TaxTMI 
TaxTMI 
2021 (11) TMI 871
X X X X Extracts X X X X
X X X X Extracts X X X X
....t : Mr. Sumesh Dhawan, Ms. Vatsala Kak, Ms. Geetika Sharma and Mr. Raghav Dembla, Advocates For the Respondents : Mr. Abhishek Sharma, Advocate with Ms. Pratibha Khandelwal, RP for R-1. Mr. Arun Kathpalia, Sr. Advocate with Mr. Ankit Popli, Advocate for R-2. JUDGMENT Ashok Bhushan, J. 1. These two Appeals have been filed by same Appellant challenging different orders passed by the Adjudicating Authority (National Company Law Tribunal), Jaipur Bench, Jaipur. Both the Appeals have been heard together. 2. Company Appeal (AT) (Ins.) No. 910 of 2021 has been filed challenging the order dated 16.07.2021 passed by the Adjudicating Authority rejecting the I.A. No. 201/JPR/2019 filed in CP (IB) No. 86(ND)/2017 (T.A. No. 83(ND)/ 2018).....
X X X X Extracts X X X X
X X X X Extracts X X X X
....oved. It is submitted that the allegations have been made by the Appellant in his Application of malafide and fraud committed by 'M/s. Mahalaxmi Traders' which has not been correctly adverted to and decided by the Adjudicating Authority. It is submitted that the only observation made by the Adjudicating Authority with regard to allegations of collusion and fraud in Paragraph 16 of the order is that even after deducting the 22.4% voting share of the 5th Respondent- 'Mahalaxmi Traders', the Resolution Plan of the Appellant could have been rejected by 77.76%, therefore, the said contention of the Appellant need not to be considered at all. It is further submitted that the Resolution Plan of 'Kals Distilleries Private Limited' which has been ap....
X X X X Extracts X X X X
X X X X Extracts X X X X
....collusion of fraud as alleged by the Appellant. 7. Learned Counsel for the 'Successful Resolution Applicant' supported the decision of the Adjudicating Authority approving the rejection of the Resolution Plan of the Appellant as well as the order approving the Resolution Plan of the 'Successful Resolution Applicant. It is submitted that the commercial wisdom of Financial Creditors in rejection of a Resolution Plan is not challengeable. 8. We have considered the submissions of the Learned Counsel for the parties and perused the record. 9. The Resolution Plan of the Appellant got rejected by 100% vote in the 19th meeting of the CoC dated 04.06.2019 on which date the Resolution Plan of the 'Successful Resolution Applicant' was approve....
X X X X Extracts X X X X
X X X X Extracts X X X X
....there is an intrinsic assumption that financial creditors are fully informed about the viability of the corporate debtor and feasibility of the proposed Resolution Plan. In paragraph 52 of the Judgment, following was laid down:- "52. As aforesaid, upon receipt of a "rejected" resolution plan the adjudicating authority (NCLT) is not expected to do anything more; but is obligated to initiate liquidation process under Section 33(1) of the I&B Code. The legislature has not endowed the adjudicating authority (NCLT) with the jurisdiction or authority to analyse or evaluate the commercial decision of CoC much less to enquire into the justness of the rejection of the resolution plan by the dissenting financial creditors. From the legislati....
X X X X Extracts X X X X
X X X X Extracts X X X X
....rity. That is made non-justiciable." 11. The decision as noted above, the CoC has rejected the Resolution Plan with 100% votes which is an important factor to reckoned with. The submission of the Learned Counsel for the Appellant is that there is collusion and fraud between 'M/s. Mahalaxmi Traders' and the 'Successful Resolution Applicant'. Admittedly, 'M/s. Mahalaxmi Traders' was one of the CoC's member holding a voting share of 22.4%. There can be no doubt that any fraud in process may vitiate the entire process but it is easy to allege fraud and collusion but difficult to prove the same. Apart from the bald allegation of the Appellant that 'M/s. Mahalaxmi Traders' colluded with the 'Successful Resolution Applicant', there is no other ....