TaxTMI 
TaxTMI 
2018 (4) TMI 1779
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....n Plan an Order is hereunder passed as prescribed U/s 31(1) of The Code. 2. The Corporate Debtor M/S. Raj Oil Mills had filed a Petition by invoking the Provisions of Section 10 of The Code read with Rule 7 of The Insolvency & Bankruptcy (Application to Adjudicating Authority) Rules 2016 on 23rd of June, 2017. 2.1. After considering the merits of the case, the said Petition was admitted vide an Order dated 10.07.2017 (TCP No.1132/I&BP/NCLT/MB/2017). Initially Mr. U.V.G. Nayak, Chartered Accountant was appointed as IRP. The said IRP had carried out the duties assigned under the I&B Code, namely:- (a) Published the commencement of CIRP in newspapers on 15.07.2017; (b) Constituted the Committee of Creditors and called First meeting on 09th August, 2017 (c) Appointed two Valuers to determine the Value of the assets. 2.2. A Resolution was passed by the Committee of Creditors for substitution of the IRP, as a consequence, a Miscellaneous Application (MA No.362/2017) was moved on 24.08.2017. Vide an Order dated 15.09.2007, the NCLT has approved the substitution by appointing Resolution Professional Dr. Rajendra M. Ganatra. It was also ....
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....h COC meeting held on 19.12.2017 and the improved Resolution Plans were placed for consideration. The COC again impressed upon the improvement in the respective Resolution Plans. It has also been communicated that a final Revised Plan be submitted by 21.12.2017. 2.8. During this interregnum, 180 days were scheduled to expire on 06.01.2018. As a consequence, an Application was submitted (MA No.5/2018) for seeking extension of 90 days. The said Application was allowed by this NCLT Bench vide Order dated 05.01.2018. 2.9. An E-Voting was held in accordance with Regulation 26(4) of the CIRP Regulations. The COC had voted in favour of the Resolution Plan submitted by RHIL jointly with Mukhi Industries Limited (MIL) by 77.68% voting. 2.10. The Resolution Professional has also communicated that in the light of the newly introduced Section 29(A) [with retrospective effect from 23/11/2017 Insolvency & Bankruptcy Code (Amendment) Act 2018] to be read with Regulation 39(3) of CIRP Regulation, a report U/s 30(2) of The Code has also been submitted. The main feature are stated to be as under :- 2.11. The Resolution Professional has thus submitted his comments as prescribed UIs 30(2)(....
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....nfuse æ43.42 crores for ROIL take over during the next 2-1/2 years. This question was raised and to get an answer, a Chartered Accountant Of Resolution Applicant made a representation on the said Resolution Plan to the Committee of Creditors and some of the salient features are as under :- "(a) the three promoters had about Rs. 25 crore in their capita/ account from which investible surplus would be deployed (no estimate or details surplus was available), and, (b) company had two contracts valued at Rs. 75 crore and the cash-flow from those project would be deployed for the commitment in ROIL. 2.15. It has also been informed that on MCA search it was found that the Promoters have promoted six Companies including Rubberwala Housing and Infrastructure Ltd. (RHIL). Track record of the Resolution Applicant has also been examined. It has also been informed that RHIL is banking upon the background of Mukhi Industries Ltd. (MIL). The net worth of MIL as on 31st March, 2017 and the paid up capital stated to be Rs. 254 lakhs, however, there were no operations during last two financial years. The Committee of Creditors had accepted the feasibility of the projected ....
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....tment towards Income Tax liability. It is also demanded that on acceptance of the Resolution Plan no property of the Company be recovered under any Order, Judgment, etc. Any property over which the Lenders or the Government Body has exercised their control belonging to the Corporate Debtor, should be released from lien subject to approval by Adjudicating Authority. On payment of the amount settled the Secured Creditors shall vacate the charge and the mortgage on the property or personal guarantee. This condition was not acceptable to Committee of Creditors. 2.20. In respect of the payment to Workers and Employees, RA had undertaken to make payment of the outstanding dues of Workers and Employees. This was accepted by the Committee of Creditors. The Resolution Professional has accepted the claim of Workers and Employees, as admitted by the Resolution Applicant. 2.21. As per the details of the Accounts, RA had noticed that in all there are 1,483 Fixed Depositors. In terms of the Resolution Plan and also accepted by the Committee of Creditors U/s 30(4) of The Code, the RA had proposed to pay 100% of the Principal i.e. 5.36 Crores in four equal quarterly instalments s....
