2020 (12) TMI 193 - Tri - Insolvency and Bankruptcy

Tribunal Approves Reliance's Resolution Plan under Insolvency Laws

ERICSSON INDIA PRIVATE LIMITED Versus RELIANCE INFRATEL LIMITED

ERICSSON INDIA PRIVATE LIMITED Versus RELIANCE INFRATEL LIMITED - [2021] 224 Comp Cas 608 (NCLT–Mum) Issues Involved:1. Approval of the Resolution Plan under Section 30(6) of the Insolvency and Bankruptcy Code, 2016.2. Compliance with the provisions of the Code and Regulations.3. Distribution and satisfaction of claims and debts.4. Management and implementation of the Resolution Plan.5. Pending applications and their impact on the Resolution Plan.Issue-wise Detailed Analysis:1. Approval of the Resolution Plan under Section 30(6) of the Insolvency and Bankruptcy Code, 2016:The application was filed by the Resolution Professional (RP) seeking approval of the Resolution Plan submitted by Reliance Projects & Property Management Services Limited. The Corporate Insolvency Resolution Process (CIRP) of the Corporate Debtor commenced on 15.05.2018, and after various procedural steps and appeals, the Committee of Creditors (CoC) approved the Resolution Plan with a 100% voting share on 02.03.2020.2. Compliance with the provisions of the Code and Regulations:The RP conducted the CIRP in compliance with the Code and the Insolvency and Bankruptcy Board of India (Corporate Insolvency Resolution Process) Regulations, 2016. The Resolution Plan was verified for eligibility under Section 29(A) of the Code, and the RP submitted Form H under Regulation 39(4), confirming compliance. The Tribunal noted that the Resolution Plan met the requirements specified in Section 30(2) of the Code and Regulations 37, 38, 38(1A), and 39(4).3. Distribution and satisfaction of claims and debts:The Resolution Plan proposed a total payment of INR 3,720 crores for the resolution of the Corporate Debtor. The plan included:- Payment of CIRP costs in full.- Payment to workmen/employees and operational creditors.- Capital reduction and equity infusion.- Payment to financial creditors on a pro-rata basis.The Tribunal highlighted that the plan provided for the full and final satisfaction and discharge of all claims and debts against the Corporate Debtor, ensuring no further liabilities for the Resolution Applicant post-implementation.4. Management and implementation of the Resolution Plan:The Resolution Plan outlined the management of the Corporate Debtor as a going concern, leveraging the expertise of the Reliance Industries Group. A monitoring committee comprising the RP, nominees of approving financial creditors, and nominees of the Resolution Applicant would oversee the implementation. The plan included provisions for fund infusion, human resource augmentation, and infrastructure upgradation.5. Pending applications and their impact on the Resolution Plan:The Tribunal acknowledged the pending applications (IA Nos. 1960 of 2019 and 3055 of 2019) challenging certain claims and decisions. However, it determined that the pendency of these applications would not hinder the approval of the Resolution Plan. The distribution of payments to creditors would be subject to the outcomes of these applications.Conclusion:The Tribunal approved the Resolution Plan submitted by Reliance Digital Platform & Project Services Limited, noting its compliance with the Code and Regulations. The plan was deemed fair and equitable to all stakeholders and binding on all parties involved. The approval did not constitute a waiver of any statutory obligations, and the Resolution Applicant was required to obtain necessary approvals from relevant authorities. The moratorium under Section 14 ceased, and the RP and Monitoring Committee were tasked with supervising the implementation of the plan. The RP was directed to forward all records to the Insolvency and Bankruptcy Board of India (IBBI) and send a copy of the order to the CoC and the Resolution Applicant for compliance.