TaxTMI 
TaxTMI 
2018 (5) TMI 78
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.... 1. This is an application filed by Liberty House Group Pte. Limited (for brevity 'Liberty House') under section 60(5)(c) of the IBC, 2016 with a prayer that the decision of the Committee of Creditors (for brevity 'CoC') dated 22.02.2018 be declared illegal and set aside. The Committee of Creditors has refused to entertain the resolution plan submitted by the applicant on 20.02.2018 on the ground that it was delayed. The Liberty House has placed on record a copy of the impugned letter dated 22.02.2018 (diary No. 1024 dated 23.02.2018) after filing of the application. An additional affidavit dated 01.03.2018 placing on record copies of the affidavits, emails, copies of documents required by Resolution Professional (for brevity 'RP') and confidentiality undertaking sent to the RP were placed on record. 2. In response to notice of motion having been issued reply by RP has been filed on 05.03.2018 (diary number 1178). A separate reply has been filed by Tata Steel Limited (for brevity TSL') on 05.03.2018 (diary No. 1168). RP had also filed a Caveat application on 22.02.2018 (diary No.983). Another separate reply has been filed on behalf of the CoC on 01.03.2018 (diary No. 1156). The a....
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....pate in the resolution process of BSPL within the time prescribed in the EOI. It is worthwhile to note that any potential Resolution applicant who was desirous of submitting a resolution plan was required to provide relevant documents to establish that it satisfied the qualification requirements on or before 06.10.2017. 5. On 30.10.2017 Information Memorandum as required u/s 29 of the Code was prepared by RP which was supposed to contain all requirements concerning documents and information needed to be supplied to RP by a Resolution applicant to facilitate submission of proposals/resolution applications. The liquidation value of the assets of BPSL as per Regulation 36 was determined at Rs. 9500/- crores (approx). 6. The applicant 'Liberty House' sent its formal EOI dated 12.11.2017 alongwith email dated 13.11.2017. In the email the applicant 'Liberty House' has stated that it is a part of Gupta family group alliance and it would like to participate in the CIR process of BPSL in accordance with the provision of the Code; and that the formal expression of interest was forwarded with a request to RP to place it before the CoC. It was further stated that audited consolidated financi....
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.... in the preceding paras the Liberty House sent its EOI on 12.11.2017 along with the email dated 13.11.2017 (annexure-A4 colly). A copy of the qualification criteria has been placed on record (annexure-A5). A copy of an audited financial statement of the applicant for the year ended 31.3.2017 (annexure -A6). 10. The RP vide email dated 18.11.2017 replied to the email of the Liberty House and called upon the applicant to submit documents including confidentiality undertaking, Memorandum of Association, Article of Association, Incorporation documents etc. On 20.11.2017 RP expressed his thanks to the Liberty House for submitting its EOI and asked for further information and formalities for issuance of RPF and grant of access to documents. He offered to schedule site visit confirming thereby that the Liberty House was one of the prospective resolution applicant. A copy of email dated 18.11.2017 sent by RP is on record (annexure -7) and email dated 20.11.2017 is also on record (annexure -8). 11. It is claimed by RP and CoC that the Liberty House was aware about the deadline for submissions of a resolution plan which was upto 08.02.2018. However, it had been extended from time to time a....
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....old that COC had decided not to open the Liberty House's resolution plan because it was submitted after the due date and in that regard written communication was to follow. 13. In support of the application the Liberty House has raised following grounds:- a. The applicant is a renowned global company, which is evident from its financial credentials and backgrounds as well as the background of the GFG Alliance. The applicant craves leave to refer to and rely on the foregoing paragraphs where details of its networth, turnover and other business expertise are set out. The GFG Alliance of which the applicant is a part, has a proven track record of developing the Steel Industry and acquiring and turning around businesses. b. The applicant meets the qualifying criteria furnished to it by the RP and that it is very well placed to act as the resolution applicant and participate in the insolvency resolution process for the BPSL. The applicant has submitted a highly competitive resolution plan and is reasonably sure that if its plan is accorded due consideration the plan would succeed in as much as the applicant is a global giant in the relevant sector of power and steel. c. The appli....
