9911796707
TMI Blog2022 (12) TMI 276X X X X Extracts X X X X X X X X Extracts X X X X ..... IA(IBC)/13/KOB/2021 in TIBA/11/KOB/2019, had among other things, observed as under: 9. "The Applicant submitted that the Resolution Plan meets the requirement of Section 30 (2) of the Code in the following manner: A. Plan provides for the priority payment of CIRP costs in full from the fund to be infused by the Resolution Applicant. B. To pay the Operational Creditors of the Corporate Debtor in the manner indicated in Clause 5.1.18.1 of the Plan. C. The average Liquidation Value of the Corporate Debtor is INR 122,90,59,890/- and average Fair Value is INR 162,22,78,150/-. D. Provides management of the CD after approval of the resolution plan for operations of the Corporate Debtor in terms of Section 30(2)(c). E. Provides implementation and supervision of the Resolution Plan as per Section 30(2)(d). F. The Plan has been approved by CoC with 100% voting share. G. The Resolution Applicant has given a declaration that the Resolution Plan does not contravene any provisions of the law for the time being in force. 10. The Applicant has also submitted that the Plan is in compliance of Regulation 38 of the Regulations in view of the following: a) Payment to Operational Cr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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 Court further held that the discretion of the Adjudicating Authority is circumscribed by Section 31 and is limited to scrutiny of the Resolution Plan "as approved" by the requisite percentage of voting share of financial creditors. Even in that enquiry, the grounds on which the Adjudicating Authority can reject the Resolution Plan is in reference to matters specified in Section 30(2) when the Resolution Plan does not conform to the stated requirements. 15. In CoC of Essar Steel (supra) the Hon'ble Apex Court clearly laid down that the Adjudicating Authority would not have power to modify the Resolution Plan which the CoC in their commercial wisdom have approved. In para 42 Hon'ble Court observed as under: "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 C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lant', had paid more than Rs.12 Lakhs towards the 'GST', for the supply of the Medicines to the Corporate Debtor, wherein, no payment was made by them. Besides this, no provisions were made in the 'Plan', at least to return the GST sum, paid by the 'Appellant', in respect of the 'Sale of Medicine' to the 'Corporate Debtor'. 8. In reality, the Appellant had suffered an 'Overdraft Loan' of around Rs.3 Crores, by giving 'Collateral Security', for running a 'Firm', which is still a 'Financial Threat', to the Appellant's survival. The categorical plea of the Appellant that the 'Present Approval Plan' and the Order passed by the 'Adjudicating Authority', in approving the 'Resolution Plan', by allowing the IA(IBC)/13/KOB/2021 in TIBA/11/KOB/2019, are in 'Violation' of the 'existing laws' and 'principles of natural justice'. 9. The other emphatic stand of the Appellant is that itself and other Creditors were completely in dark about the proceedings of the '1st Respondent / Resolution Professional' and the .'Committee of Creditors'. Further, the 'Appellant' was not provided with an 'opportunity or any of the Workmen to present their views or claims', while determining the admitted 'Claim' ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... solution Applicant', is beyond the 'Contours of Law' and 'Violation of Section 30 (2) (e) of the Code', and hence, the 'Resolution Plan', submitted by the 'Resolution Applicant' is liable to be set aside. 17. The Learned Counsel for the Appellant points out that although the 'Approval of the Resolution Plan', rests with the 'Commercial Wisdom' of the 'Committee of Creditors', the 'discrimination', ought not to be apparent 'on the face of record'. 18. The 'Operational Creditors', are paid Rs. 1 Crore, while Rs.125 Crores is paid as 'consideration' to the 'Financial Creditors'. The ratio behind the 'Operational Creditors', not being given the power to exercise their 'wisdom', in the 'Approval of the Resolution Plan', is to curtail the 'decision making process' of the 'Resolution Plan'. That cannot be taken advantage of, by the 'Financial Creditors', and the conduct of the 'Financial Creditor' and the 'Resolution Applicant' is an 'abuse of process' and therefore, the 'Resolution Plan' is to be 'Rejected', at the very inception, itself. 19. The Learned Counsel for the Appellant, points out that the 'Resolution Plan', contains obligations on the 'Regulatory Authorities' and in Paragr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Debtor'. Further, in the 'Resolution Plan' of Clause 5.1.18.3, payable to 'unsecured Financial Creditors and Operational Creditors', shall be paid in 'priority', as contemplated under the I & B Code, 2016. 