17 June 2024


Judgments

NATIONAL COMPANY LAW APPELLATE TRIBUNAL

Indian Potash Limited Vs. Naresh Kumar Verma, RP for Corporate Debtor (Bohra Industries Limited) and Ors.

MANU/NL/0602/2021

21.12.2021

Insolvency

Commercial wisdom of the CoC expressed after due deliberation has to be given weight

Present Appeal has been filed by an Unsuccessful Resolution Applicant challenging the order of the Adjudicating Authority by which the Adjudicating Authority has approved the Resolution Plan of Respondent No. 3. The Appellant challenging the order passed by the Adjudicating Authority contends that Adjudicating Authority had committed error in approving the Resolution Plan of Respondent No. 3.

The score of evaluation matrix of Respondent No. 3 being higher to the evaluation matrix of the Appellant, the submission of learned Counsel for the Appellant that CoC's decision not in accordance with Regulation 39 sub-regulation (3) cannot be accepted. The CoC has evaluated the Resolution Plan as per evaluation matrix. There is no breach of Regulation 39(3) of Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) Regulations, 2016 in the present case.

The value of Plan of Respondent No. 3 was 26.31 cores with NPV as 24.79 crores while Plan value of the Appellant was only 21.25 crores. The CoC has approved the Plan of Respondent No. 3 with 100% vote. As per Section 32 of the IB Code, any appeal from an order approving the resolution plan shall be in the manner and on the grounds laid down in sub-section (3) of Section 61.

The Apex Court in K. Sashidhar vs. Indian Overseas Bank and Ors. had occasion to consider the ground of challenge of approval of Resolution Plan and held that, the commercial wisdom of the CoC expressed after due deliberation has to be given weight.

The Appellant himself in his Appeal has filed the Minutes of the 9th, 10th, 11th, 12th and 13th CoC Meeting. A perusal of the minutes clearly indicates that both the Resolution Applicants were given multiple opportunities to submit their revised Plans. The submission of the Appellant that he was not given opportunity to revise the Plan after receipt of 2nd Plan of Respondent No. 3, is without any substance and against the record. The Plans of both the Resolution Applicants were deliberated by the CoC in several meetings and both the Resolution Applicants were requested to enhance the value of their Plans. Final Plans were received by the Resolution Professional from both the Resolution Applicants before 19th September, 2020 and thereafter, it was put to vote. By 100% vote of CoC, the Plan of Respondent No. 3 was accepted and Plan of Appellant was rejected. There is no error in the impugned order passed by the Adjudicating Authority. Appeal dismissed.

Tags : Resolution plan Approval Legality

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