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TaxTMI 
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2022 (7) TMI 299
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....s ["CoC"]. 3. This Application was moved by Mr. Aditya Kumar Tibrewal, Resolution Professional of Sri Balaji Forest Products Private Limited (CIN: U20101WB1997PTC085819), by invoking the provisions of Section 30(6) and Section 31 of the Insolvency and Bankruptcy Code, 2016 [hereinafter referred to as "the Code" or "IBC"] read with regulation 39(4) of the Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) Regulations, 2016 [hereinafter referred to as "CIRP Regulations"] for approval of a Resolution Plan in respect of Sri Balaji Forest Products Private Limited. 4. The underlying Company Petition in C.P. (IB) No. 518/KB/2018 was filed by Bank of India against Sri Balaji Forest Products Private Limited, the Corporate Debtor, under section 7 of the Insolvency and Bankruptcy Code, 2016 which was admitted vide order dated 18.10.2019 in C.P. (IB) No. 518/KB/2018. 5. Initially, the Applicant herein, Mr. Aditya Kumar Tibrewal (IBBI Reg. No. IBBI/IPA-002/IP-P00743/2017-2018/11249) was appointed as the Interim Resolution Professional. He was later confirmed as the Resolution Professional of the Corporate Debtor at the 2ndmeeting of the Committee o....
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....,020 Nand Kishore Bharswaj 32,59,00,000 26,07,20,000 Deepak Bansal 35,21,58,293 22,47,94,171 Aggregate Value (A) 36,46,25,525 23,34,22,096 b) Plant and machinery Alok Kaushik 2,84,90,257 2,02,74,126 Rajesh Gupta 3,84,69,319 2,26,39,592 Aggregate Value (B) 3,34,79,788 2,26,39,592 c) Financial Assets Gautam Maurya 36,940 36,940 Sandeep Agarwal 37,26,000 18,84,000 Aggregate Value (C) 18,81,470 9,60,470 Total Average Value (A+B+C) 39,99,86,783 25,70,22,157 11. It is stated that pursuant to expiry of the last date for submission of EoI by any prospective resolution applicant, one M/s. Swadeshi Marketing Private Limited filed an application being I.A. (IB) No. 1290/KB/2020 for consideration of their resolution plan by the Committee of Creditors. This Tribunal, vide its order dated 02.12.2020 directed the Resolution Professional to accept the EoI of M/s. Swadeshi Marketing Private Limited to enable them to submit their resolution plan. 12. Pursuant to passing of the order dated 02.12.2020, Swadeshi Marketing Private Limited dul....
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....ly put to voting on 14.02.2021 and the voting was kept open until 21.02.2021. However, one of the constituents of the CoC, namely, Bank of Baroda, requested the Applicant/ Resolution Professional to extend the last date for voting for a further period of 48 hours, i.e. till 23.02.2021, and the same was duly extended by the Applicant/ RP. However, on request of Bank of Baroda, holding 59.79% of voting rights in the Committee of creditors, the last date for voting was extended to 08.03.2021 till 08:00 p.m. 17. The Committee of Creditors duly approved the Resolution Plan of M/s. Swadeshi Marketing Private Limited by 93.46% voting on 09.03.2021. ICICI Bank Limited, being one of the members of the CoC, having voting share of 6.54% has voted against the approval of the Resolution Plan of the successful resolution applicant. 18. Applicant further submits that the Successful Resolution Applicant has also duly furnished Performance Bank Guarantee to the tune of Rs. 2,00,00,000/- (Rupees Two Crore only) in accordance with the terms and conditions of the IM and RFRP document. 19. It has been decided in the 17th CoC meeting that all the secured financial creditors and the Chairman shall con....