24. The Learned Counsel for the Respondent Nos.1 & 3 adverts to Clause 5.1.18.2 & 5.1.18.3 of the Resolution Plan, which runs as under: "5.1.18.2: The Claim amount admitted being higher than the Plan Consideration; the same may not be enough to satisfy payments for Claims to all the Creditors. Any Claim pending unpaid shall stand extinguished, the Corporate Debtor / Demerged Properties / Resolution Applicant shall not be liable or responsible or obligated for such Claims and shall stand absolutely discharged and shall be free from all obligations (direct or incidental or related to such Claims). 15.1.18.3: Considering the above, although not required, over and above the Plan Consideration, the Resolution Applicant will pay an amount of INR 1,00,00,000 (Indian Rupees One Crore Only) to the Escrow Account for the benefit of the unsecured Financial Creditors and Operational Creditors only. The same shall be distributed by the Monitoring Agent to the unsecured Financial Credito ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to appoint another 'Registered Valuer', by the 'Resolution Professional', to furnish an estimate of the 'Value', computed in the same manner, as per 'Regulation 35(b) of 'CIRP Regulations'. 29. The Learned Counsel for the Respondent Nos.1 & 3 takes a stand that the 'Value', arrived at by the 'Registered Valuers', are only estimates, and the same cannot be construed as 'Accurate Value', of the 'Corporate Debtor'. 30. The Learned Counsel for the Respondent Nos.1 & 3 by pointing out 'Regulations 35 (2) of the CIRP Regulations', comes out with a plea that the '1st Respondent', had provided the 'Fair Value' and the 'Liquidation Value' of the 'Corporate Debtor' to the members of the 'Committee of Creditors', after the receipt of 'Resolution Plans' in accordance with the Code and regulations made thereunder and after obtaining the undertaking from the 'Committee of Creditors' members to the effect that they shall maintain confidentiality of the 'Fair Value' and the 'Liquidation Value' and shall not use such values to cause an undue gain or undue loss to itself or any other person and comply with the requirements under sub-section (2) of section 29. 31. The Learned Counsel for the Respo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that for final approval of a resolution plan, the Adjudicating Authority has to be satisfied that the requirement of Sub-section (2) of Section 30 of the Code has been complied with. The proviso to Section 31(1) of the Code stipulates the other point on which an Adjudicating Authority has to be satisfied. That factor is that the resolution plan has provisions for its implementation. The scope of interference by the Adjudicating Authority in limited judicial review has been laid down in the case of Essar Steel (supra), the relevant passage (para 54) of which we have reproduced in earlier part of this judgment. The case of MSL in their appeal is that they want to run the company and infuse more funds. In such circumstances, we do not think the Appellate Authority ought to have interfered with the order of the Adjudicating Authority in directing the successful Resolution Applicant to enhance their fund inflow upfront." 33. The Learned Counsel for the Respondent Nos. 1 & 3 submits that the object behind prescribing the 'Valuation' of the 'Corporate Debtor', is to assist the 'Committee of Creditors', to take an effective decision on the 'Resolution Plan' and there was no Statutory Mand ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... CoC meetings through voting, as per voting shares, is a collective business decision. The legislature, consciously, has not provided any ground to challenge the "commercial wisdom" of the individual financial creditors or their collective decision before the adjudicating authority. That is made nonjusticiable. 35. 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 percent of voting share of financial creditors. Even in that enquiry, the grounds on which the adjudicating authority can reject the resolution plan is in reference to matters specified in Section 30(2), when the resolution plan does not conform to the stated requirements. Reverting to Section 30(2), the enquiry to be done is in respect of whether the resolution plan provides : (i) the payment of insolvency resolution process costs in a specified manner in priority to the repayment of other debts of the corporate debtor, (ii) the repayment of the debts of operational creditors in prescribed manner, (iii) the management of the affairs of the corporate debtor, (iv) the implementation and supervision of the re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in exercise of powers "by the resolution professional" during the corporate insolvency resolution period. Third, the debts owed to operational creditors have not been provided for in the resolution plan in the prescribed manner. Fourth, the insolvency resolution plan costs have not been provided for repayment in priority to all other debts. Fifth, the resolution plan does not comply with any other criteria specified by the Board. Significantly, the matters or grounds be it under Section 30(2) or under Section 61(3) of the I&B Code are regarding testing the validity of the "approved" resolution plan by the CoC; and not for approving the resolution plan which has been disapproved or deemed to have been rejected by the CoC in exercise of its business decision. 