Tribunal Upholds Resolution Plan Approval & Distribution Mechanism

The Tribunal dismissed the appeal challenging the approval of the Resolution Plan and the share proportion of the Resolution Fund distribution. It emphasized the limited scope of judicial review in matters concerning the Committee of Creditors' decisions and commercial aspects of insolvency resolution. The Tribunal upheld the Resolution Plan's approval and distribution mechanism, finding no basis for judicial intervention based on the appellant's objections post-approval.

---

---

Issues:
Challenge to approval of Resolution Plan and share proportion of Resolution Fund distribution.

Analysis:
The appellant, a member of the Committee of Creditors, challenged the approval of the Resolution Plan by the Successful Resolution Applicant, alleging inequitable distribution of proceeds among Financial Creditors. The appellant also sought revision of share proportion of the Resolution Fund, which was dismissed. The Committee approved the revised Resolution Plan with 67.97% voting in favor. The appellant objected to the allocation of Rs. 135 Crores to only four Secured Creditors, contending it violated Section 53 of the Insolvency and Bankruptcy Code. The Resolution Professional defended the allocation as a business decision to maintain the Corporate Debtor's operations.

The Tribunal noted the appellant's voting in favor of the Resolution Plan and subsequent objection to the distribution mechanism. Citing legal precedents, the Tribunal highlighted that the business decisions of the Committee of Creditors, including approval or rejection of Resolution Plans, are not subject to judicial review unless specific grounds are met. The Tribunal emphasized that the appellant, having assented to the Resolution Plan, could not challenge it based on the distribution mechanism, especially when the Resolution Professional acted within the Committee's commercial wisdom.

The Tribunal found no grounds for judicial interference, stating that the appellant's admitted claim had been considered, and the distribution mechanism was in order. The Tribunal concluded that the appellant's grievance did not warrant intervention, dismissing the appeal for lacking merit. No costs were awarded in the judgment.

In summary, the Tribunal dismissed the appeal challenging the approval of the Resolution Plan and the share proportion of the Resolution Fund distribution, emphasizing the limited scope of judicial review in matters concerning Committee of Creditors' decisions and commercial aspects of insolvency resolution. The Tribunal upheld the Resolution Plan's approval and distribution mechanism, finding no basis for judicial intervention based on the appellant's objections post-approval.

---