2019 (7) TMI 1482

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.... the Expression of Interest ("EOI") was published by the resolution Professional on 22nd July, 2018 for inviting the Prospective Resolution Applicants to submit their Resolution Plan for the corporate Debtor which is under Corporate Insolvency Resolution Process. (ii) Thc Resolution Applicant had submitted the Resolution Plan on 19.02.2019 i.e. on 268th day but the same was not considered by the Resolution Professional and was rejected on such ground of paucity of time due to which any Resolution Plan at this stage is not entertainable. (iii) Therefore, it is alleged that the Resolution professional without giving any opportunity to the resolution applicant has rejected the Resolution Plan which may affect the service and earning of around 200 employees. 3. The learned counsel appearing for the Resolution Professional has filed his reply to the present CA contending that as per regulation 36A(1) of IBC, the process of inviting of resolution plans along with timelines are well defined. The Invitation for Expression of Interest was first published on 13th August, 2018 in Business Standard (English and Hindi). The last date of submission of expression of Interest ....

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....meline thus he refused to consider such resolution plan. 10. We dully considered the above given facts and circumstances of the present application and we are of the view that :- * The main object of the code is "to reorganisation and insolvency resolution of corporate persons, partnership firms and individuals in a time bound manner for maximisation of value of assets of such persons, to promote entrepreneurship, availability to credit and balance the interests of all the stakeholders." Further this fact to be taken into consideration that the code is not meant for recovery of debts but also for seeking a revival of Corporate Debtor company in the best possible manner. Hence, we being Adjudicating Authority are legally expected to make efforts to fulfil such main theme of the I & B Code. * It may be noted that in the proposed resolution plan there is provision of Rs. 14 crores for revival of the company and the liquidation value is only Rs. 9.67 crores. Thus the proposed plan is much higher than the liquidation value of the assets of the company, this aspect is required to be considered by the COC. * We carefully examined the legal position of the pre....

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...., as otherwise a good resolution plan may have to be shelved, resulting in corporate death, and the consequent displacement of employees and workers." * By following the above stated precedent of the NCLT, Mumbai Bench in the matter of Edelweiss Asset Reconstruction Company Ltd. v. Reid Taylor (India) Ltd. [CP(IB) 382 (MB)/2018] went to held further and observed as under :-  "....The Resolution Professional is also present and submits that the Committee of Creditors in the meeting held on 14.12.2018 decided to liquidate this Company in view of the fact that no resolution plan was submitted by anybody even though Expression of Interest was given by 8 persons. It is also reported that the debt of the Corporate Debtor is around 4000 Crores whereas liquidation value is very meagre; the Company is incurring cash losses even though the Plan is functioning with 20% to 30% of its production capacity. The Resolution Professional also submits that due to lack of working capital facilities the plant could not run at its full capacity. It is further submitted that the basic criteria for submission of Resolution Applicant is that the Resolution Applicant shall have the ne....

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.... It is made very clear that the Resolution Plan has to be submitted only by the Investor and not by the Applicant Association. In order to enable the investor to submit the Resolution Plan (if he otherwise eligible), it is necessary that time period has to be either extended or time period from the date of filing of this application till the date of disposal of this application is to be excluded from the CIRP process. However, under the Code it is not possible to extend the 270 days period and hence this Bench is inclined to exclude the period from the date of filing this Application (19.12.2018) till the disposal of this Application from the CIRP period, so that above said investor or any other investor can submit their resolution plan which would revive the hopes of keeping the aspirations of workers, creditors and above all in the public interest......." * anThe NCLT, Mumbai Bench in the above stated matter has pleased to observe further that :-  "........that a humanitarian angle has to be taken and in pure public interest even the smallest opportunity, if available for the company to revive itself, cannot be denied just because the time prescribed u....