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....n by the CoC would only aid and benefit the insolvency resolution process of the corporate debtor/respondent which is as per the objective of the Code. No prejudice whatsoever would be caused to any party. g. The applicant firmly believes that it has covered all aspects mandated by law in its resolution plan and if on consideration by the CoC any further information is required to be added and/or the plan itself is required to be updated, the applicant undertakes to do so promptly. h. Whilst it was in the midst of putting finishing touches to its resolution plan, the applicant came to know that the deadline for submission of resolution plan, which had been extended from time to time, stipulated as 08.02.2018. Immediately on finding this out, on 13.02.2018, the applicant wrote a letter to the RP categorically intimating that it was in the process of submitting a viable and competitive resolution plan for the corporate debtor/respondent and that it is in a position to submit a resolution plan which the CoC would consider very viable. The applicant further stated that their plan would be in the interest of all stakeholders, in particular lenders, as the ultimate goal of the proces....
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....2018 15. After filing of the application Liberty House has also filed a copy of the letter dated 20.02.2018 handed to RP. This was done on 23.02.2018. Thereafter again additional documents were filed on 01.03.2018 which are copies of affidavit required by RP (annexurel2 and annexure-14), emails sent in December 2017 (Annexure-13) and confidentiality undertaking (Annexure-15), Reply-CoC 16. In the reply filed by COC it is claimed that COC has taken every precaution to ensure a fair, transparent and open process with the object of maximizing the value and allow for approval of a successful resolution plan within a specified timeline fixed under the Code. Every opportunity has been given to all the interested parties to put forward their interest and claim. 17. Referring to the changes, the COC has averred that some changes were brought about by IBBI with respect to the eligibility of the resolution applicants by amending the Regulation which were incorporated appropriately in the process documents and thereby it ensured compliance with the amended Regulations. It is alleged that Liberty House-applicant has failed to comply with the timeline right from the beginning and acceptance ....
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....uments because new eligibility criteria for resolution applicants has been provided by way of amendment. This has never been complied with. According to CoC this fact has been concealed from the adjudicating authority-NCLT in these proceedings. A copy of email dated 02.12.2017 has been placed on record. (Annexure A). It has also concealed the fact of another email sent by RP on 08.12.2017. The time for submission of affidavit under section 29A and the required documents was extended for further period of 10 days and it was to end on 18.12.2018. A copy of the email is placed on record (annexure-B). No affidavit till date has been submitted by the Liberty House. It is claimed that on account of the aforesaid non-compliances the Liberty House is not eligible to submit the resolution plan, 20. The process document giving details of the terms and conditions and timelines for submission of resolution plan by the resolution applicant was issued on 14.12.2017 and it was made available to only those who were qualified resolution applicants and had submitted the confidentiality undertaking and the requisite fee of Rs. 10 lakh. The Liberty House having not submitted those documents and the d....
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....ave been controverted. It is sought to be projected that the Liberty House has been closely watching the development of the CIRP in respect of the BPSL and has deliberately delayed it. It is also denied that applicant has a strong prima facie case and it has balance of convenience in its favour. Reply py RP 27. A separate reply by RP has been filed which is similar to the one filed by CoC. It has been reiterated that application of the Liberty House is not maintainable for the following reasons:- (a) Fulfilment of the prescribed qualification criteria is a sine qua non for consideration of resolution plan. (b) The consideration of the resolution plan of the applicant received beyond the prescribed deadline would be a prejudicial and arbitrary act on the part of the resolution professional/Committee of Creditors. (c) No judicial intervention required as the respondent and the Committee of Creditors have followed the due process of law. (d) The applicant has not disclosed material facts and documents which clearly highlight the shortcomings on the part of the applicant. 28. It has been pleaded that consideration of the resolution plan of the applicant would be complete ne....
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....o. (ii) Submitted the confidentiality undertaking as well as the non refundable payment of INR 10,00,000/- for access to the virtual data room when called upon to do so. It appears that the applicant has neither submitted its confidentiality undertaking nor provided the non-refundable payment of INR 10,00,000/- for access to the virtual data room, as required by the resolution professional, despite several reminders throughout the CIRP. b. The applicant's bid has come after the last date for submission which was 8.2.2018, as late as on 20.2.2018; and c. The sealed Resolution Plan were opened on 8.2.2018 as per the stipulation in the second addendum dated 26.01.2018. The applicant has, with a view to gaining an unfair advantage over other bidders (including TSL), submitted its bid after the other bids have been opened and material information regarding such other bids had already been reported in the press. 31. The whole CIR process would be prejudiced and derailed. It would set a bad precedent in IBC itself and it would in turn open floodgates to whimsical challenges to CIRP thereby leading to a complete breakdown of a time bound process. The following reasons have been give....
