TaxTMI 
TaxTMI 
2022 (2) TMI 1483
X X X X Extracts X X X X
X X X X Extracts X X X X
....ss for Corporate Persons) for approval of Resolution Plan of the Corporate Debtor. 2. The Corporate Debtor was admitted into CIRP vide order of admission dated 16.04.2021. The RP appointed carried out the following duties: a. Publish the public announcement of CIRP in Form A dated 22.04.2021 in two newspapers inviting claims from Financial / Operational Creditors etc. b. The home buyers nominated Mr. Rakesh Kumar to be the authorized representative which was approved by the Bench. 3. The notice of initiation of CIRP was sent to all statutory authorities, however, they have not referred to file any claims. The copy of serving notices to authorities are annexed to Exhibit E to the Application. 4. As per section 18(1)(c) of the Code, the CoC was constituted on the basis of claims on receipt of the creditors, the reports certifying constitution of Committee of Creditors (CoC) was submitted on 13.05.2021 to NCLT. The Constitution of COC after considering all the claims is as follows; COC Amount Admitted Voting Share Rakesh Kumar representing the interest of 260 home buyers 3,55,93,85,894/- 100% 5. The first CoC meeting was held on 20.05.20....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... compliance of resolution plan. Form H is as below; 10. The Information Memorandum: The RP prepared the Information Memorandum and the details of the Financial Creditor are as follows; 11. The secured Financial Creditor Dewan Housing Finance Corporation Ltd. had outstanding liability as per the last audited balance sheets of the Corporate Debtor, however, Dewan Housing Finance Corporation Ltd. has not filed its claims and other CIRP process. The details of other creditors including Operational Creditors are as shown as below; The balance sheet as on 31.03.2021 is as follows; 12. The salient features of Resolution Plan is as follows; a. Overview of the Corporate Debtor b. The Corporate Debtor was incorporated on 25.01.2007 and was in the business of Real Estate. An application is filed by the Mr. Anup Jain, Home Buyer vide C.P. No. 1396 of 2020 and an order of admission was passed on 16.04.2021 and the IRP, Mr. Neehal Mahamulal Pathan was appointed. The Corporate Debtor has three Suspended Board of Directors, and two shareholders. As per the information memorandum, the list of financial creditors is as follows; c. Diwan Housing Financi....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ures, shelters, civil engineers etc., the cumulative network of group entities of JVD Life Space is approximately 25 crores. The JVD group has cumulative experience of more than 40 years. 14. The Assets to be dealt with the plan in clause 2.3, 2.4 and 2.5 is as follows: 2.3 The real estate project of the Corporate Debtor comprises of the incomplete building being B1 to B7 of Royal Raj Villas, open area of CP-1 Tower And also includes Phase 2 (Royal Raj Vilas LIG/EWS) and agriculture land parcels situated in Village Shobagpura, Udaipur. However, this is subject to the rights of the Allottees and the obligations of the Corporate Debtor under the provisions of the Real Estate (Regulation and Development) Act, 2016 read along with the Rajasthan Real Estate (Regulation and Development) (Registration of real estate projects, Registration of Real Estate Agents, Rates of Interest and Disclosures on Website) Rules, 2617 ("RERA"). 2.4 Although the resolution applicant is putting its own money to complete the projects, but the resolution applicant has given the resolution plan keeping in mind that the Balance Consideration of is Rs. 44,83,92,660.64/- (Rupees Forty-Four Cr....
