TMI Blog2020 (9) TMI 600X X X X Extracts X X X X X X X X Extracts X X X X ..... ssue bailable warrants against the Appellants for thwarting the Corporate Insolvency Resolution Process in not extending cooperation to the Resolution Professional who had to file application before the Adjudicating Authority praying for adopting of legally permissible coercive methods to compel obedience by the Appellants. The Adjudicating Authority, on consideration of the application of the Resolution Professional under Section 31(1) of the I B Code, found the Resolution Plan compliant with all statutory and regulatory parameters and providing for all stakeholders besides, not being in conflict with any extant law. Approval of Resolution Plan is a business decision taken by the Committee of Creditors with requisite majority based on their commercial wisdom and the same is non-justiciable. The fair value being ascertained at ₹ 157.12 Crore and the liquidation value being ascertained at ₹ 125.92 Crore, respectively, Respondent No. 2 offered ₹ 143.50 Crore which in the opinion of Committee of Creditors was the best plan providing for satisfaction of claims of all the stakeholders and being viable and feasible, all aspects of the matter having been taken into ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gulatory compliances have been made. The main issue raised in this appeal is in regard to the valuation of assets of the Corporate Debtor and same will be adverted to as we proceed further. 3. Adverting to the factual position as emerging from record it appears that CP No. 22/ND/2018 under Section 7 of the I B Code came to be filed by Oriental Bank of Commerce (Financial Creditor) seeking initiation of Corporate Insolvency Resolution Process against Shekhar Resorts Pvt. Ltd. (Corporate Debtor) for default in regard to payment of financial debt amounting to ₹ 19,67,64,134/- including interest. The Adjudicating Authority, in terms of order dated 11th September, 2018, admitted the application, appointed Mr. Vikram Kumar as Interim Resolution Professional (IRP) and slapped moratorium against the assets of the Corporate Debtor. The Corporate Insolvency Resolution Process proceeded with public announcement being made by the Interim Resolution Professional and Expressions of Interest invited from Prospective Resolution Applicants. 22 Prospective Resolution Applicants came forward with Expression of Interest received from (1) Alchemist ARC and (2) NCJ Infrastructure Pvt. Lt ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... issue of valuation of properties. Meanwhile there was outbreak of COVID -19, the matter was listed on 8th June, 2020 and then adjourned to 22nd June, 2020. The Adjudicating Authority did not entertain the plea of Appellants for treating the matter urgent for hearing through virtual mode and put the matter for consideration of Resolution Plan on 3rd July, 2020, on which date it was pointed out that the performance guarantee given in the Resolution Plan had expired. The Adjudicating Authority directed the Respondent No. 1 to rectify the defects, the matter was adjourned to 20th July, 2020 though the order uploaded on 3rd July, 2020 stated that the order was reserved. Meanwhile, Appellants filed I.A. No. 2388 of 2020. The Appellants joined the virtual hearing on 20th July, 2020 when the Adjudicating Authority observed that the matter had been reserved on 3rd July, 2020. The application for oral hearing was not listed for consideration and the same was projected before the Adjudicating Authority. However, on 24th July, 2020, despite circulating an urgency letter by Appellants, the impugned order came to be pronounced. 5. Learned counsel for Appellants submits that the Resolution Pl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... llenge by Appellants to the liquidation value of Corporate Debtor cannot be sustained and the Appellants cannot also question the commercial wisdom of Committee of Creditors. It is further pointed out that the Appellants did not cooperate with the Resolution Professional during entire CIRP and it was at the instance of Resolution Professional that the Adjudicating Authority had to issue bailable warrants against the Appellants for seeking their cooperation. As regards, the passing of impugned order by a single bench, it is submitted that the Bench hearing the matter was reconstituted by the Hon ble President NCLT and Special Bench comprising of Shri Mohd. Sharief Tariq, Hon ble Member Judicial was reconstituted, who passed the impugned order after hearing the parties. 7. Respondent No. 2 has reiterated the arguments advanced on behalf of Respondent No. 1. It is further submitted that the law has been settled by the Hon ble Apex Court in Maharashtra Seamless Limited (supra) as regards valuation. It is pointed out that in SARFAESI proceedings initiated by the Financial Creditor Oriental Bank of Commerce, way back in 2016, auction was conducted for the Hotel Property with reser ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rrants against the Appellants for thwarting the Corporate Insolvency Resolution Process in not extending cooperation to the Resolution Professional who had to file application before the Adjudicating Authority praying for adopting of legally permissible coercive methods to compel obedience by the Appellants. The Committee of Creditors found the Resolution Plan emanating from Respondent No. 2 compliant in all respects, providing for the interests of all stakeholders as also the Resolution Costs and meeting the criteria specified by the IBBI in regard to various parameters including financial matrix, feasibility and viability. The Adjudicating Authority, on consideration of the application of the Resolution Professional under Section 31(1) of the I B Code, found the Resolution Plan compliant with all statutory and regulatory parameters and providing for all stakeholders besides, not being in conflict with any extant law. Approval of Resolution Plan is a business decision taken by the Committee of Creditors with requisite majority based on their commercial wisdom and the same is non-justiciable. While dealing with approval of Resolution Plan, the Hon ble Apex Court in K. Shashidhar V ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion of the Bench as also same not being an urgent matter has to be repelled, regard being had to the timelines prescribed under I B Code and justice being accessible. 10. As regards valuation it is apt to notice that the fair value being ascertained at ₹ 157.12 Crore and the liquidation value being ascertained at ₹ 125.92 Crore, respectively, Respondent No. 2 offered ₹ 143.50 Crore which in the opinion of Committee of Creditors was the best plan providing for satisfaction of claims of all the stakeholders and being viable and feasible, all aspects of the matter having been taken into consideration by the Committee of Creditors based on their commercial wisdom, which is not justiciable either before the Adjudicating Authority or before this Appellate Tribunal. The Code does not provide that the value given by the Resolution Applicant should match the fair value or the liquidation value. The law in this regard has been settled in Maharashtra Seamless Limited (Supra). This is apart from the fact being pointed out by the Respondents that even in 2016 in SARFAESI Proceedings not a single buyer offered bid even at the reserve price of ₹ 110 Crores. On this a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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