Trinity India Forgetech resolution plan approved with 92.87% votes, appeals dismissed over timing and conflict issues NCLAT dismissed appeals challenging approval of resolution plan by Trinity India Forgetech Pvt. Ltd. with 92.87% vote shares. Court rejected application ...
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Trinity India Forgetech resolution plan approved with 92.87% votes, appeals dismissed over timing and conflict issues
NCLAT dismissed appeals challenging approval of resolution plan by Trinity India Forgetech Pvt. Ltd. with 92.87% vote shares. Court rejected application for revised resolution plan submission by Saverni Neutech Pvt. Ltd., finding no error in adjudicating authority's decision as applicant failed to submit plan within prescribed time. Regarding Prem Trading Company's appeal claiming voting rights denial, NCLAT held that authorized representative correctly exited voting after participating in EOI process as co-resolution applicant, creating conflict of interest. Court noted Prem Trading's 2.48% vote share would not affect outcome given Trinity's overwhelming approval margin.
Issues Involved:
1. Approval of the Resolution Plan by the Resolution Professional (RP) 2. Rejection of the application to allow submission of a revised Resolution Plan 3. Voting rights of a Financial Creditor
Issue-wise Detailed Analysis:
1. Approval of the Resolution Plan by the Resolution Professional (RP):
The Corporate Insolvency Resolution Process (CIRP) against the Corporate Debtor, Adico Forge Pvt. Ltd., commenced on 23.06.2023. Two Resolution Plans were received: one from M/s. Saverni Neutech Pvt. Ltd. and another from M/s. Trinity India Forgetech Pvt. Ltd. The Committee of Creditors (CoC) held multiple meetings to discuss and extend deadlines for the submission of revised plans. By 15.12.2023, M/s. Saverni Neutech Pvt. Ltd. did not submit a revised plan. The CoC considered both plans and concluded that the plan from M/s. Saverni Neutech Pvt. Ltd. was not feasible and viable, disapproving it with 92.87% vote shares, while approving the plan from M/s. Trinity India Forgetech Pvt. Ltd. with the same percentage of votes. The RP subsequently filed an application for the approval of the Resolution Plan of M/s. Trinity India Forgetech Pvt. Ltd., which was allowed by the Adjudicating Authority.
2. Rejection of the application to allow submission of a revised Resolution Plan:
M/s. Saverni Neutech Pvt. Ltd. requested a refund of the Earnest Money Deposit (EMD) on 18.12.2023, acknowledging their failure to submit the revised plan on time. Subsequently, they filed an application (I.A. No. 124/2024) on 30.12.2023, seeking permission to submit a revised Resolution Plan. The Adjudicating Authority, on 01.01.2024, directed the RP to consider the plan, leading to a CoC meeting scheduled for 05.01.2024. However, on 05.01.2024, the Adjudicating Authority ordered the RP not to conduct the CoC meeting for considering any fresh Resolution Plan, noting confusion during the 01.01.2024 hearing. This order superseded any oral directions given earlier. The Adjudicating Authority ultimately rejected I.A. No. 124/2024, emphasizing that the CoC had already approved the plan from M/s. Trinity India Forgetech Pvt. Ltd. on 15.12.2023, and M/s. Saverni Neutech Pvt. Ltd. had no locus to file a new application after the plan's approval.
3. Voting rights of a Financial Creditor:
The appellant, Prem Trading Company, a Financial Creditor with a 2.48% vote share, claimed they were not permitted to vote in the meeting held on 15.12.2023. The representative, Rakesh Patel, was not allowed to vote due to a conflict of interest, as he was a co-Resolution Applicant. The Adjudicating Authority noted that Rakesh Patel participated in the meeting and voted on specific agenda items but exited before voting on the Resolution Plans. The CoC, led by HDFC Bank Ltd. with 92.87% vote shares, approved the plan from M/s. Trinity India Forgetech Pvt. Ltd. The Adjudicating Authority found no merit in the appeal filed by Prem Trading Company, affirming that the representative was rightly excluded from voting due to the conflict of interest.
Conclusion:
The Appellate Tribunal upheld the Adjudicating Authority's decision to approve the Resolution Plan of M/s. Trinity India Forgetech Pvt. Ltd. and reject the application to allow M/s. Saverni Neutech Pvt. Ltd. to submit a revised plan. The Tribunal also dismissed the appeal regarding the voting rights of Prem Trading Company, affirming that the exclusion was justified due to the conflict of interest. Both appeals were dismissed, and the Tribunal found no error in the orders passed by the Adjudicating Authority.
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