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....effect from April 1, 2002. In the year 2005, the Company shifted factory premises from Military Road, Marol, Andheri (East), Mumbai - 400 059 to village Ten, Manor, taluka Palghar, Thane - 401 404. Board of Directors are as under:- Azamkhan Lohani Abdulla Musla Shaukat Suleman Tharadra Saryu Chimanlal Vora Balsubramanya Hiriyannaiah Rudrapatna Rashidbhai Ismailbhai Tharadara Pragnaben Prabhulal Joshi Ishwarlal Dhudalal Jagania 3.1. As per IM at present 81 Workers are employed and 165 Other Employees are working in the Company. Company had not paid dues to its Employees since 10th July, 2017 aggregating to Rs. 35,58,196/-. However, the total outstanding which includes PF, Bonus, Gratuity and Salary is to the tune of Rs. 1,61,92,329/-. 3.2. The IM contained details of Legal matters pending, stated to be "Statutory Liability". The list contained Sales Tax Liability for several Financial Years totaling Rs. 88.62 Crores and Income Tax Liabilities for which several appeals are pending totaling Rs. 234.07 Crores. 4. During the period of next four years the affairs of the Company shall be supervised by a '....
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....COM was proposal to be paid an aggregate sum of Rs. 1,07,00,000/- (Rupees One Crore and Seven Las only), with an upfront payment of Rs. 27,00,000/- (Rupees Twenty Seven Lacs only) and the balance being payable in six quarterly installments Per contra, under the Resolution Plan submitted by Dipti Vegoils Limited, an aggregate sum of Rs. 1,61,00,000/- (Rures One Care Sixty One Las) was proposed to be paid to SICOM with an upfront payment of Rs. 1,07,00,000/- (Rupees One Crore and Seven Las only) and the balance payable in eight quarterly installments. SICOM craves leave to refer to and rely upon the plan submitted by Dipti Vegolis Limited when produced." 6.1. The objection is that the Applicant has dissented the approval of the Resolution Plan, therefore, as per the communication received, disentitled for the claim. It is informed in this Application that on 11.01.2018 the Resolution Professional addressed an e-mail stating therein that since SICOM voted against the approved Resolution Plan hence to be treated as "dissenting Creditor" and will be entitled only to receive the Liquidation Value. In short, it is pleaded that after detailed discussion and through exchange of num....
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....tute has not provided outright rejection of claim of dissenting Financial Creditor. If a Resolution Plan has a provision in respect of servicing the Financial Debt of the said dissenting Financial Creditor and that Resolution Plan in toto has been approved by the COC then it is unjustifiable to take a view against the dissenting Creditor. 6.5. Admitted position is that SICOM has not blatantly opposed the Resolution process but in the voting held on 21/12/2017 voted in favor of Dipti Vegoils Limited on the ground that in the said Plan there was a better repayment terms favourable to him. Therefore, it is a case of giving preference to one Resolution Plan over the other one. Undisputedly this 'dissenting creditor' is otherwise part of the COC. The COC had approved a plan and that plan has made a provision for this Creditor, which means that his claim is in-built in the approved Resolution Plan. Resultantly, the Miscellaneous Application 27 of 2018 submitted by SICOM is partly allowed to the extent that the sum receivable of Rs. 1.07 Crore being an Unsecured Loan shall be considered only after the Settlement of the Secured Loans. 7. 'RESOLUTION PLAN' 'F....
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....rough settlement terms and release the securities. The capital restructuring will reduce the capital to reasonable level to account for the losses incurred by the company in the previous year and to be with in line with Net Worth of the company. The Resolution applicant will induct funds for participating in the equity in the company and to own the company upto 75% of the enlarge capital. The objective is to retain the status of Listed Company in the stock exchange. The Resolution applicant will take ever (sic 'over' ) the management of the company by inducting promoter director and independent directors. The resolution applicant has full freedom of Management of the company. The resolution applicant will abide by its commitment to infuse the funds requirement for initial payment and subsequent instalment in a timely manner. Resolution applicant has adequate resources to induct additional capital as will be required in future with the consent of BOD and Shareholders. Resolution Plan is in adherence to the Regulations 37 & 38 of the Insolvency and Ban....