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....parameters with respect to resolution plan were allegedly disclosed to CoC only on 14.2.2018 and the Liberty House was never aware of the amounts of two financial bids and that the reliance of TSL on various media reports is wholly misplaced. It has been submitted that conflicting and variant reports with regard to the bids amount offered by TSL have been mentioned in the press report ranging from Rs. 11,500/- crores to Rs. 24,500/- crores. Therefore, it is sought to be emphasised that the press reports do not project the correct bidding amount of the two resolution applicants and therefore the liberty house could not have taken any benefit from those process press reports. The Liberty House would not be able to submit its resolution plan based on the report in the media. The other resolution plans are also at consideration stage and no vested right has come into existence merely by submission of the resolution plan. In any case the highest amount proposed by a resolution applicant is not the sole criteria for declaring resolution applicant as a successful resolution applicant till the time CoC formally approves the resolution plan and adjudicating authority acceprthe same under se....
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....of the Liberty House which was submitted well before the meeting of CoC on 22.2.2018. Rejoinder to the reply of CoC & RP 36. Rejoinder has also been filed to the reply filed by COC in the preliminary submissions. The averment made in the application by the Liberty House have been reiterated and it is controverted that the Liberty House is ineligible and a non serious participant. It is claimed that non opening of resolution plan of the Liberty House is prejudicial not only to itself but to all other stakeholders as it would defeat the purpose of IBC which is to maximize the value of asset. It is also claimed that Liberty House is a 'turnaround specialist' and world renowned player in steel industry. It has globally acquired fame for turning out distress industries while protecting employees and their jobs; and also by creating new jobs. The details of achievement have been listed in a tabulated form. It is also asserted that procedure cannot override the objective of the Code or the larger public interest. It is pleaded that procedure is handmaid of justice and procedural provisions cannot be stretched and considered as mandatory unless it causes serious general inconvenience. A....
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....t could not constitute a basis for non consideration of its resolution plan as no prejudice is caused to CoC or RP. Similar arguments have been advanced with regard to site inspection. It has also been asserted that process document was never ever treated by RP and /or CoC as sacrosanct, mandatory, or binding documents nor the time lines laid down therein has been adhered to. The RP has admitted that the process document was introduced only on 14.12.2017 which is three months after the publication of notice inviting EOI and about four weeks before the resolution plan were to be submitted. Other facts have also been noted in the preceding paras and it would not warrant to repeat the same. 40. We have heard learned counsel for the parties at a considerable length. On behalf of the Liberty House Mr. A.S. Chandhiok, Mr. Anand Chibber and Mr. K. Datta, learned senior counsel have made following submissions:- (i) The Liberty House qualifies the 'qualification criteria' and falls in Category A of the pre qualification criteria (annexure-5). In its EOI it has disclosed adequate data showing fulfilment of pre qualification criteria which shows turnover of more than Rs. 43000 crores and n....
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....ion for resolution applicant had to be made and (ii) an endeavour was to be made for submitting a resolution plan thirty days before expiry of the maximum period permitted under section 12 of the Code. The Regulation 39 was amended by the IBBI on 3 L 12.2017 w.e.f. 01.01.2018. If the provision of new regulation were to be applied then a fresh public notice was required to be issued to highlight the change in section 25(2)(h) and Regulation 39(1). According to amendments made in section 25(2)(h) the RP was required to invite prospective resolution plan applicants who fulfilled such criteria as may be laid down by him with the approval of CoC having regard to the complexity and scale of operations of the business of the corporate debtor. It further provides that such other conditions as may be specified by the IBBI were also required to be fulfilled. In the unamended provisions he was to communicate to the prospective lenders, investors and any other persons to put forward resolution plan a month before the maximum period provided by S. 12 of the Code. It was in the then prevailing regime that no timeline was fixed for submission of resolution plan in the advertisement dated 21.09.20....
