TMI Blog2022 (9) TMI 1289X X X X Extracts X X X X X X X X Extracts X X X X ..... D THAT:- In case the Homebuyers are not satisfied with the conduct of the AR, they have the option of replacing him. Since no such steps were taken in the present case, the AR proceeded to vote in favour of the Plan according to the majority votes of the Homebuyers and since he did not change his vote after receiving the communication regarding extension of the voting lines, it is deemed that the AR voted according to the instructions he received from the Homebuyers he represents - this is a belated stage for the Homebuyers to raise allegations against the AR especially after the CoC has voted in favour of the Resolution Plan with an overwhelming majority of 96.14% voting share. Moreover, the AR has already voted in favour of the Plan and a change in this decision would not influence the results in a substantial manner given that the Homebuyers hold 7.45% voting share in the CoC. Environment Clearances - HELD THAT:- It is noted that the Applicants apprehensions related to extension of the EC are legitimate and the EC is a mandatory compliance for the revival of the Corporate Debtor. The RP is cognizant of this fact and has taken several steps to procure the EC as expeditiousl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ndums kindly be stayed; 2. The Corporate Debtor was admitted into CIRP on 30th August 2018 under an Application filed by Raj Infrastructure Development (India) Private Ltd. filed under Section 9 of the Insolvency and Bankruptcy Code, 2016 (hereinafter called the Code ) and the Respondent No. 1 was appointed as the Resolution Professional (RP). Thereafter, the CIRP of the present Corporate Debtor was consolidated with four of their wholly-owned subsidiaries and a Consolidated Committee of Creditors (CoC), Respondent No. 2 herein, was constituted for all the companies vide Order dated 13th May 2021. Subsequently, during the course of the CIRP, the CoC approved the Resolution Plan dated 20th November 2021 proposed by Darwin Platform Infrastructure Limited, Respondent No. 4 (the Successful Resolution Applicant, hereinafter known as RA ) with 96.41% majority voting share in the Consolidated Meeting of the CoC held on 23rd November 2021. The said Plan is pending for approval before this Bench. 3. The Applicants base their argument on seven grounds of challenge. Their submissions are summarised as hereunder: a. Firstly, the Applicants submit that the Homebuyers were promised ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ingent liabilities. e. Fifthly, the Applicants argue that the RA has not laid down the projected cash flow, balance sheet and profit and loss account of the Corporate Debtor despite which the CoC voted on the Plan without evaluating its feasibility and viability. This gives rise to considerable apprehension in the minds of the Applicants as the Plan envisages contribution from the Homebuyers towards actual cost of construction without informing individual Homebuyers of the exact amount/ liability of such contribution expected from them. f. Sixthly, the Applicants raise allegations on the entire voting process by which the Plan was approved by the CoC. It is submitted that the Resolution Plan was put to vote in the 17th CoC Meeting and the voting for CoC was to open from 25th November 2021 and for Homebuyers from 26th November 2021. In the meantime, several issues cropped up during the 18th CoC Meeting which was held when the voting lines were still open and these were to be resolved by submitting addendums to the Resolution Plan by the RA. Three such addendums were submitted by the RA and accepted by the RP but the Homebuyers were not given due notice of this fact and t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... btor was duly calculated by Registered Valuers who provided an estimate of the fair value and liquidation value in terms of Regulation 35 of the CIRP Regulations. Hence the liquidation value is not notional and in fact, the Plan was approved by the CoC after considering this liquidation value along with the viability of the Plan. d. The RP submits that Homebuyers constitute a separate class of creditors and they may be afforded a treatment that is different from other Financial Creditors in the CIRP. The RP argues that it is open for the RA to strike different bargains between creditors belonging to different classes and the same was held in the case of Essar. It is denied that only the payout made to the Homebuyers is linked to the grant of EC while there is no such linkage for the payments to the secured Financial Creditors. e. The RP states that the Plan cannot be termed as conditional merely because it stipulates procuring EC as key to successful resolution and revival of the Corporate Debtor as any development or construction in the area earmarked for building the Hill Station is intrinsically linked to procurement of EC and no meaningful revival is possible in i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... erent class of creditors distinct from the other Financial creditors. Individual Homebuyers may have divergent views but ultimately, they vote as a class and individuals therein cannot claim to be dissenting financial creditors if they vote against the Resolution Plan. This is elaborated in Jaypee Kensington (supra) as follows: 163 .we are clearly of the view that the propositions of some of the associations and individual homebuyers to claim themselves as dissenting homebuyers and thereby, dissenting financial creditors do not stand in conformity with the scheme of the Code and the manner of voting on a plan of resolution by the Committee of Creditors. 165 There is no scope for any homebuyer suggesting himself to be a dissenting financial creditor merely because he was not with majority within the class. His dissatisfaction does not partake the legal character of a dissenting financial creditor. Thus, since Individual Homebuyers cannot be called as dissenting Financial Creditors, the question of providing separate liquidation values to each Homebuyer under Section 30 of the Code does not arise. 6. Secondly, whether the e-voting conducted by the RP for app ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in the CoC. 8. Additionally, it was contended by the Applicants that when the Plan was put to vote before the Homebuyers, only 230 out of 1086 Homebuyers voted and out of which only 144 Homebuyers voted for the Plan which constitutes hardly 10% of the total number of Homebuyers, hence the requisite 50% majority mark was not achieved as claimed by the RP. To put rest to this argument, a bare reading of sub-section (3A) of Section 25A would suffice: (3A) Notwithstanding anything to the contrary contained in sub-section (3), the authorised representative under sub-section (6A) of section 21 shall cast his vote on behalf of all the financial creditors he represents in accordance with the decision taken by a vote of more than fifty per cent. of the voting share of the financial creditors he represents, who have cast their vote: The Code is thus abundantly clear on the fact that the 50% majority mark has to be achieved amongst those creditors of a particular class who actually cast their vote. In the instant case, voting results of the Homebuyers show that 65.69% majority (Out of 230 Homebuyers present and voting, 144 voted in favour) was achieved which is more than the re ..... X X X X Extracts X X X X X X X X Extracts X X X X
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