Allowed

In the matter of Jadoun International Pvt. Ltd. Ia No. 03-JPR-2020 in Cp No. (Ib) 707(PB)-2018

NCLT16 Jul 2021

Case brief

AI extract

What is this about?

The NCLT approved a revised resolution plan for Jadoun International Pvt. Ltd. submitted by Yusuf Khan. The plan was approved by 82.2% of voting financial creditors. The court verified compliance with IBC requirements regarding IPR costs, operational creditor payments, dissenting creditor liquidation values, and proposal viability, ordering discharge of the moratorium order.

What did the court decide?

The resolution plan submitted by the Resolution Applicant was approved. The order under Section 14 of the Code passed on 25.01.2019 ceased to have effect. Management and control were handed over to th

In the matter of Jadoun International Pvt. Ltd. Ia No… — Company and Corporate | NCLT (2021)

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IN THE NATIONAL COMPANY LAW TRIBUNAL JAIPUR BENCH

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CoTam: SHRI AJAY KUMAR VATSAVAYI, HON'BLE JUDICIAL MEMBER SHRI RAGHU NAYYAR, HON'BLE TECHNICAL MEMBER

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IA No. 03/JPR/2020 In CP No. (tB) 707(PB)12018

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IN THE MATTER OF SECTION 7 OF IBC, 2016.

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IN THE MATTER OF:

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M/S INDUS CONTAINBR LINES PRIVATE LIMITED

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... Financial Creditor

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VERSUS

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M/S JADOUN INTERI\ATIONAL PRIVATE LIMITED

...Corporate Debtor

IA No. 03/JPR/2020

MEMO OF PARTIBS

Ajit Kumar (Resolution Professional of M/s Jadoun lnternational Pvt. Ltd.) 83, National Media Center, Near Ambience Mall, Dlf Cybercity, Gurugram- 122010

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..Applicant

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VERSUS

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Committee of Creditors

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Indus Container Lines Pvt. Ltd. 702-Vishal Bhawan, 95-Nehru Place, New Delhi- 1 10019

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...Respondent No. I

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IA No. 0311PN2020 In CP No. (IB) 707(PBy20l8

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Capital First Bank IDFC First Bank Ltd., Man Upsana Tower, Sardar Patel Marg, Jaipur- 302001

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...Respondent No.2

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HDFC Bank Branch and Lending Office, Time Square Building, Vidhyadhar Nagar, Jaipur- 302039

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...Respondent No.3

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INDUSIND Bank One Indiabulls Centre, Tower 1, 841 Senapati Bapat Marg, E,lephistone Road(w), Mumbai- 400013

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.".Respondent No.4

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Tata Motors Finance Ltd. B-53-54, 2nd Floor, Ummaid Mansion, Gautam Marg, Hanuman Nagar-B, Vaishali Nagar, Jaipur- 302021

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...Respondent No. 5

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FortheApplicant	ShivangshuNaval,Adv.and
	AkankshaNoval,Adv.forRP
	AjitKumar,RP
Forthe Respondents	None-appeared
	OrderPronouncedon:16.07.2021

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ORDER

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Per: Shri Raghu Naylzar. Technical Member

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IA No. 031JPPU2020 In CP No. (IB) 707(PB)t20tB

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I " This Application is filed by Mr. Ajit Kumar, Resolution Professional ('RI> / 'Applicant') of IWs Jadoun International Pvt. Ltd. ('Corporate Debtor') under Sections 30(6) and 31 of the Insolvency and Bankruptcy Code, 2016 ('IBC' / 'code') read with Regulation 39@) of the Insolvency and Bankruptcy Board of India (Insolvency Process of Corporate persons) Regulations, 2016 ('Regulations') seeking approval of resolution plan.

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The insolvency application was filed by the Financial Creditor Mls Indus Container Lines Pvt. Ltd. under Section 7 of the Code for initiation of Corporate Insolvency Resolution Process ('CIRP') against the Corporate Debtor and the same was admiued by this Adjudicating Authority vide order dated 25.01.2019. The Applicant was appointed as the Interim Resolution Professional ('IRP') and on 29.Ol.2}lg,the IRp issued a public announcement as per Regulation 6 of the Regulations read with Sections 13 and l5 of the Code in Form A in two newspapers i.e., Economic Times (English) and Prabhat Abhinandan (Hindi) thereby inviting claims from the creditors of the corporate Debtor as envisaged in the code.