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....ed valuers as per section 35 which is amended on 06.02.2018. It cannot be at the discretion of the RP/CoC to apply one amendment and refuse to apply other. 41. On behalf of RP Mr. Kathpalia learned senior counsel has made following submissions:- (a) The applicant has failed to disclose material facts and documents and on that score alone the application is liable to be dismissed. The suppression of material facts and documents is intentional. According to the learned counsel the applicant has attempted to project its actions as act of good faith whereas it has miserably failed to perform its obligation under EOI. Substantiating his arguments learned counsel has submitted that Liberty House had failed to disclose the factum of submitting the EOI beyond the date prescribed in the advertisement; it has concealed its own mail dated 20.11.2017, acknowledging the email sent by RP on 18.11.2017. It was stated in its mail that RP asked the Liberty House to furnish additional documents and confidentiality undertaking in accordance with the CIRP Regulation and it had undertaken to do the needful. Liberty House failed to submit the affidavits in the format prescribed concerning the provisi....
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.... caused subject to the applicant submitting all eligible documents prescribed in the format dated 21.9.2017 which he failed to submit. The RP repeatedly sought the aforesaid documents and also requested the necessary confidentiality undertaking in accordance with section 29A of the code along with a deposit of Rs. 10 lacs to enable access to VDR containing all the documents with respect to Corporate Debtors necessary for resolution applicant to prepare his comprehensive resolution plan. For a period of 3 months from November to February 2018 no steps were taken by the Liberty House. It is only after crossing the barrier of qualification criteria that stage A of the process is completed and those who qualify were permitted to be promoted to the next stage B. A detailed process and timeline for submissions of resolution plan was to be communicated only then as per the terms of the public notice. All this was done to ensure the timeline and the evaluation matrix was examined which was set up by RP in consultation with CoC. The process document and the VDR were made available only to the serious applicants who have successfully answer the qualification criteria whereas the one who fail....
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.... who fulfilled the qualification criteria were provided the 'process document' dated 14.12.2017. It was clearly mentioned in the process document that resolution plan were to be submitted on or before 10.1.2018. This date was later extended twice for those who fulfilled the qualification criteria. The first addendum added with the process document was issued on 3.1.2018 and second addendum was issued on 26.1.2018 which was on account of amendments to the Code and CIRP Regulations. In that regard reference has been made to the Insolvency and Bankruptcy Amendment Ordinance, 2017 which came into force w.e.f. 23.11.2017 and Insolvency and Bankruptcy (Amendment) Act, 2018 w.e.f. 19.1.2018 along with the various corresponding amendments in CIR Regulations. (h) Mr. Kathpalia then submitted that no judicial intervention would be warranted as the RP and CoC have followed the due process of law and complied with all the requirements laid down by the Code. According to the learned counsel IBC is a complete Code and it is prerogative of RP and CoC to finalize the process condition and timelines. It is an essential 'Commercial Function' and scope of the judicial intervention is extremely limi....
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....with the realities of commercial world. It has therefore been submitted that the satisfaction of CoC regarding adequacy of price is of paramount importance. In that regard reference has been placed on Sections 18, 25 and 28 of the Code. Referring to the judgement in the case of Divya Jyoti Manufacturing Put Ltd. (Supra)it has been argued that the aforesaid view has now been considerably water down by a recent judgment of Hon'ble the Supreme Court rendered in the case of Vedika Procon Private Limited v. Balleshwar Greens Put. Ltd. AIR 2015 SC 3103and Valji Khimji and Company v. Official Liquidator of Hindustan Wipro Products (Gujarat) Limited [2008] 9 SSC 299. 42. On behalf of CoC Mr. Ramji Srinivasan learned Senior Counsel has made following submissions:- (i) Mr. Srinivasan has reiterated that CoC & RP is empowered to lay down criteria of selection concerning timeline for submission of resolution plan. Both under the pre-amended and post amended provisions of section 25(2) (h) of the Code the difference is recognised between prospective Resolution Applicant and Resolution Applicant which means an applicant who successfully crosses a threshold of eligibility criteria and would be....
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....to 8.2.2018. The reason is one of the qualified resolution applicant - Tata Steel requested that on account of national holiday the date may be changed. Mr. Srinivasan also submitted that he adopt all the submission made by Mr. Kathpalia who has appeared on behalf of the RP. 43. Dr. A.M. Singhvi, learned senior counsel appearing for the TSL has prefaced his arguments by giving few snippets. According to Dr. Singhvi on principle any individual who takes liberty with law and does not submit to its mandate should not be rewarded by accepting a challenge on his behalf. A tilt in favour of such a mischief-monger would marginalized the bid system which have developed around Article 14 of the Constitution under the Tender law, Company law and the Insolvency and Bankruptcy Code. The bid system according to authoritative judgments of Hon'ble the Supreme Court rendered in the cases like 2G Spectrum namely Subramanian Swamy v. A. Raja, (2012) 11 S.C.R. 873 must be fully applied. The tender principles are the species of the same genus and there is marriage of private and public law because it involves the larger public interest. Reliance has also been placed on the judgment rendered in the ca....
