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TMI Blog2022 (2) TMI 1254X X X X Extracts X X X X X X X X Extracts X X X X ..... , Senior Advocate B. Dhanaraj, Advocate (For RP of RISPL) R. Murari, Senior Advocate Cibi Vishnu, Advocate (for ARCIL) P.S. Raman, Senior Advocate Vidya, Advocate (for Applicant in Inv.P/11/2021) P. Mohan Prasad, Advocate (for Applicant in Inv.P/13 & 14/2021 COMMON ORDER Per: Justice (Retd.) S. RAMATHILAGAM, MEMBER (JUDICIAL) Under adjudication is an application filed by the Resolution Professional in respect of the Corporate Debtor viz. Regen Powertech Private Limited under Section 30(6) of Insolvency and Bankruptcy Code, 2016, (hereinafter referred to as "IBC, 2016") seeking approval of Resolution Plan submitted by the Resolution Applicant viz. Renew Power Services Limited which was approved by the CoC in its 13" CoC meeting held on 03.04.2021. 2. OTHER APPLICATIONS: 2.1. The following intervening Petitions has been filed as objections to the Resolution Plan: a) Inv.6/IB/CHE/2021 b) Inv.7/IB/CHE/2021 c) Inv.11/IB/CHE/2021 d) Inv.13/IB/CHE/2021 e) Inv.14/IB/CHE/2021 2.2. Inv.6/IB/CHE/2021 is filed by the Resolution Professional in respect of the Regen Infrastructure Services Private Limited (which is the subsidiary of the Corporate Debtor) and it is stated in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... custody of the Corporate Debtor and it is stated that the Applicant has taken steps under Section 25 of the IBC, 2016, and also reviewed the production of stock in respect of the Corporate Debtor. In pursuance of the publication announcement being made, it. was submitted that the Applicant received claims from the various creditors and accordingly constituted the Committee of Creditors (CoC) in the following manner: S. No NAME OF THE FINANCIAL CREDITOR TOTAL CLAIM FILED DETERMINED CLAIM % OF VOTING SHARE 1 State Bank of India 802,53,76,258 802,53,76,258 51.56 2 Canara Bank 288,23,63,476 288,23,63,476 18.52 3 Axis Bank 125,68,66,009 125,68,66,009 8.08 4 Indian Overseas Bank 77 ,26,59,307 77,26,59,307 4.96 5 Standard Chartered Bank 12,67,74,320 12,67,74,320 0.81 6 L&T Infra Investment Partners 70,13,51,231 56,86,97,721 3.65 7 L & T Finance Limited 238,17,94,723 193,13,02,279 12.41 TOTAL CLAIM OF FINANCIAL CREDITORS 1614,71,85,324 1556,40,39,370 100 3.4. After constituting the CoC, the 1st meeting of the CoC was conducted on 10.01.2020 and in the said meeting, the CoC did not approve the resolution to confirm the Applicant to cont ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rised the CoC that he has received the Expression of Interests from the following persons: a) Renew Power Services Private Limited; b) Rajalakshmi Renewable Energy Limited; c) CFM Asset Reconstruction Private Limited; 3.8. It was submitted in the said CoC meeting after a detailed discussion, the final list of prospective Resolution Applicants was placed before the CoC and also the CoC fixed the last date for the submission of the Resolution Plan as 30.07.2020. It is also seen that the Applicant has issued the Information Memorandum to the final prospective Resolution Applicant on 30.06.2020. 3.9. However, it was submitted that the prospective Resolution Applicants have requested for extension of time to submit the Resolution Plan citing human constraints due to Covid-19 lockdown and by taking into consideration the said fact, the CoC in its 5 CoC meeting held on 29.07.2020 extended the last date for the submission of Resolution Plan till 19.08.2020. However, despite said extension being granted, further time was being sought by the prospective Resolution Applicant and the CoC after detailed discussions and deliberations granted further time extension till 20.09.2020 to su ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ubmitted only by M/s. Renew Power Services Private Limited in the 11 CoC meeting on 26.02.2021 and another prospective Resolution Applicant namely M/s. Rajalakshmi Wind Energy Limited has not submitted the Resolution Plan to the Applicant within the due date. 3.14. It was submitted that the CoC in its 12" meeting held on 04.03.2021, 05.03.2021 & 06.03.2021 discussed about the modifications of the resolution plan submitted by the prospective Resolution Applicant viz. Renew Power Services Private Limited in detail and after detailed discussions and deliberations made in the CoC meeting, the CoC in its 13 CoC meeting held on 03.04.2021 has put for vote the Resolution Plan submitted by the Renew Power Services Limited. The last date for e-voting was fixed as 24.03.2021 and accordingly the CoC with the 94.08% has voted in favour of the Resolution Plan. 3.15. It is stated that the said decision of the CoC in approving the Resolution Plan was conveyed to the successful Resolution Applicant on 25.04.2021 and the RP has also issued a Letter of Intent to the successful Resolution Applicant on 26.04.2021. It is also submitted that the successful Resolution Applicant has submitted i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ISPL") is a wholly owned subsidiary of M/s. Regen Powertech Private Limited ("RPPL"). RISPL was admitted into Corporate Insolvency Resolution Process by this Tribunal vide its order dated 19.02.2020 passed in IBA/1424/2019 and one Ms. Renuka Devi Rangaswamy was appointed as Interim Resolution Professional, who was confirmed as the "Resolution Professional" in the 3 meeting of the CoC held on 21.09.2020. 