2018 (11) TMI 803 - AT - Insolvency and Bankruptcy

Tribunal approves Ultratech's Plan, dismisses appeals, sets aside adverse observations

Binani Industries Limited Versus Bank of Baroda & Anr., Rajputana Properties Pvt. Ltd. and Versus Binani Industries Limited & Ors., Rajputana Properties Pvt. Ltd. and Versus Ultratech Cement Ltd. & Ors. and Binani Industries Limited Versus Binani Cements Limited & Anr. and Mr. Vijay Kumar Iyer Resolution Professional Versus Mr. Braj Bhusandas Binani & Ors.

Binani Industries Limited Versus Bank of Baroda & Anr., Rajputana Properties Pvt. Ltd. and Versus Binani Industries Limited & Ors., Rajputana Properties ... Issues Involved:1. Interaction and meeting with bidders/Resolution Applicants, Financial Creditors, and stakeholders.2. Acceptance of Binani Industries Limited's proposal for repayment and closure of the Corporate Insolvency Resolution Process (CIRP).3. Consideration of the settlement plan proposed by Binani Industries Limited.4. Approval of the Resolution Plan submitted by Rajputana Properties Private Limited.5. Adverse observations against the Resolution Professional.Issue-wise Detailed Analysis:1. Interaction and Meeting with Bidders/Resolution Applicants, Financial Creditors, and Stakeholders:The Appellant, Binani Industries Limited, contended that the Adjudicating Authority should have allowed them to interact with and/or meet the bidders, Resolution Applicants, Financial Creditors, and other stakeholders of the Corporate Debtor from time to time. The Tribunal did not grant this request, leading to an appeal.2. Acceptance of Binani Industries Limited's Proposal for Repayment and Closure of CIRP:Binani Industries Limited appealed against the order dated 2nd May 2018, where the Adjudicating Authority refused to accept their proposal for repayment of the dues of the Financial Creditors and close the CIRP, citing a lack of jurisdiction. The Tribunal upheld this decision, noting that there is no provision in the I&B Code for settlement once the CIRP is initiated.3. Consideration of the Settlement Plan Proposed by Binani Industries Limited:Rajputana Properties Private Limited appealed against the order dated 27th March 2018, which granted liberty to the Committee of Creditors (CoC) to consider the settlement plan proposed by Binani Industries Limited. The Tribunal found that the CoC did not properly consider the revised offer from Ultratech Cement Limited and discriminated against other Resolution Applicants by only negotiating with Rajputana Properties Private Limited.4. Approval of the Resolution Plan Submitted by Rajputana Properties Private Limited:The Tribunal found that the Resolution Plan submitted by Rajputana Properties Private Limited was discriminatory and contrary to the scheme of the I&B Code. The plan provided 100% of the verified claims to certain Financial Creditors while giving lesser percentages to others like Export-Import Bank of India (72.59%) and State Bank of India-Hong Kong (10%). The Tribunal directed the CoC to consider other Resolution Plans, including those submitted by Ultratech Cement Limited, which offered better terms for all stakeholders.5. Adverse Observations Against the Resolution Professional:The Resolution Professional, Mr. Vijay Kumar Iyer, appealed against the adverse observations made by the Adjudicating Authority. The Tribunal found these observations uncalled for, noting that the Resolution Professional had acted in compliance with the orders of the Tribunal and the settlement reached between the CoC and IDBI. The Tribunal set aside the adverse observations.Conclusion:The Tribunal dismissed the appeals by Rajputana Properties Private Limited and Binani Industries Limited, while allowing the appeal by the Resolution Professional, setting aside the adverse observations against him. The Tribunal approved the revised Resolution Plan submitted by Ultratech Cement Limited, which was found to be non-discriminatory and in compliance with the I&B Code, and remitted the records to the Adjudicating Authority for implementation.