X X X X Extracts X X X X
X X X X Extracts X X X X
....s mentioned in the sanction letter. However, several flats are sold/booked with the no objection from Dewan Housing Finance Limited and thus its security interest is restricted to that extent. Based on the complete due diligence and financial viability carried out by the Resolution Applicant, it is not feasible to complete the project and handover constructed units to the allottees by the Resolution Applicant and also phase-2 if the Resolution Applicant has to repay the outstanding debt of [NR 71 crores to Dewan Housing Finance limited. Further, the IM of the CD clearly states that Dewan Housing Finance Limited has not filled for any claims under the CIRP process. However, with a clear conscience and keeping in mind the need to handover constructed possession of units to the allottees and also completing and handing over phase-2, the Resolution Applicant proposes to pay an amount of Rs. 5.00 crore in full & final settlement of its entire dues. This amount would be paid over the next three years as the project is completed and further units are sold in the project. Based on the feasibility of the project carried out by Resolution Applicant, it would not be possible to pay Dewan Hous....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... Corporate Debtor. Each of the Allottees shall be required to contribute the amounts owed by them under the terms of the agreements between them and the Corporate Debtor, i.e., their share of the Balance Consideration. A chart showing the amounts due from each of them is annexed hereto as Annexure-1 21. Proposed Corporate Restructuring 22. Retention of employees All employees and workers of Corporate Debtor shall continue to be in service on the same terms and conditions as applicable to them. 23. Ownership of properties pertaining to Corporate Debtor The Corporate Debtor is a owner of property upon which RRV and phase 2 is constructed. 24. Time lines of implementation of plan The Resolution Applicant shall complete the construction of RRV in accordance with this Plan within a period of fifteen (15) months from the Effective Date and in accordance with the plans sanctioned by the competent authority. The timeline for implementation of this Plan as is set out herein is a term of fifteen (15) months from the Effective Date. The timeline as set out here under for completion of the RRV project is subject to the Resolution Applicant getting all the approvals f....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ution Plan, the Resolution Applicant envisages to run the company by paying of Dewan Housing Finance Limited and hand over the completed flats to the home buyers in time bound manner. 27. Proposal for CIRP cost Insolvency Resolution Plan consider insolvency Resolution Process Costs which has been estimated at an amount of Rs. 75.00 Lacs which includes payment to Interim Resolution Professional and/or Resolution Professional and all amount of expenses incurred by IRP and/or RP, to the extent duly ratified or approved by the Committee of Creditors (CoC) an shall he paid in priority to all other debts by Resolution Applicant after the approval of Resolution Plan by Adjudicating Authority. The source for amount can be identified as a commitment by resolution applicant for Rs 75.00 Lacs. Any higher amount over and above this (as approved by CoC) shall be borne and paid by Resolution Applicant on priority basis. In the event of the CIRP cost comes to a lower figure than the estimated level of 75.00 Lacs, the balance amount shall he added to the amount to be given to Secured Financial Creditors. The Resolution Plan proposes a cost of 75 lakhs towards the CIRP cost. 28. Prop....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... workmen and employee Total amount of dues towards employees and workers of Corporate Debtor as per claim admitted by IRP/RP is Rs. 0.54 Lacs. Resolution Applicant shall make payment of priority workmen dues pursuant to Section 53 (1) of IBC, 2016. 32. Proposal for infusing funds for completion and finishing of existing home buyers (Secured financial Creditors) who have lodged the claims as per the balance sheet The Corporate Debtor was developing a residential cum commercial project in Udaipur under the name of Royal Raj Villas and Connaught Place. Total 363 residential flats and 111 commercial units are being constructed. Out of above units 273 flats have been booked and sold and 111 commercial units -have been sold totally. The project is not complete only partial civil work has been done and to complete the unfinished portion of sold flats further investment of 6000.00 lacs will be done by Resolution Applicant to complete the balance work of sold flats and hand over the possession of flats to Home Buyers. The claims of secured home buyers will be settled by handing over the finished flats with all amenities as promised by the Corporate Debtor in his sales Brochure. ....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... confirmed in past, during or before the CIRP or even may be confirmed in the time to come are proposed to be waived off fully. Even any other known or unknown (Whether recorded or not recorded in books) contingent liabilities are proposed to be waived off fully. E. Compliance of Section 29A The Resolution Applicant has filed the affidavit incompliance with the section 29A of the Code. The Resolution Applicant has filed the affidavit that it is not prevented from submitted the claim under section 29 of the Code. F. The Bank Guarantee provided under the Resolution Plan is as follows: G. Mandatory contents of CIRP: H. Reliefs concessions and dispensations: With regard reliefs, concessions and waivers as sought by the Resolution Applicant, this Bench orders that the reliefs and concessions are granted as per the judgement of Hon'ble Supreme Court in Ghanshyam Mishra & Sons vs. Edelweiss Asset Reconstruction Company limited, where at para 95 (i) it was held that once a resolution plan was approved a creditor cannot initiated proceedings for recovery of the claim which are not part of the Resolution plan. Hence, all past liabilities ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....30(2)(a) the Resolution Plan provides in payment of Rs. 75 lakhs towards CIRP cost within a period of 15 days of effective date and in priority for the Creditors, section 30(2)(b) it is stated that the Form H states that the fair value of the Corporate Debtor is 18,61,29,096/-and the Liquidation value is 33,83,34,076/-. 40. The Resolution Plan proposes to pay Rs. 5 lakhs to the Secured Financial Creditor Rs. 0.54 lakhs to the workmen and employees, the resolution plan proposes that the dues payable to the unsecured financial creditors shall be entirely paid/ written off, the plan also provides that 5% of statutory dues will be paid i.e. 0.86 lakhs will be paid and the balance will be waived off, the operational creditors would be paid an amount of Rs. 6.7 lakhs within a period of 60 days. The existing equity shares shall get written off and 10 lakhs new equity shares of Rs. 10 each for cash at par shall be issued to resolution applicant. 41. Section 30(2)(c)(d) the Resolution Plan further provides for the monitoring committee is as follows; a. Monitoring agency will be overseeing the resolution plan b. The Resolution Applicant should supervise the implementa....