38. Indubitably, the inquiry in such an appeal would be limited to the power exercisable by the resolution professional under Section 30(2) of the I & B Code or, at best, by the adjudicating authority (NCLT) under Section 31(2) read with 31(1) of the I & B Code. No other inquiry would be permissible. Further, the jurisdiction bestowed upon the appellate authority (NCLAT) is also expressly circumscribed. It can examine the cha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... owers the adjudicating authority (NCLT) to oversee the justness of the approach of the dissenting financial creditors in rejecting the proposed resolution plan or to engage in judicial review thereof. Concededly, the inquiry by the resolution professional precedes the consideration of the resolution plan by the CoC. The resolution professional is not required to express his opinion on matters within the domain of the financial creditor(s), to approve or reject the resolution plan, under Section 30(4) of the I&B Code. At best, the Adjudicating Authority (NCLT) may cause an enquiry into the "approved" resolution plan on limited grounds referred to in Section 30(2) read with Section 31(1) of the I&B Code. It cannot make any other inquiry nor is competent to issue any direction in relation to the exercise of commercial wisdom of the financial creditors be it for approving, rejecting or abstaining, as the case may be. Even the inquiry before the Appellate Authority (NCLAT) is limited to the grounds under Section 61(3) of the I&B Code. It does not postulate jurisdiction to undertake scrutiny of the justness of the opinion expressed by financial creditors at the time of voting. To take an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the resolution scheme - workers are paid, the creditors in the long run will be repaid in full, and shareholders/investors are able to maximize their investment. Timely resolution of a corporate debtor who is in the red, by an effective legal framework, would go a long way to support the development of credit markets. Since more investment can be made with funds that have come back into the economy, business then eases up, which leads, overall, to higher economic growth and development of the Indian economy. What is interesting to note is that the Preamble does not, in any manner, refer to liquidation, which is only availed of as a last resort if there is either no resolution plan or the resolution plans submitted are not up to the mark. Even in liquidation, the liquidator can sell the business of the corporate debtor as a going concern. [See ArcelorMittal (supra) at paragraph 83, footnote 3]. 12. It can thus be seen that the primary focus of the legislation is to ensure revival and continuation of the corporate debtor by protecting the corporate debtor from its own management and from a corporate death by liquidation. The Code is thus a beneficial legislation which puts the corp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n 14 shall cease to have effect. The scheme of the Code, therefore, is to make an attempt, by divesting the erstwhile management of its powers and vesting it in a professional agency, to continue the business of the corporate body as a going concern until a resolution plan is drawn up, in which event the management is handed over under the plan so that the corporate body is able to pay back its debts and get back on its feet. All this is to be done within a period of 6 months with a maximum extension of another 90 days or else the chopper comes down and the liquidation process begins. [emphasis supplied] 54. It could thus be seen, that one of the dominant objects of I&B Code is to see to it, that an attempt has to be made to revive the Corporate Debtor and make it a running concern. For that, a resolution applicant has to prepare a resolution plan on the basis of the Information Memorandum. The Information Memorandum, which is required to be prepared in accordance with Section 29 of I&B Code along with Regulation 36 of the Regulations, is required to contain various details, which have been gathered by RP after receipt of various claims in response to the statutorily mandated p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mmittee and it has been provided, that the decision with regard to appropriate disposition of a defaulting firm, which is a business decision, should only be made by the creditors. It has been observed, that the evaluation of proposals to keep the entity as a going concern, including decisions about the sale of business or units, restructuring of debt, etc., are required to be taken by the Committee of the Financial Creditors. It has been provided, that the choice of the solution to keep the entity as a going concern will be voted upon by CoC and there are no constraints on the proposals that the resolution professional can present