TaxTMI 
TaxTMI 
2019 (1) TMI 1766
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.... 2. Brief facts of the case, which are relevant to the issue in question, as mentioned in the Application, are as follows: (1) C.P.(IB)No.l55/BB/2018 is filed by M/s. Elite Brilliant Limited (Petitioner/Operational Creditor) u/s.9 of the IBC, 2016, r/w Rule 6 of the I&B (AAA) Rules, 2016, by inter alia seeking to initiate CIRP in respect of the Corporate Debtor i.e., M/s. ILC Industries Limited, was admitted by the Adjudicating Authority, vide order dated 16-4-2019 by appointing Mr. Ravindranath Narayana Rao, as the Interim Resolution Professional, imposing moratorium, etc. Subsequently, the Committee of Creditors of the Corporate Debtor in their first meeting of the CoC held on 28-5-2019 confirmed the appointment of Mr. Ravindranath Narayana Rao, as the Resolution Professional. This Adjudicating Authority vide order dated 26th November, 2019, extended CIRP of the Corporate Debtor by further 90 days beyond 180 days period starting from October 13th 2019 i.e. till January 13, 2020 upon an Application filed by RP under section 12 of the Code, read with Regulations 40 of the IBBI (Insolvency Resolution Process for Corporate Persons) Regulations, 2016. (2) In pursuant....
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....Refineries Private Limited A communication was made for all the final list of Resolution Applicants to submit a plan within the due date and Resolution Professional had not received any Resolution Plan from the above shortlisted Applicants till September 15, 2019. (6) It is further stated that fourth meeting of CoC was held on 09-8-2019 and Resolution Professional Informed to CoC about the eligibility criteria and informed that all was eligible to submit a Resolution Plan. Further, the Resolution Professional received a request on 15th September, 2019 from one of the prospective Resolution Applicant, namely, Karatagi Refineries Private Limited and ILC Iron and Steel Pvt. Ltd., requesting extension of one month (up to 15th October, 2019) period for submission of Resolution Plan for ILC Industries Ltd. The Sixth Meeting of Committee of Creditors of the Corporate Debtor was held on 4th October 2019, where in a resolution to seeking an extension of CIRP by 90 days and thus time was granted by the Adjudicating Authority, on November 26, 2019. (7) It is stated that the Resolution Applicant, upon communication of rejection of Resolution Plan, has revised and sub....
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....ness after approval of the Resolution Plan: Upon approval of this Resolution Plan by Adjudicating Authority, the following shall apply: (i) "Resolution Professional shall continue to manage and control the company after approval of CoC till settlement Date. (ii) By virtue of the approval order of this Resolution Plan Board Directors of the company shall be reconstituted at the option of the Applicant. (iii) Management of by virtue of the order of the Adjudicating Authority approving this Resolution Plan, and on the date of approval of this Resolution Plan, the existing articles of association of the Company shall stand amended and modified, and the draft articles of association that are indicated or informed by the Resolution Applicant shall be in force and effect. (iv) All existing authorisations for operating bank accounts of the Company (both physically and online) shall be withdrawn and all such authorisations shall be suitably modified by the applicant on the Settlement Date. However, the Resolution Professional shall carry on such operations till the Settlement Date. (v) Management Committee shall comprise for Resolution P....
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....osed Plan Implementati on day+180 Resolution Applicant 10 Capital Reduction 11 Infusion of funds towards Equity (f) Dealing with the Assets of the Corporate Debtor: The Resolution Applicant proposes to have full rights to all IPs and assets (both movable and immovable) of the Corporate Debtor (g) The Resolution Plan Demonstrates that I. The Cause of Default is addressed II. It is feasible and Viable III. It has provisions for effective implementation IV. It has provisions for approvals required and the timeline for the same & V. The Resolution Applicant has the capability to implement the Resolution Plan. (h) Future Projections Particulars 2019-20 2020-21 2021-22 2022-23 2023-24 Total revenue 13,05,18,546 14,98,06,158 15,71,87,699 17,25,27,137 18,93,81,552 Total expense 13,17,28,002 14,42,32,047 15,01,56,691 16,08,96,401 17,20,70,359 Profit Before Tax (12,09,456) 55,74,111 70,31,008 1,16,30,736 1,73,11,193 (10) Other Terms and Conditions proposed by the Resolution Applicant i....
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.... terms of the "Plan" after its approval by the Adjudicating Authority. vii. Payment to equity shareholders: Considering the liquidation value of the assets of the Corporate Debtor, Plan envisages 100% sacrifice from the promoters/existing shareholders and consequently entire share capital will be reduced to NIL and the resultant amount credited to Capital Reserves Account. viii. Protection from continuation of litigation/appellate proceedings against the Corporate Debtors after the Plan is Approved by the AA i. Subject to the Adjudicating Authority granting the relief as set out in this Resolution Plan, any Encumbrance or any other form of restraints/attachments etc against the Company or any type of encumbrances created by the Promoters of the Company in connection with any Operational Debt of the Company, at any time prior to the Insolvency Commencement Date, shall automatically be waived and/released or lifted and all liabilities and obligations of the Company shall stand permanently waived and/or released on the approval of this Resolution Plan by the Adjudicating Authority, without requirement of any further action on part of any party. ....