X X X X Extracts X X X X
X X X X Extracts X X X X
....has to be within the four corners of section 30(2) of the Code, insofar as the Adjudicating Authority is concerned, and section 32 read with section 61 (3) of the Code, insofar as the Appellate Tribunal is concerned, the parameters of such review having been clearly laid down in K. Sashidhar (supra)." 46. We further rely on the judgement of the Hon'ble Supreme Court in case of K. Shashidhar Vs IOB, wherein it was held inter alia that no corresponding provision has been envisage by the legislature to empower the Resolution Professional, Adjudicating Authority, of that matter NCLAT to reverse the commercial decision of the CoC. It is also held that the commercial decision of Financial Creditor are not open for judicial review by Adjudicating authority and by Appellate Authority. Therefore, in view of the above discussion. The decision taken by the Financial Creditor/CoC Members falls within the ambit of its commercial and banking wisdom and is therefore not being interfere with. 47. In view of the above discussion the decision taken by the CoC falls within the ambit of its commercial wisdom and cannot be interfere with. ORDER 48. Therefore, subject to the observation made....
X X X X Extracts X X X X
X X X X Extracts X X X X
....gulations, 2016 I, NEEHAL MAHAMULAL PATHAN an insolvency professional enrolled with Indian Institute of Insolvency Professionals of ICAI and registered with the Board with registration number IBBI /IPA-001/IP-P/01561/2018- 19/12406, am the resolution professional for the corporate insolvency resolution process (CIRP) of UDAIPUR ENTERTAINMENT WORLD PRIVATE LIMITED. 2. The details of the CIRP are as under: Sl. No. Particulars 1 Name of the CD 2 Date of Initiation of CIRP 3 Date of Appointment of IRP Description Udaipur Entertainment World Private Limited 16th April 2021 16th April 2021 (Order received to IRP on 20 April 2021] 4 Date of Publication of Public Announcement 22nd April 2021 5 Date of Constitution of CoC 13th May 2021 6 Date of First Meeting of CoC 20th May 2021 7 Date of Appointment of RP 20th May 2021 8 Date of Appointment of Registered Valuers 28th May 2021 9 Date of Issue of Invitation for Eol 29th May 2021 10 Date of Final List of Eligible Prospective Resolution Applicants 28th June 2021 11 Date of Invitation of Resolution Plan ....
X X X X Extracts X X X X
X X X X Extracts X X X X
..... (iv) I sought vote of members of the CoC by electronic voting system which was kept open at least for 24 hours as per the regulation 26. 5. The list of financial creditors of the CD Udaipur Entertainment World Private Limited being members of the CoC and distribution of voting share among them is as under: Sl. No. Name of Creditor 1 Class of Creditors - Home buyers TOTAL: Voting Share (%) Voting for Resolution Plan (Voted for / Dissented/Abstained) 100.00 100.00 80.692/1.98/17.328 80.692/1.98/17.328 6. The Resolution Plan includes with the interests of all stakeholders in compliance with the Code and regulations made thereunder. Ã statement under regulation 38(1A) of the CIRP Regulations as to how it has dealt 7. The amounts provided for the stakeholders under the Resolution Plan is as under: Sl. No. Category Stakeholder* of Sub-Category Stakeholder (Amount in Rs. lakh) of Amount Claimed Amount Admitted Amount Provided Amount Provided under the Plan# to the Amount Claimed (%) (1) (2) (3) (4) (5) (6) (7) 1 Secured Financi....