to CoC. The requirements, that the resolution professional needs to confirm to the Adjudicator, are: (i) that the solution must explicitly require the repayment of any interim finance and costs of the insolvency resolution process will be paid in priority to other payments; (ii) that the plan must explicitly include payment to all creditors not on the creditors committee, within a reasonable period after the solution is implemented; and lastly; (iii) the plan should comply with existing laws governing the actions of the entity while implementing th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 270 days (outer limit) failing which, initiation of liquidation process has been made inevitable and mandatory. In the earlier regime, the corporate debtor could indefinitely continue to enjoy the protection given under Section 22 of the Sick Industrial Companies Act, 1985 or under other such enactments which has now been forsaken. Besides, the commercial wisdom of CoC has been given paramount status without any judicial intervention, for ensuring completion of the stated processes within the timelines prescribed by the I&B Code. There is an intrinsic assumption that financial creditors are fully informed about the viability of the corporate debtor and feasibility of the proposed resolution plan. They act on the basis of thorough examination of the proposed resolution plan and assessment made by their team of experts. The opinion on the subject−matter expressed by them after due deliberations in CoC meetings through voting, as per voting shares, is a collective business decision. The legislature, consciously, has not provided any ground to challenge the "commercial wisdom" of the individual financial creditors or their collective decision before the adjudicating authority. T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... certain type of operational creditor, namely, the electricity distribution company, out of upfront payment offered by the proposed resolution applicant which may also result in a consequent reduction of amounts payable to other financial and operational creditors. What is important is that it is the commercial wisdom of this majority of creditors which is to determine, through negotiation with the prospective resolution applicant, as to how and in what manner the corporate resolution process is to take place." (emphasis supplied) 145. This Court held, that what is left to the majority decision of CoC is the "feasibility and viability" of a resolution plan, which is required to take into account all aspects of the plan, including the manner of distribution of funds among the various classes of creditors. It has further been held, that CoC is entitled to suggest a modification to the prospective resolution applicant, so that carrying on the business of the Corporate Debtor does not become impossible, which suggestion may, in turn, be accepted by the resolution applicant with a consequent modification as to distribution of funds, etc. It has been held, that what is important is, t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aggage of variety of factors. To wit, the feasibility and viability of the proposed resolution plan and including their perceptions about the general capability of the resolution applicant to translate the projected plan into a reality. The resolution applicant may have given projections backed by normative data but still in the opinion of the dissenting financial creditors, it would not be free from being speculative. These aspects are completely within the domain of the financial creditors who are called upon to vote on the resolution plan under Section 30(4) of the I&B Code." 148. It has been held, that in an enquiry under Section 31, the limited enquiry that the Adjudicating Authority is permitted is, as to whether the resolution plan provides: (i) the payment of insolvency resolution process costs in a specified manner in priority to the repayment of other debts of the corporate debtor, (ii) the repayment of the debts of operational creditors in prescribed manner, (iii) the management of the affairs of the corporate debtor, (iv) the implementation and supervision of the resolution plan, (v) the plan does not contravene any of the provisions of the law for the time ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ground that it is only an opinion of the minority financial creditors....." 152. This Court in Committee of Creditors of Essar Steel India Limited through Authorised Signatory (supra) after reproducing certain paragraphs in K. Sashidhar (supra) observed thus: "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." 153. It can thus be seen, that this Court has clarified, that the limited judicial review, which is available, can in no circumstance trespass upon a business decision arrived at by the majority of CoC. 154. In the case of Maharashtra Seamless Limited (supra), NCLT had approved the plan of appellant therein with regard to CIRP of United Seamless Tubulaar (P) Ltd. In appeal, NCLAT directed, that the Appellant therein should increase upfront payment to Rs.597.54 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... olution applicant to enhance their fund inflow upfront. 