TaxTMI 
TaxTMI 
2025 (9) TMI 1544
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.... the resolution professional of the Corporate Debtor is the Respondent No.1 herein. Committee of creditors ('CoC') through its resolution professional Mr. Reetesh Kumar Aggarwal is the Respondent No.2 herein. M/s Pooja Marbles through its Partner Mr. Prakash Chandra Rathi is the Respondent No.3 herein, who is the Successful Resolution Applicant. 3. We note that the Adjudicating Authority in its order dated 08.06.2020, admitted the application filed by the Operational Creditor, OM Logistics Limited, under Section 9 of the Code against the Corporate Debtor, Servel India Private Limited. Consequently, the Adjudicating Authority initiated the Corporate Insolvency Resolution Process (CIRP) against the said Corporate Debtor. 4. It is also noted that pursuant to the initiation of the CIRP against the Corporate Debtor, the Interim Resolution Professional (IRP), Mr. Reetesh Kumar Agarwal (Respondent No. 1), published Form-G on 05.01.2021, inviting Expressions of Interest (EOI) from the general public for the submission of resolution plans and by the last date for submission of EOIs, i.e., 21.02.2021, nine EOIs were received by the IRP, including a joint EOI submitted by the Appe....
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....es during the pandemic. It is the case of the Appellants that they requested an extension of 15 days to resolve the queries and provide the additional documents sought vide email dated 02.06.2021, however, their reasonable request for an extension was rejected by Respondent No. 1 vide email dated 03.06.2021, disregarding the extenuating circumstances caused by the pandemic. 9. The Appellants submitted that the Respondent No. 1 via email dated 04.06.2021 at 11:54 AM, shared the link for the 12th meeting of the CoC, scheduled on the same day at 3:30 PM and during the said meeting, the CoC rejected their resolution plan on the grounds of non-compliance with the terms of the Request for Resolution Plan (RFRP). The Appellants emphasized that they were in the process of submitting the revised resolution plan but were unable to do so due to extraordinary circumstances arising from the ongoing pandemic and the refusal of Respondent No. 1 to grant an extension of time. The Appellants submitted that as aggrieved resolution applicants, they filed an application before the Adjudicating Authority under IA No. 4619/2021 in Company Petition No. (IB)-2728/ND/2019 and challenged not only the dec....
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....Order dated 08.06.2020, commenced the CIRP against the Corporate Debtor under the provisions of the Code, with the statutory period of 330 days, inclusive of any extensions or exclusions as may have been sanctioned by the Adjudicating Authority, culminating on 22.06.2021. 16. The Respondent No. 1 submitted that consequent to the issuance of Form- G on 05.01.2021, the deadline for submission of resolution plans by prospective resolution applicants was stipulated as 21.02.2021, and that the Appellants duly lodged their proposed Resolution Plan on 20.02.2021, in adherence to the prescribed timeline. 17. The Respondent No. 1 contended that during the 8th meeting of the CoC, convened on 08.04.2021, the members of the CoC directed the Resolution Applicants, including the Appellants herein, to revise their respective settlement proposals in order to align with the objectives of the CIRP under the Code. Respondent No. 1 further submitted that the deliberations of the said meeting necessitated such revisions to ensure the viability and efficacy of the proposed plans. 18. The Respondent No. 1 submitted that pursuant to the discussions held in the 8th CoC meeting, an email was dispat....
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....nal details pertaining to the property of the Corporate Debtor, which were duly provided by the Respondent No. 1 through emails dated 19.05.2021 and 20.05.2021. It is averred that, upon reviewing the requested information, the Appellants submitted an Addendum to their resolution plan on 21.05.2021, in compliance with the stipulated deadline. 23. The Respondent No. 1 submitted that during the 11th meeting of the CoC which convened on 27.05.2021, the revised resolution plan submitted by the Appellants was subjected to thorough scrutiny and discussion by the members of the CoC and the Appellants assured the CoC of their commitment to submit further revised proposals within a period of three days, in order to address the concerns raised and enhance the plan's. It is averred that the Respondent No. 1, vide an email dated 28.05.2021, requested the Appellants to adhere to their assurance and submit the revised resolution plan by 29.05.2021, as communicated during the 11th CoC meeting. 24. The Respondent No. 1 submitted that, unexpectedly, the Appellants, vide their email dated 28.05.2021, expressed an intent to reassess their proposal and sought permission to visit the premises of t....
