Approved resolution plan distribution cannot be altered, and dissenting creditors remain protected by liquidation value entitlements.

Once a resolution plan is approved and incorporates a distribution mechanism, that mechanism becomes binding and cannot be altered by a Monitoring Committee constituted only for implementation. The text further states that a dissenting financial creditor must receive at least the liquidation value protected by section 30(2)(b) read with section 53 of the Insolvency and Bankruptcy Code, and that this entitlement is confined to the approved computation basis. It also notes that the dissenting creditor's payment did not include any share in auto unit sale proceeds, because those proceeds were reserved for assenting financial creditors under the plan.

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Issues: (i) Whether the Monitoring Committee could alter the distribution mechanism already approved by the Committee of Creditors and incorporated in the approved resolution plan; (ii) whether the dissenting financial creditor was entitled to receive payment in accordance with section 30(2)(b) of the Insolvency and Bankruptcy Code, 2016 on the basis of the liquidation value attributable to its security interest; (iii) whether the impugned direction wrongly included any entitlement from the auto unit proceeds.

Issue (i): Whether the Monitoring Committee could alter the distribution mechanism already approved by the Committee of Creditors and incorporated in the approved resolution plan.

Analysis: The distribution mechanism was consciously approved by the Committee of Creditors in its meetings and formed part of the framework of the approved resolution plan. Once the plan was approved, it attained finality and bound all stakeholders, including any committee constituted only for implementation. The Monitoring Committee had no authority to revisit or modify the commercial decision already taken by the Committee of Creditors, and any departure from that mechanism would amount to rewriting the resolution plan.

Conclusion: The Monitoring Committee could not alter the approved distribution mechanism, and the challenge on this ground fails.

Issue (ii): Whether the dissenting financial creditor was entitled to receive payment in accordance with section 30(2)(b) of the Insolvency and Bankruptcy Code, 2016 on the basis of the liquidation value attributable to its security interest.

Analysis: Section 30(2)(b) requires that a dissenting financial creditor receive not less than the amount payable in liquidation under section 53. The resolution plan and the Committee of Creditors' approved mechanism contemplated payment of the liquidation value attributable to each secured financial creditor, as determined by the evaluation advisor. The amount awarded to the dissenting financial creditor was treated as its statutory entitlement and not as any premium, and the appellate challenge seeking reduction of that amount was inconsistent with the approved plan and the statutory minimum protection.

Conclusion: The payment directed to the dissenting financial creditor was in accordance with section 30(2)(b) and the approved distribution framework.

Issue (iii): Whether the impugned direction wrongly included any entitlement from the auto unit proceeds.

Analysis: The plan provided that the auto unit sale proceeds would go to assenting financial creditors, while the computation for the dissenting financial creditor was confined to the liquidation value of the steel unit. The record showed that the amount awarded to the dissenting financial creditor was computed only on that basis and did not confer any share in the auto unit proceeds. The objection that the impugned order granted an unwarranted benefit from the auto unit was therefore unfounded.

Conclusion: The impugned direction did not include any entitlement from the auto unit proceeds.

Final Conclusion: The approved resolution plan and the distribution mechanism based on liquidation value remained binding, the Monitoring Committee could not modify them, and the appeal was liable to fail.

Ratio Decidendi: Once a resolution plan is approved and incorporates a distribution mechanism, neither the Monitoring Committee nor subsequent stakeholders can alter that mechanism, and a dissenting financial creditor must receive at least the amount payable in liquidation under section 30(2)(b) read with section 53.

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