Tribunal Modifies Orders for Resolution Applicants, Emphasizes Avoiding Liquidation

The Tribunal modified the Adjudicating Authority's orders, directing all four Resolution Applicants to submit revised plans within 15 days and the CoC to complete the process within 30 days. Emphasizing efforts to avoid liquidation, the Tribunal gave a final opportunity for resolution. Appeals were disposed of without costs.

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Issues Involved:
1. Voting on Resolution Plans.
2. Exclusion of a Financial Creditor from voting.
3. Clarification of Adjudicating Authority's orders.
4. Submission and consideration of revised Resolution Plans.
5. Liquidation proceedings.

Issue-wise Detailed Analysis:

1. Voting on Resolution Plans:
The Corporate Insolvency Resolution Process (CIRP) was initiated against the Corporate Debtor on 24.04.2019. The Resolution Professional received 16 Expressions of Interest (EoI) and conducted three rounds of voting on the Resolution Plans. In the first and second rounds, 'Sattva' received 64.64% of the votes but failed to achieve the requisite 66%. In the third round, 'Sattva' and 'Experion' both received 64.64% votes. The Appellant's voting share of 35.36% was sufficient to reject any plan but not to approve one. Consequently, no plan received the necessary votes for approval.

2. Exclusion of a Financial Creditor from Voting:
The Appellant, having a voting share of 35.36%, was accused of ensuring that no Resolution Plan was approved. Applications were filed by 'Experion' and 'Standard Chartered Bank' to exclude the Appellant from voting. The Adjudicating Authority deferred the consideration of the liquidation application and directed the CoC to reconsider the pending plans.

3. Clarification of Adjudicating Authority's Orders:
The Adjudicating Authority's order dated 01.10.2021 directed the CoC to reconsider two pending plans. The Resolution Professional sought clarification on whether the two plans referred to were those of 'Sattva' and 'Experion' or 'MD/AD' and 'Experion'. The Adjudicating Authority, on 25.11.2021, clarified that the two plans receiving 64.64% votes should be considered, which included 'Experion' and another plan. However, 'Sattva' had withdrawn, making 'Experion' the only plan for consideration.

4. Submission and Consideration of Revised Resolution Plans:
The CoC, in its meeting on 07.10.2021, decided to approach all four Resolution Applicants to confirm their interest in participating again. 'Sattva' did not respond, 'M3M' expressed interest, 'Experion' sought permission to submit a revised plan, and 'MD/AD' confirmed their participation. The Resolution Professional filed an application seeking clarification on whether 'M3M' should also be allowed to submit their plan. The Adjudicating Authority directed the CoC to ensure the completion of the voting process within seven days.

5. Liquidation Proceedings:
The Adjudicating Authority deferred the liquidation application filed by the Resolution Professional, pending the outcome of the voting process. Given the elapsed 330 days and the failure to achieve the requisite votes, the Tribunal considered whether to direct the liquidation or make a final attempt to resolve the insolvency. The Tribunal decided to give one more opportunity to all four Resolution Applicants to submit their revised plans and directed the CoC to deliberate and vote on these plans within 30 days.

Conclusion:
The Tribunal modified the orders of the Adjudicating Authority dated 25.11.2021 and 01.10.2021, directing all four Resolution Applicants to submit their revised plans within 15 days and the CoC to complete the process within 30 days. The Tribunal emphasized the need to make serious efforts to save the Corporate Debtor from liquidation. The appeals were disposed of with no order as to costs.

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