TaxTMI 
TaxTMI 
2025 (4) TMI 71
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....Mr. Sripatham Venkatasubramanian Ramkumar [ Justice Sharad Kumar Sharma ] Member ( Judicial ) And [ Jatindranath Swain ] Member ( Technical ) For the Appellant : Mr. Krishna Srinivasan, Senior Advocate For Ms. Pavitra Venkateswaran, Advocate For the Respondents : Mr. R. Sankaranarayanan, Senior Advocate For Mr. Aditya Reddy, Mr. Abhishek Swaroop, Mr. Palash Agarwal and Ms. Bhawana Sharma, Advocates for R1 Mr. Pradeep Joy and Ms. Dharmya M S, Advocates for R2 Mr. Srinath Sridevan, Senior Advocate For Mr. Rama Subramaniam Raja, Advocate for R3 Mr. N. Somasundar, Advocate for R10 Mr. H Arunachalam, Advocate for R21 JUDGMENT ( Hybrid Mode ) [ Oral Judgment : Justice Sharad Kumar Sharma, Member ( Judicial ) ] These are two company appeals. The respective counsels, representing the parties in two appeals have unanimously agreed that, since the issues of law and facts are common, in both appeals, they may be considered and decided together. 2. In Company Appeal (AT) (CH) (Ins) No. 36/2024, RBL Bank Limited versus Sical Logistic Limited and 21 others, the Appellant (RBL Bank Limited) questions the propriety of the impugned order of 20.12.2023, as passed in IA (IBC) ....
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.... (RBL Bank Limited) to the impugned order of 20.12.2023, as it was passed in IA (IBC) No.1329/(CHE)2023, as preferred in Company Petition (IB) No. 73/2020, whereby the Ld. Tribunal has declined the prayer to restrain Respondent No. 1 (SICAL Logistics Limited) from alienating the assets of the Corporate Debtor, provided as security to the Appellant herein and rejected the relief sought for, in the IA (IBC) No. 1329/2023, with the observations, that "the members of the erstwhile Committee of Creditors", are directed, to take action within a period of one month from the date of the order, to redraw the distribution matrix by taking into account the amount already disbursed, the amount withheld and future receipts based on the principles to the effect that "the Dissenting Creditors shall be paid the amount in accordance with Section 53(1) of the I & B Code", in the event of liquidation, in compliance with the terms of provision contained under Section 30(2) of the I & B Code, 2016, as mentioned in Para 1.2.9.1(b) of the Resolution Plan and the Dissenting Financial Creditors shall be paid in priority over the Assenting Financial Creditors as held in IA(IBC) No. 250/(CHE)2023. 6. For ....
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....the approved Resolution Plan, unless directions are given to pay the Dissenting Financial Creditors in terms of Clause 1.2.9 (1) (b) of the said plan. 9. The Resolution Plan that was approved by Committee of Creditors (CoC) on 29.02.2022, and later on, affirmed by Ld. NCLT on 08.12.2022 in IA(IBC)No.366/2022 amounts to payment of Rs. 521.82 Crores by the Successful Resolution Applicant (SRA), Respondent No. 1 herein, the breakup of which is given below: - i) Payment of secured FCs - upfront: Rs 54.32 Crores (Effective Date +30 days) ii) Payment of Secured FCs from the internal cash balance of the Corporate Debtor: Rs. 40.63 Crores (Effective Date +30 days) iii) Payment of Secured FCs - deferred Lot-1: Rs. 105 Crores. iv) Payment of Secured FCs: deferred Lot-2: Rs. 226 Crores. v) Payment of Secured FCs, if live BGs are invoked: Rs. 84.82 Crores. The effective date was also determined to be 11.01.2023 10. We may not be much concerned at this stage, with regards to the Resolution Plan and its implication, which stood approved by the Committee of Creditors, because the only controversy which, has been addressed upon by the Ld. Couns....
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....ribunal may report, regarding the actions of the Respondent No.01 in IA i.e., the Resolution Professional, to IBBI for further and appropriate action. So far as the other reliefs are concerned, we may not be much concerned, while deciding these appeals except for relief A, which has been extracted hereunder: -. "A. The Respondent No. 1, the Resolution Professional, be directed to make payment of the sum of Rs. 32.71 crores to the Applicant herein (i.e. the total amount payable under the terms of resolution plan Rs.42.09 crores minus the amount received by the Applicant on 13.01.2023 Rs.9.38 crores) in line with the resolution plan of the Respondent No.2, successful resolution applicant, dated 08.01.2022 (amended on 11.02.2022 and 24.02.2022) which was approved by this Hon'ble Tribunal vide order dated 08.12.2022;" 13. IA (IBC) No. 250/2023, was vehemently contested by the respective parties including the Appellant. The Ld. Adjudicating Authority on considering the rival contentions while deciding IA (IBC) No. 250/2023, including the narration of facts pertaining to the basis of the claim, its determination and the quantification of the entitlement of the Dissenting ....
