive the Corporate Debtor which revival is in accordance with objective and purpose of the IBC - MC Lenders shall not invoke the Performance Bank Guarantee in the facts of the present case as on date and for invocation if any MC Lenders may take leave of the Adjudicating Authority. Application disposed off.

Summary

Issues Involved:
1. Approval and implementation of the Resolution Plan.
2. Appointment of Board of Directors.
3. Exclusion of time for implementation of the Resolution Plan.
4. Restraining invocation of Performance Bank Guarantee.

Summary:

Approval and Implementation of the Resolution Plan:
Jet Airways (India) Limited, the Corporate Debtor, was admitted to insolvency on 20.06.2019. A Resolution Plan submitted by Respondent No.1 was approved by the Committee of Creditors (CoC) on 21.09.2020 and the Adjudicating Authority on 22.06.2021. Appeals challenging this order were dismissed, upholding the Plan with certain directions. The conditions precedent for operationalizing the Corporate Debtor were contested between the Successful Resolution Applicant (SRA) and the Monitoring Committee of Lenders (MC Lenders). The Adjudicating Authority on 13.01.2023 held that the conditions precedent were fulfilled and extended the timeline for Plan execution till 15.05.2023. The MC Lenders challenged this order, but the Tribunal declined to stay it, emphasizing the need for all stakeholders to act towards implementing the Resolution Plan.

Appointment of Board of Directors:
IA No.1975 of 2023 was filed by the Appellant seeking permission for appointing Directors to the Corporate Debtor's Board to ensure regulatory and legal compliances. This application was not opposed by the SRA, and the Tribunal allowed the appointment as essential for corporate compliance under law.

Exclusion of Time for Implementation of the Resolution Plan:
IA Nos.2028-2029 of 2023 filed by the SRA sought exclusion of the period from 16.11.2022 to the decision of the Appeal for implementing the Resolution Plan. The Tribunal noted that despite the Adjudicating Authority's order on 13.01.2023, the MC Lenders did not take necessary steps. The Tribunal allowed the exclusion of the period from 16.11.2022 to 03.03.2023, when the interim relief was declined, and directed the SRA to withdraw their pending application before the Adjudicating Authority.

Restraining Invocation of Performance Bank Guarantee:
IA Nos.2159-2160 of 2023 filed by the SRA sought to restrain the MC Lenders from invoking the Performance Bank Guarantee. The Tribunal observed that the Performance Bank Guarantee could only be invoked upon the SRA's failure to implement the Plan. Given that the Plan's implementation was ongoing and the SRA was willing to fulfill its obligations, the Tribunal directed the MC Lenders not to invoke the Performance Bank Guarantee without the Adjudicating Authority's leave.

Conclusion:
The Tribunal emphasized coordinated efforts between MC Lenders and SRA for the revival of the Corporate Debtor. The Appeal was set for final hearing on 12th July 2022, and the Tribunal directed that the case need not be listed on 30.05.2023 as previously directed.