5.1. OBJECTIONS RAISED BY RP oF RISPL 5.1.1 That the proposed Resolution Plan is prejudicial to public interest and against well settled principles of law and seeks to destroy the business of RISPL which is a Subsidiary of RPPL. 5.1.2 That the Applicant was appointed as the Resolution Professional of RISPL, which is the 100% Wholly Owned Subsidiary of RPPL, by virtue of the Order of this Hon'ble Tribunal dated 19.02.2020 made in Application No. IBA/1424/2019. Likewise, the Holding Company RPPL was admitted into CIRP by the order of this Hon'ble' Tribunal dated 13.12.2019 made in IBA/1099/2019. 5.1.3. That RPPL's. principal business is the manufacture of Wind Energy Generators (WEGs). RPPL incorporated RISPL as its Subsidiary to aid RPPLs business by making main objects of R ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... greements until the copy of the Agreements were filed before the Mediator appointed by this Tribunal. 5.1.8 That on going through the various Applications filed by RISPL Customers, where in some cases RPPL is also made a party, the Applicant came to understand the impact of the Knowhow License and Technical Assistance Agreements entered with Saarbruecken (Germany). 5.1.9 That the crux of the said Agreements is that RPPL is vested with the rights to use the Know- how technology provided by Vensys Energy AG and RPPL is entitled to assign its right under the said Agreements to RISPL. In short, RISPL business operation mostly depends on the Intellectual Property rights vested with RPPL. In the event RPPL revokes the permission given to RISPL under the Know-how License and Technical Assistance Agreements, RISPL would be forced to close its business and wind up its operations. In essence, RISPL is a pawn in the hands of RPPL. 5.1.10 That in these circumstances, RPPL proceeded to call for Expression of Interest (Eol) during Covid Lockdown period and secured a plan from the Proposed Resolution Applicant (PRA). A bare perusal of the Resolution Plan submitted by the PRA would establish ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... an of the PRA is sanctioned, the affected parties are not only the Stakeholders of RISPL but also the Third-Party Public Customers and indirectly the Banks which funded the purchase of WEGs also will not be able to realize their dues. In addition to the above, the shutting down of most of the WEGs in view of the threat of closure of RISPL's business impacts the Nation's capacity to generate wind energy. Thus, on all counts, the Resolution Plan is prejudicial to the public and against public policy. 5.1.15. Without prejudice to the above, it is just and necessary to point out that the proposed Resolution Plan in addition to resulting in the death of RISPL, would also deprive 320 Direct Employees and about 350 Contract Employees currently working across India, of their employment. 5.1.16. That the Proposed Resolution Plan also intends to prohibit the transfer of the License to Know-how technology on production, license, marketing, sale and installation of WEGs of different models with power variants. In view of the prohibition clause contained in the Know-how License and Technical Assistance Agreements, RISPL would be deemed as a Third Party bringing the businesses of RISPL i.e., ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ting a Resolution Plan, the intent of the legislature to follow a transparent procedure is clear. 5.2.3 That the Applicant states that 10% of the Representation has not been provided for and is in violation of the Code. Hence, the approval of the Resolution Plan by the COC is vitiated and bad in law. 5.2.4 That there is a lack of transparency with respect to the details of the subsidiaries of the Corporate Debtor. It was submitted that the minutes of the COC meeting do not provide the details of the subsidiaries, however, it merely records that the "Chairman briefed the CoC on the various subsidiaries of the Corporate Debtor". It was further submitted that Corporate Debtor has certain Special Purpose Vehicles who hold certain land assets of the Corporate Debtor and this fact has been totally ignored by the COC and there has been no attempt to confirm the veracity of these facts. 