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....esolution Plan envisages transfer of land of the personal guarantor mortgaged with the financial creditors, defined in detail at Clause (II) @ pg. 116 of application, in favour of the Corporate Debtor upon approval of the resolution plan Clause (40) of Annexur e 3 @ pg. 181 Regulation 37 (ba) Restructuring of the Corporate Debtor, by way of merger, amalgamation and demerger The Resolution Plan does not contemplate restructuring through merger, amalgamation and/ or demerger Annexur e 1 @ pg. 167 Regulation 37 (c) The substantial acquisition of shares of the Corporate Debtor, or the merger or consolidation of the Corporate Debtor with one more person Please refer to Annexure 1 structure for acquisition of control over the Corporate Debtor by the Resolution Applicant Annexur e 1 @ pg. 167 Regulation 37 (ca) cancellation or delisting of any shares of the corporate debtor, if applicable Please refer to Annexure 1 structure for acquisition of control over the Corporate Debtor by the Resolution Applicant Annexur e 1 @ pg. 167 Regulation 37 (d) Satisfaction or modification of any security interest The security interest on all assets of the corporate debtor shall stand satis....
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....entral Government, State Government or any local authority, provided that the resolution professional agrees, undertakes and shall be obligated to sign and approve any document required for obtaining such approvals (by virtue of the order of the Adjudicating Authority approving the resolution plan) Clause (IX) @ pg. 156 III. Mandatory contents of Resolution Plan in terms of Regulation 38 of CIRP Regulations: Reference to relevant Regulation Requirement How dealt with in the Plan 38 (1) The amount due to the operational creditors under a resolution plan shall be given priority in payment over financial creditors. Clause (V) (5) (c) of the Resolution Plan & Clause (II) (C) (ii) & (iii) of the Resolution Plan 38 (1A) A resolution plan shall include a statement as to how it has dealt with the interests of all stakeholders, including financial creditors and operational creditors of the corporate debtor. Clause (B) (2) of Executive Summary of the Resolution Plan 38 (1B) A resolution plan shall include a statement giving details if the resolution applicant or any of its related parties has failed to implement or contributed to the failure of implementation of any other res....
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....CIRP Regulations which has been annexed as to with the Application. Details of Resolution Plan/ Payment Schedule 25. The Applicant submits the relevant information with regard to the amount claimed, amount admitted and the amount proposed to be paid by the Successful Resolution Applicant i.e. Swadeshi Marketing Private Limited, under the said Resolution Plan is tabulated as under: S. No. Particulars Amount Claimed (in Lakh) Amount Admitted (in Lakh) Amount in the Plan (in Lakh) 1 CIRP Cost 40.00 2 Financial Creditors - Secured Financial Creditors 24525.08 24525.08 2607.00 - Unsecured Financial Creditors -- -- -- 3 Operational Creditors (other than workmen & employees & government/ statutory dues) -- -- -- 4 Workmen & Employee dues -- -- -- 5 Government/ Statutory dues 7.68 7.68 Nil Total outlay of the resolution plan 24532.77 24532.77 2647 26. Details on Management/ Implementation and Reliefs as per the Resolution Plan - Salient Features The Resolution Plan also provides for - a. Management of Company after resolution i....
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....e Limited. The only way through which the premises of the corporate debtor can be accessed from the highway is through the approach road, which is owned by Sri Balaji Logs Products Private Limited. 32. It was thereafter contended that in accordance with Section 4 of the Easements Act, 1882, an easement is a right which the owner or occupier of certain land possesses, as such, for the beneficial enjoyment of that land, to do and continue to do something, or to prevent and continue to prevent something being done, in or upon, or in respect of, certain other land not his own. Dominant and servient heritages and owners. 33. Reliance was placed on Amar Singh v. Kehar Singh AIR 1995 HP 82 and it was contended that an easement is always appurtenant to the dominant tenement and inseparably attached to it. Furthermore, relying upon C. Mohammedd v. Ananthachari AIR 1988 Ker 298, it was contended that an easement is a privilege without profit, which the owner of one tenement has a right to enjoy in respect of that tenement in or over the tenement of another person, by reason where of the latter is obliged to suffer or refrain from doing something on his own tenement for the advantage of the....
