Tribunal Approves Resolution Plan for NRS Projects Pvt Ltd under IBC

The Tribunal approved the resolution plan for the Corporate Debtor, M/s NRS Projects Private Limited, in compliance with IBC provisions. The plan, submitted by a Promoter and approved by the COC with 73.03% votes, met the requirements of Sections 30(2) and 31 of IBC. Despite opposition from dissenting Financial Creditors, the plan ensured equitable debt payments and established a Management Committee for post-approval operations. The Promoter's eligibility under Section 29A of IBC was upheld, allowing the plan's acceptance. The Tribunal lifted the moratorium, directed notification of relevant parties, and forwarded all records to the IBBI for documentation.

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Issues:
Approval of resolution plan by COC, Compliance with IBC provisions, Eligibility of Promoter to submit resolution plan

Approval of Resolution Plan by COC:
The resolution plan submitted by one of the Promoters of the Corporate Debtor was approved by the Committee of Creditors (COC) in a meeting with 73.03% votes, despite opposition from all Financial Creditors except Home Buyers. The plan was approved in accordance with Section 30(4) of the Insolvency and Bankruptcy Code (IBC), which requires a minimum of 66% voting share for approval. The commercial feasibility and viability of the plan were considered by the COC, leading to its approval. The plan was analyzed in light of Section 30(2) and 31 of IBC along with Regulation 38 of IBBI Regulations.

Compliance with IBC Provisions:
The resolution plan ensured priority payments to Operational Creditors and dissenting Financial Creditors after setting aside funds for Corporate Insolvency Resolution Process (CIRP) costs. The plan included provisions for debt payments to all dissenting Financial Creditors, treating them equitably by paying 100% of their claims. Despite full debt repayment, the dissenting Financial Creditors opposed the plan, possibly due to security interests in project flats. The plan also established a Management Committee to oversee the Corporate Debtor's operations post-approval, meeting the requirements of Section 30(2)(c) and 30(2)(d) of IBC.

Eligibility of Promoter to Submit Resolution Plan:
The eligibility of the Promoter to submit the resolution plan was questioned under Section 29A of IBC, as the Promoter was considered a related party. However, it was argued that the Promoter, being part of an MSME, could benefit from Section 240A of IBC. Citing a precedent, it was established that if the Promoter satisfies all creditors and can maintain the Corporate Debtor as a going concern, the plan can be accepted. The Tribunal found the Promoter eligible to submit the plan, as he paid debts equitably to all stakeholders.

The Tribunal approved the resolution plan for the Corporate Debtor, M/s NRS Projects Private Limited, in compliance with IBC provisions. The plan was deemed effective from the date of the order, lifting the moratorium and directing the Resolution Professional to notify all relevant parties. All records related to the insolvency process and plan were to be forwarded to the Insolvency and Bankruptcy Board of India for documentation. The application was allowed and disposed of as per the specified directions.

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