TaxTMI 
TaxTMI 
2019 (9) TMI 675
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....y the Financial Creditors of the Corporate Debtor, the petition was admitted on 04.06.2018 and that one Mr. Madhusudan Sharma having IBBI registration No. IBBI/ IPA-003/IPL0004612017-18/10395 was appointed as the Interim Resolution Professional (IRP) in relation to the CIRP Process initiated. 2. The Corporate Debtor, it is stated was being managed by one Mr. Rahul Aneja, Mrs. Ruchika Aneja being the directors of the Corporate Debtor and Mr. Pawan Aneja, Manager all occupying their offices at the time of insolvency commencement date. Consequent to the publication calling for the claims as provided under IBC, 2016 and the Attendant Regulations in the Economic Times (English) and Seema Sandesh (Hindi) on 06.06.2018 and after uploading the public announcement in the website as maintained by IBBI, the IRP received six claims from Financial Creditors and three claims from Operational Creditors till 18.06.2018 being the last date specified for the submission of the claims. Save, Oriental Bank of Commerce (OBC) all the other Financial Creditors were related parties and shareholders. Thus, the IRP constituted a Committee of Creditors (CoC) with OBC as the sole member having 100% votin....
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....ts. Time was extended till 29.10.2018 based on the request. 8. The application also brings to light that in application IA No. 58/JPR/2018 dated 15.10.2018 has been filed before this Tribunal for appropriate relief in relation to preferential and other transactions in terms of Sections 43, 45, 50 and 66 of the Code as against the respondents named therein. 9. It is reported that on 30.10.2018, the fifth CoC meeting was convened as per the extended date of 29.10.2018 since only one resolution plan was received, the RP was directed to check for compliance with the requirements of IBC, 2016 and Regulations Attendant therein in relation to the resolution plan. RP after ascertaining the compliance with the Code and Regulations by the Resolution Applicant and with an opportunity being provided to the Resolution Applicant to cure the deficiencies for which time was given till 12.11.2018 and based on the submissions of the revised plan, the 6th meeting of the CoC was convened on 17.11.2018 and the revised resolution plan was submitted by the resolution applicant, which was placed before the CoC for discussion. The options available to the CoC in relation to the resolution plan to the....
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....tingent tax liability, as and when liability is crystalized and payable. Income Tax Officer, Ward-2, Sriganganagar vide order 2018-19/2138 dated 28.12.2018 has raised a demand of Rs. 41 lakhs on the CD after reassessment for the Assessment Year 2011-12. Appeal against the said demand it is stated that has been filed on 23.01.2019. 13. As per the Resolution Plan it is stated that no interest shall be paid to existing unsecured loan for next five years the Plan implementation period (page 18 of the Plan). Undertakings to that effect by the related parties Mrs. Promila Rani Aneja, Proprietor of Prime Trade link, Mr. Pawan Kumar Aneja, Partner of Prime Multitrade Co., and Mr. Rahul Aneja, Karta of Rahul Aneja (HUF) for unconditional consent not to claim interest on their dues from the CD for the Resolution Plan implementation period have been duly annexed. 14. Further the amount provided to the different types of creditors as well as other stake holders under the resolution plan has been given in Paragraph 19 which for ready reference as reproduced hereunder: - The amount provided for the stakeholders under the Resolution Plan is as under: (Amount in Rs. Lakh) Sr. No.....
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....et for more than a year but however, OBC has not declared the said person as a wilful defaulter. 17. Ultimately, it has been stated that the resolution plan as submitted by the resolution applicants, namely, M/s. Rahul and Ruchika Consortium and as approved by the Committee of Creditors by 100% voting share is in order and thereby seeking for direction of this Tribunal being the adjudicating authority to declare the resolution plan upon its approval to be binding on the company, its creditors, guarantors, members, employees and stakeholders involved in the resolution plan in accordance with Section 31(1) of IBC, 2016 as well as based on consequential orders. 18. IA No. 57/JPR/2019 has been filed by the Financial Creditor who in the first place initiated the proceedings before this Tribunal seeking for CIRP of the Corporate Debtor and taking into consideration this Tribunal admitted the petition and initiated the CIRP. The grievance expressed by the applicant in IA No. 57/JPR/2019 is that his claim is not admitted in full by the RP including the principal and interest as claimed in a sum of Rs. 1,31,61,143/- and that as against the said claim the resolution plan discloses only....
