9911796707
TMI Blog2021 (11) TMI 949X X X X Extracts X X X X X X X X Extracts X X X X ..... de. 2. The Applicant submits that the Hangji Global Limited, Operational Creditor initiated the Corporate Insolvency Resolution process (CIRP) against Globecon Commercial Services Private Limited under Section 9 of the Code and was admitted vide an order dated 25.01.2021 and the Applicant herein was appointed as the Interim Resolution professional (IRP) of the Corporate Debtor. 3. The Applicant submits that Public Announcement dated 29.01.2021 in Form A was published on the website of the IBBI and in Free Press Journal (Mumbai Edition - English Language) and Nav Shakti (Mumbai Edition - Marathi Language) newspapers on 29.01.2021. 4. The first meeting of the Committee of Creditors (CoC) was held on 23rd February, 2021 wherein the IRP apprised the members of the CoC regarding the steps taken as the IRP. Further, the IRP Mr. Ajit Gyanchand Jain was confirmed as the Resolution (RP) of the Corporate Debtor. The Applicant further submits that the report certifying the Constitution of Committee of Creditors was filed by the Applicant on 17th February 2021 with this Tribunal and post submission of the report, the Applicant received further claims from 3 (three) Financial Creditor and 1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... shed Form G- Invitation for Expression of Interest on 8th April 2021 in 2 newspapers namely Free Press Journal (English Daily) and Navshakti (Marathi Daily) of Mumbai Edition and also uploaded on the IBBI website, whereby the last date for receipt of expression of interest (hereinafter referred to as "EOI") was 23rd April 2021 and the last date for submission of the Resolution Plan was 7th June 2021. 8. In the 4th meeting of the CoC held on 29th April 2021 the Applicant apprised the CoC members regarding the dates of issuance of the Form G and about receiving two (2) EOI's from PRAs i.e M/s PP Metalix Limited and M/s Hangji Global Limited. The members were informed that the Resolution Professional had received 2 (two) emails from the interested parties i.e. M/s Prabhatam Investment vide email dated 19th April 2021 and from Mr. Sambhav Jain on 27th April 2021 (i.e., after the last date for submission of EOI) expressing their interest in submitting EOI, however a formal EOI and supporting documents as per the detailed EOI was not received from them. However, due to the ongoing restrictions in the State of Maharashtra in view of 2nd wave of Covid-19 pandemic, few PRAs were unable to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... i.e. Unnao Trading Private Limited and the Sales Tax Department of Maharashtra, Operational Creditor (Statutory/Government Authority) stated that the amount offered by the Resolution Applicant in the proposed plan is very less and should be reconsidered, to which the Resolution Applicant stated that they intend to restructure the distribution under the proposed resolution plan wherein the amount proposed under the Resolution Plan will be first attributed towards payment of the CIRP cost and the balance amount will be distributed amongst the Creditors proportionately to the amount of claim admitted in the total debt of the Corporate Debtor. He further added that the only asset the Corporate Debtor has is the Steel Slag, that would be used to extract different kinds of metals, considering the same the amount offered by the Resolution Applicant is the maximum and he further added that if the CIRP cost is reduced then the amount left to be distributed to all the stakeholders will gradually be increased. 14. That the Applicant states that the liquidation value and fair value as per the valuation reports submitted by the valuers is as under: (Amount in Lakhs) Particulars Valuer 1 V ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the same CoC meeting the Applicant informed the members of the CoC that he will issue a compliance certificate in accordance with the provisions of the Code. The Applicant presented the payments proposed to various stakeholders under the resolution plan which had been modified based on the observations pointed out by the CoC and the RP in the previous CoC meeting regarding the distribution structure after payment of CIRP cost and the amount available for distribution to the other creditors. The Applicant further submits that the Resolution for approval of Resolution Plan submitted by Hangji was put up for e-voting and the voting window was kept open from 7th July 2021 till 9th July 2021. The Resolution Plan submitted by Hangji was approved by 100% of the voting share of the members of the CoC. SALIENT FEATURES OF THE APPROVED RESOLUTION PLAN 18. The Resolution Professional submits that the Resolution Applicant proposes a total Financial proposal of Rs. 40 Lakhs to be paid for the full and final settlement of all liabilities of the Corporate Debtor. The summary of the payment proposed under the Resolution Plan dated 29.06.2021 are as follows :- Sr. No. Stakeholder/Category of Cl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... su basis; or The amount that would have been paid to such workmen and/or Employees under Section 53 of the Code in the event of liquidation of the Corporate Debtor; or The amount that would have been paid to such workmen and/or employees if the Resolution Amount had been distributed in accordance with the manner of priority set out under Section 53 of the Code. It is hereby clarified that any payment to the Workmen and or Employees shall be made out of the entitlement of the Operational Creditors in the Resolution Amount. 6. Upfront cash payment to the Operational Creditors (Other than the Government The Resolution Applicant has proposed Creditors and the Workmen and the Employees) that the Resolution Amount (after the CIRP Costs have been paid in full) shall be distributed amongst the Financial Creditors, the Operational Creditors and the Government Creditors on prorata basis in the ratio of their claims verified and admitted by the Resolution Professional. The Resolution Applicant does not propose to make any payment to the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Applicant has admitted a total claim of Rs. 1,17,23,102/- (Rupees One Crore Seventeen Lakhs Twenty-Three Thousand One Hundred and Two Only) towards the claim of Operational Creditors (Excluding Statutory Authority and workmen and employees). ii. It is submitted that the claims of Operational Creditors (Excluding Statutory Authorities and workmen and employees) shall be paid in compliance with Regulation 38 of the IBBI (CIRP) Regulation, 2016. The Resolution Applicant has proposed that subject to the terms set out in the Resolution Plan and after the payment of CIRP costs in full, the balance Resolution amount shall be distributed amongst the Unrelated Financial