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The Applicant upon receipt of claims till 08.02.2019 constituted the Committee of Creditors ('CoC') on 12.02.2019 and convened the l.tCoC meeting dated 22.02.2019 wherein the Applicant was appointed as the Rp. In the 2nd coc meeting convened on 04.04 .zolg, coc appointed two registered valuers for determination of liquidation value of the Corporate Debtor. Further, in conpliance of the resolution passed, the pp made

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public announcement in Form G in two newspapers i.e., Economic Times (English) and Prabhat Abhinanadan (Hindi) inviting Expression of Inrerest ('EOI') on 08.04.2019. Thereafter, the Applicant reconstituted the CoC after admitting the claims of HDFC Bank on 13.07.2019.

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The Applicant stated that on 17.O7.2}lg, rhmeeting of CoC was convened and resolution for extension of CIRP period for 90 days was passed. In view of this, the Applicant filed IA No. 2z7lJpFV2Olg before rhis Adjudicating Authority and the same was allowed vide order dated 26.07.20t9.

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It is further stated that in the 5th CoC meeting dated 0g.0g.2019, the Applicant apprised the CoC regarding various applications filed against the sundry debtors of the Corporate Debtor to recover outstanding amount due for rendering freight services by the Corporate Debtor. The CoC further decided to extend the date of invitation of EOI and consequently, the Applicant vide advertisements dated 15.08.2019 in two newspapers namely, Economic Times (English) and Prabhat Abhinandan (Hindi) invited EOI, fixing the last date for submission of resolution plan at 05" 10.2019.

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6' The Applicant also stated that it moved an application against Tata Motors Finance Pvt. Ltd. (Respondent No. 5) for violation of the moratorium period by selling off the vehicle of the Corporate Debtor undergoing CIpp and this Authority vide order dated lg.Og.2Ol9 directed Respondent No. 5

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to pay the amount ofRs. 25,10,000/- to the Applicant RP within one week. However, Respondent No. 5 did not deposit the said amount and consequently, the Applicant filed a contempt petition against it. Order dated 19.09.2019 was challenged by Respondent No. 5 wherein the Hon'ble National Company Law Appellate Tribunal ('NCLAT') dismissed the said appeal and held that upon making the said payment within l5 days Respondent No. 5 will be entitled to file its claims against the Corporate Debtor with the Rp"

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It is submitted that 6th CoC meeting was held on 22.10.2019 wherein the Applicant placed the resolution plan of Mr. Yusuf Khan and Mr. Vibhash Kumar (ointly) for consideration before the members of the CoC. However, as per due diligence report, Mr. Vibhash Kumar was disqualified to be a Resolution Applicant and thereafter, Mr. Yusuf Khan expressed his desire to be the sole Resolution Applicant and submitted the revised resolution plan on 21.10.2019. In view of this, the CoC resolved to file an application for exclusion of 60 days in completion of CIRp of the Corporate Debtor and the same was granted by this Authority vide order dated 23.10.2019"

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It is stated that in the 7th CoC meeting dated 22.ll.21lg,the said resolution plan was approved by the CoC. However, in view of the directions by this Authority and the Hon'ble NCLAT in respect of the claims of Respondent No. 5, the Applicant Rp admitted its claims on lo.l2.2olg and IA No. 031JPN2020 In CP No. (IB) 707(PBy20l8

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reconstituted the coc. Accordingly, the Applicant Rp requested the Resolution Applicant to submit the revised Resolution plan by incorporating the claims and including claim of Respondent No. 5 and the same was placed for e-voting in the 8th CoC meeting dated l8.ly.21l9. The coc approved the revised resolution plan by a majority of g2.2%o on 19.12.2019.

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9' The Applicant RP has provided brief details of the Resolution plan, which

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are as follows:

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S. No.	Particular	Amount (inRs.)	Total Amount (inRs.)
1	lI(PCost		25,00,000
2	AmountprovidedinResolutionplan fo, securedFinancialCreditors		90,00,000
	Less:Liquidation valuetoU.puiOto dissentingfinancialsecuredcreditori.e., TataMotorsFinanceLtd.	24,19,790
	lJalanceAmountavailableforFinancial CreditorswhoassentedtotheResolution Plan: a.Induslnd Bank b.HDFC Bank Total	58,47,535 7,33,675 65,81,210
1J	UnsecuredFinancialCreditors a.Indus Container Linespvt. Ltd. b.CapitalFirst Bank	4,35,614 64,396	5,00,000
4	Uperatronal Creditors		2,00,000
5	WorkmenandEmployees

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6	Statutorydues Iotai	1,22,00,000

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lO.The Applicant RP stated that Respondent No. 5 has dissented with the

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Resolution Plan, therefore it will get the liquidation value of its assets i.e., Rs' 25,10,000/- (based on auction they carried out). However, Respondent No. 5 had claimed the amount of Rs. 24,18,790l- so the liquidation value being paid to the said Respondent is being restricted to their claim amount i'e', Rs. 24,18,7901-. It is further stated that liquidation value of the Operational Creditors is nil. However, the Resolution Applicant has provided Rs. 2,00,000/- for the operational creditors.

