TaxTMI 
TaxTMI 
2021 (9) TMI 993
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....ed challenging the Order passed by the Ld. Adjudicating Authority dated 10.02.2021 to the extent that the Application filed by the Appellant herein bearing MA No. 186/KOB/2020 which was filed for ordering Liquidation of the Corporate Debtor. (3) The Learned Counsel submitted that the Appeal is preferred only to the extent that the Ld. Adjudicating Authority ought to have ordered for Liquidation of the Corporate Debtor. In view of the reason that the Respondent herein being the Successful Resolution Applicant failed to implement the plan. (4) The Learned Counsel for the Appellant narrated the brief facts. He submitted that the Corporate Insolvency Resolution Process (CIRP) of the Corporate Debtor i.e., Palm Lagoon Backwater Resorts Private Limited was initiated pursuant to the Order passed by the Adjudicating Authority dated 20th September 2019. After compliance of due procedure as per Law, the Resolution Plan submitted by the Resolution Applicant was approved by the Committee of Creditors (CoC) with a voting share of 100 per cent on 19.08.2020. The Ld. Adjudicating Authority approved the said Resolution Plan by an Order dated 10.03.2020. As per the approved Resolution Plan, t....
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....l to the extent that the rejection of the Appellant's MA need to be set aside and direct the Hon'ble Adjudicating Authority to pass Order of Liquidation in terms of Section 33(3) and Section 33(4) of the I & B Code, 2016. (7) Heard the Learned Counsel for the Appellant and none appeared for the Respondent. On the filing of the instant Appeal this 'Tribunal' directed to issue Notice to the Respondent through 'Speed Post' returnable by 10.06.2021 and directed to send Notice to the e-mail address of the Respondent. As per the directions of this 'Tribunal' the 'Office of the Registry' sent Notice to the Respondent and this 'Tribunal' on 10.06.2021 recorded that Notice was served upon the Respondent on 27.05.2021. However, there is no appearance for the Respondent at the time of calling of the matter. This 'Tribunal' also directed the Learned Counsel for the Appellant to inform the Learned Counsel for the Respondent who had appeared before the Adjudicating Authority (National Company Law Tribunal, Kochi Bench). (8) As per the direction of this 'Tribunal' the Learned Counsel for the Appellant informed the Learned Counsel for the Respondent appeared before the Adjudicating Authority....
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....e Debtor, its employees, members, creditors, guarantors and other stakeholders involved in the Resolution Plan. Further, in Para 16 of the Order dated 10.09.2020, the Ld. Adjudicating Authority reproduced the relief as sought by the Resolution Applicant with regard to approval of the Resolution Plan stating that "The total payment under the Resolution Plan shall be made within 15 days from the date of approval of Resolution Plan by the Tribunal". (13) In the Plan submitted by the Respondent at page 106 of the Appeal Paper Book(s), internal page 44 of the Order dated 10.09.2020, the contents of the Plan (Para (b) Final payment) wherein it is stated "The Resolution Applicant shall make payment of the balance 50% of the resolution plan amount i.e., a sum of Rs. 50,00,000/- within 15 days from the effective date to the RP in the designated account which shall be utilised towards full and final payment to the secured financial creditors". (14) Further, the Ld. Adjudicating Authority in its Order dated 10th September 2020 at Para 19, page 140 of the Appeal Paper Book(s) internal page 78, stated "Further, in case of non-compliance of this order or withdrawal of Resolution Plan by th....
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....functus officio after approval of a Resolution Plan with the consent of both the parties. (17) The issue felt for consideration before this Tribunal is whether the prayer of the Appellant with regard to liquidating the Corporate Debtor ought to have considered or not. The Ld. Adjudicating Authority observed that the 'Tribunal' (NCLT) cannot either order Liquidation or to direct the refund of the EMD, as the Tribunal has become Functus Officio after approval of the Resolution Plan with the consent of both the parties. (18) Admittedly the CIRP was initiated on 20th September 2019. 270 days completed on 23rd August 2020 and 330 days completed by the end of October 2020. The Application filed by the Appellant bearing MA No.186/KOB/2020 in the month of November 2020 i.e., after completion of 330 days. In the Application, the Appellant prayed at Para 17 [Page 62 of the Appeal Paper Book(s)] internal page 23 of the Application wherein it is prayed "That this Hon'ble Adjudicating Authority may be pleased to pass an order to liquidate the Corporate Debtor or such other order as may be desired in view of the fact that RA is not willing to implement the approved resolution plan". Apart ....
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....the Adjudicating Authority for a liquidation order as referred to in sub-clauses (i), (ii) and (iii) of clause (b) of sub-section (1)." (22) As per the above provision of Law, the Resolution Plan approved by the Adjudicating Authority is contravened by the concerned Corporate Debtor, "any person" other than the Corporate Debtor may make an Application to the Adjudicating Authority for a Liquidation Order. Sub Section 4 of Section 33 of the I & B Code, 2016 reads thus :- "On receipt of an application under sub-section (3), if the Adjudicating Authority determines that the corporate debtor has contravened the provisions of the resolution plan, it shall pass a liquidation order as referred to in sub-clauses (i), (ii) and (iii) of clause (b) of sub-section (1)." (23) In the present case, according to Sub Section 3 of Section 33 this 'Tribunal' is of the view that the Appellant rightly moved the Application under Section 60(5) read with Section 33 of the I & B Code, 2016 praying the Adjudicating Authority to pass an Order of Liquidation of the Corporate Debtor for the reason that the Respondent/Resolution Applicant did not implement the plan as mandated by the Code. Furth....