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...., as contained under Clause B to be read with the conclusion arrived at which are extracted hereunder: - "B.) What is the amount eligible to be paid to dissenting creditors in case the amount payable under resolution plan is more than liquidation value? B1). In the instant case, the resolution amount is higher than the liquidation value. The Applicant RBL Bank arrived at its share of Rs.42.09 crores by calculating 9.88% on the resolution plan value i.e. Rs.425.93 crores instead of calculating the share on the liquidation value. The liquidation value is Rs.351.88 crores. Assuming non- deduction of CIRP cost and workmen dues etc., the Applicant is entitled to receive its share as per the liquidation value i.e. 9.88% of Rs.351.88 crores, which comes to Rs.34.76 crores only as opposed to the Applicant claims of Rs.42.09 crores. In the JLM held 13.01.2023, the Applicant had demanded that if the liquidation value is to be taken, then the same shall be as per the liquidation value of the individual lenders." 17. During the proceedings of the instant appeals, the Ld. Counsel for the Bank of Baroda, the lead member of the Committee of Creditors, Respondent No.3 herein h....
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....ing Status CoC Member Upfront Deferred Total Assenting Bank of Baroda 11.72 130.54 142.25 Assenting Yes Bank Ltd 6.20 69.07 75.27 Dissenting RBL bank Limited 42.09 - 42.09 Assenting IDFC Bank Limited 4.54 50.52 55.05 Assenting Canara Bank - - - 18. At this stage, we feel that Ld. Adjudicating Authority has erred in holding that the amount payable to a Dissenting Creditor is the minimum amount prescribed in Section 30(2)(b) of I & B Code, 2016, which is the amount to be determined as per Section 53(1) of the I & B Code, 2016, in the event of liquidation of the Corporate Debtor in compliance with the provision of Section 30(2) of the Code as mentioned in para 1.2.9.1.b of the approved Resolution Plan. The entitlement of Dissenting Creditor is laid down in Section 30(2)(b)(ii) along with explanation (I). Section 30(2)(b)(ii) stipulates that Resolution Plan shall provide for payment to a Dissenting Creditor, which shall not be less than the amount to be paid in accordance with Section 53(1) in the event of liquidation of the Corporate Debtor. This implies that the payment to be given shall n....
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....Cs in such manner as may be specified by IBBI. IBBI has specified the relevant guidelines in Regulation 38(1)(b) of IBBI (Insolvency Resolution Process for Corporate Persons) Regulations, 2016, which is that such dissenting FCs shall be paid in priority over assenting FCs. The Ld. Adjudicating Authority has also directed that the dissenting Financial Creditors will be paid in priority over the assenting Financial Creditors in the manner as discussed in para C1 - C6 of its order dated 20.12.2023. But full clarity is yet to be made available in the said order dated 20.12.2023. Will the Appellant (RBL Bank) get its dues in full, before any payment is given to other Assenting Creditors which he is praying for? This has not been answered clearly in the said order and has been left to be interpreted by the monitoring committee. We are of the view that priority in payment will mean that whenever any payment is released by the Successful Resolution Applicant (SRA) to the FCs, the Dissenting Creditor will still be paid pro-rata, but first in case where SRA pays the plan amount at one go, then the issue is simple, pay dissenting FC first and then to other FCs. But in most cases, payments fro....
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.... was required to be fulfilled as per the terms of the approved Resolution Plan, that is, the Corporate Debtor would be handed over to the Successful Resolution Applicant (SRA) as a going concern along with its management control and operation and the Successful Resolution Applicant (SRA), as part of the implementation of the Resolution Plan, would have to disburse a sum of Rs. 331,00,00,000/- as deferred FC debt payments to the Financial Creditors in two installments, that is Rs. 105,00,00,000/- within a period of two years and the balance amount of Rs. 226,00,00,000/- within two years and six months of the effective date. It was further observed that the Corporate Debtor has also agreed to pay the interest at the rate of 8% per annum, payable annually at the end of each year as computed on a monthly basis for the deferred component to be paid to the Financial Creditors. 22. The Ld. Adjudicating Authority, while considering the stand taken by the Ld. Counsel for the Appellant regarding the IA No. 1188/2023, has made reference to the order passed on 20.12.2023 on IA (IBC) 250/2023. According to the findings recorded, the Ld. Adjudicating Authority while making reference to the te....
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....s of the Approved Resolution Plan. (b) The Respondent Nos. 2 to 22 are directed to facilitate any regulatory filing, in relation to the sale of assets of the CD including issuance of any documents as required / sought by the person including the Government / authority / office for enabling the sale of the assets including sale of 1.37 acres of land situated at GNT Road, Madhavaram and 1.82 acres of land situated at Thattankulam, Madhavaram, in terms of the Approved Resolution Plan. (d) Respondent Nos. 2 to 22 are directed to execute the respective definitive documents including Term Debt Agreement, Declaration of Trust and Trustee Agreement, etc., and take steps pursuant thereof as stipulated under the Approved Resolution Plan. Respondent No. 1 is also directed to provide all assistance / facilitation as required by the Applicant for the above. 24. As regard relief which has been prayed in para (c) of the relief clause, the applicant in its application itself has stated that in terms of para 1.2.9.1(m) of resolution plan, financial creditors shall be deemed to have provided consent to such sale on the approval of resolution plan. Since the Corporate Debto....