Tribunal Approves Resolution Plan under IBC 2016 with 100% CoC Support

The Tribunal approved the Resolution Plan under IBC, 2016, with 100% voting share from CoC. An extension of 180 days for plan implementation was granted, and pending claims by the GST Department were to be considered. The plan involved capital reduction to zero and equity infusion of Rs. 17.72 crores. Compliance with legal requirements, distribution of funds, and appointment of RP were ensured. The Resolution Plan was deemed effective immediately, with detailed implementation directions provided for stakeholders.

---

---

Issues:
Approval of Resolution Plan under IBC, 2016, Extension of time for plan implementation, Consideration of claims by GST Department, Capital reduction and equity infusion, Compliance with Section 30(2) of IBC, 2016, Approval of Resolution Plan by CoC, Distribution of funds to stakeholders, Implementation schedule, Appointment of RP, Addressing insolvency causes, Relief and concessions sought, Effectiveness of Resolution Plan.

Analysis:

Approval of Resolution Plan under IBC, 2016:
- IA 617 of 2019 filed for approval of Resolution Plan under Section 31 of IBC, 2016.
- Resolution Applicant submitted amended plan within the stipulated time frame.
- Resolution Plan complied with Section 30(2) of IBC, 2016 and relevant regulations.
- CoC approved the plan with 100% voting share.

Extension of Time for Plan Implementation:
- IA 398 of 2020 sought extension of 180 days for plan implementation.
- CoC granted the extension which was agreeable to the Resolution Applicant.
- Amended Resolution Plan submitted within the extended timeline.

Consideration of Claims by GST Department:
- Pending issues regarding denial of input credit by GST Department.
- Claims to be considered by RP while distributing funds to Operational Creditors.
- Separate consideration for State Tax Officer's belated claim.

Capital Reduction and Equity Infusion:
- Resolution Plan involved reduction of existing equity share capital to zero.
- Infusion of funds by Resolution Applicant to the tune of Rs. 17.72 crores.
- Steps outlined for capital reduction, equity subscription, and debentures issuance.

Compliance and Approval:
- Resolution Plan met requirements of Section 30(2) of IBC, 2016 and relevant regulations.
- Compliance certificate provided by Resolution Professional.
- Plan not in contravention of Section 29A.

Distribution of Funds and Implementation Schedule:
- Stakeholders' claims settled as per the Resolution Plan.
- Detailed implementation schedule provided for various payments.
- RP appointed to oversee plan implementation.

Relief and Concessions Sought:
- Resolution Applicant may seek concessions as per prevailing laws.
- Approval of Resolution Plan does not automatically waive legal proceedings.

Effectiveness and Implementation:
- Resolution Plan approved and binding on all stakeholders.
- Capital reduction permission granted, with necessary amendments to be filed.
- Plan to be effective immediately, moratorium ceases, and records forwarded to IBBI.

Conclusion:
The Tribunal approved the Resolution Plan, addressed pending issues, and provided detailed directions for effective implementation. Compliance with legal requirements, distribution of funds, capital reduction, and appointment of RP were key aspects considered. The Resolution Plan was deemed effective immediately, with necessary steps outlined for compliance and implementation.

---