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I l 'Accordingly, the Applicant RP is duty bound to prefer an application under Section 30(6) and 3l of the Code read with Regulation 39(a) of the Regulations seeking approval of revised Resolution plan which was duly accepted by the CoC, from this Authority. The Applicant has submitted the resolution plan along with a compliance certificate in Form H under Regulation 39@) of the Regulations. In the matter of Committee of Creditors of Essor Steel India Private Limited vs. Satish Kumar, the Hon'ble Supreme Court held that in consonance with the provisions of Regulation 28(lA), the Resolution Plan should take care of the interest of all the stakeholders, including operational creditors of the Corporate Debtor. Therefore, the resolution plan has fulfilled the parameters of the

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said judgement, inter alia, the maximization of value of the assets of the Corporate Debtor and interest of all the stakeholders has been taken into consideration. The copy of the Resolution Plan along with the compliance certificate in Form H is annexed as Annexure 14.

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12.It is also stated that the Applicant RP had apprised the CoC members of the several applications against the sundry debtors for recovery of the outstanding amount due to the Corporate Debtor. In view of this, it is proposed that 50Yo of amount recovered from these debtors should be paid to secured creditors (within a period of 2 year-s from approval of the Resolution Plan), subject to the total contractual liability of secured creditors.

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13.The Applicant RP has stated that the revised Resolution Plan envisages the revival of the Corporate Debtor and to sustain it as a going concern. In case of rejection of the revised Resolution Plan, the Corporate Debtor would be required to be liquidated and that would seriously prejudice the interest of all stakeholders.

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l4.Moreover, the Applicant RP states that as per Section 30 of the Code, amended vide Insolvency and Bankruptcy Code (Amendment) Ordinance, 2018 (No. 6 of 2018) that came into force on 06.06.2018, the revised Resolution Plan ought to be approved by 66% of voting share of financial creditors. It is submiued that the Resolution Plan has been duly approved by the CoC by a majority of 82.2o/o of the members.

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15.We have carefully considered the submissions of the learned counsel for the RP and the learned Counsel for the resolution applicant and have also perused the record.

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16.The Corporate Debtor was incorporated on 16.03.2012 and the CIRp proceedings were initiated under Section 7 of the Code against the corporate Debtor by order delivered on 25.ol.2org. The present application is filed for approval of the resolution plan submitted by Mr" Yusuf Khan (Successful Resolution Applicant). The approval has been sought under the provisions of Section 31 (1) of the code.

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17.We may first of all state that after receipt, verification and collation of claims as discussed above, the IRp constituted the coc as per the provisions of Section}L ofthe Code. The details of the financial creditors, the distribution of voting share among them and the position of voting for the resolution plan is as under (para No.5 of Form H) -

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|S.
No.|NameofCreditor
|Voting
Share
(%|Voting
Plan
for/Diss|forResolution
(Voted
entedlAbstained)| |---|---|---|---|---| |1|Indus ContainerLinesPrivateLimited
(UnsecuredCreditor)
oAmount ofclaim-Rs.
61,35,0361_|1t54%||Dissented| |2|CapitalFirstLimited(Unsecured
Creditor)
oAmountofclaim-Rs.
9,06,7941-|l.7lo||Abstained| |3|HDFC BankLimited(SecuredCreditor)
oAmountofclaim-Rs.
49,71,397.631-|9"16%||VotedFor|

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4	INDUSINDBankLimited(Secured Creditor) oAmountofclaim-Rs. 3,99,26,0001_	73.04%	Voted for
5	TATAMotorsFinanceLimited(Secured Creditor) oAmountofclaim-Rs. 24,19,7901_	4.5s%	Dissented

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18.The details of stakeholders under the resolution plan are given in para 7 of

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Form H:-

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S. No	Categoryof Stakeholde rrr	Sub-Category of Stakeholder	Amount Claimed	Amount Admitted	Amount Provided underthe Plan	Amount provide d to the Amount Claimed (%)
(l)	{2)	(3)	(4)	(s)	(6)	(7)
I	Secured Financial Creditors (Internal Pg.ll&12 of the	(a)Creditors nothavinga righttovote under sub- section(2)of section21
	Resolution Planand pageno.97 and98ofthe Application)	(b)Other (a)above: (i)who did not voteinfavour ofthe resolutionPlan (TataMotors Finance Limited)	24,19,790.00	24,19,790.00	24,19,790.00	100.00