156. It would thus be clear, that the legislative scheme, as interpreted by various decisions of this Court, is unambiguous. The commercial wisdom of CoC is not to be interfered with, excepting the limited scope as provided under Sections 30 and 31 of the I&B Code." 38. The Learned Counsel for the Respondent Nos. 1 & 3, refers to the Judgment of the Hon'ble Supreme Court of India, in the matter of Committee of Creditors of Essar Steel India Limited v. Satish Kumar and Ors. (vide Civil Appeal Nos. 8766 - 67 of 2019), wherein, it was held that the limited Judicial review available with the 'Adjudicating Authority' or the 'Appellate Tribunal', has to be within the four corners of Section 30 (2) of the Code. 39. Further, in regard to the 'Adjudicating Authority' is concerned and Section 32 read with Section 61 (3) of the Code, in regard to the 'Appellate Tribunal' is concerned, can in no circumstance trespass upon a business decision arrived at by the majority of the 'Committee of Creditors'. 40. Moreover, it is not open to the 'Adjudicating Authority', or an 'Appellate Authority', to reckon any other factor, other than menti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... de. In fact, the Adjudicating Authority, after fully satisfying itself about the compliances under the Code, had approved the Resolution Plan, as per Section 31 of the I & B Code. 46. The Learned Counsel for the Respondent Nos. 1 & 3, prays for dismissal of the instant Comp. App (AT) (CH) (INS) No. 179 of 2021, filed by the 'Appellant', before this 'Tribunal'. Pleas of 2nd Respondent / Successful Resolution Applicant : 47. According to the Learned Counsel for the 2nd Respondent, the 'Resolution Plan', was implemented in its entirety and that the 'Corporate Debtor' was not functional for a long period and that the implementation of the 'Employee Engagement Programme', as contemplated in the 'Plan' had commenced. Furthermore, the instant 'Appeal', is a concocted endeavour to delay the 'Revival'. Fair Value: 48. A 'Fair Value', is an estimated 'Realisable Value' of the 'Assets' of the 'Corporate Debtor', if they were to be exchanged on the beginning of 'Insolvency Commencement Date' and the 'Liquidation Value' is the estimated 'Realisable Value' of 'Assets' of the 'Corporate Debtor', if the 'Corporate Debtor' were to be liquidated on the beginning of the 'Insolvency Commencement ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 75% of voting share on 'Financial Creditors', as per Section 30(4) of the I & B Code, 2016. An 'Adjudicating Authority', can examine the 'reasoning of accepting or rejecting or any objection or suggestion and express his views in the matter. 53. In tune with the ingredients of Section 31 of the I & B Code, 2016, even an 'Adjudicating Authority', is satisfied with the 'Resolution Plan', being 'approved', by the 'Committee of Creditors', as per Section 30 (4) of the I & B Code, that it fulfils the requirements, as visualised in Section 30 (2) of the Code, it shall by an 'Order' approve the 'Resolution Plan', which shall be binding on the 'Corporate Debtor', 'Members', 'Employees', 'Creditors' and other 'Stakeholders', involved in the 'Resolution Plan'. 54. One of the objects of the I & B Code, 2016, is to promote 'entrepreneurship', 'availability of credit' and 'balancing interest'. It is pointed out that a 'Resolution Plan' is not a 'Recovery' / not a 'Sale' / not an 'Auction'. No individual is either buying and selling the 'Corporate Debtor'. However, a 'Resolution Plan', is not to be a 'Discriminatory one'. 55. If there is a 'Resolution Applicant', who can continue to run the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... itors', on the numerous 'Legal', 'Technical' and 'Financial' aspects of the 'Resolution Plan'. In fact, the 'Committee of Creditors', had unanimously approved the 'Resolution Plan', after considering its 'Feasibility' and 'Viability', the manner of 'Distribution' proposed and compliance with the 'Provisions' of the 'Code' and 'Regulations', made thereunder, and such other requirements, as may be prescribed by the 'Board'. Judicial Review: 61. The scope of 'Judicial Review', by an 'Adjudicating Authority', revolves around a 'restricted and narrow field'. 62. Furthermore, the 'Resolution Plan', given by the 'Resolution Applicant', had satisfied the requirements, mentioned in the I & B Code, and the Regulations, thereunder and a 'Compliance Certificate', was filed by the '1st Respondent / Resolution Professional' in this regard, before the 'Adjudicating Authority' ('National Company Law Tribunal'), in terms of the Regulation 39 (4) of the 'Corporate Insolvency Resolution Process Regulations'. 