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....ion of Interest' was floated, second before the bid date and last after the bid date. The Resolution Professional floated expression of interest where the potential Resolution Applicant were required to submit the relevant documents concerning qualifications on or before 06.10.2017 which was the deadline fixed. The Liberty House-applicant admittedly failed to adhere to the last date and filed his expression of interest on 13.11.2017 whereas TSL submitted its expression of Interest before the closing date. On the examination of the expression of interest submitted the eligibility was to be determined and in terms of the public notice the time line was to be communicated to the qualified potential Resolution Applicant only. After the expression of interest, the Committee of Creditors in its meeting dated 11.11.2017 and 17.11.2017 authorized Resolution Professional to issue process document setting out the deadline, process and criterion for submission of resolution plans. Despite the fact that Resolution Professional kept on asking the Liberty House-applicant to submit confidential undertaking and various other documents like audited financial statements, Memorandum of Association, A....
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....he assets of the company could be achieved only in a time bound manner. In that regard reliance has been placed on the observations made by this Bench in an order dated 15.02.2018 passed in the case of Clutch Auto Limited, (IB) No. 15(PB)/2017, Dr. Singhvi has argued that paradigm shift between the earlier regime and the post Insolvency and Bankruptcy Code has been noted to be the time line which is associated necessarily with the value of the assets which deplete very fast. Based on the observations made in the aforesaid order Dr. Singhvi has highlighted that acceptance of commercial decisions of Committee of Creditors ought to be a rule and interference with it should be an exception. Likewise, reliance has been placed on similar observations made in the order dated 19.12.2017 rendered in the case of Bank of India v. Tirupati Infraprojects Private Limited, (IB) No.l04(PB)/2017 to argue that allowing the participation of a person after the deadline would amount to changing the rules of the game after the game has begun. Expanding his argument, it has been submitted by Dr. Singhvi that if a rule provides where a power is given to do a certain thing in a certain way then that thing ....
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....provisions of Section 29A where list of persons not eligible to submit resolution plan have been detailed. Therefore, the time line finalized by the Resolution Professional in consultation with the Committee of Creditors was required to be adhered to. Dr. Singhvi has then drawn our attention to para 27 of the judgment rendered in the case of Sorath Builders v. Shreejikrupa Buildcon Limited and Another, [2009] 11 SCC 9 and has argued that their Lordships of Hon'be the Supreme Court upheld the time schedule attached to the notice inviting tenders and did not permit a late comer to participate in the tendering process. Likewise, reliance has been placed on para 66 of the judgment rendered in the case of B.S.N. Joshi & Sons Ltd. v. Nair Coal Services Ltd. and Ors., [2006] 11 SCC 548. 50. Learned Counsel has made a pointed reference to the general principles which have been summarized by Hon'ble the Supreme Court namely (a) all essential conditions must be followed, unless there is a power of general relaxation no relaxation is to be given and (b) the bidder cannot form a cartel; (c) and that they may be give an offer to match with the rates quoted by the lowest tenderer in public inte....
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.... Thereafter he is to conduct CIR Process by managing the affairs and operations of the Corporate Debtor (S. 23) and conduct meetings of the CoC as per the procedure postulated in S. 24 of the Code. Section 25 (1) of the Code has listed various duties of the Resolution Professional. The RP is under a sacred obligation of preserving and protecting the assets of the Corporate Debtor including its business operation. S. 25 (2) has enumerated numerous other duties cast on the RP. 52. Before 23.11.2017 S. 25 (2) (h) of the Code stood differently. In term it meant that for the purposes of preserving and protecting assets of the Corporate Debtor the RP was to 'undertake the following actions, namely ..................(h) invite prospective lenders, investors, and any other persons to put forward resolution plans'. This is in fact what was made known in the print media by the RP. The 'invitation seeking Resolution Plans for BPSL5 as published in the press on 21.09.2017 reads as under;- INVITATION SEEKING RESOLUTION PLANS FOR BHUSHAN POWER & STEEL LIMITED The undersigned has been appointed as the resolution professional ("RP") by the committee of creditors of Bhushan Power and Steel Limi....
