TMI Blog2023 (2) TMI 486X X X X Extracts X X X X X X X X Extracts X X X X ..... tion Professional on 02.07.2021, on which application notices were issued and it was only at that stage when Appellants have filed I.A. No. 4388/2021 seeking direction to permit the Appellants Suspended Directors to submit Resolution Plan for revival of the Corporate Debtor. From the order passed by the Adjudicating Authority, it is clear that the Adjudicating Authority also extended the CIRP period and directed the Resolution Professional to call a lenders meeting for taking appropriate decision and deliberate on whether more Resolution Applicants can be invited. After the order of the Adjudicating Authority dated 28.09.2021, meeting of CoC took place on 20.10.2021, where it was decided to consider the Resolution Plan submitted by the Appellants. However, CoC did not decide to issue any fresh Form G and invite any other Resolution Applicants, which act of the CoC has been adversely commented by the Adjudicating Authority - the Adjudicating Authority vide order dated 28.09.2021 gave opportunity to the Resolution Professional and the CoC to take steps to revive the Corporate Debtor. The Adjudicating Authority is right in its observation that the CoC ought to have taken steps in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion, on which notices were issued by the Adjudicating Authority. (vii) On 06.09.2021, Suspended Directors of the Corporate Debtor appeared before the Adjudicating Authority and submitted that they are interested in submitting Resolution Plan for revival of the Corporate Debtor and they shall be filing an application for above purpose. (viii) I.A. No. 4388/2021 was filed by the Appellant seeking direction that the Resolution Plan submitted by the Appellant be placed before the CoC for consideration. The Appellant s case was that the Corporate Debtor has been registered as MSME on 30.08.2021 and Appellants are now eligible to file Resolution Plan by virtue of Section 240A of the Code. (ix) The Adjudicating Authority passed an order on 28.09.2021 allowing the I.A. No. 4388/2021 filed by the Appellant. The Resolution Professional to call for a lenders meeting for taking appropriate decision and to deliberate on whether more Resolution Applicants can be invited. The Adjudicating Authority also extended the period of CIRP for 150 days. (x) Appellants submitted Resolution Plan on 19.10.2021. CoC in 6th meeting held on 20.10.2021, deliberated and decided to consider the Resolu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o submit Resolution Plan on 28.09.2021, cannot take contrary view in the impugned order. It is submitted that there was no objection filed to the approval of the Resolution Plan by any of the parties. There being no objection to the Resolution Plan, the Resolution Plan could not have been rejected. In the CIRP process when no Resolution Plan was approved and the Promoter wanted to revive the Corporate Debtor by submitting a Resolution Plan, the Adjudicating Authority ought to have approved the decision of the CoC. The decision of the CoC approving the Resolution Plan was a decision taken in the commercial wisdom of the CoC which ought not to have been interfered with. 5. Learned counsel for the Liquidator has filed a reply, where it supported the resolution of the CoC approving the Resolution Plan. It is submitted that the Resolution Professional has proceeded to consider the Resolution Plan submitted by the Appellant in pursuance of the order passed by the Adjudicating Authority on 28.09.2021. It is submitted that on e-voting the Resolution Plan was approved with 67.34% voting share. 6. Learned counsel appearing for Respondent No.10, one of the Financial Creditor who has ini ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... icating authority permits cannot entertain which plan after expiry of 330 days of CIRP. Since the CIRP is expired, no CoC Meeting can be held. Hence, the Plan cannot be put before the CoC. Learned Counsel for the ex-management states that the apart from money, the undertaking is given by Learned Counsel of proposed Resolution Applicant not to transfer any of the employees and at present there are around seventy employees working for the Corporate Debtor. In our view, Resolution should always be considered that at any stage and interest of employees and workers if is being taken on record by running company further should be considered as a prime concern. We direct Resolution Professional to call a Lender's Meeting for taking appropriate decision and deliberate on whether more Resolution Applicants may be invited. While going through application, it is seen that the present application seeking 90 days' extension if granted from the date of expiry of 330 days also has expired on 16.09.2021 and present application is filed on 23.09.2021. Be that as it may, while considering the Resolution and probably the maximization of value and also the interest of employees and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hether more Resolution Applicants may be invited and no specific direction to consider the Resolution Plan proposed by the Suspended Directors was given. Therefore, the RP, COC as well as the promoters were duty bound to follow the procedure as laid down by the IBBI in the Code and CIRP Regulations. 11. In the facts of the present case, we are of the view that the order dated 28.09.2021 was not followed in its true spirit resulting in nonapproval of Resolution Plan approved by the CoC on 30.12.2021. The Respondent No.10 who was also one of the Financial Creditor, who had filed Resolution Plan in the CIRP which was not approved, in his reply has also stated that Respondent No.10 is still interested in submitting a resolution plan for the Corporate Debtor and make sincere efforts to revive its business. In Para 43 of the reply of the Respondent No.10 such submission has specifically been made to the following effect: 43. It is stated that the Answering Respondent, being a PRA earlier, is still interested in submitting a resolution plan for the Corporate Debtor and make sincere efforts to revive its business. It is stated that by virtue of the increase in land prices in Far ..... X X X X Extracts X X X X X X X X Extracts X X X X
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