63. It cannot be ignored, that the 'Commercial Wisdom' of the 'Committee of Creditors', is not be interfered with, except in the limited ambit, as contemplated under Section 30 (2) of the I & ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s' of Essar Steel India Ltd. v. Satish Kumar Gupta, the Hon'ble Supreme Court of India (vide Judgement dated 15.11.2019, in Civil Appeal Nos.8766-8767 of 2019 (reported in MANU/SC/1577/2019) at Paragraphs 53 and 54, it is observed as under: 53. "However, as has been correctly argued on behalf of the operational creditors, the preamble of the Code does speak of maximisation of the value of assets of corporate debtors and the balancing of the interests of all stakeholders. There is no doubt that a key objective of the Code is to ensure that the corporate debtor keeps operating as a going concern during the insolvency resolution process and must therefore make past and present payments to various operational creditors without which such operation as a going concern would become impossible. Sections 5(26), 14(2), 20(1), 20(2)(d) and (e) of the Code read with Regulations 37 and 38 of the 2016 Regulations all speak of the corporate debtor running as a going concern during the insolvency resolution process. Workmen need, to be paid, electricity dues need to be paid, purchase of raw materials need to be made, etc. This is in fact reflected in this Court's judgment in Swiss Ribbons (s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r as a going concern. (See ArcelorMittal [ArcelorMittal (India) (P) Ltd. v. Satish Kumar Gupta, MANU/SC/1123/2018: (2019) 2 SCC 1] at para 83, fn3). (emphasis supplied) 54. This is the reason why Regulation 38(1A) speaks of a resolution plan including a statement as to how it has dealt with the interests of all stakeholders, including operational creditors of the corporate debtor. Regulation 38(1) also states that the amount due to operational creditors under a resolution plan shall be given priority in payment over financial creditors. If nothing is to be paid to operational creditors, the minimum, being liquidation value which in most cases would amount to nil after secured creditors have been paid - would certainly not balance the interest of all stakeholders or maximise the value of assets of a corporate debtor if it becomes impossible to continue running its business as a going concern. Thus, it is clear that when the Committee of Creditors exercises its commercial wisdom to arrive at a business decision to revive the corporate debtor, it must necessarily take into account these key features of the Code before it arrives at a commercial decision to pay off the dues of fina ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... operational and as secured or unsecured. Full freedom and discretion has been given, as has been seen hereinabove, to the Committee of Creditors to so classify creditors and to pay secured creditors amounts which can be based upon the value of their security, which they would otherwise be able to realise outside the process of the Code, thereby stymying the corporate resolution process itself." 66. Dealing with the plea of the 'Appellant' that a 'Resolution Applicant', cannot be a 'Charitable Public Trust', and that in the present case, the 'Resolution Applicant' / 'Lissie Medical Institutions', is a 'Charitable Public Trust', and further that, the 'act of acquiring the Corporate Debtor', under the 'Resolution Plan', cannot be placed under any of the purview of 'Charitable Purpose', this 'Tribunal', aptly points out that the decision of the Hon'ble Supreme Court of India (relied on the side of the '2nd Respondent' / 'Successful Resolution Applicant'), in Sole Trustee Loka Shikshana Trust v. Commissioner of Income Tax, reported in 1976 1 SCC at Page 254, wherein it is observed as under: "The difficult question, however, still remains: what is the meaning of "charitable purpose" w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vote after satisfying itself about the compliance of Section 30 of the I & B Code, 2016. To put it succinctly, the 'Adjudicating Authority', ('National Company Law Tribunal', Kochi Bench, Kerala) was subjectively satisfied as to the compliance of the requirements under the I & B Code, 2016, and 'Approved' the 'Resolution Plan', in conformity with Section 31 of the I & B Code, 2016. 71. This 'Tribunal', on going through the words, any person 'Aggrieved', occurring in Section 61 (1) of the I & B Code, 2016, is of the view that in Section 61 (1) of the Code, the words 'Party Aggrieved', are not employed. For an affected person, the 'Order' of an 'Adjudicating Authority', must cause a 'Legal Grievance', by wrongfully depriving him of something and in the process, his 'Legal Right' is breached, by the act complained of. 72. In the present case, in view of the plea taken by the 'Appellant' that as an 'Operational Creditor', who had supplied 'Life Saving Medicines' to the 'Corporate Debtor' / 'M/s. PVS Hospital' and they had purposefully withheld payments due to the 'Appellant' in respect of the period from Jun'2017 to Apr'2019 and when the credit had exceeded the limits, in Nov'2018, t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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