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....without any discrimination and under the circumstances seeks for these two applications to be dismissed. 23. We have carefully considered these applications including the one filed for approval of Resolution Plan unanimously voted favourably by the Committee of Creditors in its meeting held on 30.01.2019 and which has prompted the resolution professional to move this application in IA No. 44/JPR/2019. The facts in relation to the CIRP process hitherto which has taken place as can be culled out from the application as filed by the RP has been fully detailed in the preceding paragraphs and for sake of brevity the same are not repeated. 24. Compliance certificate in Form H has been duly annexed as Annexure 19 along with the typed set filed by the RP. Perusal of the said form discloses that Oriental Bank of Commerce is the only Financial Creditor not related and having a 100 per cent voting strength. The dissenting FC who has filed Application Nos. 57 and 58 of 2019 are related party Financial Creditors and in the circumstances, they do not have any say in the decision of the CoC. From clause VI of Form H it is seen that the resolution plan in the opinion of the Resolution Profes....
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....l Bank of Commerce has agreed to provide overdraft facility of Rs. 326 lakhs and the balance amount shall be paid out of the funds infused by the Resolution Applicant. Further resolution applicant shall make interest to the secured creditor on the amount outstanding in its account from the date of commencement of CIRP till date of approval of resolution plan. Full payment to Operational Creditors: Resolution applicant propose to make full payment to all the operational creditor of the Corporate Debtor as per the books of account of the Corporate Debtor. The amount is estimated to be Rs. 176 lakhs. This amount includes the claim of creditors who have not submitted their claims. However in case of liquidation the payment to operational creditors will be delayed and they might have to sacrifice some amounts as the liquidation value will not be such to allow the 100% payment to operational Creditors. In compliance to the regulation 38(f) of the Insolvency and Bankruptcy Board of India (Insolvency Resolution Process of Corporate Persons) Regulation, 2016 Resolution applicant shall make to the Operational Creditor under a resolution plan in priority over financial creditors. Amo....
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.... No. Particulars (Liabilities payable in first three months) Amount (in lakhs) 1. CIRP Cost 3 2. Operational Creditors other than related parties including unclaimed amount 156 3. Secured financial Creditors 361 4. Bank interest 18 Total(A) 538 Sl. No. Particulars -Sources of funds (First three months post approval) Amount (in lakhs) 1. Funds already generated during CIRP 107 2. Fresh infusion by Resolution Applicants in three months 45 3. Bank overdraft 326 4. Funds from operations 60 Net funds available for payment 538 Sl. No. Particulars (Liabilities Deferred) Amount (in lakhs) 1. Unsecured financial creditors and shareholders - Resolution applicants 121 2. Unsecured financial creditors- CIRP applicants. 56 Total (B) 177 Sl. No. Particulars (Liabilities payable in first three months) Amount (in lakhs) 1. Funds owned and deferred by resolution applicants till completion of plan 121 2. Cash flow as per projection of next five years 56 Net funds....
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....t find much force in their contentions in opposing the resolution plan as all the related parties under the RP and their repayment are categorised under one umbrella and the repayments are required to take place accordingly under the Resolution Plan. However, it is required to notice that in relation to related parties IBC, 2016 does not permit the related parties being Financial Creditor to participate in CoC for obvious reasons, as any transactions between the related parties cannot be equated to that type of transactions with outsiders on an arm's length basis and hence there is bound to be a differential treatment as between a related party being a related party to a Corporate Debtor whether it be secured of unsecured. 28. Further learned RP has also brought forth that despite repeated reminders through emails to the dissenting financial creditor/related parties/applicant in IA Nos. 57 and 58 of 2019, no supporting documents have been filed in relation to the claim of interest and in the circumstances the same was not taken into consideration in the final Resolution plan based on the claim admitted by the RP seems to be justified. Evidences have also been furnished along wit....
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....s/business of the Corporate Debtor. It is also stressed that all the activities like purchase or sale are carried at arms length transactions only and not as averred by the RP, who at the time of oral submissions by learned counsel for RA/Respondent contends that the same has been made by the RP without understanding the nature of business done by the Corporate Debtor being that of dealing in mustard seeds, mustard cake, mustard oil are driven by its own mechanics, however for the time being we are not closing application in CA No. 58 of 2018 filed by the RP in view of the directions issued to direct the monitoring agency in the concluding part of this order. 31. Be that as it may, taking into consideration the overall interest of the stakeholders of the Corporate Debtor, we approve the resolution plan however subject to the following direction: (i) That the dissenting FC even though a related party shall be paid the principal amount due and as agreed before this Tribunal by the Resolution applicant before payment is made to the equity shareholders as contemplated under the resolution plan. (ii) Further in relation to the transactions as brought to the notice o....