Rectification of resolution plan order granted as minimum public shareholding direction conflicted with completed delisting.

Rectification of the NCLT approval order was allowed because the direction to maintain minimum public shareholding of 5% was inconsistent with the approved resolution plan and the corporate debtor's completed delisting. The tribunal treated that direction as a typographical error, since the plan contemplated delisting in accordance with applicable regulations and the securities had already been delisted by the stock exchanges. The earlier order was therefore to be read without the requirement to maintain 5% public shareholding, while the operative effect remained extinguishment of the existing share capital and issuance of new equity share capital.

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Issues: Whether the order approving the resolution plan required rectification by deleting the direction to maintain minimum public shareholding of 5% and by confining the operative direction to extinguishment of the existing share capital and issuance of new equity share capital.

Analysis: The application was for rectification of the earlier order under the NCLT Rules. The resolution plan itself contemplated delisting of the corporate debtor's securities in accordance with the applicable delisting regulations after approval of the plan, and the delisting process had already been completed by the stock exchanges. The impugned direction to maintain minimum 5% public shareholding was found to be inconsistent with the corporate debtor's delisted status and with the plan as approved. The direction was treated as a typographical error that did not affect the object or implementation of the resolution plan.

Conclusion: The rectification was allowed and the earlier order was directed to be read without the direction requiring maintenance of minimum 5% public shareholding.

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