Tribunal directs CoC to consider Resolution Plan, criticizes rejection based on technicalities.

The Tribunal ruled in favor of the Applicant, directing the CoC to consider the Resolution Plan on its merits. Emphasizing the objective of maximizing asset value under the IBC, the Tribunal criticized the CoC's rejection based solely on technicalities. It held that Resolution Plans can be accepted after the cut-off date if no other plan has been finalized and the CIRP period is ongoing. Additionally, the Tribunal excluded five days from the CIRP period to allow for the consideration of the Applicant's plan.

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Issues Involved:
1. Legality of the CoC's decision to reject the Applicant's Resolution Plan without considering its merits.
2. Applicability of the cut-off date for submission of Resolution Plans.
3. Whether the CoC can accept Resolution Plans after the cut-off date.
4. The role of the RP in presenting Resolution Plans to the CoC.
5. The object of the Insolvency and Bankruptcy Code (IBC) in maximizing asset value.
6. Precedents of NCLT and NCLAT permitting late submission of Resolution Plans.
7. Applicability of Regulation 36A of IBBI (Insolvency Resolution Process for Corporate Persons) Regulation, 2016.
8. Exclusion of time from the CIRP period.

Detailed Analysis:

1. Legality of the CoC's Decision to Reject the Applicant's Resolution Plan:
The Applicant challenged the CoC's decision to refuse to open and consider its Resolution Plan submitted after the cut-off date. The Tribunal found that the CoC's rejection of the Resolution Plan without evaluating its merits was against the spirit of the IBC. The Tribunal emphasized that technicalities should not override the objective of the Code, which is to maximize asset value and ensure the best possible returns.

2. Applicability of the Cut-off Date:
The Applicant argued that the cut-off date for submitting Resolution Plans, as contemplated by the EOI, is not mandatory and can be extended. The Tribunal noted that while the CoC had set a cut-off date, the rejection of the Applicant's plan solely based on this technicality was not justified, especially when the plan was submitted before the finalization of any other Resolution Plan.

3. Acceptance of Resolution Plans After the Cut-off Date:
The Tribunal held that the CoC could consider Resolution Plans submitted after the cut-off date, provided the CIRP period had not elapsed and no other Resolution Plan had been accepted. The Tribunal directed the CoC to consider the Applicant's Resolution Plan on its merits, emphasizing that the primary objective is to maximize asset value.

4. Role of the RP in Presenting Resolution Plans:
The Applicant contended that the RP is required to present the Resolution Plan to the CoC under Section 30(3) of the Code. The Tribunal found that the RP had failed to submit the Applicant's Resolution Plan in the manner contemplated by the Code, thereby extending the period for submission and necessitating the CoC's consideration of the plan on its merits.

5. Object of the IBC:
The Tribunal underscored that the IBC aims to maximize the value of the assets of the Corporate Debtor and ensure the best possible returns. The CoC's action in rejecting the Applicant's plan without consideration was deemed contrary to this objective, and the Tribunal directed the CoC to evaluate the plan judiciously.

6. Precedents Permitting Late Submission:
The Applicant cited several cases where NCLT and NCLAT permitted the submission of Resolution Plans after the cut-off date. The Tribunal acknowledged these precedents, reinforcing the view that the CoC should consider Resolution Plans submitted before the finalization of any other plan and within the CIRP period.

7. Applicability of Regulation 36A:
The Applicant argued that the amended Regulation 36A, effective from 03.07.2018, did not apply to this case since the EOI was issued on 08.06.2018. The Tribunal agreed, stating that the erstwhile Regulation 36A, effective from 06.02.2018, was applicable. Moreover, the RP had not issued the EOI in terms of Form G, further supporting the Applicant's position.

8. Exclusion of Time from the CIRP Period:
In a separate application by the RP, the Tribunal considered the exclusion of time from the CIRP period. The Tribunal excluded five days from the CIRP period, during which the Applicant's application was pending, thereby extending the CIRP period to 03.01.2019. This exclusion was justified to allow the RP to fulfill duties and obligations concerning the Resolution Plan.

Conclusion:
The Tribunal allowed the Applicant's application, directing the CoC to consider the Resolution Plan on its merits. The Tribunal emphasized that the primary objective of the IBC is to maximize asset value, and technicalities should not impede this goal. The Tribunal also excluded five days from the CIRP period to accommodate the consideration of the Applicant's plan.

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