Case Laws
Acts
Notifications
Circulars
Classification
Forms
Manuals
Articles
News
D. Forum
Highlights
Notes
🚨 Important Update for Our Users
We are transitioning to our new and improved portal - www.taxtmi.com - for a better experience.
⚠️ This portal will be discontinued on 31-07-2025
If you encounter any issues or problems while using the new portal,
please
let us know via our feedback form
so we can address them promptly.
Home
2024 (10) TMI 1407 - AT - IBCApproval of Resolution Plan - Applicability of Section 240A of the IBC to the Corporate Debtor registered as MSME - whether SRA was ineligible as per Section 29A (c) of the IBC to submit the Resolution Plan in the CIRP of the Corporate Debtor? - HELD THAT - The Adjudicating Authority has held that Birendra Kumar Pasari who is Managing Director of the SRA is also the Promoter and in control and management of the CD hence he shall be deemed to be in management and control of the SRA. It was also noted and observed that Birendra Kumar Pasari and his family members are also in management and control of the Financial Creditor. After considering the RBI Circular dated 01.07.2015; clarification dated 12.11.2021; provisions of Section 29A and judgment of the Hon ble Supreme Court in ARCELORMITTAL INDIA PRIVATE LIMITED VERSUS SATISH KUMAR GUPTA ORS. 2018 (10) TMI 312 - SUPREME COURT the Adjudicating Authority has come to the conclusion in paragraph 48 that account of CD having become Non-Performing asset on 14.06.2020 whose debt could not have been paid for a period of at least one year before commencement of CIRP by virtue of Section 29A the SRA becomes ineligible to submit the Resolution Plan. The facts of the present case clearly indicate that the Corporate Debtor was registered as MSME much prior to the submission of the Resolution Plan by Bishwanath Traders Investment Ltd. Thus the eligibility of SRA has to be seen on the date of submission of Resolution Plan. A perusal of the judgment of the Adjudicating Authority indicate that Adjudicating Authority has not adverted to Section 240A of the IBC and declared the SRA ineligible on the strength of Section 29A(c). On looking into the scheme of Section 29A(c) which is relied by the Suspended Director the scheme itself contemplate ineligibility on the ground that Resolution Applicant is a person under whose management or control the Corporate Debtor s account has become non-performing. Thus when Section 240A is applied ineligibility in the Resolution Applicant under whose management and control the account of the CD was declared non-performing cannot be reckoned. No other ineligibility of the SRA has been pointed out or pressed SRA Bishwanath Traders Investment Ltd. did not suffer from any ineligibility from submitting the Resolution Plan on 11.07.2022 on which date Plan was submitted. The Adjudicating Authority committed error in allowing IA No.4173 of 2023 filed by the Suspended Director and rejecting IA No.5458 of 2022 filed by the RP for approval of the Resolution Plan. The order dated 24.01.2024 impugned in these Appeal(s) are set aside. IA No.4173 of 2023 is dismissed and IA No.5458 of 2022 is allowed approving the Resolution Plan - appeal allowed.
|