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TMI Blog2019 (7) TMI 1603X X X X Extracts X X X X X X X X Extracts X X X X ..... Paban Bishwal, Adv. For Workers side : Ashim Amitabh Dash, Adv., Pratik Dash, Adv. For Monitoring Committee : Ujjaini Chatterjee, Adv. ORDER 1. All above applications are filed under Section 60 (5) of Insolvency and Bankruptcy Code, 2016 by State Bank of India one of the Financial Creditor, and State Bank of India as one of the Member of Committee of Creditors, by Resolution Professional, by Liberty House Group (For short LHG) the successful Resolution Applicant, by workmen of the Corporate Debtor, by MSTC one of the Operational Creditor of the Corporate Debtor etc. State Bank of India/Committee of Creditors and the Resolution Professional have filed application for direction to the Liberty House Group - the successful Resolution Applicant to act as per the approved Resolution Plan. Later on, State Bank of India/Committee of Creditors filed application to cancel the Resolution Plan of Liberty House Group stating that they committed breach in implementation of Resolution Plan. State Bank of India/Committee of Creditors stated that this authority may not pass order of Liquidation of the Corporate Debtor but to pass order of the revival of the Corporate Insolvency Resolution Pro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... they committed default in paying financial debt of more than Rs. 7,477,200,000/- (SevenHundred Forty-Seven Crore Seventy-Two Lakh only) Learned Adjudicating Authority at Kolkata admitted both Adhunik Metaliks Limited and Zion Steel Limited in Corporate Insolvency Resolution Process vide order dated 03.08.2017. Mr. Sumit Binani was appointed as Interim Resolution Professional later on he was confirmed as Resolution Professional. 8. During Corporate Insolvency Resolution Process, the Resolution Professional called for Resolution Plan from prospective Resolution Applicant. In pursuant thereto, Liberty House Group submitted the Resolution Plan. The Committee of Creditors by 99.94 % votes approved the Resolution Plan of Liberty House Group. The Adjudicating Authority at Kolkata by order dated 17.07.2018 approved that Plan and thereby Corporate Insolvency Resolution Process of the Corporate Debtor was successfully completed. However, while passing approval of the Resolution Plan of Liberty House Group, the Adjudicating Authority at Kolkata rejected M/S MSTC Limited's contention of settling their claim of Rs. 108.36 Crore. Feeling aggrieved of rejection of their claim MSTC Limited fi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as obliged to make upfront cash payment of Rs. 410 Crore within 57 days of approval of the Resolution Plan. They did not make the payment thereby they committed breach of the implementation of the Resolution Plan. As against the Liberty House Group contends that Committee of Creditors/Monitoring Committee did not issue in their favour offer letter of equity shares of the Corporate Debtor. Unless such offer letter is issued, it is difficult for them to invest the funds as per the Plan. 13. At the outset, it is made clear that Hon'ble NCLAT passed the order dated 15.03.2019 directing Liberty House Group to make upfront payment within 30 days. It is as follows: "Having rejected the prayer, as made by both the Appellants, to give one opportunity for the purpose of compliance of this order and implementation of the plan, we allow the Appellant - 'Liberty House Group' another 30 days to make upfront payment in terms of the 'Resolution Plan'. On failure, it will be open to the Adjudicating Authority, Kolkata Bench to pass the appropriate order in accordance with law". 14. All parties in the appeal before Hon'ble NCLAT are bound by this order unless it is set as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ited to show readiness and willingness of Liberty House Group in implementation of the Resolution Plan. The facts on record would show that his client is not at all in fault for non-implementation but the COC did not cooperate his client by giving offer letter of equity shares of the Corporate Debtor. The amount deposited as the part of upfront payment cannot be forfeited treating the same as the performance's security. 18. It is seen from the record that Liberty House Group did not make upfront cash payment within 57 days of approval of the Resolution Plan. Not only that, firstly this authority and thereafter Hon'ble NCLAT extended time to make upfront payment but they did not make. By filing various applications now, they raised the point that as per Resolution Plan it was for Committee of Creditors/Monitoring Committee to give them an offer letter about equity shares of the Corporate Debtor. I hold that this contention of Liberty House Group cannot be accepted mainly for two reasons; (i) It is raised deliberately at belated stage. They could have raised this issue of Offer Letter at earlier point of time and not after almost one year after the approval of their Resolu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s performance's security, it would be nothing but penalising them at this stage. Such provision cannot be used retrospectively. Their Plan is approved almost year ago before the amendment. Hence, the prayer of Committee of Creditors to allow them to forfeit sum of Rs. 50 Crore deposited by Liberty House Group treating it as a performance's Security cannot be allowed. Since the Liberty House Group did not demand back that sum of amount, I am not passing any order thereto at this stage. 21. In this case, the situation that has arisen is that Successful Resolution Applicant Liberty House Group is not in position to implement the Resolution Plan. Corporate Insolvency Resolution Process period of 270 days has already been over along back. In such a situation this authority has no option but to pass order of liquidation of the Corporate Debtor as per Section 33 of Insolvency and Bankruptcy Code, 2016. However, learned Senior Counsel Mr. Saha submitted that this authority can passed order of liquidation of the Corporate Debtor only in two contingencies as stated under Section 33 (l) (a) and (b) of Insolvency and Bankruptcy Code, 2016. He submitted that; (i) Contingencies are th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ebtor is going concern having more than 1,500 workers and employees. Hence, I direct the Liquidator to liquidate the Corporate Debtor as a going concern as per Regulation 32 (f) of Insolvency and Bankruptcy Board of India (Liquidation Process Regulation, 2016). I hereby appoint Mr. Sumit Binani Resolution Professional as the Liquidator. With this all application stand disposed off and I proceed to pass the following order - ORDER (i) Corporate Debtor Adhunik Metaliks Limited, a company incorporated under the provisions of the Companies Act, 1956, having its registered office at Chadri, Hariharpur, P.O. Kuarmunda, Sundargarh, Orissa 770039 & Zion Steel Limited, a company incorporated under the provisions of the Companies Act, 1956, having its registered office at Gobira, P.O. Kuarmunda, P.S. Birmitrapur, Sundargarh, Orissa, India 770039 is admitted in process of liquidation. (ii) Mr. Sumit Binani, Resolution Professional having Registration No. IBB1/1PA-001/1P-N00005/2016-17/10025 of 2A, Ganesh Chandra Avenue, Commerce House, Room No. 6, 4th Floor, Kolkata - 700013 and Email-id [email protected] is appointed as the Liquidator in cp (IB) No. 373/KB/2017 renumbered as TP N ..... X X X X Extracts X X X X X X X X Extracts X X X X
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