TaxTMI 
TaxTMI 
2025 (3) TMI 851
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....plicant (RA) has been filed challenging the order dated 29.07.2024 passed by the Adjudicating Authority (National Company Law Tribunal, Mumbai Bench, Court - IV) in I.A. No.1143/2024. Adjudicating Authority by the impugned order passed in I.A. No.1143/2024 filed by the Respondent - Ashden Properties Private Limited has directed the resolution plan submitted by respondent to be considered by the Committee of Creditors (CoC). Aggrieved by the said order, this appeal has been filed by the appellant, who is one of the RA. 2. Brief facts of the case necessary to be noticed for deciding the appeal are: i. Corporate Insolvency Resolution Process (CIRP) of the corporate debtor, AA Estate Private Limited, commenced by order dated 06.12.2022. ii. RP issued publication inviting the Expression of Interest (EoI) from Prospective Resolution Applicant (PRA). EoIs were received and list of PRA was issued, which included the name of the appellant as well as the Respondent No. 1. iii. Request for Resolution Plan (RFRP) was issued by the Resolution Professional (RP) and shared with all RA. iv. On 30.01.2024, PRAs were informed that the last date for submission o....
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.... could not be allowed to be considered at the time when CoC is going for approval of the Resolution Plan. It is submitted that the meeting of the CoC has been convened for tomorrow to consider the directions issued by the Adjudicating Authority in the impugned order. Submissions made by the Counsel for the Appellant need consideration. 2. Let 'Notice' be issued to the Respondents through 'Speed Post'. Let the requisites together with process fee be filed within three days from today. The Appellant is required to provide the e-mail address of the Respondents and in that mode also, the service can be effected. The Appellant is also required to furnish the Mobile No. of the Respondents to the 'Office of the Registry'. 3. Let Reply be filed within one week. Rejoinder, if any, be filed within one week thereafter. Appellant may also serve all the Respondents personally. 4. List the Appeal for consideration on 22.08.2024. In the meantime, the directions issued by the Adjudicating Authority by the impugned order may not be implemented by the CoC." xiv. In the appeal, reply was filed by Respondent No. 1 to which rejoinder has also been filed. Res....
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....4 and the plan were to be considered on 16.02.2024, hence the plan was sent prior to date when plans were to be considered and hence there was no reason for non-consideration of the plan by the CoC. CoC erred and in deciding not to consider the plan of the appellant. The application filed by the Respondent No. 1 has rightly been allowed by the Adjudicating Authority. Maximisation of the value of the corporate debtor is one of the objectives of the CIRP and consideration of the plan of Respondent No. 1 is towards that object and Adjudicating Authority has rightly passed an order directing for consideration of the plan. Learned counsel also referred to the judgment of the Hon'ble Supreme Court in the matter of 'Kalparaj Dharamshi' Vs. 'Kotak Investment Advisors Ltd. & Anr.' reported in (2021) 10 SCC 401, which has been relied by the Adjudicating Authority in the impugned order. It is submitted that no grounds have been made out to interfere with the impugned order. 6. Learned Counsel for the RP submitted that all necessary information was provided to Respondent No. 1 and in spite of extension of last date, the Respondent No. 1 did not submit the plan within time. The RP brou....
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....ast extension. In the present case, after plan was sent by Respondent No. 1, the RP placed the resolution plan of the receipt from the appellant before the CoC in its meeting dated 16.02.2024. In Agenda Item No. A (3), the RP updated, the CoC and also informed about receipt of the plan by Respondent No. 1 on 15.02.2024 and EMD of the above plan also after the due date. Even though some homebuyers were in favour of accepting the plan, the meeting on 16.02.2024 was also adjourned to 17.02.2024 and in the 17.02.2024 meeting again the issue was deliberated and CoC took a decision not to accept the plan of Respondent No. 1. It is useful to extract following minutes of the meeting: "...The Authorised Representative of Homebuyers said that the legal opinion is very clear that both the plans should not be accepted which is received after the due date and which is received without the EMD. Consequently, the Authorised Representative of Homebuyers and the Representative of Suraksha ARC is with the view of the legal counsel. The RP asked the Representative of SBI about the plans, in reply the representative of SBI asked the RP about his view, the RP replied that the legal provisions ....