Creditors, the Operational Creditors (Other than the Government Creditors and Workmen and Employee) and the Government Creditor on pro-rata basis in the ratio of their claims as admitted by Resolution Professional as on Resolution Plan Approval Date. iii. It is submitted that in any event the amount payable to the Operational Creditors (other than the Government Creditors and Workmen & Employees) shall not be less than (i) the Liquidation Value owed to the Operational Creditor (other than the employee & workmen dues and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... i. It is submitted that there are no dues outstanding towards the employees and workmen and no claims have been received from the workmen and Employees of the Corporate Debtor. ii. It is submitted that in the event the Resolution Professional receives and admits any claim of any Workman or Employee or the Corporate Debtor prior to the Resolution Plan Approval Date, such Workmen or Employees shall be paid, in full and final settlement of their claims, an amount equivalent to (a) INR 5,000 (Rupees Five Thousand); or (b) the amount to be paid to such Workmen and employees under Section 53 of the Code in the event of liquidation of the Corporate Debtor; or (c) the amount that would have been paid to such Workmen and/or Employees if the Resolution Amount had been distributed in accordance with the priority in Section 53(1) of the Code, whichever is higher. iv. Such payment shall be made out of the entitlement of the Operational Creditors (other than the Government Creditors) in the Resolution Amount and the amount payable to the Operational Creditors (other than the Government Creditors) shall stand reduced accordingly. Any payment to the Workmen and/or Employees pursuant to this ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al and any claims in relation thereto shall stand extinguished without any payment or recourse. g. Payment to other Creditors and Related Parties of the Corporate Debtor. i. The Resolution Plan does not propose to make any payment to the other Creditors and /or Related Parties of the Corporate Debtor. ii. It is submitted that all the Claims of the Related Parties against the Corporate Debtor as on the Closing Date shall stand extinguished and deemed to be fully settled against 'NIL' consideration in accordance with the Resolution Plan without any further liability or obligation of the Resolution Applicant and/or the Corporate Debtor. 22. Further the Applicant states that as per the RFRP dated 08.05.2021, the Successful Resolution Applicant shall within 4 Business Days from the date of issuance of the Letter of Intent (LoI) (or earlier in case the Application for approval of Resolution Plan is to be submitted to NCLT earlier) provide an irrevocable and unconditional Performance Bank Guarantee (PBG) of an amount aggregating to 10% of the Resolution Applicant Contribution in favour of the Corporate Debtor which comes to Rs. 4,00,000/-. Further the Applicant has issued (LoI) dat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... provides for the payment of debts of financial creditors, who do not vote in favour of the resolution plan, in such manner as may be specified by the Board, which shall not be less than the amount to be paid to such creditors in accordance with sub-section (1) of section 53 in the event of a liquidation of the corporate debtor. Explanation - For the purpose of this section - (i) it is hereby clarified that at each stage of the distribution of proceeds in respect of a class of recipients that rank equally, each of the debts will either be paid in full, or will be paid in equal proportion within the same class of recipients if the proceeds are insufficient to meet the debts in full; and (ii) the term "workmen's dues" shall have the same meaning as assigned to it in section 326 of the Companies Act, 2013 (18 of 2013). c) Provides for the management of the affairs of the Corporate debtor after approval of the resolution plan; a) The implementation and supervision of the resolution plan; b) Does not contravene any of the provisions of the law for the time being in force; c) Confirms to such other requirements as may be specified by the Board. 28. Section 30 (4) of the Co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... irement of the Code in terms of Section 30(2)(a) to 30(2)(f) and Regulations 38(1), 38(1)(a), 38(2)(a),38(2)(b), 38(2)(c) & 38(3) of the Regulations. 34. The RP has filed Compliance Certificate in Form-H along with the Plan. On perusal the same is found to be in order. The Resolution Plan includes a statement under regulation 38(1A) of The Regulations as to how it has dealt with the interest of the stakeholders in compliance with the Code and the Regulations. 35. The Resolution Plan has been approved by the CoC in the 7th meeting with 100% votes. 36. In K Sashidhar v. Indian Overseas Bank & Others (in Civil Appeal No.10673/2018 decided on 05.02.2019) the Hon'ble Apex Court held that if the CoC had approved the Resolution Plan by requisite percent of voting share, then as per section 30(6) of the Code, it is imperative for the Resolution Professional to submit the same to the Adjudicating Authority (NCLT). On receipt of such a proposal, the Adjudicating Authority is required to satisfy itself that the Resolution Plan as approved by CoC meets the requirements specified in Section 30(2). The Hon'ble Court observed that the role of the NCLT is 'no more and no less'. The Hon'ble Cour ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in the Resolution Plan, shall be subject to approval by the Authorities concerned. iii. This Tribunal will not deter such authorities to deal with any of the issues arising after giving effect to the Resolution Plan. iv. The Memorandum of Association (MoA) and Articles of Association (AoA) shall accordingly be amended and filed with the Registrar of Companies (RoC), Mumbai, Maharashtra for information and record. The Resolution Applicant, for effective implementation of the Plan, shall obtain all necessary approvals, under any law for the time being in force, within such period as may be prescribed. v. The moratorium under Section 14 of the Code shall cease to have effect from this date. vi. The Applicant shall supervise the implementation of the Resolution Plan and file status of its implementation before this Authority from time to time, preferably every quarter. vii. The Applicant shall forward all records relating to the conduct of the CIRP and the Resolution Plan to the IBBI along with copy of this Order for information. viii. The Applicant shall forthwith send a certified copy of this Order to the CoC and the Resolution Applicant, respectively for necessary compliance. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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