Tribunal Overturns Authority's Order on Resolution Plans, Emphasizes Compliance with Statutory Provisions

The Tribunal set aside the Adjudicating Authority's order allowing submission of revised resolution plans, directing approval of the Appellant's plan approved by the CoC with 98.05% voting shares. The Tribunal deemed the Authority's actions as lacking jurisdiction and arbitrary, emphasizing compliance with statutory provisions. The appeal was allowed, and no further hearing was required as the matter was conclusively decided by the Tribunal.

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Issues Involved:
1. Jurisdiction of the Adjudicating Authority to allow submission of revised resolution plans.
2. Validity of the third modified Information Memorandum.
3. Approval and viability of the Appellant's resolution plan by the Committee of Creditors (CoC).

Issue-wise Detailed Analysis:

1. Jurisdiction of the Adjudicating Authority to allow submission of revised resolution plans:
The Appellant challenged the order dated 7th May 2018, where the Adjudicating Authority directed the Resolution Professional (RP) to receive modified offers from both the Appellant and the 8th Respondent. The Adjudicating Authority had accepted the Appellant as the successful Resolution Applicant (H-1) but allowed the 8th Respondent to submit a revised offer. The Tribunal found that the Adjudicating Authority issued directions without recording any reason, which is essential for such orders. The Tribunal held that the Adjudicating Authority had no jurisdiction to give another opportunity to the 8th respondent or even to the Appellant, especially when all procedures had been followed without any infirmity.

2. Validity of the third modified Information Memorandum:
The third modified Information Memorandum was issued by the RP without instructions from the CoC after the final decision on 5th April 2018. This memorandum included claims from IHCL and Emfar based on data records. The Tribunal noted that while the RP should have brought the reason for the revised memorandum to the notice of the CoC, it did not declare the third Information Memorandum as bad. This is because the facts regarding dues of IHCL and Emfar were communicated to the Resolution Applicants, including the Appellant and the 8th Respondent, and were considered in their plans.

3. Approval and viability of the Appellant's resolution plan by the Committee of Creditors (CoC):
The Appellant's resolution plan was declared the best, viable, and feasible by the CoC on 25th April 2018, based on upfront payment and scoring matrix. The Appellant's plan offered Rs. 111.11 Crores, which was higher than the 8th Respondent's offer of Rs. 103.50 Crores. The CoC's e-voting on 28th and 29th April 2018 resulted in a 98.05% voting share in favor of the Appellant's plan, while the 8th Respondent's plan received 0% votes. The Tribunal emphasized that the RP is required to examine each resolution plan for compliance with Section 30(2) and present it to the CoC for approval under Section 30(3). Once the plans are clear and placed before the CoC, the RP cannot issue another revised Information Memorandum without CoC's approval.

Conclusion:
The Tribunal set aside the impugned order dated 7th May 2018, directing the Adjudicating Authority to approve the Appellant's resolution plan as approved by the CoC with 98.05% voting shares. The Tribunal concluded that the Adjudicating Authority's order to allow further revised plans was without jurisdiction and arbitrary. The appeal was allowed, and no further hearing was deemed necessary as the matter was finally decided by the Tribunal.

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