Tribunal Rejects Resolution Applicant's Request for Plan Consideration Due to CIRP Expiry and CoC Concerns

The Tribunal dismissed the application filed by the Resolution Applicant, citing the expired CIRP period and lack of reasonable grounds for directing consideration of the 'Resolution Plan.' Despite concerns raised about improper evaluation by the Resolution Professional and requests for an extension of the CIRP period, the Tribunal found insufficient basis to compel the CoCs to discuss the Plan. The CoCs' reservations regarding asset valuation and transactions with the Resolution Applicant were noted, but the lack of active discussion on the Plan led to the rejection of the application.

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Issues:
1. Consideration of Resolution Plan by CoCs
2. Allegations of improper evaluation by Resolution Professional
3. Request for extension of CIRP period

Analysis:

Issue 1: Consideration of Resolution Plan by CoCs
The Tribunal considered the application filed by the Resolution Applicant against the Resolution Professional and the Members of the Committee of Creditors (CoCs) requesting direction to place the 'Resolution Plan' for consideration before the CoCs. The Resolution Plan proposed the takeover of the Corporate Debtor on an "as is where is" basis with a consideration of Rs. 71.17 crores, outlining payment mechanisms for stakeholders. The Resolution Applicant alleged that despite multiple invitations to present the Plan before the CoCs, they were not given the opportunity for discussion or consideration. The CoCs, in response, raised concerns about the valuation of assets and transactions involving the Resolution Applicant and the Corporate Debtor. The Tribunal noted the lack of discussion on the Resolution Plan despite sharing among CoC Members and ultimately rejected the application, citing the expired CIRP period and lack of reasonable grounds for directing consideration of the Plan.

Issue 2: Allegations of improper evaluation by Resolution Professional
The Resolution Applicant contended that the Resolution Professional failed to adequately evaluate the assets of the Corporate Debtor and the Promoters, leading to discrepancies in the valuation provided in the Resolution Plan. The CoCs highlighted transactions between the Resolution Applicant and the Corporate Debtor, urging scrutiny under relevant sections of the Insolvency and Bankruptcy Code, 2016. The CoCs also requested an extension of time and replacement of the Resolution Professional. However, the Tribunal observed that despite the concerns raised, the Resolution Plan was not discussed, and the CIRP period had expired, further emphasizing the lack of grounds for directing consideration of the Plan.

Issue 3: Request for extension of CIRP period
The Resolution Professional mentioned the termination of a crucial contract by M/s. Pepsi Co., which significantly impacted the Corporate Debtor's operations, leading to substantial losses and hindering its status as a "going concern." The CoCs reiterated the need for an extension of the CIRP period, exclusion of time consumed by the current Resolution Professional, and the appointment of a new Insolvency Resolution Professional (IRP). Despite these requests, the Tribunal found no reasonable basis to compel consideration of the Resolution Plan, ultimately rejecting the application.

In conclusion, the Tribunal dismissed the application filed by the Resolution Applicant, emphasizing the lack of grounds for directing the Resolution Professional and the CoCs to consider the proposed 'Resolution Plan,' given the expired CIRP period and the CoCs' cold response towards the Plan.

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