5.2.5 It was submitted that the Corporate Debtor has 8 wholly owned subsidiaries and one of which is a Foreign wholly owned subsidiary and it is a fact borne on record that no Annual Returns have been filed by the Corporate Debtor for the Financial Year 2019 - 2020 asa result of which the correctness ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e CIRP cost. 5.2.9 It was submitted that there was non-adherance to the provisions of IBC, 2016 and the publication of Expression of Interest in Form G has not been made by the RP as required under Regulation 36A of the IBBI (Insolvency Resolution Process for Corporate Persons) Regulations, 2016. It was submitted that, considering that the Corporate Debtor has business operations in various parts of India, it would have been appropriate to publish Form G in All India Edition in both English and respective vernacular, however the RP has chosen to ignore publication in the principal office of the Corporate Debtor at Tada, Andhra Pradesh. 5.2.10 It has been averred in the Petition that the Applicant Mr. S. Krishnamoorthy has perused the Resolution Plan and having been in the Wind Industry the Applicant is of the firm opinion that the present Resolution Plan has overlooked a lot of practical requirements from the customers point of view and aims at settling RPPL alone with disregard to the status of its customers. 5.3. OBJECTIONS RAISED BY TVH ENERGY RESOURCES PvT. LTD. 5.3.1 The Objector i.e., TVH Energy Private Limited, claims to be an Operational Creditor of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pending before this Tribunal against the Corporate Debtor and its wholly owned subsidiary. 5.3.7 It was submitted that it was beyond comprehension for the subsidiary of RPPL to even survive or secure the repair equipment for the infrastructure installed in their respective wind farms. Further, it was submitted that the Resolution plan leave the objector stranded with no contractual relief and the manner of approval is shrouded with malice, haste and underhandedness. 5.3.8 It was submitted that the Resolution Plan is contradictory to the object of IBC, 2016 and also contrary to the principles observed and discussed by the drafters of the Code. Further, it was submitted that the Resolution Plan does not meet the requirements as set out under Section 30(2) of IBC, 2016. It was submitted that the Resolution Applicant has sought to repudiate all the contracts and liabilities of the Corporate Debtor and also it was pointed out that the Objectors six motors and wind mill parts are de-erected and are at the factory of the Corporate Debtor and the same is yet to be serviced. Hence it was submitted that the Resolution Plan submitted by the Resolution Applicant is required to be rejected ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by due process of law to recover any assets, if legally taken over by the Corporate Debtor as alleged. It was submitted that the Resolution Plan does not and cannot in any way seek to vest rights on RPPL over any assets of RISPL or assets of the subsidiary as the Resolution Plan can deal only with the assets of the Corporate Debtor. 6.6. In relation to the intervention Application filed by the alleged Operational Creditors, it was submitted that they are erstwhile customers of RPPL and has no legs to stand and to maintain any objections to the Resolution Plan in respect of RPPL. In order to buttress the said issue, reliance was placed upon the order passed by this Tribunal on 01.11.2021 wherein, this Tribunal has dismissed the Application filed for Consolidation / simultaneous CIRP in respect of the RPPL and RISPL, in which it was held that the Applicants have no locus standi since they are only customers in respect of RPPL. It was submitted that the alleged Operational Creditors are trying to re-agitate the same issue which was canvassed and rejected by this Tribunal vide its order dated 01.11.2021 on the ground of locus standi. 6.7. On merits, it was submitted that as per the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Pointedly there is no provision in the Code to allow unconnected Operational Creditors to nominate a representative for them at the COC nor is there any procedure mandated for the Resolution Professional to select such representative. Even at the most stretched interpretation of the Code and Regulations a representative who approaches the Resolution professional setting out that he is duly appointed by Operational Creditor's owning 10% debt can be invited to the CoC. It is no part of RP's duty to find and select representatives of Operational Creditor in the absence of any mechanism under the Code and regulations thereunder for this purpose. It is not the case that someone who represented 10% debt holder Operational Creditor was refused to be allowed to participate in the COC despite such person having sought the same. Even otherwise as per the Explanation proviso of Section 24(4) clearly indicates that such absence will not invalidate the proceedings of COC as there is no voting right to Operational Creditor. 