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of <h1>Tribunal Corrects Share Distribution Error in Resolution Plan Under Insolvency Code to Match Applicant's Proposal.</h1> <h3>Kailash T Shah Erstwhile Resolution Professional & Member of Monitoring Committee of GSL Nova Petrochemical Limited Versus Mr. Sunil Kataria</h3> The NCLT, Ahmedabad, allowed an application for rectification under Section 60(5)(c) of the Insolvency and Bankruptcy Code, 2016, concerning an error in ... Seeking rectification of order - Section 60(5)(c) of the Insolvency and Bankruptcy Code, 2016 read with Rule of 154 of National Company Law Tribunal Rules, 2016 - Applicant submits that Clause 21 sub-clause XIII Page 17 of the order dated 05.10.2021 is inconsistent with the proposal made by the resolution applicant in its resolution plan at page number 44 at clause 4.14. as the same changes the proposition made in plan. HELD THAT:- The instant application is allowed and clause 21 subclause XIII page 17 of the order is replaced with following clause: 'On the effective date and with effect from the appointed date, the entire shareholding of the erstwhile promoters and their family members, whether as equity share capital or preference share capital shall be fully cancelled and stand reduced to zero. All other public shareholders shall be paid Rs. 1/- for every 100 shares held in the company as proposed under the plan.' The application is allowed and stand disposed of. Issues: Rectification of order under Section 60(5)(c) of the Insolvency and Bankruptcy Code, 2016.In the judgment delivered by the National Company Law Tribunal, Ahmedabad, the application was filed seeking rectification of an order dated 5.10.2021 under Section 60(5)(c) of the Insolvency and Bankruptcy Code, 2016. The applicant, a member of the monitoring committee of the Corporate Debtor, highlighted an error in the distribution of shares in the resolution plan approved on 5.10.2021. The Tribunal noted that the error was substantial in nature and could not be rectified through speaking to minutes. The applicant contended that the distribution of shares in the approved resolution plan did not align with the proposal made by the resolution applicant. The Tribunal, after considering the submissions and documents on record, allowed the application for rectification. The clause in the order regarding the shareholding of the promoters and public shareholders was modified to align with the resolution plan proposed by the resolution applicant.This judgment underscores the importance of ensuring accuracy in the distribution of shares in a resolution plan under the Insolvency and Bankruptcy Code. It highlights the process for seeking rectification of errors in such orders and emphasizes the need for alignment between the approved resolution plan and the proposals made by the resolution applicant. The Tribunal's decision to allow the rectification application demonstrates the commitment to upholding the integrity and accuracy of insolvency proceedings.
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