X X X X Extracts X X X X
X X X X Extracts X X X X
....le of operations of business of the CD? Section 29A Whether the Resolution Applicant is eligible to submit resolution Clause 8.1 Yes plan as per final list of Resolution Applicants or Order, if any, of the Adjudicating Authority? Section 30(1) Whether the Resolution Applicant has submitted an affidavit Clause 6.1 Yes stating that it is eligible? Section 30(2) Whether the Resolution Plan- (a) provides for the payment of insolvency resolution process Clause 6.1 Yes costs? (b) provides for the payment to the operational creditors? Clause 6.1 Yes (c) provides for the payment to the financial creditors who did not Clause 6.1 Yes vote in favour of the resolution plan? Clause 6.1 Yes TARY ARUN Y. FATIL CATE & NOTARY LAPUR NO 6395 (d) provides for the management of the affairs of the corporate (e) provides for the implementation and supervision of the resolution plan? debtor? Section 30(4) Section 31(1) Regulation 35A Regulation (1) 38 Regulation 38(1A) Regulation 38(1B) Regulation 38(2) Clause 6.1 Yes (f) contravenes any of the provisions of the law ....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... ARUN V. PATIL VOCATE & HOTAR Latest Timeline Actual Date under regulation [Order passed on 40A 16.04.2021 but order received on 20.04.2021 hence CIRP date considered 20.04.2021 is as Section 16(1) -Regulation 6(1) Section 15(1)(c) /Regulation 12 (1) Regulation 13(1) Section 26(6A)/ Regulation 15A Regulation 17(1) Section 22(1) and regulation 17(2) Regulation 35A IRP Submission of Claims Commencement of CIRP and Appointment of T 20.04.2021 Publication of Public Announcement T+3 T+14 22.04.2021 04.05.2021 Verification of Claims T+21 11.05.2021 Application for Appointment of Authorized T+23 22.05.2021 Representative, if necessary Filing of Report Certifying Constitution of CoC First Meeting of the CoC T+23 T+30 13.05.2021 20.05.2021 Determination of fraudulent and other transactions T+115 28.08.2021 Regulation 27 Regulation 36 (1) Regulation 36A Regulation 36B Section 30(6)/ Regulation 39(4) Section 31(1) Appointment of two Registered Valuers Submission of Information Memorandum to CoC Invitation of Eol....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ilable: Rs.99,33,064/- NO. 6096 "Contributions required to be made: Rs.1,15,48,986/- Financial creditor wise contribution is as under: 203 Sl. No. 1 Total Name of financial creditor Home Buyers Home Buyers 15B. The committee has recommended Amount to be contribued (Rs.) 1,15,48,986 1,15,48,986 under regulation 39C as under: a. Sale of corporate debtor as a going concern: b. Sale of business of corporate debtor as a going concern: The details of recommendation are available with the resolution professional. Yes/No Yes/No - No, will be fixed once the order is passed. 15C. The committee has fixed, in consultation with the resolution professional, the fee payable to the liquidator during the liquidation period under regulation 39D.] 16. I (Name of Resolution Professional) hereby certify that the contents of this certificate are true and correct to the best of my knowledge and belief, and nothing material has been concealed therefrom. (Signature) Cyathe WV. * P-001/ 2018-19/ 12406 NCY PROFESSIONAL OSH PATH Name of the Resolution Professional: NEEHAL MAHAMULAL PATHAN IP Registratio....
X X X X Extracts X X X X
X X X X Extracts X X X X
....,57,50,000 Loan) Unsecured 52,44,72,147 52,44,72,147 52,44 72,147 Loan-Others Document 6 TAR ARUN V. PATIL Class or creditors BOCATE & NOTARY APUR NO Operational Exp. 1990 DU Creditors As per Balance Sheet amount 1,21,38,775 Glaimed Amount 20,55,976 (in Rs) Admitted amount 20,55,976 For D LIFESPACE Statutory Creditors 3,12,076 0 312,076 (As per Books) Statutory Dues 2,54,99,400 0 2,04,99 400 (Stamp Duty MOU) (Contingent Liability) Refund of Booking 60,79,900 1,76,25,580 1,76,25,580 Cancellation amount Workmen & 54000 0 54000 Employees Document 7 (Rs in lakhs) FINANCIAL YEAR Profit & Loss Account Total Revenue EBITDA Depreciation Finance Cost PBT Taxes 31.03.2021 (Audited) 679 10 1 960 PAT 9 Cash Accruals 10 Document 8 NO NO PROPOSED CORPORATE RESTRUCTURING Control of Board Boards of ARUN V.PATIL Directors (*) Change of Auditors On acquisition of almost entire stake / controlling interest in the Company by the Resolution Applicant, the existing Board of....