6.11. The value of the subsidiaries that accrues to the holding company is not the value of the assets of the subsidiary but is rather only the investments ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ance was placed upon the Judgment of the Hon'ble Supreme Court in the matter of India Resurgence ARC Limited -Vs- Amit Metaliks Limited and Another; (2021) SCC Online SC 409 to state that "Jn other words in the scheme of IBC, every dissatisfaction does not partake the character of a legal grievance and cannot be taken up as a ground of appeal". 7.3. It was submitted that customers are not stakeholders and they have no /ocus standito maintain any application before this Tribunal and an attempt is made to circumvent the order dated 01.11.2021 passed by this Tribunal wherein consolidation plea was rejected. Further, it was submitted that Section 24(3)(c) of IBC, 2016 provides for right to attend meetings to those operational creditors having claim value of 10% of the debt and not of operational debt and by virtue of Sec. 24(4) of IBC, 2016 any non-compliance will not invalidate the proceedings. 7.4. It was submitted that section 60(5) of IBC, 2016 is in the nature of a residuary jurisdiction vested in NCLT so that NCLT may decide all questions of law or fact arising out of or in relation to insolvency resolution and liquidation under the provisions of IBC, 2016 and such a residual ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... "Operational Creditor" in relation to the Corporate Debtors. Sec. 5(20) and 5(21) of IBC, 2016 defines the term "Operational Creditor" and "Operational debt", which is extracted hereunder; (20) "operational creditor' means a person to whom an operational debt is owed and includes any person to whom such debt has been legally assigned or transferred; (21) "operational debt" means a claim in respect of the provision of goods or services including employment or a debt in respect of the 2 [payment] of dues arising under any law for the time being in force and payable to the Central Government, any State Government or any local authority; 5.7. The term "Operational Creditor" means a person who has provided goods or rendered service to the Corporate Debtor. In the present case, all the Applicants herein have not rendered services to the Corporate Debtor, however, it is that the Corporate Debtor who has rendered services to all the Applicants as per the Operation and Maintenance Agreement. In such a scenario, the Applicants herein cannot be termed as an "Operational Creditor". Thus, these Applicants who are all customers of RPPL and RISPL in the opinion of this Adjudicating A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l US and UK case laws, one of which being the case of Food Fair Inc., In re; 10 BR 123 (1981), where the Bench held that the key factor for granting substantive consolidation of all debtors is required to yield an 'equitable treatment' of creditors without any undue prejudice. However, the provisions of IBC, 2016 do not deal with the 'equitable treatment' when it comes to Operational Creditors and 'Financial Creditor' and this legal position is fortified by the Judgment of the Hon'ble Supreme Court in the matter of Committee of Creditors of Essar Steel India Limited -Vs- Satish Kumar Gupta and Others; (2020) 8 SCC 531, wherein it has been held that the Financial Creditors and Operational Creditors by virtue of their business relations with the Corporate Debtor can never be equally placed and that the IBC itself contemplates Operational Creditors as a separate class of creditors. 5.11. It is also required to be noted that the question of consolidation is one arising out of equity. The decision of the NCLT Mumbai Bench, and the Hon'ble NCLAT in certain matters ordering for Consolidation of CIRP, in the absence of specific provisions under IBC, 2016, was only by exercising its equit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bsidiaries situated in India; and (c) any question of priorities or any question of law or facts, arising out of or in relation to the insolvency resolution or liquidation proceedings of the corporate debtor or corporate person under this Code 5.14. The powers conferred under Section 60(5)(c) of IBC, 2016 cannot be equated with that of Section 105(a) of the US Bankruptcy Code, since under the latter, broad powers have been conferred to pass "any orders or judgments", however under provisions of IBC, 2016, powers have been conferred only to decide on the question of priorities or any question of law or facts arising out of or in relation to the insolvency resolution or liquidation proceedings of the Corporate Debtor. Thus, it is seen that the indian legislative makers have consciously omitted to confer such "equity jurisdiction" upon the Indian Insolvency and Bankruptcy Code, 2016. Also, the Hon'ble Supreme Court while dealing with the provisions of IBC, 2016 had an occasion to deal with the said issue and as early as in the year 2019 while dealing with the approval of a Resolution Plan and the jurisdiction of NCLT and NCLAT, in the matter of K. Sashidhar - Vs- Indian Overseas B ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he Adjudicating Authority and the Appellate Authority cannot extend into entering upon merits of a business decision made by a requisite majority of the CoC in its commercial wisdom. Nor is there a residual equity based jurisdiction in the Adjudicating Authority or the Appellate Authority to interfere in this decision, so long as it is otherwise in conformity with the provisions of the IBC and the Regulations under the enactment. 