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.... immediately (1) pass the necessary Corporate Resolutions; (ii) provide all approvals, execute all documents, deeds, instruments, notices, certificates or power of attorney in the format provided by the resolution applicant of the Corporate Debtor; (iii) do all filings and take all actions and do all registration and/or other requirements to be effected for transfer of the landed premises under the applicable laws to the Corporate Debtor; (iv) to take all actions and do all deeds as may be required and/or as directed by the resolution applicant for transferring the aforesaid landed premises to the Corporate Debtor or such person as the resolution applicant may direct within 30 days from the date of order of Hon'ble NCLT. C. The resolution applicant undertakes to pay the stamp duty and relevant registrar of Assurance fees, if not waived by the concerned authorities, to effect all registration requirements in relation to the transfer of the said land under applicable laws." 36. In order to contend that such inclusion of the property of the suspended board of directors and guarantors which have been mortgaged to the financial creditors of corporate debtor and have been invoke....
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.... have been in complete controlled the corporate debtor till initiation of Corporate Insolvency Resolution Process. 41. It is also important to point out that land is an essential part of the corporate debtor's business. The entire plant and factory of the corporate debtor is being established on the said land sought to be transferred to the successful resolution applicant by virtue of the approval of the resolution plan. Therefore, it is an essential part of the Resolution Process. The value arrived in the 'CIRP', the purported liquidation value, all includes the value of the land and the same has always been the essence of the business of the Corporate Debtor. 42. It has also been contended by the Ld. Senior Counsel appearing for the Resolution Professional that the aforesaid decision of the Hon'ble Appellate Tribunal in Vanguard Credit & Holdings Pvt. Ltd. (supra) has not been interfered with by the Hon'ble Supreme Court in as much as the Civil Appeal being 1688 of 2021 was dismissed by order dated 02.07.2021. 43. In light of the aforesaid, relief and concession sought by the successful resolution applicant at Sr. No. 40 of Annexure 3 of the Resolution Plan is hereby grant....
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....State Pollution Control Boards to approve renewal of the consents to operate obtained by the CD under applicable provisions of the Water (Prevention and Control of Pollution) Act, 1974, Air (Prevention and Control of Pollution) Act, 1981. Granted, subject to the law and applicable Regulations. 6 All Governmental Authorities to waive all past Non-Compliances of the CD under Applicable Laws, and the CD, RA shall not be liable for any Non-Compliances under Applicable Laws for the period prior to the Plan Effective Date. Granted. 7 The rights of any Person (whether exercisable now or in the future and whether contingent or not) to call for the allotment, issue, sale or transfer of shares or loan capital of the CD or the RA, whether on a change of control, or otherwise, shall stand unconditionally and Irrevocably extinguished. Granted. 8 As the RA was not made available all the information's while preparing the Resolution Plan in relation to the Government Approvals required for undertaking the business of the CD, it is probable that some of such Government Approvals may have lapsed, expired, suspended, cancelled, revoked or terminated or the CD has certain Non- Compliances....
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....lassification shall be "standard" for the purposes of all Applicable Laws Granted. 16 All Governmental Authorities to grant any relief, concession or dispensation as may be required for implementation of the transactions contemplated under the Resolution Plan in accordance with its terms and conditions. Granted. 17 On the Effective Date, all the outstanding negotiable instruments issued by the Corporate Debtor or by any Person on behalf of the Corporate Debtor including demand promissory notes, post-dated cheques and letters of credit, shall stand terminated and the Corporate Debtor's liability under such Instruments shall stand extinguished. Granted in terms of the Ghanashyam Mishra and Sons Pvt Ltd v Edelweiss Asset Reconstruction Company Ltd, wherein the Hon'ble Supreme Court has held in para 95(i) that once a resolution plan is duly approved by the Adjudicating Authority under subsection (1) of section 31, the claims as provided in the resolution plan shall stand frozen and will be binding on the Corporate Debtor and its employees, members, creditors, including the Central Govt, any State Govt or any local authority, guarantors and other stakeholders. 18 The In....