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....d process and timeline for submission of resolution plans shall be separately communicated to the Potential Applicant who meet the qualification requirements as mentioned above. For clarifications, if any, please contact: [email protected] Please note that RP reserves the right to amend or modify the Invitation without assigning any reason and without incurring any liability of whatsoever nature. Any amendment or modification shall be posted on the website of the corporate debtor www.bhushanpowersteel.com. Potential Resolution Applicants are requested to regularly visit the aforesaid website for regular updates. Sd/- Mahender Kumar Khandelwal Resolution Professional - Bhushan Power & Steel Limited 53. After this public notice to the whole world no other public notice has been issued specifying a different date for submission of a Resolution Plan. It is admitted case at all hands that the process has been kept internal on the ground that those who meet the qualification requirements were alone entitled to further informations. 54. In the aforesaid backdrop we proceed to examine the provisions of law as existed on 21.09.2017 when the Resolution Plans were invited and duly publis....
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....er creditor; (b) liquidation value due to operational creditors and provide for such payment in priority to any financial creditor which shall in any event be made before the expiry of thirty days after the approval of a resolution plan by the Adjudicating Authority; and (c) liquidation value due to dissenting financial creditors and provide that such payment is made before any recoveries are made by the financial creditors who voted in favour of the resolution plan. (2) A resolution plan shall provide: (a) the term of the plan and its implementation schedule; (b) the management and control of the business of the corporate debtor during its term; and (c) adequate means for supervising its implementation. Regulation 39 (1) "Approval of resolution plan. 39. (1)A resolution applicant shall endeavour to submit a resolution plan prepared in accordance with the Code and these Regulations to the resolution professional, thirty days before expiry of the maximum period permitted under section 12 for the completion of the corporate insolvency resolution process. 55. A perusal of Section 12 of the Code would show that initial time limit for completion of Corporate Insolven....
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....ective resolution applicants, who fulfil such criteria as may be laid down by him with the approval of committee of creditors, having regard to the complexity and scale of operations of the business of the corporate debtor and such other conditions as may be specified by the Board, to submit a resolution plan or plans. 56. It is significant to notice that after issuance of public notice in print media on 21.09.2017 (supra) the Resolution Professional has not issued any other public notice notifying the criteria which might have been laid down by the Committee of Creditors. If no new public notice notifying the criteria finalized by CoC in terms of amendment is issued, then the original public notice would prevail with regard to the period for receipt of Resolution Plan application. 57. In the aforesaid context it would be necessary to make a brief survey of the minutes of meeting of Committee of Creditors. The first meeting of the Committee of Creditors was held on 01.09.2017. There was no discussion with regard to inviting Resolution Plan Applicants to file the resolution plans as at that stage the RP was not supposed to seek any approval from the CoC to qualification requireme....
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....aluation and approval of resolution plan was to be submitted by RP to the Committee of Creditors and that it was within the power of the Committee of Creditors under the Code and CIRP Regulations. It provides further that the CoC was to specify an evaluation criteria separately for evaluation of the resolution plans. It is significant to note that the public notice clearly specifies that (the detailed process and timeline for submission of resolution plans shall be separately communicated to the Potential Resolution Applicant who meet the qualification requirements as mentioned above.' 60. The Liberty House submitted its formal expression of interest on 13.11.2017 (Annexure A/4). In the third meeting of the CoC held on 31.10.2017 under item No. 9 the Resolution Professional pointed out that seven expression of interest were received from the Resolution Applicants and their names were furnished which are as under:- Sr. No. Resolution Applicants 1 Vedanta Limited 2 Tata Steels Limited 3 JSW Steel Limited 4 AION Capital Management Limited 5 Mohammed Ayub Shikh Mohammed Shahid 6 Middle East Integrated Steel Limited 7 Shri Sanjay Singal & Others - the existing Promote....
