TMI Blog2019 (10) TMI 965X X X X Extracts X X X X X X X X Extracts X X X X ..... ibunal observed, held and directed that As the liquidation so taken up under the I B Code , the arrangement of scheme should be in consonance with the statement and object of the I B Code . Meaning thereby, the scheme must ensure maximisation of the assets of the Corporate Debtor and balance the stakeholders such as, the Financial Creditors , Operational Creditors , Secured Creditors and Unsecured Creditors without any discrimination. We vacate the Interim order passed in both the appeals and allow/ direct Resolution Professional/ Liquidator to act in terms with the direction of the aforesaid decision - appeal disposed off. - Company Appeal (AT) (Ins) No. 47 of 2018 With Company Appeal (AT) (Ins) No. 48 of 2018 - - - Dated:- 8-8-2019 - Justice S.J. Mukhopadhaya, Chairperson And Justice Bansi Lal Bhat, Member (Judicial) For The Appellant : Mr. S. Santanam Swaminadhan and Ms. Nishtha Khurana, Advocates For The Respondents : Mr. E. Omprakash, Sr. Advocate with Ms. Madhusmita Bora, Advocate, Mr. D. Sreenivasan, Mr. G.Ananda Selvam and Ms. Kavita Bhardwaj, Advocates ORDER The Corporat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ancial Creditor submitted that the appellant had not cooperated with the Resolution Professional. However, we are not deliberating on such issue. In both the cases, we find that the applications under Section 10 were admitted on 14.06.2017, therefore, we are not inclined to grant any further time for successful resolution and thereby not inclined to interfere with any of the orders of the liquidation. However, we are of the view that the Liquidator in both the cases required to follow the decision of this Appellate Tribunal in Y. Shivram Prasad Vs. S. Dhanapal Ors. etc. Company Appeal (AT) (Insolvency) No. 224 of 2018 286 of 2018 , disposed of on 27th February, 2019 , wherein this Appellate Tribunal observed, held and directed as follows: 11. During the liquidation stage, Liquidator required to take steps to ensure that the company remains a going concern and instead of liquidation and for revival of the Corporate Debtor by taking certain measures. 12. The aforesaid issue fell for consideration before this Appellate Tribunal in S.C. Sekaran v. Amit Gupta Ors.─ Company Appeal (AT) (I ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the Insolvency and Bankruptcy Board of India (Liquidation Process) Regulations, 2016, states that the liquidator may also sell the corporate debtor as a going concern. 6. In Meghal Homes Pvt. Ltd. vs. Shree Niwas Girni K.K. Samiti Ors. (2007) 7 SCC 753 the Hon ble Supreme Court observed and held as follows: 33 . The argument that Section 391 would not apply to a company which has already been ordered to be wound up, cannot be accepted in view of the language of Section 391(1) of the Act, which speaks of a company which is being wound up. If we substitute the definition in Section 390(a) of the Act, this would mean a company liable to be wound up and which is being wound up. It also does not appear to be necessary to restrict the scope of that provision considering the purpose for which it is enacted, namely, the revival of a company including a company that is liable to be wound up or is being wound up and normally, the attempt must be to ensure that rather than dissolving a company it is allowed to revive. Moreover, Section 391(1)(b) gives a right to the liquidator in the case of a company which is being wound up, to propose ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ucturing consented to by not less than seventy-five per cent. of the secured creditors in value, including- ( i) a creditor s responsibility statement in the prescribed form; ( ii) safeguards for the protection of other secured and unsecured creditors; ( iii) report by the auditor that the fund requirements of the company after the corporate debt restructuring as approved shall conform to the liquidity test based upon the estimates provided to them by the Board; ( iv) where the company proposes to adopt the corporate debt restructuring guidelines specified by the Reserve Bank of India, a statement to that effect; and ( v) a valuation report in respect of the shares and the property and all assets, tangible and intangible, movable and immovable, of the company by a registered valuer. ( 3) Where a meeting is proposed to be called in pursuance of an order of the Tribunal under sub-section (1), a notice of such meeting shall be sent to all the creditors or class of creditors and to all the members or class of members and the debenture-hol ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... se or arrangement and shall require that representations, if any, to be made by them shall be made within a period of thirty days from the date of receipt of such notice, failing which, it shall be presumed that they have no representations to make on the proposals. ( 6) Where, at a meeting held in pursuance of sub-section (1), majority of persons representing three-fourths in value of the creditors, or class of creditors or members or class of members, as the case may be, voting in person or by proxy or by postal ballot, agree to any compromise or arrangement and if such compromise or arrangement is sanctioned by the Tribunal by an order, the same shall be binding on the company, all the creditors, or class of creditors or members or class of members, as the case may be, or, in case of a company being wound up, on the liquidator appointed under this Act or under the Insolvency and Bankruptcy Code, 2016, as the case may be, and the contributories of the company. ( 7) An order made by the Tribunal under sub-section (6) shall provide for all or any of the following matters, namely:- ( a) where the compromise o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cation to the Tribunal in the event of any grievances with respect to the takeover offer of companies other than listed companies in such manner as may be prescribed and the Tribunal may, on application, pass such order as it may deem fit. Explanation.-For the removal of doubts, it is hereby declared that the provisions of section 66 shall not apply to the reduction of share capital effected in pursuance of the order of the Tribunal under this section. 8. In view of the provision of Section 230 and the decision of the Hon ble Supreme Court in Meghal Homes Pvt. Ltd. and Swiss Ribbons Pvt. Ltd. , we direct the Liquidator to proceed in accordance with law. He will verify claims of all the creditors; take into custody and control of all the assets, property, effects and actionable claims of the corporate debtor , carry on the business of the corporate debtor for its beneficial liquidation etc. as prescribed under Section 35 of the I B Code. The Liquidator will access information under Section 33 and will consolidate the claim under Section 38 and after verification of claim in terms of Section 39 will either admit or reject the claim, as required under Secti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r under Section 230 to overrule the objections, if the arrangement and scheme is beneficial for revival of the Corporate Debtor (Company). While passing such order, the Adjudicating Authority is to play dual role, one as the Adjudicating Authority in the matter of liquidation and other as a Tribunal for passing order under Section 230 of the Companies Act, 2013. As the liquidation so taken up under the I B Code , the arrangement of scheme should be in consonance with the statement and object of the I B Code . Meaning thereby, the scheme must ensure maximisation of the assets of the Corporate Debtor and balance the stakeholders such as, the Financial Creditors , Operational Creditors , Secured Creditors and Unsecured Creditors without any discrimination. Before approval of an arrangement or Scheme, the Adjudicating Authority (National Company Law Tribunal) should follow the same principle and should allow the Liquidator to constitute a Committee of Creditors for its opinion to find out whether the arrangement of Scheme is viable, feasible and having appropriate financial matrix. It will be open for the Adjudicating Authority as a Tribunal to approve the arrangement o ..... X X X X Extracts X X X X X X X X Extracts X X X X
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