Tribunal approves RMS Employees Trust's resolution plan under Insolvency Code

The Tribunal approved the resolution plan submitted by RMS Employees Welfare Trust, with 96.73% voting share in favor, following compliance with the Insolvency and Bankruptcy Code. The plan included the release of personal guarantees, settlement of dues, and effective implementation measures. The promoter director's challenge to the ordinance disqualifying them was withdrawn, leading to the approval of the Trust's plan. The moratorium ceased, and the RP was directed to transfer records to the Board, concluding the case.

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Issues Involved:
1. Initiation of Corporate Insolvency Resolution Process (CIRP).
2. Formation and meetings of the Committee of Creditors (COC).
3. Submission and approval of the resolution plan.
4. Eligibility and disqualification of resolution applicants.
5. Compliance with the Insolvency and Bankruptcy Code (IBC) and related regulations.
6. Effective implementation of the resolution plan.
7. Release of personal guarantees and settlement of dues.

Detailed Analysis:

1. Initiation of Corporate Insolvency Resolution Process (CIRP):
The petition was filed by the Corporate Debtor under Section 10 of the Insolvency and Bankruptcy Code 2016 for initiating CIRP. The petition was admitted on 16.03.2017, and a moratorium under Section 14 was declared. Mr. Purushottam Ram Singhania was appointed as the Interim Resolution Professional (IRP).

2. Formation and Meetings of the Committee of Creditors (COC):
The IRP constituted the COC comprising SBI, HDFC, and ICICI. In the first meeting on 27.04.2017, it was resolved to replace Mr. Singhania with Mr. Anil Goel as the Resolution Professional (RP). The CIRP period was extended for another 90 days by order dated 12.09.2017.

3. Submission and Approval of the Resolution Plan:
The RP filed CA No.84/2018 under Section 31 of the Code for approval of the resolution plan submitted by RMS Employees Welfare Trust. The Trust formed by the employees of the Corporate Debtor submitted its plan, which was found compliant with Section 30(2) of the Code. The plan was discussed and approved in the 7th and 8th COC meetings, with 96.73% voting share in favor.

4. Eligibility and Disqualification of Resolution Applicants:
The promoter director initially submitted a resolution plan, but became ineligible due to the promulgation of the Insolvency and Bankruptcy Code (Amendment) Ordinance, 2017, which added Section 29A. The promoter director challenged the ordinance but later withdrew the petition and did not object to the approval of the Trust's resolution plan.

5. Compliance with the Insolvency and Bankruptcy Code (IBC) and Related Regulations:
The RP confirmed that the resolution plan complied with Section 30(2) of the Code, including payment of insolvency resolution process costs, repayment of debts to operational creditors, management of the Corporate Debtor's affairs, and adherence to legal provisions. The plan was certified to meet all requirements of the Code and Regulations.

6. Effective Implementation of the Resolution Plan:
The resolution plan provided for its effective implementation, including the appointment of a Monitoring Agency and the creation of a pledge in favor of SBI. The RP, Mr. Anil Goel, was identified to supervise the implementation, submitting monthly reports to stakeholders.

7. Release of Personal Guarantees and Settlement of Dues:
The promoter director and SBI agreed on the release of personal guarantees through a compromise. SBI received payments from the promoter's personal assets. The plan proposed payments to financial creditors, workmen, and some government dues, with no objections from COC members.

Conclusion:
The Tribunal approved the resolution plan submitted by RMS Employees Welfare Trust, binding on all stakeholders involved. The moratorium order ceased, and the RP was directed to forward all records to the Board. The application CA No.84/2018 was disposed of accordingly.

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