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.... It is averred that the CoC, in its discretion, approved the resolution plan submitted by Respondent No. 3 herein, while rejecting the resolution plan of the Appellants. 28. The Respondent No. 1 elaborated that, pursuant to the decision of the CoC, the Respondent No. 1, on 22.06.2021, filed an application under Section 30 of the Code, being I.A. No. 2810/2021, before the Adjudicating Authority, seeking approval of the resolution plan of Respondent No. 3, as duly approved by the CoC. The Respondent No. 1 submitted that the said application remains pending adjudication before the Adjudicating Authority as on date. 29. The Respondent No. 1 submitted that in light of the aforementioned facts and circumstances, the Appellants were afforded ample opportunities, including as many as five extensions of time, to submit their revised resolution plan during the CIRP. The Respondent No. 1 further submitted that such extensions demonstrate the fairness and reasonableness extended to the Appellants, and consequently, the contention that they were not granted a fair opportunity to revise their plan is wholly devoid of merit and unsustainable in law or fact. 30. The Respondent No. 1 furth....
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.... a resolution plan is approved by the CoC, it can only be set aside under Section 31 of the Code and only if it fails to meet the requirements of Section 30(2) of the Code. The prayers sought by the Appellants are thus contrary to established legal provisions and lack merit. 36. The Respondent No. 2 submitted that it is a settled proposition of law that once a resolution plan is approved by the CoC, an unsuccessful resolution applicant has no locus standi to challenge the plan or the decisions made by the CoC during the consideration and deliberation of various plans. As per Section 31(1) of the Code an unsuccessful resolution applicant cannot be regarded as a "stakeholder," nor does the appellant qualify as an aggrieved person under Section 61(1) of the Code. Reference was drawn by the Respondent No.2 to the judgment in M.K. Rajagopalan Balaji Villa vs. S. Rajendran, RP Vasan Health Care Pvt. Ltd. and Ors, IA No. 215 of 2023 in Company Appeal (AT) (CH) (INS) No. 58 of 2023, decided on 17.03.2023, which reinforces this legal position. 37. The Respondent No. 2 submitted that the Appellants lack the locus standi to challenge the commercial wisdom of the Committee of Creditors (....
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....ions, or the Request for Resolution Plan (RFRP) allowing post- facto modification of a resolution plan once it has been unanimously approved by the CoC. The Respondent No.2 highlighted that as a matter of record that the application for approval of Respondent No. 3's resolution plan (I.A. No. 2810/2021) was filed by the Resolution Professional on 22.06.2021 before the Adjudicating Authority, whereas the Appellants filed I.A. No. 4619/2021 challenging the CoC's decision taken in its 12th meeting held on 04.06.2021 almost four months later, on 11.10.2021. 40. The Respondent No. 2 submitted that under Code there is no equity jurisdiction, and the Adjudicating Authority is bound to adjudicate matters strictly within the provisions of the Code. Reference was drawn to the judgments in Pratap Technocrats (P) Ltd. & Ors. vs. Monitoring Committee of Reliance Infratel Limited & Anr., Civil Appeal No. 676 of 2021 decided on 10.08.2021, and Ranjeet Singh vs. M/s Karan Motors Pvt. Ltd., Company Appeal (AT) (Ins) Nos. 719, 721, 722, 723 & 728 of 2020 decided on 18.08.2021, which reaffirm this position of law. The Respondent No.2 emphasized that there is no infirmity in the Impugned Or....