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....lan of the Resolution Applicant is rejected the advance will be remitted back to Resolution Applicant. In accordance with the compliance with the condition we are depositing Rs. 6.22cr, being 10% of total proposed payment to all the creditors of Rs. 62.23cr. We may further add that we will further deposit Rs. 5.65cr. on approval of Resolution Plan by NCLT. In our proposed Resolution Plan submitted earlier we had agreed for payment of initial amount. The balance part of initial amount will be paid by 25th March, 2018. -We have committed Rs. 15cr. to Edelweiss Assets Reconstruction Company Limited as initial amount. We may clarify that 10% amounting to Rs. 2.7cr. of Rs. 27 cr. is getting deposited on 21st December, 2017 Rs. 4.05cr. will be deposited/ paid on approval of Resolution Plan by NCLT and balance Rs. 5.25cr. shall be paid by 25th March, 2018. We have committed Rs. 20.50cr. to SVC Bank as initial amount. We may clarify that 10% amounting to Rs. 2.05cr. of Rs. 20.50 cr. is getting deposited on 21st December, 2017 Rs. 1 cr. will be deposited / paid on approval of Resolution Plan by NCLT and balance Rs. 2.45cr. shall be paid by 25th March, 2018. ....
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.... Bank Equity Mortgage Loan 0.36 036 Bank Of Baroda 0.06 0.06 Total 178.78 47.92 The amount Of settlement due to secured lenders will be paid as under: Edelweiss will be paid Rs. 15 Crores as initial payment by 25th March, 2018 on approval Of Resolution Plan. The balance amount of Rs. 15 Crores will be paid in four quarterly instalments. The first three quarters will be paid Rs. 3 cr. per quarter and Balance Rs. 6 cr. by 31st March, 2019 2. SVC Co-op bank will be paid Rs. 5.5 Crores as initial payment by 25th March, 2018 on approval Of Resolution Plan. The balance Rs. 15 Crores will be paid in fifteen quarterly instalments of Rs. 1cr. each 3. City Bank will be paid Rs. 6 lakhs as initial payment and balance of Rs. 30 lakhs in Five quarterly instalments of Rs. 6 lakhs each. 4. Bank Of Baroda will be paid Rs.O.06 Crores as part Of initial payment PUBLIC FIXED DEPOSIT Public Fixed Deposit is from socially weaker section and senior citizens. We intend that the small fixed deposit holders should not suffer; therefore we are proposing to settle the principal amount due to fixed deposit holders @ of 100%....
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....zed demand maximum to Rs. 2.58 crores. The amount due on the settlement as stated above will be paid in 4 equal quarterly instalments starting from Sep, 2019. VAT: The Company has not received any Claim Form from Value Added Tax department towards VAT liabilities. In view of the same no provision is required to be made for payment of dues on account of VAT liabilities. RP has enumerated on page no. 72 of the 1M The details of legal matters with regards to VAT. ROM has filed appeals with Value Added Tax Appellate Tribunal, before Commissioner of VAT. The subject matters are not settled and the liabilities cannot be determined. New Promoters (NP) proposes to settle crystalized demand as per the order of Value Added Tax Appellate Tribunal or Commissioner of VAT Appeals. The so determined demand will be settled for a settlement amount of @1% of crystalized demand maximum to Rs.O.89 crores. The amount due on the settlement as stated above will be paid in 4 equal quarterly instalments starting from Sep, 2019. The details are as under : " Sundry Liabilities Amount Claimed Settled@Percentage Amount setteled Quarterly Instalment (beginning 30^th Jun....
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....s of Rs. 10 each amounting to Rs. 14,98,86,840/-. Revised Capital structure of the company will be as under: Particulars Number of Shares amount Authorised Capital 16,00,00,000 1,60,00,00,000 1600 lakhs equity shares Of FV Of Rs. 10 each Subscribed and Paid up Capital 1,49,88,684 14,98,86,840 749.43 lakhs equity shares of Face Value Of Rs. 10 each Shareholding pattern will be as under: Share holders Percentage No of shares Amount in Rs. Promoters 75% 112,41,513 11,24,15,130 Public 25% 37,47,171 3,74,71,710 TOtal 100% 1,49,88,684 14,98,86,840 The Equity shares of the company are listed on BSE and NSE stock exchanges. NP will make application to NSE & BSE for appropriate approvals and sanction for reduction of capital and allotment of new shares within the framework, rules and regulation Of SEBI and any other law as make(sic.) be applicable. Compa....
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....he company to adhere to make payments to financial creditors for an amount and in the manner and in accordance with the terms as envisaged in the scheme financial creditors should be entitled to reinstate their due to the original status as per the admitted claims by the RP along with security available to them. However the principal outstanding of each lender shall stand reduced by the amounts actually paid by the company, till such date. Till the completion of the repayment of the entire amount of the restructured loan payable to the financial creditors, the financial creditors shall have the right to seek copies of audited financial statement. The balance sheet of the company as on the cut-off date (date of approval Of this Resolution Plan received from the Adjudicating Authority) shall stand restructured in terms of the scheme. All the workers and employees shall continue, except in cases where they are willing to discontinue with the Corporate Debtor or are incapable to provide services. The Resolution Plan envisages continuity of business along with most effective use of the assets and equipments. All the Trade Marks, B....