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....he Applicant in parity with other Resolution Plans and; c) Pending the hearing and final disposal of the present Application this Hon'ble Tribunal be pleased to, by an order, grant a stay and injunction restraining the Committee of Creditors of the Corporate Debtor from considering any resolution plan or from voting on any resolution plans already submitted by other Prospective Resolution Applicants; d) Any other order that this Hon'ble Tribunal may deem fit in the facts and circumstances of the present case." 13. The Respondent No. 1 sought a direction to the RP and CoC to consider the resolution plan, whereas in the present case, CoC has already considered the plan submitted by 15.02.2024 from the Respondent No. 1 and has decided to not to accept the resolution plan and to proceed with CIRP process. Thus, present is not a case for RP and CoC failing to exercise jurisdiction under Regulation 36B (6) rather the CoC deliberated on extension of timeline and refused to extend the timeline. Adjudicating Authority in the impugned order has not returned any finding that decision of the CoC dated 16.02.2024 was arbitrary or not in accordance with the regulatio....
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....nal to take on record the revised Resolution Plan which Application was rejected by the Adjudicating Authority on 18.03.2020 against which Appeal was filed by Respondent No.1 before NCLAT which Appeal was allowed by order dated 19.10.2020. The judgment of this Appellate Tribunal was challenged before the Hon'ble Supreme Court. The Hon'ble Supreme Court after considering the facts of the said case and after noticing that Resolution Plans were approved adopting Swiss Challenge open biding method allowed the Appeal, setting aside the order passed by this Appellate Tribunal. It is useful to extract paras 25, 26 & 27 of the judgment of the Hon'ble Supreme Court:- "25. The minutes of the 5th meeting of the CoC would further reveal that the CoC thereafter invited Ngaitlang Dhar for negotiation of the bid and requested him to enhance the bid amount. Ngaitlang Dhar agreed to enhance the bid amount from Rs.63 crore to Rs.64 crore. Thereafter again, the representative of PPIPL returned back and requested to adjourn the meeting for a few days. The said request was specifically rejected by the CoC informing the representative of PPIPL that they were bound to follow the IBC timeline and....
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....esentative of PPIPL that it had to adhere to the IBC timeline and would have to conclude the matter by next day. On the next day, i.e., 12th February, 2020, when the adjourned proceedings of the CoC were held, the respondent No.1PPIPL had sent an email, stating therein that the Directors of its Company will not be available for the said meeting and requested for deferring the meeting by a day or two. On the insistence of all the prospective Resolution Applicants present, the CoC clarified that since the timeline was coming to an end, it had decided to exclude the prospective Resolution Applicants who were not present in the said meeting. In the said meeting, Ngaitlang Dhar came to be declared as the highest bidder after he improved his bid in the open bidding held between him and Mr. Abhishek Agarwal. 27. It could thus be seen that the RP as well as the CoC had acted in a totally transparent manner. An equal opportunity was accorded to all the prospective Resolution Applicants. However, the respondent No.1PPIPL, without improving his bid amount, went on insisting for more time, which request was specifically rejected by the CoC." 15. We may also notice the judgment of t....
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....lso approved the plan on 28.11.2019. In appeal NCLAT allowed the appeal directing the CoC to take fresh decision, against which order the appellant filed the appeal in the Hon'ble Supreme Court. Hon'ble Supreme Court allowed the appeal and held that NCLAT could not have interfered in the commercial decision of CoC to accept the plan of appellant. Following was held by Hon'ble Supreme Court in paragraphs 170 to 172: "170. This Court observed, that the Court ought to cede ground to the commercial wisdom of the creditors rather than assess the resolution plan on the basis of quantitative analysis. This Court clearly held, that the appellate authority ought not to have interfered with the order of the adjudicating authority by directing the successful resolution applicant to enhance their fund inflow upfront. 171. It would thus be clear, that the legislative scheme, as interpreted by various decisions of this Court, is unambiguous. The commercial wisdom of CoC is not to be interfered with, excepting the limited scope as provided under Sections 30 and 31 of the I&B Code. 172. No doubt, it is sought to be urged, that since there has been a material irregularity....