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....liberate consideration of the possibility of receiving a commercially superior offer and their conscious choice against granting an extension. 47. The Respondent No. 3 submitted that the appellants' claim of offering a commercially superior resolution plan compared to the approved plan of the Respondent No.3 is devoid of merit. At the relevant time, the appellants failed to submit a revised proposal or demonstrate a commercially better plan, despite having the opportunity to do so. 48. The Respondent No. 3 submitted that the Impugned Order dated 19.07.2024 is devoid of any legal or factual infirmity. The Adjudicating Authority has duly considered the record and noted that the appellants had already availed multiple extensions, rendering their contention of insufficient opportunity baseless. Further, the Impugned Order clearly establishes that the appellants' claim of seeking extension due to clarifications requested by the Resolution Professional on 01.06.2021 is contradicted by their own email dated 02.06.2021, which attributes the extension request solely to Covid-19-related issues. The Resolution Professional placed the appellants' extension request before the CoC, which r....
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....he resolution professional shall file an application to the Adjudicating Authority to extend the period of the corporate insolvency resolution process beyond one hundred and eighty days, if instructed to do so by a resolution passed at a meeting of the committee of creditors by a vote of 1[sixty-six] per cent. of the voting shares. (3) On receipt of an application under sub-section (2), if the Adjudicating Authority is satisfied that the subject matter of the case is such that corporate insolvency resolution process cannot be completed within one hundred and eighty days, it may by order extend the duration of such process beyond one hundred and eighty days by such further period as it thinks fit, but not exceeding ninety days: Provided that any extension of the period of corporate insolvency resolution process under this section shall not be granted more than once. ^2[Provided further that the corporate insolvency resolution process shall mandatorily be completed within a period of three hundred and thirty days from the insolvency commencement date, including any extension of the period of corporate insolvency resolution process granted under this section....
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....n the litigant's right to carry on business under Article 19(1)(g) of the Constitution. The effect of this declaration is that ordinarily the time taken in relation to the corporate resolution process of the corporate debtor must be completed within the outer limit of 330 days from the insolvency commencement date, including extensions and the time taken in legal proceedings. However, on the facts of a given case, if it can be shown to the Adjudicating Authority and/or Appellate Tribunal under the Code that only a short period is left for completion of the insolvency resolution process beyond 330 days, and that it would be in the interest of all stakeholders that the corporate debtor be put back on its feet instead of being sent into liquidation and that the time taken in legal proceedings is largely due to factors owing to which the fault cannot be ascribed to the litigants before the Adjudicating Authority and/or Appellate Tribunal, the delay or a large part thereof being attributable to the tardy process of the Adjudicating Authority and/or the Appellate Tribunal itself, it may be open in such cases for the Adjudicating Authority and/or Appellate Tribunal to extend time beyo....
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....late Tribunal. 59. At this stage, it will be important for us to take into consideration the few significant dates to understand whether the opportunities were granted to the Appellants or not and whether the process was fair to both the bidders including SRA i.e. the Respondent No.3 or not. 60. The important dates read as under:- • 08.06.2020- The Adjudicating Authority initiated CIRP against the Corporate Debtor i.e. Servel India Pvt. Ltd. • 21.02.2021: The Last date for submission of resolution plan in terms of Form G published on 05.01.2021. • 20.02.2021: The Appellants submitted resolution plan. • 08.04.2021: 8th CoC meeting held whereby CoC members advised Appellants to revise their proposal. • 14.04.2021: (1stExtension) Appellants sought time till 17.04.2021 to submit revised plan, which was granted by the Respondent No.1. • 17 .04.2021: (2nd Extension) Appellants again sought time till 20.04.2021 to submit revised plan, which was granted by the Respondent No.1. • 21.04.2021: (3rd Extension) Appellants again sought time till 30.04.2021 to submit revised plan, which was granted by....