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.... to the AA. Thereafter, u/s 31, as reproduced supra, AA is to examine the contents of the Resolution Plan. The mandate of this section is that if the AA is "satisfied" that the Resolution Plan as approved by the Committee of Creditors meets the requirement as referred to in section 30(2), shall by an Order, approve the Resolution Plan. So the prerequisite is that recording of "satisfaction" by AA is a condition precedent. A "satisfaction" is to be recorded in writing in the Judgment approving the Resolution Plan. "Satisfaction" is required to be based upon a conscious decision on examination of the terms of the Resolution Plan. In our humble opinion a thorough study of a Resolution Plan is required before recording a "satisfaction" in writing by AA. The 'satisfaction' as mandated in the statute can either objective or subjective or both, but it is a condition precedent. Naturally 'satisfaction' is to be recorded in writing with reasons after proper application of mind. The pros and cons of the scheme is required to be studied before recording subjective satisfaction. If the COC has submitted the scheme of Resolution after visualising the advantage and disadvantage t....
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....te Debtor and other stakeholders involved in this Resolution Plan so that revival of the Debtor Company shall come into force with immediate effect and the "Moratorium" imposed under section 14 shall cease to have any effect henceforth. The Resolution Professional shall submit the records collected during the commencement of the Proceedings to the Insolvency & Bankruptcy Board of India for their record and also return to the Resolution Applicant or New Promoters. Certified copy of this Order be issued on demand to the concerned parties, upon due compliance. 11.1. That the incoming Management shall not be personally responsible for any act, omission, commission and/or offence committed by the erstwhile Management of Raj Oil Mills till commencement of CIRP. 11.2. That liberty is hereby granted that if deem fit and legally permissible, can move Miscellaneous Application if required in connection with implementation of this Resolution Plan. 11.3. That in respect of stepping by the New Promoters/Resolution Applicant into the shoes of the erstwhile Company and taking over the business, the provisions of Companies Act, 2013 shall be applicable and because of this reason a copy of....
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....any is conceptually in order, it needs to be examined for feasibility. Establishing feasibility requires financial and execution credentials with requisite size, apart from the financial viability of proposed investment so that the COC is assured of the RA's ability to successfully implement the resolution plan. Detailed evaluation is covered in this report later. Implementa-tion and RA stated that the resolution plan after approval by the adjudicating supervision of the resolution plan authority will be implemented in 90 days. Implementation in 90 days is not feasible since the plan period is 15 quarters after initial payment. The plan implementation will involve infusion of RA's equity of Rs. 11.25 crore, unsecured loans of Rs. 34.85 crore over 15 quarters achieving projected cash accruals and utilization thereof to meet the obligation under the plan. Document 2 30(2)(e) The affairs of the company during the implementation period of 4 years will be supervised by Supervision Committee consisting of Managing Director, Representative of Secured Creditors Auditor of the company and one Independent Auditor The report of the....
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....ta and ascertain the status. In respect of criminal cases pending / convictions also, the RA's declaration has been relied upon since the RP does not have time and Document 3 resources to ascertain the same. In this regard, information from internet search was conducted to get information for specific news on any of the promoters on this issue. In this connection, the following link was indicative of issues with Mr. Tabrez Rubberwala: https://www.facebook.com/bandranewsmumbai/posts/100263107981 5067 The link carries a letter dated May 18, 2016 from AH Khan of Adarsh Samaj Sevak Sangh, Mazgaon (ASSM an NGO), addressed to (i) chief minister of Maharashtra, (ii) home minister of Maharashtra, and (iii) director general of police, Mumbai, complaining that ASSM had come to know about several complaints and cases against Mr. Tabrez Rubberwala at J.J. Police station (CR 10/15), Pydhonie police station (FIR No. 318/2012), Agripada police station, etc. ASSM further stated that Mr. Tabrez Rubberwala was cheating poor people in the name of construction, was a habitual cheater and requested for cancellation of police protection given to hi....
