Liberty House Group Plan Approved in Zion Steel Insolvency Case, Sets Precedent for Workmen Dues

The National Company Law Tribunal, Kolkata, approved the Resolution Plan of Liberty House Group Pte Ltd. in a Corporate Insolvency Resolution Process initiated against Zion Steel Ltd. The plan, complying with the Insolvency & Bankruptcy Code, addressed workmen dues and corporate affairs, becoming binding on all parties. The Adjudicating Authority praised the Resolution Professional's efforts, lifting the moratorium and transferring records to the Insolvency and Bankruptcy Board of India, thus commencing the company's revival. The case concluded with the disposal and provision for certified copies of the order to concerned parties.

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Issues:
- Corporate Insolvency Resolution Process (CIRP) under section 7 of the Insolvency & Bankruptcy Code, 2016.
- Approval of Resolution Plan by the Committee of Creditors (COC).
- Consideration of Resolution Plans by the Adjudicating Authority.
- Compliance with mandatory requirements of the Insolvency & Bankruptcy Code.
- Approval and binding nature of the Resolution Plan.

The National Company Law Tribunal, Kolkata, dealt with a case involving the Corporate Insolvency Resolution Process (CIRP) initiated by the State Bank of India against a Corporate Debtor, Zion Steel Ltd., for defaulting on loan payments. The Resolution Professional, Mr. Sumit Binani, oversaw the process, including the admission of CIRP, appointment of Interim Resolution Professional, and subsequent confirmation as Resolution Professional by the COC. Various resolution plans were submitted and considered during the CIRP, with one plan from Liberty House Group Pte Ltd. being initially accepted by the COC. However, concerns arose regarding the eligibility of the bidder under section 29A of the I&B Code. After clarification, the plan was found acceptable. Extensions were granted for the CIRP period, and applications from different parties, including workmen unions and erstwhile resolution applicants, were addressed by the Adjudicating Authority.

The Adjudicating Authority carefully reviewed the Resolution Plan approved by the COC, ensuring compliance with the mandatory requirements of the Insolvency & Bankruptcy Code. The plan included provisions for resolving workmen dues and managing the affairs of the Corporate Debtor. After thorough examination and confirmation by the Resolution Professional, the Adjudicating Authority approved the Resolution Plan of Liberty House Group Pte Ltd. under section 31(1) of the I&B Code. The order made the plan binding on all relevant parties, marking the commencement of the revival plan for the company. Additionally, the moratorium order under Section 14 was lifted, and the Resolution Professional was directed to transfer all related records to the Insolvency and Bankruptcy Board of India.

In concluding the judgment, the Adjudicating Authority commended the efforts of the Resolution Professional in ensuring the approval of the Resolution Plan, acknowledging the role in revitalizing the struggling company. The case was disposed of, with provisions for issuing certified copies of the order to concerned parties upon request. The detailed analysis and approval of the Resolution Plan highlighted the meticulous consideration of legal requirements and the significance of COC approval in the insolvency resolution process.

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