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....uled for tomorrow i.e. 04.06.2021. hence, RP is recommending your request to the CoC for necessary consideration or approval thereon." • 04.06.2021 at 11:54 am: The Resolution Professional around 11 :54 am forwarded the link of CoC meeting fixed at 3.30 pm • 04.06.2021 at 4:31 pm: The Appellants submitted to the Resolution Professional that they saw the email forwarded by Resolution Professional only at 4:31 pm and informed that their consultant has been detected of covid positive so it will be difficult to attend the meeting • 05.06.2021 at 1:46 pm: The Appellants informed the Resolution Professional that meeting link/information was received by them only 4 hours before the of appeal meeting and moreover the link was not working • 05.06.2021 at 4:23pm: Resolution Professional informed the Appellants that the extension period for submission of resolution plan has been denied by the CoC in its meeting dated 04.06.2021 • 22.06.2021: The Resolution professional filed I.A. No.2810 of 2021 for approval of Resolution Plan of Respondent No.3 as approved by CoC in its meeting dated 04.06.2021. • 11.10.2021: The A....
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....Learned Counsels for the Applicants and the Respondents, and further perused the averments made in the Application and written submissions presented by the Parties. The Applicants has filed this Application under Section 60(5) of the Insolvency and Bankruptcy Code, 2016 seeking directions against the Respondents for consideration of their Revised Resolution Plan. 6. The Applicants has submitted their Resolution Plan on 20.02.2021 pursuant to FORM G issued by the Respondent No. 1. Thereafter, in 8th CoC meeting the CoC members asked the Resolution Applicants to revise their Resolution Plans by way of addendum. Consequently, the Applicants sought extensions for submitting their revised proposals from Respondent No.1 on multiple occasions Le., 14.04.2021, 17.04.2021,21.04.2021, 01.05.2021,30.05.2021. Respondent no. 1 granted these extensions five times at the request of Applicants. 7. The contention of the Applicants that they were not given sufficient opportunities to revise their Resolution Plan does not appear to be correct statement, due to the fact that at the request of Applicants the opportunity was already given five times to them by extending the timelines a....
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....lution Plan on the pretext of Covid-19 pandemic, not because of their inability to answer those clarifications. This clearly indicates that the queries raised by Respondent No. 1 did not prevent the Applicants from submitting the revised plan. Thus, the contention of the Applicants that Respondent No. 1 sought such queries on the last occasion, Le., the last date for submission of the Revised Resolution Plan which disables them for submitting their revised plan cannot be relied upon. The relevant extract of the email dated 02.06.2021 is reproduced below: "Dear Sir, Please refer to your trailing email. Please note that we tried to re evaluate the Corporate Debtor as suggested by the CoC members in the last meeting. In view of the present Lockdowns imposed by various state governments and also the prevailing circumstances due to the second wave of the pandemic COVID-19, we have not been able to evaluate the assets of the Corporate Debtor and will require time to submit the revised proposal. request you to please give a further time of 15 days to submit the revised proposal. We are genuinely interested to purchase the corporate debtor and would request you to give us....
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....ey which the appellant was to put up initially for taking over the Corporate Debtor, for this Court to understand as to what other reasons, grounded in the Code's provisions, compelled the Adjudicating Authority-NCLT to embark upon the novel path of ordering revaluation by the OL. At the cost of repetition, nobody had moved before the NCLT or raised any objection challenging the Resolution Plan pending approval. Even the NCLAT has only indicated that when "figures of crores" are emerging stage-wise, "then there is no harm to look at the Expert opinion", which the Adjudicating Authority-NCLT in this case has asked for. " 11. In light of the above, we do not find any merit in the prayers made by the Applicants seeking reconsideration of their Resolution Plan and do not warrant any further directions to the Committee of Creditors (CoC). Consequently, the relief sought by the Applicants lacks merit and is therefore dismissed. Accordingly, IA No. 4619 of 2021 in CP(IB) No. 2728/ND/2019 is hereby dismissed and disposed of." 68. We find the Adjudicating Authority has clearly recorded the sequence of events and opportunities offered to the Appellants. The Impugned Order is ....