48. Certain foreign jurisdictions allow resolution/reorganization plans to be challenged on grounds of fairness and equity. One of the grounds under which a company voluntary arrangement can be challenged under the United Kingdom's Insolvency Act, 1986 is that it unfairly prejudices the interests of a creditor of the company. The United States' US Bankruptcy Code provides that if a restructuring plan has to clamp down on a dissenting class of creditors, one of the conditions that it should satisfy is that it does not unfairly discriminate, and is fair and equitable. However, under the Indian insolvency regime, it appears that a conscious choice has been made by the legislature to not confer any independent equity based jurisdiction on the Adjudic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 16 by the Adjudicating Authority and also by the Appellate Authority, in the matter of Arun Kumar Jagatramka -Vs- Jindal Steel and Power Ltd. &Anr., 2021 SCC OnLine SC 220, has held as follows; 103. At this juncture, it is important to remember that the explicit recognition of the schemes under Section 230 into the liquidation process under the IBC was through the judicial intervention of the NCLAT in Y Shivram Prasad (supra). Since the efficacy of this arrangement is not challenged before us in this case, we cannot comment on its merits. However, we do take this opportunity to offer a note of caution for the NCLT and NCLAT, functioning as the Adjudicatory Authority and Appellate Authority under the IBC respectively, from judicially interfering in the framework envisaged under the IBC. As we have noted earlier in the judqment, the IBC was introduced in order to overhaul the insolvency and bankruptcy regime in India. As such, it is a carefully considered and well thought out piece of legislation which sought to shed away the practices of the past. The leqislature has also been working hard to ensure that the efficacy of this legislation remains robust by constantly amending it bas ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... CIRP of group companies, however in stark contrast, in the present case, the Committee of Creditors of RPPL are totally opposing consolidation, since they have a Resolution Plan in the offing. Similar is the case of RISPL, as seen from the 7" and 8 Coc meeting that RISPL is also evincing Resolution Plans from four prospective Resolution Applicants, however the RP of RISPL based upon a Resolution passed in the 8th CoC meeting has moved IA/548/CHE/2021 for simultaneous CIRP of both RPPL and RISPL. Thus, it becomes crucial at this stage for this Adjudicating Authority to decide on the aspect as to whether consolidation can be ordered at this stage, where the Resolution Plan in respect of both the entities are in the offing. Hence, the timing of consolidation is also required to be examined, since ordering of consolidation of CIRP would amount to de novo start of CIRP process and also there is no extant procedure established under IBC, 2016, as to how to conduct the consolidated CIRP in relation to group companies. Further, when the Resolution Plan in respect of both RPPL and RISPL are in the pipeline, ordering for consolidation of CIRP and thereby starting a de novo CIRP process woul ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l dated 02.03.2020, the Objector/ Financial Creditor withdrew the claim with a liberty and the RP also by way of its e-mail dated 11.03.2020 allowed for withdrawal of the claim. 8.4. Subsequently the Hon'ble NCLAT vide its judgment dated 24.11.2020 in the matter of State Bank of India -Vs- Athena Energy stated that the creditors were allowed to proceed against the Corporate Debtor and the guarantor simultaneously and immediately thereafter, the objector / Financial Creditor filed their claim with the RP on 08.12.2020 and has resubmitted the claim before the RP in Form-C. However, it was submitted that the RP of the Corporate Debtor has failed to reply to the email of the Financial Creditor and that it was submitted that after a delay of more than 3 months the RP has replied vide email dated 05.04.2021 that the Applicant's resubmission of the claim has been rejected in terms of Regulation 12 of the IBBI (Insolvency Resolution Process for Corporate Persons) Regulations, 2016. Aggrieved by the same, the Financial Creditor has filed MA/61/2020 before this Tribunal. The gist of objections raised by the said objector / Financial Creditor is that the CoC was illegally constituted and he ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l and once a Resolution Plan is approved for the subsidiary the same would bind the parties including the Corporate Debtor herein. Further, it is also seen that the approval of the Resolution Plan in respect of the Corporate Debtor would not in any way interfere with the CIRP proceedings of the subsidiary of the Corporate Debtor viz. RISPL and that as already noted in the order dated 01.11.2021, the RP of RISPL is not left in lurch and the RP of RISPL can in no manner be permitted to interfere in the Resolution Plan of the Corporate Debtor. 