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....2 710 1064 300 2858 Grand Total 7484 Document 6 " Initial-2018 2019 2020 2021 2022 Financial year Issue of new equity shares to new promoters 1125 Loans from new Promoters 1752 1733 Accruals used for debt restructuring plan Total 800 1064 300 710 2552 710 1064 300 2858 Grand Total 7484 " Document 7 (a) The revised resolution plan with the figures as submitted by the RAS as per the format given by the COC today may be submitted latest by 12 noon on December 21, 2017. (b) The revised resolution plan should not have any condition linked to proposed payment to the creditors though it may have conditions relating to required waivers/forbearances from various government authorities/agencies (c) The revised resolution plan should cover all the extant provisions/regulations including under regulations 37 and 38. It should specifically indicate the amount payable to the dissenting creditors, the equity structure proposed in the plan in terms of subscription amount, and percentage holding by the RA, public, and other entities if any. Besides it should propose one or more agencies for ....
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.... Financial is Abdulla Document 9 UNSECURED LOANS Sr. No Financial Creditors Amount as per books as Claim Amount as on Claim to be admitted Security Interest on 10.07.2017 10.07.2017 2 SICOM Limited 1110,03,393 2140,96,799 2140,96,799 Musla. Raj oil mills ltd is a co-borrower. L&T has shown Raj oil mills ltd as the borrower. Hence, treated as Unsecured Loans) Secured by way of pledge of shares of 55,50,500 nos. of the directors which have been sold due to committed default by the Company. The amount realised was appropriated towards interest dues. 3 SIDBI 240,24,622 564,24,547 564,24,547 Secured by: IFCI Factors Limited 991,84,844 2206,05,202 2206,05,202 Security interest as 5 Shaukat S. Tharadra 630,82,073 630,82,073 630,82,073 6 Abdullah K. Musla 140,62,354 147,24,682 147,24,682 7 Azamkhan F. Lohani 8,00,000 8,00,000 8,00,000 1. Bills of Exchange accepted by the Company. 2. Irrevocable and unconditional Personal Guarantee of Mr. Shaukat S.Tharadra, Mr. Rashid Isma....
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.... piece and parcel of land admeasuring at about 16000 sq.mtrs., bearing Survey No. 4 & 6, Hissa No. 1 lying, being and situate at Village Ten, Taluka Palghar, Dist. Thane, together with structures standing thereon admeasuring at about 49,649 sq.fts., and the plant and machinery installed located therein. On or towards North: By Forest, On or towards South: Land of Bharat Industries On or towards East: By Forest On or towards West By Gram 4004,27,273 Panchayat Road Secured against Flat No. 6, Avval Co-opt 36,05,092 Hsg Soc belonging to the Company Secured with Fixed deposit amounting to 5,64,211 INR 7,87,720/- 2368,59,336 4004,27,273 3 4 City Bank Equity Mortgage Loan Bank of Baroda 34,84,648 36,05,092 5,44,623 5,64,211 Document 11 APPLICANTS CORPORATE INFORMATION APPLICANT NO. 1 Name of the Company: RUBBERWALA HOUSING & INFRASTRUCTURE LIMITED Registered Address: Rubberwala House, Dr. Nair Road Opp. Agripada Police Station Mumbai 400011 Corporate Address: Rubberwala House, Dr. Nair Road Opp. Agripada Police Station Mumbai 400011 : U45200MH2003PLC142620 CIN Date of Incorporation: 10....
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.... shares to New Promoters Loans from New 10 10 11 12 12 13 14 16 15 16 Total 11.25 11.25 11.25 Promotor Accruals used for debt restructuring plan Total Means of Finance 34.84 17.33 4.88 4.88 2.38 5.38 ' 34.84 28.74 2.00 2.00 2.00 2.00 1.98 1.92 1.60 1.60 2.66 2.66 2.66 2.66 1.00 1.00 1.00 - 28.74 74.83 28.58 6.88 6.88 4.38 7.38 1.98 1.92 1.60 1.60 2.66 2.66 2.66 2.66 1.00 1.00 1.00 74.83 Document 13 Description TOTAL Intel Year 1 Year 2 Year 3 Year 4 Insolvency Cost 0.60 0.60 0.60 Payment to discharge liabilities 62.24 20.98 4.38 4.38 4.38 7.38 1.98 1.92 1.60 1.60 2.66 2.66 2.66 2.66 1.00 1.00 1.00 62.24 Refurbushing of Existing plant & Machinery & New Equipements 2.00 Funds required for Working Capital Total 10.00 5.00 2.50 2.50 10.00 Total Project Cost 74.84 28.58 6.88 6.88 4.38 7.38 1.98 1.92 1.60 1.60 2.66 2.66 2.66 2.66 1.00 1.00 1.00 74.84 Means of Finance Description TOTAL initial Issue of new equity shares to New Promoters 11.25 11.25 11.25 Loans from New Promotor Accruals used for debt res....