X X X X Extracts X X X X
X X X X Extracts X X X X
....e bridged by self-funding by RA and Related parties of RA/ sale of flats) Loan from Related Party (as per confirmation letter attached) Internal Accruals from sale of unsold flats 1387.95 6587.95 Document 11 The Terms of payment to Secured Financial Creditors as follows No. 3. Particulars In Lacs 事 Cash payment on approval 150.00 of Resolution Plan from Adjudicating Authority in 180 days after payment of CIRP costs, operational creditor, dissenting financial creditors. Cash Payment on or before 150.00 365 days of the effective date Cash Payment on or before 200.00 730 of the effective date Document 12 34 No. 1. 2. Particular Stamp Duty payment Demand TDS WCT Payable Service Tax payable Total Amount Amount in Rs. 14,13,844.00 1,38,291.00 25,742.00 1,48,043.00 17,25,920.00 Document 13 Proposal for Contingent Liabilities of Corporate Debtor Following liabilities are reported as contingent liabilities in the books of the corporate debtor: No. Particular Interest (Not Penalty (Not Other Net Contingent Stamp Duty on MOU Provided bo....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... taken into account the interests of all stakeholders of the Corporate Debtor. A synopsis (subject to the terms and conditions of the plan) of how the Resolution Applicant has dealt with the Interest of all stakeholders is set put below in this Clause. Reg Stakeholder Interests as addressed in Resolution Plan 38(1) The amount payable under Operational Creditors will be paid in priosity over a resolution plan - financial creditors. (a) to the operational creditors shall be paid in priority over financial creditors NO ARUN V.PATIL ADVOCATE Resolation Plan for Udaipur Entertainment World Pvt Ltd by JVD Life Space KOLHAPUR FERS 6935 12/03/2013 DIA NO For JVD LIFESPACE Proprietor/Authorised Signatory B to the financial The resolution plan provides for payment to be creditors, who have a right to vote under sub-section 2) of section 21 and did not vote in favour of the resolution plan, shall be paid in priority over financial creditors made to the financial creditor/s who voted against the resolution plan in priority over the other financial creditor/s who 17 voted in favour of ....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... the extent of Rs. 0.54 lakhs towards full and final settlement of their Priority Workmen Dues, and Priority Employee Dues within 30 (thirty) days of Effective Date. The 5% of total Statutory Dues payable to the erstwhile promoter's group shall be paid i.c. 0.86 Lacs and balance shall be entirely waived / written off. Operational Creditors (OC) Amount of 6.07 lakh will be paid within 60 days Shareholders: from effective date. The existing Equity Shares shall get written off fully and Ten lakh new equity shares of Rs 10/ For JVD LIFESPACE NOVO Recruit Plan for Udaipur Entertainment World Pvt Ltd by JVD Life Space кр T8095 Exp. Date OIA Ajay Proprietor Authorised Signalety 48 each for cash at par shall be issued to the resolution applicant and his relatives in accordance with this resolution plan. 38 (IB) A resolution plan shall The resolution applicant hereby declares that include a statement giving neither it nor any of its related parties have failed details if the resolution to implement or contributed to, the failure of applicane or any of its implementation of any other resolution plan ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....standing anything contained in this Plan, no part of this plan shall become effective or enforceable until the Plan is approved by the NCLT in the form and substance acceptable to the Resolution Applicant. Upon approval of the Plan by the NGET, this Plan shall ipso facto form part of the NCLT order approving the Plan. Resolution Plan for Udaipur Entertainment World Pvt Ltd by JVD Life Space FV Dale For JVD LIFESPACE Proprietor Authorised Signatory 49 NDIA 38(2)(b) the 38(2)(c) management and Up to the Effective Date, the Resolution control of the business of the corporate debtor during its term adequate supervising means implementation. ANY FATH ★ADVOCATE & NOTARY Resolution Date Professional to: continue his duties and obligations as set out in the code and CIRP Regulations, (i) continue to have the powers of the Board vested in him; (ii) manage the business of the Corporate Debtor as a going concern, acting on the instructions of the Committee of Greditors, with the voting and other procedures prescribed under the Code continuing to apply. On and fro....
X X X X Extracts X X X X
X X X X Extracts X X X X
....LIFESPAGE 51 Proprietor Authorised Signator 38(3)(c) it has provisions for its effective implementation industry, the project is expected to get completed as scheduled. Please refer to response to Reg 38(2)(c) hereinabove 38 (3)(d) it has provisions for Please refer para 6.2 approvals required and 38(3)(e) the timeline for the same the resolution applicant has the capacity to implement the resolution plan 39(1) A prospective resolution applicant in the final list CH Please refer para 1.3 and para 2 herein above may submt resolution plan or plans prepared in accordance with the Code and these regulations to the resolution professional electronically within the time given in the request for under resolution regulation plans 36B along with - 39(1)(a) an affidavit stating that it 39(1)(c) Affidavit in terms of provisions of 29A of the is eligible under section Code is enclosed as Annexure 5 29A to submit resolution plans, an undertaking by the prospecuve applicant resolution that every information and records provided in....