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....cement date and payable as under: a. 100 % payable on or before 31-3-2022 without future Interest. b. Discharge the corporate debtor of all its obligation as well as its promoters/guarantors iv. From Central Government: (Under Regulation 37(1) (j) of CIRP Regulations) To exempt the Company from penal provisions of Income Tax Act, Companies Act, Central Excise Tax Act, Central Sales Tax, Customs Act, and any other law. v. Central Board of Direct Taxes: a. To accept the payment provided under the "Plan" at Rs. 1,08,03,423/- (One Crore eight lakh three thousand four hundred and twenty three only), in full and final settlement of all its claims against the corporate debtor up to the commencement date. b. To grant refund of the excess amount of Rs. 6.61 crore against the recoveries made under the attachment proceedings amounting to Rs. 7.69 crore. c. To withdraw all its balance claims over and above the settlement provided for in the Plan. d. To grant exemption/grant of relief to the company from the provisions of Sections 28, 41(1), 45, 72 (3), 43-B, 79, 80 read with 139, 115JB and the provisions of Chapte....
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....nal settlement of all its claims against the corporate debtor up to the commencement date. d. Top gains minerals macro commercial offshore Ltd., to accept the payment provided under the "Plan" at Rs. 27,87,076/-(Twenty seven lakh eighty seven thousand and seventy six only), in full and final settlement of all its claims against the corporate debtor up to the commencement date. e. Sri. A Seenam Bhat to accept the payment provided under the "Plan" at Rs. 3,140/- (Three thousand one hundred and forty only), in full and final settlement of all its claims against the corporate debtor up to the commencement date. f. Elite Brilliant Limited to accept the payment provided under the "Plan" at Rs. 25,13,970/-(Twenty five lakh thirteen thousand nine hundred and seventy only) in full and final settlement of all its claims against the corporate debtor up to the commencement date. In addition to the above, Elite Brilliant Limited shall be eligible and be at liberty to pursue its litigation to claims its rights over the cargo lying at Bevinahalli (EoU PLANT) Bellikeri Port and Krishnapatnam Port, under restraint orders from Karnataka State Forest Department and DMG Kopp....
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.... conforms to such other requirements as maybe specified by the Board." 6. In compliance with the said conditions, the Resolution Professional has submitted various documents and statements as per provisions of the Code and the Rules made thereunder. And these compliances are briefly stated hereunder. 7. The Resolution Professional has filed Compliance Certificate in Form-H, Under Regulation 39(4) of the IBBI (Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) Regulations, 2016: 1. The details of the CIRP are as under: Sl. No. Particulars Description 1 Name of the CD ILC Industries Ltd. 2 Date of Initiation of CIRP 16-4-2019 3 Date of appointment of IRP 16-4-2019 4 Date of Publication of Public Announcement 04-5-2019 5 Date of Constitution of CoC 22-5-2019 6 Date of First Meeting of CoC 28-5-2019 7 Date of Appointment of RP 28-5-2019 8 Date of Appointment of Registered Valuers 02-6-2019 9 Date of Issue of Invitation for Eol 12-7-2019 10 Date of Final List of Eligible Prospective Resolution Applicants 10-7-2019 11 Date of ....
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.... 5. The Resolution Plan includes a statement under Regulation 38(1 A) of the CIRP Regulations as to how it has dealt with the interest of all stakeholders in compliance with the Code and Regulations made thereunder. 6. The amount provided for the stakeholders under the Resolution Plan is as under: SI No. Category of Stakeholder* Amount Claimed Amount Admitted Amount Provided under the Plan# Amount provided to the Amount Claimed (%) 1 Dissenting Secured Financial Creditors - - - - 2 Other Secured Financial Creditors 598.4 598.4 598.4 100% 3 Dissenting Unsecured Financial Creditors 778.3 122.08 194.58 25% 4 Other Unsecured Financial Creditors - - - - 5 Operational Creditors 5519.19 5519.19 55.20 1% Government 12,538.50 12,538.50 125.40 1% 5 Other Debts and Dues Total 19434.39 18778.17 973.58 *if there are sub-categories in a category, please add rows for each sub-category. #Amount provided over time under the Resolution Plan and includes estimated value....
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....to pay the - (a) insolvency resolution process costs? Yes (b) liquidation value due to operational creditors? Yes (c) liquidation value due to dissenting financial creditors? Not Applicable Regulation 38(1A) Whether the resolution plan includes a statement as to how it has dealt with the interest of all stakeholders? Yes Projected Financial Statements Regulations 38(2) Whether the Resolution Plan provides: (a) the terms of the plan and its implementation schedule? Yes (b) for the management and control of the business of the Corporate Debtor during its term? Yes (c) adequate means for supervising its implementation? Yes 38(3) Whether the resolution plan demonstrate that - (a) it addressee the cause of default? Yes (b) it is feasible and viable? Yes (c) it has provisions for its effective implementation? Yes (d) it has provisions of approvals required and the timelines for the same? Yes (e) the resolution applicant has the capability....