Appellate Tribunal grants extension for Resolution Plan completion in Corporate Insolvency cases

The Appellate Tribunal allowed the appeal by the Resolution Applicant seeking an extension of time in the Corporate Insolvency Resolution Process. The Tribunal set aside the Adjudicating Authority's order and granted the Applicant 90 days to complete the process from the date of the Amendment Act. The Applicant was directed to finalize the Resolution Plan within the specified timeframe, with instructions for the Committee of Creditors to make a decision within 30 days and present the matter for appropriate orders. The appeal was allowed, emphasizing compliance with the amended provisions and timely completion of the process.

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Issues:
Extension of time in the Corporate Insolvency Resolution Process

Analysis:
The Appellate Tribunal dealt with an application filed by a Resolution Applicant seeking an extension of time in the Corporate Insolvency Resolution Process against a Corporate Debtor. The Applicant requested an exclusion of 54 days from the process period, permission to submit the Resolution Plan by a specific date, and challenged the decision of the Resolution Professional regarding dissenting voters. The Adjudicating Authority initially refused to exclude the 54-day period, prompting the Applicant to appeal.

During the proceedings, it was argued that the Committee of Creditors had considered the relevant provisions of the Insolvency & Bankruptcy Code, specifically the third proviso of Section 12, which allowed for a 90-day extension. The Resolution Professional, representing the Respondents, also supported the extension of time for considering the Resolution Plan.

The Tribunal noted the recent amendments to Section 12 of the Code, which introduced additional provisos regarding the time limit for completing the Corporate Insolvency Resolution Process. The third proviso stated that if the process was pending beyond the stipulated period, it must be completed within 90 days from the date of the Amendment Act.

Considering the legislative changes and the circumstances of the case, the Tribunal set aside the Adjudicating Authority's order and granted the Resolution Applicant 90 days to complete the process from the date of the Amendment Act. The Tribunal directed the Applicant to approach the Committee of Creditors and the Resolution Professional to finalize the Resolution Plan within the specified timeframe.

Furthermore, the Tribunal instructed the Committee of Creditors to make a decision on the Resolution Plan within 30 days and present the matter before the Adjudicating Authority for appropriate orders under Section 31 of the Insolvency & Bankruptcy Code. Ultimately, the appeal was allowed with the aforementioned directions, emphasizing compliance with the amended provisions and timely completion of the Corporate Insolvency Resolution Process.

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