8.7. The RP has filed the Compliance Certificate as mandated under Regulations 39 (4) of the IBBI Regulations Corporate Persons, 2016 in Form H and the perusal of the same discloses that the fair value and the liquidation value of the Corporate Debtor is arrived at Rs.189,38,04,819/- and Rs.137,12,08,408/- respectively and the perusal of the Resolution Plan also manifest the fact that the RP has obtained an affidavit from the successful Resolution Applicant that he is not ineligible to submit the Resolution Plan as per Section 29A of the IBC, 2016. 8.8. From the averments made in the Application as well as in Form-H as filed by the Resolutio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . 38(2) -- Resolution Plan shall provide: a) term of plan and its implementation schedule b) management and control of the business of the Corporate Debtor during its term; c) it has provisions for effective implementation d) it has provisions for approval required and the timeline for the same; and e) the Resolution applicant has the capability to implement the Resolution Plan. Clause 5.4 of the Resolution Plan deals with the Implementation Schedule and supervision of the Resolution Plan Reg. 38 ~- Resolution Plan shall demonstrate: a) it address the cause of default b) it is feasible and viable c) it has provisions for effective implementation d) it has provisions for approval required and the timeline for the same e) the resolution applicant has the capability to implement the resolution plan Clause 3.7 of the Resolution Plan and the sub sections given thereunder address the capability of the Resolution Applicant to implement the Resolution Plan and Clause 5.6 of the Resolution Plan deals with the provisions for effective implementation. S. 30(2)(e) - Does not contravene any of the provisions of the law for the time being in force The Resolution Professional ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the same into effect, the Corporate Debtor in the capacity of assignor, RISPL in the capacity of assignee and the relevant customer executed various assignment agreements to set out their agreement in respect of the assignment of the O&M agreements. Pursuant to the execution of the said assignment agreements with various customers, all obligations, promises or commitments made or guarantee given by, or indemnity given by the Corporate Debtor whatsoever in respect of obligation of RISPL with regard to the O&M agreement shall stand extinguished, released and discharged, without any further act, instrument or deed by the Corporate Debtor, and no person shall have any claim whatsoever against the Corporate Debtor or the Resolution Applicant in respect of obligation or liabilities of the Corporate Debtor under the said assignment agreements. Granted, subject to the provisions of IBC, 2016 and other Applicable laws 3 Contract with National Aluminium Company Limited ("NALCO"):Post the Transfer Date the Corporate Debtor will complete and implement 15 (fifteen) MW (10 (ten) WEGs) out of the agreed 25.5 MW wind energy project at Kayathar site, Tuticorin in terms of the agreement dated Oc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t and the Corporate Debtor shall have immunity from any actions and penalties (of any nature whatsoever) under any applicable laws for any non-compliance of applicable laws or breach of contractual obligations in relation to or by the Corporate Debtor for any period upto the Transfer Date. Granted 7 The Corporate Debtor shall be entitled to carry forward the unabsorbed depreciation and accumulated losses under the income tax and minimum alternate tax and to utilize such amounts to set off future tax obligations. Granted 8 All consents, licenses, approvals, rights, entitlements, benefits and privileges whether under applicable law, contract, lease or license, granted in favour of the Corporate Debtor or to which the Corporate Debtor is entitled or accustomed to shall, notwithstanding that they may have already lapsed or expired due to any noncompliance or efflux of time, be deemed to continue without disruption for the benefit of the Corporate Debtor and the Resolution Applicant for a period of 12 months from the Approval Date (as defined in the resolution plan) or until the period mentioned in such licenses, consents or approval ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a in the matter of Committee of Creditors of Essar Steels -Vs- Satish Kumar Gupta &Ors. in Civil Appeal No. 8766 - 67 of 2019at para 42 has held as follows; 42 ......... Thus, it is clear that the limited judicial review available, which can in no circumstance trespass upon a business decision of the majority of the Committee of Creditors, has to be within the four corners of Section 30(2) of the Code, insofar as the Adjudicating Authority is concerned, and Section 32 read with Section 61(3) of the Code, insofar as the Appellate Tribunal is concerned, the parameters of such review having been clearly laid down in K. Sashidhar (supra). 