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....essional also informs the CoC in its meeting dated 21.02.2018 that he received a resolution plan on 20.02.2018 although it was after the expiry of the time line prescribed in the process document, i.e., 1400 hours 1ST on 08.02.2018 (internal process). The Resolution Professional also disclosed to the CoC that the packet is stated to contain a Resolution Plan, the Liberty House has submitted another envelope which is stated to contain two drafts of Rs. 25,00,00,000/- (Rupees Twenty Five Crores) and Rs. 10,00,000/-(Rs. Ten Lacs Only) respectively. The Resolution plan in the original sealed envelope as received by the RP was placed before the members of the CoC. It was further pointed out that in the light of the amended provisions of Regulation 39 (1) of the CIRP Regulations all Resolution Applicants were required to submit their resolution plan in terms of the time line given in the public notice inviting the expression of interest. It was also pointed out that Liberty House submitted their bids after the other two bids had been received which were under evaluation. In the aforesaid facts and circumstances the legal counsel advised the Members of the Committee of Creditors that the ....
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....n Power & Steel Limited at F-Block, 1st Floor, International Trade Tower, Nehru Place, New Delhi-110019 today i.e. 22nd of February 2018, otherwise the same shall be sent to you by registered post to your abovementioned address." 65. The aforesaid decision of the CoC would stare in the face of the stand taken by the RP while discussing item No. 9 in the third meeting of the Committee of Creditors dated 31.10.2017. There the Resolution Professional equivocally clarified that non acceptance of expression of interest by Liberty Group would not debar the Liberty Group or any other party from submitting a resolution plan if the same is submitted before 150th day of the CIRP (30 days before the expiry of the maximum period of 180 days). However, this period of 180 days was extended in the present case to 270 days vide order dated 22.12.2017 which has already been noted in the preceding paras. It needs to be emphasized that this period could not be curtailed until and unless a public notice is issued in the print media with regard to the last date to receive a resolution plan to provide a level playing field to all. The process after receipt of 'expression of interest' is completely opaq....
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....tions put forward by learned senior counsel Mr. Arun Kathpalia, Mr. Ramji Srinivasan and Dr. A.M. Singhvi for RP, CoC and TSL respectively that there should be level playing field for each of the participants. In the present case the level playing field was provided by inviting resolution plan within the period specified in the public notice dated 21.09.2017 and the Liberty House has filed its resolution plan 30 days before the expiry of maximum period provided under Section 12 of the Code. The aforesaid period cannot be curtailed by any internally involved mechanism especially when pre-qualification criteria did not have approval of CoC at that stage. The principle laid down in the judgments like Valji Khimji and Company (supra) ould have no application to the facts of the present case as in that case higher bid was offered after confirmation of the bid in a process which was found to be wholly lawful. In the present case the whole process is at a nascent stage. It is also true that commercial wisdom of the Committee of Creditors must be respected as has been observed by us in Clutch Auto Limited's (supra) case. What is to happen if you firstly held out to the whole world that res....
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....pplicants are not more than ten. The reasons for such small number are evident. Firstly, most of the time it is a specialized business and the number of such person participating in the CIR process is likely to be limited as the experience has shown so far. Secondly when the magnitude of assets involved is enormous then the number is likely to be limited as is evident from the facts of the present case. We find support to the aforesaid view from the observations made by Hon Hole the Supreme Court in paras 16 & 17 in the case of B, Ramakichenin @Balagandhi v. Union of India and Ors., [2008] 1 SCC 362 which read as under:- "16. Even if there is no rule providing for short-listing nor any mention of it in the advertisement calling for applications for the post, the Selection Body can resort to a short-listing procedure if there are a large number of eligible candidates who appry and it is not possible for the authority to interview all of them. For example, if for one or two posts there are more than 1000 applications received from eligible candidates, it may not be possible to interview all of them. In this situation, the procedure of short- listing can be resorted to by the Select....
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....ns, partnership firms and individuals in a time bound manner for maximization of value of assets of such persons, to promote entrepreneurship, availability of credit and balance the interests of all the stakeholders including alteration in the priority of payment of government dues and to establish an Insolvency and Bankruptcy Fund, and matters connected therewith or incidental thereto. An effective legal framework for timely resolution of insolvency and bankruptcy would support development of credit markets and encourage entrepreneurship. It would also improve Ease of Doing Business, and facilitate more investments leading to higher economic growth and development." 73. In the new regime consideration of a Resolution Plan of another competitor would advance the object of the Code in maximisation of the assets of the Corporate Debtor and may provide better solution in restructuring the stressed assets. The packet in sealed cover has been kept intact so that it may be seen by CoC and RP. The bench officer shall hand it over to RP or his counsel. 74. During the course of arguments, we found that the Committed of Creditors wanted to proceed with the consideration of resolution plan ....