TaxTMI 
TaxTMI 
2022 (4) TMI 478
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.... challenged the order of the Adjudicating Authority dated 29.01.2021 passed in I.A. No. 334 of 2020 in CP (IB) No. 132 of 2017, hence, this Tribunal decided to dispose of the Appeals by passing a common Judgment. Brief Facts: Appellant's Submissions in CA (AT) (Ins) No. 110 of 2021: 2. The Learned Counsel for the Appellant submitted that the Appellant being Operational Creditor aggrieved by the impugned order dated 29.01.2021 passed by the Hon'ble Adjudicating Authority in I.A. No. 334 of 2020, whereby the Hon'ble Adjudicating Authority without appreciating the facts with respect to claims of the Operational Creditors passed an order approving the Resolution Plan. It is submitted that the Appellant provided security and housekeeping services for the projects undertaken by the Corporate Debtor. It is submitted that the security services provided were of due importance and did aid the timely completion of the projects and shall be right fully treated as operational debt under the provisions of IBC. 3. Upon initiation of CIRP against the Corporate Debtor, the Appellant by an email dated 21.10.2019 submitted proof of claim in form B to the first Respondent specifying the am....
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.... no merit in the Plan. The act of the 2nd Respondent is in clear violation and contrary to the provisions of the code. 9. The 2nd Respondent failed to verify and acknowledge the claims submitted by the Appellant (Operational Creditor) and completely disregarded the rightful claims of the Appellant which was duly admitted by the 1st Respondent. 10. While considering the Plan during 8th CoC meeting, held on 30.07.2020, one Mr. Prakash a Real-Estate Allottee had raised concerns with respect to allocating of funds towards the unsecured creditors which includes the Appellant. 11. The Ld. Counsel further submitted that the Plan provided by the 2nd Respondent is not in conformity with Section 30 (1) of the I & B Code, 2016 and the Hon'ble Adjudicating Authority ought not to have approved the Resolution Plan provided by the 2nd Respondent despite the fact that it did not provide for the payment to the Appellant i.e. the Operational Creditors. Further, the Hon'ble Adjudicating Authority ought to have liquidated the Corporate Debtor on the ground that the Resolution Plan was not in conformity with Section 30 (1) of the I & B Code, 2016. 12. In view of the reasons as stated above,....
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....and Six Hundred and Twenty One only) (d) Operational Creditors (of which class the Appellant forms a part): Rs. 99,50,075/- (Rupees Ninety Nine Lakhs Fifty Thousand and Seventy Five only). 18. It is submitted that the liquidation value of the Corporate Debtor is Rs. 18,06,64,274/-. It is evident that the liquidation value is far lower than the total admitted claims made against the Corporate debtor and in light of the waterfall mechanism set out in Section 53 of the Code, no payment would be paid to Operational Creditors in the event of the liquidation of the Corporate Debtor. 19. In view of the aforesaid fact, it is clearly stated in the Resolution Plan that payment to the Operational Creditors is not proposed, since the liquidation value of the Corporate Debtor is insufficient to satisfy their claims, or even those of the secured Financial Creditors. It is submitted that non-payment of the Operational Creditor's including the Appellant is permissible in accordance with Section 30 (2) (b) read with Section 53 (1) of the Code. Since in the event of liquidation of the Corporate Debtor, the Appellant would not have received any payment at all. 20. It is submitted th....
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....n of the Corporate Debtor. 28. It is submitted that this Respondent vide revised Resolution Plan dated 03.08.2020 contemplated to invest a sum of Rs. 8,80,00,000/- Crores inclusive of CIRP Cost. If these sums were to be distributed in accordance with the waterfall mechanism set out in Section 53, no amount would be payable to the Operational Creditor. 29. It is submitted that after considering the feasibility and viability of the Resolution Plan, the Committee of Creditors of the Corporate Debtor have by a majority vote of 95.07% approved the Resolution Plan submitted by this Respondent. Even though under Section 30(4) of the I & B Code, 2016 the requisite voting share of the Committee of Creditors required to approve the Resolution Plan is 66%. The Plan was approved by the CoC in their commercial wisdom, the Plan is ultimately a commercial roadmap for the restructuring of the Corporate Debtor. 30. In view of the reasons as stated above the Appeal is devoid of merits and liable to be dismissed. Analysis/Appraisal: 31. Heard the Ld. Counsel appeared for the respective parties perused the pleadings, documents filed by them. Having analysed the pleadings the only point ....
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....rational Creditors the following proposal is made in Sub clause -(xii) as under: "ii. The Liquidation Value is insufficient for payment to the Operational Creditors of the Company as the Liquidation Value is insufficient to satisfy the claims of even the Secured Financial Creditors in full and nil payment has been proposed under the Resolution Plan towards claims of Operational Creditors whether filed or not, whether admitted or not, whether asserted or not and whether or not set out in the balance sheets of the company or the profit and loss account statements of the Company or the List of Creditors and no source has been identified for such payment under this Resolution Plan." 36. Even in the Plan the outstanding Government dues, taxes etc. which was admitted as operational creditor debt, nil payment has been proposed under the Plan towards payment of any Government dues, taxes etc. 37. Schedule -6 of the Resolution Plan the payment to creditors and cost of Resolution Plan other than homebuyers have been provided. From the said schedule it is seen that Rs. 8 Crores has been earmarked for payment to Financial Creditors against a claim of Rs. 123,05,76,095/-. Further....
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....ction 53 including the priority and value of the security interest of a secured Creditor) and such other requirements as may be specified by the Board. 41. Further, Section 31 of the I & B Code, 2016 deal with approval of Resolution Plan. As per Sub Section (1) if the Adjudicating Authority is satisfied that the Resolution Plan as approved by the Committee of Creditors under Sub-Section (4) of Section 30 meets the requirements as referred to in Sub-Section (2) of Section 30, it shall by order approve the Resolution Plan which shall be binding on the Corporate Debtor and its employees, members, creditors (including the central Government, any State Government or any Local authority to whom a debt in respect of the payment of dues arising under any law for the time being enforced, such as Authorities to whom Statutory dues are owed,) guarantors and other stakeholders involved in the Resolution Plan. 42. Due procedure as contemplated under I & B Code, 2016 is to be followed to submit a Resolution Plan. Accordingly, the Resolution Applicant shall submit a Plan before the Resolution Professional and it should contain the requirements as per the said provision including the payment....