TMI Blog2021 (12) TMI 793X X X X Extracts X X X X X X X X Extracts X X X X ..... the appellant-Ngaitlang Dhar in its meeting held on 1112th February, 2020. It is trite law that commercial wisdom of the CoC has been given paramount status without any judicial intervention, for ensuring completion of the processes within the timelines prescribed by the IBC. It has been consistently held that it is not open to the Adjudicating Authority (the NCLT) or the Appellate Authority (the NCLAT) to take into consideration any other factor other than the one specified in Section 30(2) or Section 61(3) of the IBC. It has been held that the opinion expressed by the CoC after due deliberations in the meetings through voting, as per voting shares, is the collective business decision and that the decision of the CoC s commercial wisdom is non-justiciable, except on limited grounds as are available for challenge under Section 30(2) or Section 61(3) of the IBC. In the present case, leave apart, there being any material irregularity , there has been no irregularity at all in the process adopted by the RP as well as the CoC. On the contrary, if the CoC would have permitted the PPIPL to participate in the process, despite it assuring the other three prospective Resolution ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 020 was filed assailing the order dated 18th May, 2020 passed by the NCLT, in an unnumbered I.A. filed by the RP, vide which the appellantNgaitlang Dhar s (H1 bidder) Resolution Plan came to be approved by the NCLT. 5. Vide the impugned judgment and order dated 19th October, 2020, the NCLAT has set aside both the orders, dated 18th March, 2020, and 18th May, 2020, and directed the Corporate Insolvency Resolution Process (hereinafter referred to as CIRP ) to be resumed from the stage of consideration of the Resolution Plans. 6. The facts in brief giving rise to the present appeals are as under: 7. An application being CP(IB) No.13/GB/2019 came to be filed under Section 7 of the Insolvency and Bankruptcy Code, 2016 (hereinafter referred to as the IBC ) for initiation of CIRP in respect of Meghalaya Infratech Ltd. (hereinafter referred to as the Corporate Debtor ) by the Allahabad Bank (now known as Indian Bank) (hereinafter referred to as the Allahabad Bank ). The NCLT vide order dated 28th August, 2019 admitted the petition and as such, the CIRP came to be initiated in respect of the Corporate Debtor and Mr. Amit Pareek came to be appointed as the Interim RP, who was su ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... PL. 14. Shri Mukul Rohatgi, learned Senior Counsel appearing on behalf of Ngaitlang Dhar, the successful Resolution Applicant (H1 bidder), submitted that the entire approach adopted by the NCLAT in the impugned judgment and order was erroneous. He submitted that the NCLAT ought to have taken into consideration that the CoC after exercising its commercial wisdom has resolved to accept the Resolution Plan submitted by Ngaitlang Dhar. He submitted that the RP had given an equal opportunity to all the bidders/resolution applicants. He submitted that though adequate opportunity was given to all the Resolution Applicants by adjourning the proceedings in CoC meetings on number of occasions, the respondent No.1PPIPL failed to revise its bid within the stipulated period. He submitted that the CoC, in its meeting, held on 1112th February, 2020, had resolved to declare Ngaitlang Dhar as the successful resolution applicant. He submitted that, not only that, thereafter the NCLT had also allowed the application filed by the RP to approve the Resolution Plan of Ngaitlang Dhar. 15. Shri Rohatgi submitted that it is only after 12th February, 2020, the respondent No.1PPIPL, on 14th February, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aring on behalf of the respondents Banks (the financial creditors) also support the arguments of the learned counsel appearing on behalf of Ngaitlang Dhar. They submit that the Banks have received the entire payment that was owed to them. It is further submitted that the email dated 14th February, 2020 sent by PPIPL was also endorsed to the Allahabad Bank as well as the Corporation Bank. It is submitted that both the Banks had refused to consider the said offer inasmuch as such an offer was not valid in law. 20. The facts are not in dispute in the present matter. 21. Vide order dated 28th August, 2019, the application filed by Allahabad Bank under Section 7 of the IBC for initiation of CIRP in respect of the Corporate Debtor came to be allowed. Vide the said order dated 28th August, 2019, Mr. Amit Pareek came to be appointed as the Interim RP. 22. The interim RP, in compliance with Section 15 of the IBC, made public announcement calling for claims from creditors of the Corporate Debtor. Upon receipt of claims from the creditors, the CoC came to be formed on 17th September, 2019. Thereafter, in the first meeting of the CoC, held on 25th September, 2019, the Interim RP cam ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bid amount and informed the CoC about the brief details of plan. The PRA also want to know about the basis of score, the RP CoC informed at this mature stage of CIRP this is not the right time and place to discuss about the evaluation and also informed that the evaluation has been done as per the RFRP, IM evaluation matrix which has been circulated to all the PRA in due time. 3. The CoC RP informed the PRA about the anomalies deficiency in the rectified Resolution Plan submitted by them still persist despite of given them opportunity earlier after the submission of original resolution plan for the rectification. The PRA requested to allow some more time for the rectification and submit revise plan. The casual approach of PRA noted. 4. The CoC requested to improve the bid amount to the PRA, the PRA states that at this stage we will not increase the bid amount 25. The minutes of the 5th meeting of the CoC would further reveal that the CoC thereafter invited Ngaitlang Dhar for negotiation of the bid and requested him to enhance the bid amount. Ngaitlang Dhar agreed to enhance the bid amount from ₹ 63 crore to ₹ 64 crore. Thereafter again, the rep ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... had enhanced his bid from ₹ 63 crore to ₹ 64 crore, the representative of PPIPL subsequently came and requested for adjourning the meeting for few days. The said request was specifically rejected by the CoC by informing the representative of PPIPL that it had to adhere to the IBC timeline and would have to conclude the matter by next day. On the next day, i.e., 12th February, 2020, when the adjourned proceedings of the CoC were held, the respondent No.1PPIPL had sent an email, stating therein that the Directors of its Company will not be available for the said meeting and requested for deferring the meeting by a day or two. On the insistence of all the prospective Resolution Applicants present, the CoC clarified that since the timeline was coming to an end, it had decided to exclude the prospective Resolution Applicants who were not present in the said meeting. In the said meeting, Ngaitlang Dhar came to be declared as the highest bidder after he improved his bid in the open bidding held between him and Mr. Abhishek Agarwal. 27. It could thus be seen that the RP as well as the CoC had acted in a totally transparent manner. An equal opportunity was accorded to all the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... has been consistently reiterated in a catena of judgments of this Court, including: (i) K. Sashidhar v. Indian Overseas Bank and Others (2019) 12 SCC 150 (ii) Committee of Creditors of Essar Steel India Limited Through Authorized Signatory v. Satish Kumar Gupta and Others (2020) 8 SCC 531, (iii) Maharashtra Seamless Limited v. Padmanabhan Venkatesh and others (2020) 11 SCC 467, (iv) Kalpraj Dharamshi and Another v. Kotak Investment Advisors Limited and Another (2021) SCC OnLine SC 204. (v) Ghanashyam Mishra and Sons Private Limited Through the Authorized Signatory v. Edelweiss Asset Reconstruction Company Limited Through the Director Ors. (2021) 9 SCC 657 32. No doubt that, under Section 61(3)(ii) of the IBC, an appeal would be tenable if there has been material irregularity in exercise of the powers by the RP during the corporate insolvency resolution period. However, as discussed hereinabove, we do not find any material irregularity. 33. We may gainfully refer to the following observations of this Court in the case of Keshardeo Chamria v. Radha Kissen Chamria and others (1953) 4 SCR 136 while considering the scope of the words material irre ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