12. Further the Supreme Court in the matter of K. Sashidhar v. Indian Overseas Bank and Ors. (2019) 12 SCC 150 has lucidly delineated the scope and interference of the Adjudicating Authority in the process of approval of the Resolution Plan and held as follows; "55. Whereas, the discretion of the adjudicating authority (NCLT) is circumscribed by Section 31 limited to scrutiny of the resolution plan "as approved" by the requisite per cent of voting share of financial creditors. Even in that enquiry, the grounds on which the adjudicating authority ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the I&B Code, which is limited to matters "other than" enquiry into the autonomy or commercial wisdom of the dissenting financial creditors. Thus, the prescribed authorities (NCLT/NCLAT) have been endowed with limited jurisdiction as specified in the I&B Code and not to act as a court of equity or exercise plenary powers." (emphasis supplied) 13. Also the Supreme Court of India in the matter of Committee of Creditors of Essar Steel India Limited v. Satish Kumar Gupta and Ors. (2020) 8 SCC 531 after referring to the decision in K. Sashidhar (supra) has held as follows; "73. There is no doubt whatsoever that the ultimate discretion of what to pay and how much to pay each class or sub-class of creditors is with the Committee of Creditors, but, the decision of such Committee must reflect the fact that it has taken into account maximising the value of the assets of the corporate debtor and the fact that it has adequately balanced the interests of all stakeholders including operational creditors. This being the case, judicial review of the Adjudicating Authority that the resolution plan as approved by the Committee of Creditors has met the requirements referred to in Section 30(2) wo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... me of IBC, where approval of resolution plan is exclusively in the domain of the commercial wisdom of CoC, the scope of judicial review is correspondingly circumscribed by the provisions contained in Section 31 as regards approval of the Adjudicating Authority and in Section 32 read with Section 61 as regards the scope of appeal against the order of approval. 77.1. Such limitations on judicial review have been duly underscored by this Court in the decisions above-referred, where it has been laid down in explicit terms that the powers of the Adjudicating Authority dealing with the resolution a do not extend to examine the correctness or otherwise of the commercial wisdom exercised by the CoC. The limited judicial review available to Adjudicating Authority lies within the four corners of Section 30(2) of the Code, which would essentially be to examine that the resolution plan does not contravene any of the provisions of law for the time being in force, it conforms to such other requirements as may be specified by the Board, and it provides for: (a) payment of insolvency resolution process costs in priority; (b) payment of debts of operational creditors; (c) payment of debts of diss ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... interference with the commercial aspects of the decision of the CoC; and there is no scope for substituting any commercial term of the resolution plan approved by the CoC. Within its limited jurisdiction, if the Adjudicating Authority or the Appellate Authority, as the case may be, would find any shortcoming in the resolution plan vis-a-vis the specified parameters, it would only send the resolution plan back to the Committee of Creditors, for re-submission after satisfying the parameters delineated by Code and exposited by this Court. 15. Thus, from the catena of judgments rendered by the Supreme Court on the scope of approval of the Resolution Plan, it is amply made clear that only limited judicial review is available for the Adjudicating Authority under Section 30(2) and Section 31 of IBC, 2016 and this Adjudicating Authority cannot venture into the commercial aspects of the decisions taken by the Committee of Creditors. 16. On perusal of the documents on record, we are also satisfied that the Resolution Plan is in accordance with sections 30 and 31 of IBC, 2016. Thus, the Resolution Plan is hereby approved and is binding on the Corporate Debtor and other stakeholders involved ..... X X X X Extracts X X X X X X X X Extracts X X X X
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