TaxTMI 
TaxTMI 
2026 (2) TMI 1163
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.... (AHM)/2025 and has directed for liquidation of corporate debtor under Section 33(1)(b) of the Insolvency and Bankruptcy Code, 2016, (for short the Code or the IBC). Aggrieved by the said order, these two appeals have been filed. 2. Comp. App. (AT) (Ins.) No. 164/2026 has been filed by Ms. Sonali Sumit Mehta, the Successful Resolution Applicant (SRA) and Comp. App. (AT) (Ins.) No. 165/2026 has been filed by Mahadev Construction Pvt. Ltd., the sole member of the Committee of Creditors (CoC). 3. Brief facts of the case necessary to be noticed for deciding the appeals are: i. The corporate debtor - Rexsona Tiles Pvt. Ltd. was incorporated on 31.01.2014. Company is involved in cutting, shaping and finishing of stones used in construction. Corporate debtor earned revenues in Financial Year 2021-22, 2022-23 & 2023-24 and also losses in the respected years. ii. Company sold its asset in the year 2022-23. Audit Report of 2023-24 states that company has sold out entire property, plant and equipment in the year 2024. On 31.03.2024, the inventory of the corporate debtor is NiL. iii. The corporate debtor took a loan from Mahadev Constructions Private Limited of....
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....irement including Section 29A eligibility, feasibility and viability and all other requirements. Observation of the adjudicating authority that appellant - Mahadev Construction Pvt. Ltd. being not an institution financial creditor does not hold expertise to perform the function of the CoC is against the scheme of the Code. The mere fact that corporate debtor has no employee or business cannot be a reason to conclude that corporate debtor cannot be revived as a going concern. Learned counsel for the appellant in both the appeals have raised above submissions, challenging the order of the adjudicating authority rejecting the plan and directing for liquidation. 6. We have considered the submissions of the counsel for the parties and perused the records. 7. The question to be considered and answered in this appeal is as to whether the order of the adjudicating authority dated 08.12.2025 rejecting the I.A. (Plan)/17(AHM)/2025 is in excess of its jurisdiction and contrary to the limited scope of interference conceded to adjudicating authority while considering an application for approval for resolution plan. We need to first notice that adjudicating authority in the impugned order ....
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....er section 9 was filed by M/s Bell Impex on 04.03.2024. • The company did not have any employee at the time of publishing Form G and thereafter. • The company did not have any business and was not a going concern as per Information Memorandum. • One motorcycle and one computer are the only plant and machinery of the Corporate Debtor. • The Corporate Debtor had tangible assets of Rs. 2756.77 lakhs as on 31.03.2023 and it sold all the assets in the financial year 2023-2024 and only assets remaining were computer and motorcycle (of value Rs. 0.35 lakhs as on 31.03.2024). A cash of Rs. 2427.75 lakhs was received due to sale of assets. That means by selling the assets, the company did not have any machines/plant/building can be used later on to carry on any business and the RP in the Information Memorandum noted that the Corporate Debtor is not a going concern entity. • The Corporate Debtor sold entire stock/inventory during FY 2023-2024. • The Corporate Debtor had a business loss of Rs. 20,54,00,321. • Net worth of the Corporate Debtor is negative by Rs. 788.88 lakhs. • It appears th....
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....7.75 lakh due to sale of asset in the same order. It is relevant to extract certain observations made in paragraph 74 by the adjudicating authority, which is as follows: "74. ...There appears to be no justifiable reason to seek a loan of Rs. 8 lakhs from M/s Mahadev Construction Company on 17.01.2024 as this amount is miniscule in comparison to cash received of Rs. 2427.75 lakhs due to sale of assets in the same year, who became the sole CoC member and was obligated to perform the functions of the CoC during the CIRP period. The sole CoC member apparently did not look into the fact that the Corporate Debtor had no business, no assets, and no employees and whether the liquidation could have been a better option. The Corporate Debtor already had cash/cash balance equivalent of Rs. 43 lakhs and many other valuable assets, including tax assets due to business loss of more than Rs. 20 crores even then it approved the plan of Rs. 53 lakhs. The Plan value of Rs. 53 lakhs indicate that the business had no goodwill or intangible. The entire exercise suggests an accommodation or collusive arrangement with the sole purpose of helping the Corporate Debtor obtain benefits, reliefs, and....
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....ible and viable; (c) it has provisions for its effective implementation; (d) it has provisions for approvals required and the timeline for the same; and (e) the resolution applicant has the capability to implement the resolution plan." 83. In the present case, upon a detailed consideration of the material on record, it is evident that the resolution plan fails to satisfy the criteria laid down in the above regulation. Further, section 30(2) of the IBC, 2016 requires that the plan provide for the implementation of the plan and resolution of the insolvency. The RA has no plans to provide a resolution to the corporate insolvency. As discussed in detail with cogent reasons, the Plan fails to meet the requirements of clauses (c), (d), (e), and (f) of Section 30(2) of the IBC, 2016." 12. The adjudicating authority on valid reasons have observed that the resolution plan is not commercially feasible and viable. Feasibility and viability of resolution plan is one of the statutory requirements as required by Regulations 38(3)(b) of the CIRP Regulations, 2016. Adjudicating authority has returned its finding that plan is not feasible and viable in paragra....