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.... owned by the Corporate Debtor. Granted. 25 Any and all rights and entitlements of any actual or potential Third Party, whether admitted or not, due or contingent, asserted or un-asserted, crystallized or uncrystallized, known or unknown, disputed or undisputed, present or future. In relation to any period prior to the Effective Date or arising on account of the acquisition of control by RA over the Company pursuant to this Resolution Plan, shall be deemed to be permanently extinguished by virtue of the order of the NCLT approving this Resolution Plan and the Company or RA shall at no point of time, directly or indirectly, have any obligation, liability or duty in relation thereto. Granted in terms of the Ghanashyam Mishra and Sons Pvt Ltd v Edelweiss Asset Reconstruction Company Ltd, wherein the Hon'ble Supreme Court has held in para 95(i) that once a resolution plan is duly approved by the Adjudicating Authority under subsection (1) of section 31, the claims as provided in the resolution plan shall stand frozen and will be binding on the Corporate Debtor and its employees, members, creditors, including the Central Govt, any State Govt or any local authority, guarantors an....
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....ironmental laws, directions or orders by the Ministry of Environment and Forest, permits clearances and forest related clearances) and to procure that the Company regularizes such noncompliances under the Applicable Law existing prior to the Completion Date. Granted as per Provisions of the Code. 31 Withdrawal of litigations initiated by the Financial Creditors against Corporate Debtor, issue no-dues certificate(s) in favour of Corporate Debtor and release their respective charges on the securities in full and complete satisfaction of all debts owed to the Financial Creditors by Corporate Debtor, including all guarantees which may have been provided to the Financial Creditors, for credit facilities availed by Corporate Debtor. However, this clause shall exclude any personal guarantee given by erstwhile guarantor/promoter of the Corporate Debtor save and except in respect of the landed premises as mentioned in the table herein above (under SL. 3. Resolution Plan Amount and Payment Thereof) starting from S.N. to 40, which may be enforced by creditor separately as per extant rules and regulations. It should be noted that, Company and/or RA shall be immune from any subrogation right....
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.... duly approved by the Adjudicating Authority under subsection (1) of section 31, the claims as provided in the resolution plan shall stand frozen and will be binding on the Corporate Debtor and its employees, members, creditors, including the Central Govt, any State Govt or any local authority, guarantors and other stakeholders. 33 An order approving the Resolution Plan shall be a deemed order upon Financial Creditors to cancel all pledge/ lien/ other encumbrances upon the issued share capital of the Company to enable corporate action as envisaged in the Resolution Plan. Granted in terms of the resolution plan. 34 The Ministry of Corporate Affairs and/ or the Adjudicating Authority shall exempt compliance with the provisions of Chapter XV of the Companies Act, 2013 (and the corresponding rules issued under the Companies Act, 2013), in respect of schemes of arrangement contemplated under the Plan. Granted. 35 Relinquishment of all / any promise to pay towards any obligation including corporate guarantee, pledge on any shares, mortgage or charge on any specific asset, etc. issued by Corporate Debtor in favour of or on behalf of any of its subsidiaries, associates, group compa....
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....ther documentary filing registration, permission, approval or other requirement to be effected by the Corporate Debtor and the personal guarantees given by Satyaprakash Pandey and Murlidhar Pandey in respect of the landed premises as mentioned in the table herein above (under SL 3. Resolution Plan Amount and Payment Thereof)starting from S.N. 1 to 40, shall also be transferred in the name of the Corporate Debtor. B. The approval of the resolution plan by the Hon'ble Adjudicating Authority will be binding on the personal guarantors pursuant to Section 31(1) of the Code and the personal guarantors Mr. Satyaprakash Pandey and Mr. Murlidhar Pandey as stakeholders in respect of landed premises as mentioned in the table herein above (under St. 3. Resolution Plan Amount and Payment Thereof) starting from S.N. 1 to 40 which are included as the assets of the CD In the IM are directed to immediately (1) pass the necessary Corporate Resolutions; (ii) provide all approvals, execute all documents, deeds, instruments, notices, certificates or power of attorney in the format provided by the resolution applicant of the Corporate Debtor; (iii) do all filings and take all actions and do ....