NCLT Kolkata: Approves SIS Mohan Real Estate Resolution Plan

National Company Law Tribunal, Kolkata: In a case wherein, Interlocutory Application was filed by Resolution Professional (RP) seeking direction for final approval of resolution plan, the Division Bench of Labh Singh (Judicial Member) and Rekha Kantilal Shah (Technical Member) approved the Total Resolution Plan and held that the applicant complied with requirement of the Insolvency and Bankruptcy Code, 2016 (IBC). Further emphasised that Commercial Wisdom of CoC was to be given paramount status. The application was filed by the Applicant-RP of Corporate Debtor, SIS Mohan Real Estate Private Limited under Sections 30(6) and 31 , IBC seeking direction for final approval of Resolution Plan submitted by Secure Infratech Finserv and Securities Limited. The Committee of Creditors, comprising a single member, approved the Resolution Plan with 100 per cent voting share. Tatanagar Financial Services Limited, Operational Creditor initiated the Corporate Insolvency Resolution Process (CIRP) under Section 9 , IBC which was admitted on 31st August 2023. Public announcement was made in accordance with Section 15 , IBC read with Regulation 6 of Insolvency and Bankruptcy of India (Insolvency Resolution Process for Corporate Persons) Regulation, 2016 (CIRP Regulations, 2016) regarding initiation of CIRP. Pursuant to the publication of the request for Resolution Plans in accordance with IBC and the corresponding provisions of the CIRP Regulations, 2016 one Resolution Plan was received from an eligible Resolution Applicant. In 8th CoC meeting, the Resolution Plan of the Resolution Applicant was placed before CoC and the Resolution Plan of Secure Infratech Finserv and Securities Limited was approved with 100 per cent Voting Share. The RP filed the instant Application which included the provisions with respect to the compliances in prescribed form, i.e., Form H of Regulation 39(4) of the CIRP Regulations, 2016. It was submitted that the Successful Resolution Applicant (SRA) met the criteria approved by CoC. It was further submitted that SRA was eligible to submit a resolution plan in terms of Section 29-A , IBC and accordingly, a declaration was also furnished in the Application. The RP submitted the details of various compliances as envisaged within the IBC and the CIRP Regulations, 2016 to which a Resolution Plan had been adhered to. Further, it was submitted that the SRA had submitted its eligibility in terms of Section 30(1) IBC . It was further submitted that the resolution plan did not contravene any of the provisions of law for time being force. The Resolution Plan dated 28 th May 2024 as originally submitted by the SRA, proposed a total amount of 1,55,00,000, to be paid over a period of 60 days from the date of approval of the Resolution Plan. The amount of 1,55,00,000 as against the total admitted claim of 10,45,63,676 represented a haircut of 87.07% for the Operational Creditor. It was further submitted that in terms of Regulation 35-A read with Regulation 39(2) of the CIRP Regulation, 2016 the RP has not found or determine any avoidance transactions (PUFE transactions) under Sections 43 , 45 , 50 and 66 IBC on the ground that no documents were available to conduct the audit and persistent non-cooperation from the suspended board of directors. Analysis, Law and Decision The RP filed a Compliance Certificate in Form H along with the Plan. On perusal, the same was found to be in order. The Bench also observed that, Resolution Plan of the SRA, provided: 1. Payment of CIRP Cost as specified under Section 30(2)( a ) , IBC . 2. Repayment of Debts of Operational Creditors as specified under Section 30(2)( b ) IBC . 3. For management of the affairs of the Corporate Debtor, after the approval of the Resolution Plan, as specified under Section 30(2)( c ) IBC . 4. The implementation and supervision of the Resolution Plan by the RP and the CoC as specified under Section 30(2)( d ) IBC . The Adjudicating Authority observed in the present application

Lawyers should note that the NCLT's approval of this resolution plan sets a precedent for operational creditors, who may now consider negotiating similar haircuts in their own cases.

Source: Original reporting via SCC Online Blog