2020 (6) TMI 773 - Tri - Insolvency and Bankruptcy

Tribunal approves Resolution Plan for Print House (India) by Sify Technologies Limited

The Tribunal approved the Resolution Plan submitted by Sify Technologies Limited for Print House (India) Private Limited under Section 30(6) of the ... Approval of a Resolution Plan - section 30(6) of the Insolvency and Bankruptcy Code, 2016 read with regulation 39(4) of the Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) Regulations, 2016 - HELD THAT:- The Resolution Plan in hand satisfies the minimum threshold of approval by 66% majority of the CoC. Hence, as per the CoC, the plan meets the requirement of being viable and feasible for revival of the Corporate Debtor. By and large, all the compliances have been done by the RP and the Resolution Applicant for making the plan effective after approval by this Bench. Grant of time to comply with the statutory obligations/seeking sanctions from governmental authorities - HELD THAT:- The Resolution Applicant is directed to do the same within one year as prescribed under section 31(4) of the Code - in case of non-compliance of this order or withdrawal of Resolution Plan, the CoC shall forfeit the EMD amount already paid by the Resolution Applicant. The resolution plan is approved - Resolution Plan is binding on the Corporate Debtor and other stakeholders involved so that revival of the Debtor Company shall come into force with immediate effect and the Moratorium imposed under section 14 shall cease to have any effect forthwith - application allowed. Issues Involved:1. Approval of Resolution Plan under Section 30(6) of the Insolvency and Bankruptcy Code, 2016.2. Compliance with the mandatory requirements of the Insolvency and Bankruptcy Code and CIRP Regulations.3. Objections raised by suspended directors and promoters regarding the Resolution Plan.Issue-wise Detailed Analysis:1. Approval of Resolution Plan under Section 30(6) of the Insolvency and Bankruptcy Code, 2016:The Resolution Professional (RP) filed an application for the approval of a Resolution Plan for Print House (India) Private Limited under Section 30(6) of the Insolvency and Bankruptcy Code, 2016, read with Regulation 39(4) of the Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) Regulations, 2016. The RP detailed the claims of financial and operational creditors and the meetings of the Committee of Creditors (CoC) held during the Corporate Insolvency Resolution Process (CIRP). The CoC approved the Resolution Plan submitted by Sify Technologies Limited with the requisite majority. The Tribunal found that the Resolution Plan satisfied the minimum threshold of approval by the CoC and met the requirements of being viable and feasible for the revival of the Corporate Debtor.2. Compliance with the mandatory requirements of the Insolvency and Bankruptcy Code and CIRP Regulations:The RP submitted that all necessary compliances as envisaged within the Code and the CIRP Regulations were adhered to. The Resolution Plan included provisions for the payment of CIRP costs, repayment of debts to operational creditors, management of the Corporate Debtor's affairs post-approval, and measures required for the implementation of the Resolution Plan. The Tribunal directed the Resolution Applicant to comply with statutory obligations and seek necessary sanctions from governmental authorities within one year as prescribed under Section 31(4) of the Code.3. Objections raised by suspended directors and promoters regarding the Resolution Plan:Suspended directors and promoters of the Corporate Debtor filed an application under Section 60(5) of the Code, seeking to implead themselves in the application for the approval of the Resolution Plan. They contended that the Resolution Plan was essentially a plan for the sale of the Corporate Debtor's assets and did not intend to revive its printing business. They argued that the Resolution Applicant, Sify Technologies Limited, lacked experience in the printing business and intended to convert the Corporate Debtor's premises into data centers. The Tribunal dismissed these objections, stating that there is nothing in the Code that inhibits a Resolution Applicant from pursuing a different line of business. The Tribunal emphasized that the commercial wisdom of the CoC, which had approved the Resolution Plan, should be respected, subject to limited judicial review.Final Order:The Tribunal approved the Resolution Plan submitted by Sify Technologies Limited, binding it on the Corporate Debtor and other stakeholders involved. The moratorium imposed under Section 14 ceased to have effect, and the RP was directed to hand over all records and premises to the Resolution Applicant. The Tribunal also dismissed the application filed by the suspended directors and promoters, affirming the decision of the CoC.