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....ng SPV.docx 16K Servel_Bid Documents compliance checlist.xlsx 20K Undertaking_Assets Roclassification.docx 16K Sat, Jun 5,2021 at 1:33 PM Green Overseas To: sundeop@@osrikgroup.com [Quoted text hidden] 5 attachments Format V_Undertaking by RA.docx 20K Letter of Committment.docx 15K Undertaking SPV.docx 16K Servel_Bid Documents compliance checlist.xlsx 26K Undertaking_Assets Reclassification.docx 10K Document 2 [Quoted text hidden] Mon, May 31, 2021 at 11:21 AM Reetesh kumar To: Green Overseas Dear applicant, Thanks for updates about the visit to the factory and submission of revised plan. This is the final extension being given to you for submission of a revised resolution plan. You have to submit the revised plan by 1st June, 2021. You are advised to submit the plan with : 1. Self attested financials of Giriraj Prasad and Kamla Gupta as on 31.03.2020 and provisional financials as on 31.03.2021. 2. Copy of Income Tax Return for the assessment year 2020-21. [Quoted text hidden) Tue, Jun 1, 2021 at 11:27 AM Reetesh kumar To: Green Overseas Dear Sir At the time of revising the Plan PI also check the point o....
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.... of the Corporate Debtor and wil require time to submit the revised proposal. request you to please give a further time of 15 days to submit the revised proposal. We are genuinely interested to purchase the corporate debtor and would request you to give us time to reevaluate the Corporate Debtor. Regards Giriraj Prasad Resolution Applicant [Quoted lext hidden! Thu, Jun 3, 2021 at 11:16 AM Reetesh kumar To: Green Overseas Dear Mr. Giriraj Prasad Gupta, This is with reference to your mail received on 02.06.2021 requesting for further extension of the time as allotted for submission of resolution plan duly amended in accordance with the advisory given by COC In its meeting held on 27ª May, 2021. In light of the instruction given by CoC, Document 4 the Resolution Professional has extended your time on several requests. As you were given time 29"> May, 2021 to submit the addendum or amended Resolution Plan, you made request for extension upto 30.05.2021. Subsequently, on your request, the RP has granted you the extension to submit the amended resolution plan by 30.06.2021, 31.05.2021 and last extension was given of 01.06.2021, whereas you had requested for exte....
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....lease note that as already informed to you my consultant has been detected COVID positive so it will be difficult to attend the meeting. Regards Giriraj Prasad [Quoted lest hidden! Reatesh kumar Søt, Jun 5, 2021 at 10:22 AM To: Green Overseas Dear Sir Thanks for your mail but for your information there is no mail received regarding that your consultant become COVID positive [Quoted last hidden! Green Overseas Sat, Jun 5, 2021 at 1:48 PM To: Reetesh kumar Dear Sir, Please note that we received the information regarding the CoC meeting only 4 hours before the meeting. Moreover " when we tried to join the meeting, the link was not working and same was duly communicated to your representative over the phone.Thereafter, we also tried to connect through phone however could not connect which was also duly communicated to your representative. Anyways, like we have always been stating that we are very much interested in submitting a improved resolution plan, in this direction we are arranging one of our technical expert for visiting the plant tomorrow to further assess our resolution plan. He would be coming from Chandigarh as such youare kindly reque....
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....ry much interested in submitting a improved resolution plan, in this direction we are arranging one of our technical expert for visiting the plant tomorrow to further assess our resolution plan. He would be coming from Chandigarh as such youare kindly requested to allow to visit the plant. Further we would request you to consider our request vide email dated 3rd June' 2021 for extension of 15 days keeping in view the order of Hon'ble Supreme Court, for maximisation of value to stakeholders and in the interest of justice. Further we are also in process of preparing the reply to your email dated 1st June' 2021 requesting for information and same shall be sent to you shortly. It is further requested to forward our email to the CoC members and also provide us their email id. Hope our request would be considered favourably keeping in view the order of Hon'ble Supreme Court, for maximisation of value to stakeholders and in the interest of justice. [Quoted lindt hidden] Document 7 Gmail - (no subject) 7/7/2021 Sat. Jun 5, 2021 at 4:23 PM Restesh kumar To: Green Overseas Dear Sir The extension period for submission of the resolution plan requested by you has been dis....