TMI Blog2022 (1) TMI 265X X X X Extracts X X X X X X X X Extracts X X X X ..... COC for consideration. However, the Adjudicating Authority vide Order dated 30.04.2021 has dismissed the Application holding that voting has already been taken place on resolution plan and against that order when the Appeal came for hearing before this Appellate Tribunal at that time the resolution plan has already been approved by the CoC and the Application was pending before the Adjudicating Authority for approval of Resolution Plan. Therefore, this Appellate Tribunal declined to interfere in the order passed by the Adjudicating Authority. When this Appellate Tribunal has already overruled all the objections of the Appellant and directed the Adjudicating Authority to consider the Application for approval of Resolution Plan then there is no occasion for the Appellant to file the Application praying that the Application filed by the RP for approval of plan be dismissed and liquidation order be passed. We are in agreement with the finding of Ld. Adjudicating Authority that the subject matter of this Application is similar to the prayer in earlier Application I.A. No. 426/KB/2021 and the issue was settled on 30.04.2021 which is upheld by this Appellate Tribunal on 02.08.2021. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... peal is filed against the order dated 08.10.2021 passed by Ld. Adjudicating Authority (National Company Law Tribunal, Kolkata Bench, Kolkata) whereby dismissed the Application I.A. (IB) No. 775/KB/2021 in CP (IB) No. 832/KB/2019, filed by West Bengal Financial Corporation (one of the member of the Committee of Creditors). 2. Brief facts of this case are that Carbon Resources Pvt. Ltd. (Operational Creditor) filed an Application under Section 9 of IBC against the Dimension Steel Alloys Pvt. Ltd. (Corporate Debtor) before Adjudicating Authority Kolkata for initiation of Corporate Insolvency Resolution Process (CIRP). The same was allowed vide order dated 18.10.2019 and Ms. Meena Sureka was appointed as Interim Resolution Professional (IRP). Subsequently, Mr. Bijoy Murmuria was appointed as Resolution Professional (RP). The RP has published Form-G on 30.12.2019 and revised Form-G on 21.01.2020. The last date to submit the Resolution Plan was 10.12.2020 which was extended to 22.12.2020. Despite such extension no Resolution Plan was received. In the 10th meeting held on 04.01.2021 Committee of Creditor (CoC) had decided to go for liquidation. The RP had moved an application IA No. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or deliberating the amended and/or altered and/or modified resolution plan, if any, submitted by the Respondent No.2, in terms of the directions of the Respondent No.1 given in the meeting convened on March 25, 2021. (c) Injunction restraining the respondents from approving the amended and/or altered and/or modified resolution plan, if any, submitted and/or circulated by the Respondent No.2 in any manner whatsoever. (d) An order of liquidation be passed in terms of section 33 of the Code. 5. The Application was dismissed by the Adjudicating Authority vide order dated 30.04.2021. Operative portion of the Order is as under:- 15. Given the circumstances and the fact that voting has already been taken place in resolution plan, we do not at this stage pass any orders with respect to liquidation of the corporate debtor. 16. In the circumstances, the prayers sought for in the present IA 426/KB/ 2021 cannot be granted at this stage. However, we direct that the entire process be concluded expeditiously. 17. I.A No. 426/KB/2021 shall stand disposed of accordingly. 6. The Appellant has challenged the order before this Appellate Tribunal, in CA (AT) (INS) 536 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s the deadline for taking a decision on the Resolution Plan. The RP and CoC disregarded the deadline and unilaterally granted extension for submission of modified Resolution Plan. The proviso to Section 12(3) IBC provides that any extension of the period of CIRP under Section 12 cannot be granted more than ones. Even the 3rd proviso to Section 30 states that nothing in the 2nd proviso shall be construed as extension of a period for the purposes of the proviso to sub-Section 3 of Section 12 and the CIRP shall be completed within the period specified in that sub-section. Even the literal language of Section 12(1) makes it clear that proviso must be read as mandatory. For this purpose, cited the Judgment of Hon ble Supreme Court in the case of Arcellormittal India Pvt. Ltd. Vs. Satish Kr. Gupta 2018 SCC Online 1733. 12. Learned Counsel for the Appellant further submitted that learned Adjudicating Authority erroneously held that the subject matter of the IA No.479/KB/2021 is similar to the prayers in IA No.426/KB/2021 and hence, this issue was settled on 30.4.2021. It is incorrect to say that the Order dated 30.4.2021 upheld by this Hon ble Tribunal and hence attained finality. This ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Respondent No. 2 submitted that Hon ble Supreme Court in the case of Essar Steel India Limited, Committee of Creditors Vs. Satish Kumar Gupta reported in (2020) 8 SCC 531, at paragraph 127 has categorically struck down the term mandatory in section 12(3) and has specifically directed that it would be in the interest of all stakeholders that the corporate debtor be put back on its feet instead of being sent into liquidation. It may be open in such exceptional cases for the Adjudicating Authority and/or Appellate Tribunal to extend time beyond 330 days. Thus, Ld. Adjudicating Authority keeping in view of the main objective of the IBC exercised his discretion rightly even though RP and CoC has not strictly adhered to the timeline fixed in the Code, in the interest of all stakeholders of the Corporate Debtor. Thus, there is no substance in the Appeal and the Appeal may be dismissed. 16. Ld. Counsel appearing on behalf of the Respondent No. 1 adopts the argument advanced by the Ld. Sr. Counsel for the Respondent No. 2. 17. After hearing, learned Counsels for the parties, we have gone through the record. 18. Following issues arose for our consideration: - (i) Whether the su ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dismissed and liquidation order be passed. We are in agreement with the finding of Ld. Adjudicating Authority that the subject matter of this Application is similar to the prayer in earlier Application I.A. No. 426/KB/2021 and the issue was settled on 30.04.2021 which is upheld by this Appellate Tribunal on 02.08.2021. Issue No. (ii) Whether the time limit of 330 days provided in Section 12 of IBC is mandatory? 21. The object of the IBC is the resolution of the insolvency of a Corporate Debtor. Efforts of all stakeholders has to be towards resolution of insolvency. There can be no dispute that the law mandates that CIRP proceedings have to be concluded within 330 days. Hon ble Supreme Court, after noticing the above requirement of 330 days in Section 12, laid down in (2020) 8 SCC 531 - Committee of Creditors of Essar Steel India Ltd. vs. Satish Kumar Gupta and Ors. that normally as per law, insolvency resolution process has to be completed within 330 days maximum, but in exceptional cases, the period can be extended by Adjudicating Authority/ Appellate Tribunal. In paragraph 127 of the judgment, following has been laid down: 127. Both these judgments in Atma Ra ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s largely due to factors owing to which the fault cannot be ascribed to the litigants before the Adjudicating Authority and/or Appellate Tribunal, the delay or a large part thereof being attributable to the tardy process of the Adjudicating Authority and/or the Appellate Tribunal itself, it may be open in such cases for the Adjudicating Authority and/or Appellate Tribunal to extend time beyond 330 days. Likewise, even under the newly added proviso to Section 12, if by reason of all the aforesaid factors the grace period of 90 days from the date of commencement of the Amending Act of 2019 is exceeded, there again a discretion can be exercised by the Adjudicating Authority and/or Appellate Tribunal to further extend time keeping the aforesaid parameters in mind. It is only in such exceptional cases that time can be extended, the general rule being that 330 days is the outer limit within which resolution of the stressed assets of the corporate debtor must take place beyond which the corporate debtor is to be driven into liquidation. 22. The Hon ble Supreme Court in the above case has held that it would be in the interest of all stakeholders that the Corporate Debtor will be back ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
