Tribunal Approves Tega Industries' Resolution Plan for McNally Sayaji Engineering

The Tribunal approved the Resolution Plan submitted by Tega Industries Limited for McNally Sayaji Engineering Limited. The Resolution Plan was found compliant with legal provisions, leading to the discharge of the Resolution Professional and granting access to corporate debtor records. The Moratorium under section 14 of the Insolvency and Bankruptcy Code ceased, making the Resolution Plan binding on all stakeholders, providing a path for the company's revival.

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Issues Involved:
1. Application under section 30(6) of the Insolvency and Bankruptcy Code, 2016.
2. Constitution and meetings of the Committee of Creditors (CoC).
3. Collation of claims.
4. Corporate Insolvency Resolution Process (CIRP) and compliances.
5. Evaluation and voting on Resolution Plans.
6. Compliance of the approved Resolution Plan with various provisions.
7. Details of Resolution Plan/Payment Schedule.
8. Management/Implementation and Reliefs as per the Resolution Plan.
9. Relinquishment/Waiver of liabilities and Approvals.
10. Orders and directions from the Tribunal.

Detailed Analysis:

1. Application under section 30(6) of the Insolvency and Bankruptcy Code, 2016:
The application I.A. (IB) No. 1214/KB/2022 was filed under section 30(6) of the Insolvency and Bankruptcy Code, 2016, following the approval of the resolution plan by the Committee of Creditors (CoC). This application was submitted by the Resolution Professional of McNally Sayaji Engineering Limited for the approval of a Resolution Plan.

2. Constitution and meetings of the Committee of Creditors (CoC):
The Interim Resolution Professional (IRP) made a public announcement on 15 February 2021, calling for proof of claims from creditors. The CoC was constituted with sixteen Financial Creditors, and a report was filed before the Adjudicating Authority. Eleven CoC meetings were held during the CIRP period, from 14 December 2021 to 17 August 2022.

3. Collation of claims:
The amounts claimed and admitted by various creditors were summarized, with significant discrepancies between claimed and admitted amounts. For instance, Secured Financial Creditors claimed Rs. 3217,25,44,643.08, but only Rs. 294,15,79,977.95 was admitted.

4. Corporate Insolvency Resolution Process (CIRP) and compliances:
Invitations for Expressions of Interest (EoI) were issued on 28 January 2022, with the last date for receipt being 12 February 2022. Seventeen EoIs were received, and the Information Memorandum, Evaluation Matrix, and Request for Resolution Plan (RFRP) were shared with Prospective Resolution Applicants. The last date for submission of Resolution Plan was extended to 21 April 2022.

5. Evaluation and voting on Resolution Plans:
The Resolution Plans were discussed and revised in various CoC meetings. In the 8th CoC meeting, negotiations and bidding took place, and the revised plans were put for e-voting in the 11th CoC meeting. The Resolution Plan submitted by Tega Industries Limited was approved with a 99.787% voting share.

6. Compliance of the approved Resolution Plan with various provisions:
A Compliance Certificate in Form 'H' was submitted, detailing compliance with sections 30 and 31 of the IBC and regulations 38 and 39 of the CIRP Regulations. The Resolution Applicant also submitted an affidavit of eligibility under section 29A of the Code.

7. Details of Resolution Plan/Payment Schedule:
The Resolution Plan defined the "Transfer Date" and included details on the management of the company post-resolution, the term of the resolution plan, and its implementation and supervision.

8. Management/Implementation and Reliefs as per the Resolution Plan:
The Resolution Plan provided for the management of the company, the term of the resolution plan, and its implementation. Reliefs, exemptions, and waivers were sought for successful implementation.

9. Relinquishment/Waiver of liabilities and Approvals:
Reliefs, waivers, and concessions were sought, with the Tribunal granting those within its jurisdiction under the Code and the Companies Act 2013. Claims not part of the resolution plan were extinguished, as per the Supreme Court's judgment in Ghanashyam Mishra and Sons Pvt Ltd v Edelweiss Asset Reconstruction Company Ltd.

10. Orders and directions from the Tribunal:
The Tribunal approved the Resolution Plan, finding it compliant with sections 30 and 31 of the IBC. The Resolution Applicant was directed to comply with statutory obligations within one year. Reliefs and waivers were granted as per the Code and relevant Supreme Court judgments. The Resolution Professional was discharged from duties, and the Resolution Applicant was granted access to the corporate debtor's records and premises. The Moratorium under section 14 of the Code ceased, and the Resolution Plan became binding on all stakeholders.

Conclusion:
The Tribunal approved the Resolution Plan submitted by Tega Industries Limited, finding it compliant with the necessary legal provisions and viable for the revival of McNally Sayaji Engineering Limited. The Resolution Professional was directed to hand over all relevant records to the Resolution Applicant, and the Moratorium was lifted.

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