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	(ii)whovoted infavour ofthe resolution plan (Induslnd Bank Limitedand HDFCBank Limited)	4,46,62,935.63	4,36,97,397.63	65,81,210.00	15.06
	Total[(i)+(ti)]	47,081,625.63	46,116,197.63	90,00,000/-	19.52
2 Unsecured Financial Creditors	(a)Creditors nothavinga righttovote undersub- section(2)of section2l
InternalPg. ll&12of the Resolution Plan and pg. no.97-98of the Application)	(b)Other (a)above: (i)who didnot voteinfavour of the resolutionPlan (Indus Container LinesPrivate Limitedand CapitalFirst Limited)	70,96,425.00	70,41,930.00	5,00,000.00	7.t I
	(ii)whovoted infavourofthe resolution plan
	Total[(i)+(ii)]	70,96,425.00	70,41,930.00	5,00,000	7.1
J Operational Creditors (InternalPg. no.72ofthe	(a) Related Party of Corporate Debtor

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Resolution Planand Application)	(b)Otherthan (a)above:	89,39,115.66	85,22,423.69	2,00"000.00	2.3s
	(i)Government	N.A	N.A	N.A
	(ii)Workmen	N.A	N.A	N.A
	(iii)Employees	N.A	N.A	N.A
	Total[(a) + (b)]	89,39,115.66	85,22,423.69	2,00,000.00	2.35
4 Otherdebts anddues		N.A	N.A	N.A	N.A
GrandTotal		63,116,L66.29	6t,690.44t.32	97,00,000.00	15.73%

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*If there are sub-categories in a category, please add rows for each sub-category.

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Amount provided over time under the Resolution Plan and includes estimated value of non-cash components. It is not NPV.I

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19.The abovementioned amount of Rs. 95,00,0001- payable to the Financial

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Creditors (secured and unsecured) is proposed to be paid within 1g0 days

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as per the Repayment Schedule provided in the Resolution plan.

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20.The compliance aspect of the resolution plan has been given in para No. 9

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of Form H, which is as follows:-

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Sectionofthe CodelRegulation No.	Requirementwithrespect toResolutionPIan	Clause of ResolutionPlan	Compliance (Yes/I.,lo)
2s(2)(h)	WhethertheResolution Applicantmeetsthecriteria approvedbythe CoChaving regardtothecomplexityand scaleofoperationsof businessofthe CD?	Chapter-I	Yes,RPhasdone DueDiligenceand the NetWorth mentionedonPg. No.90 of the Applicationof Resolution Planis much higherthan

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			the minimum requirementof Rs.50Lakhas per Minimum EligibilityCriteria. RAalsometthe otherrequirements of Minimum EligibilityCriteria
Section29,A	WhethertheResolution Applicantiseligibleto submit resolution planasper finallist ofResolution ProfessionalorOrder,ifany, of the Adjudicating Authority?	Chapter-1(As perFinalList)	. Yes, Applicantis eligibleandhas submittedthe AffidavitonPg. No.120onthe Applicationof ResolutionPlan.
Section 30(1)	WhethertheResolution Applicanthas submittedan affidavitstatingthatitis eligible?	Annexedwith ResolutionPlan	Yes,Affidaviton Pg.No.120
Section 30(2)	Whether the Resolution Plan- (a) Providesforthe paymenr ofinsolvencyresolution process costs?	(a) Chapter3 PartB(Pg.95of Applicationof ResolutionPlan) Rs25Lakh	(a) Yes
	(b)providesforthe payment tothe operational creditors?	(b)Chapter3 PartD(Pg.99of Applicationof ResolutionPlan- Rs.2Lakh/-will bepaidtothe Operational Creditors)	(b) Yes
	(c)providesforthepayment tothefinancialcreditorswho didnotvoteinfavourofthe resolutionplan?	(c)Chapter3 PartC(Pg.98 and ll of Applicationof ResolutionPlan). Dissentsecured financialcreditor	(c)Yes

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	(d)providesforthe managementofthe affairsof the corporate debtor?	will beRs. 24,18,790.(Tata MotorsFinance Limited) However unsecured creditorwhose liquidationvalue isniltobepaid Rs.5lakh. (d)Chapter3 PartM(Pg.lll of Applicationof ResolutionPlan)	(d) Yes
	(e)provides implementation supervisionofthe plan? for the and resolution	(e) Chapter3 PartN(Pg.lll of Applicationof ResolutionPlan)	(e) Yes
	(f)contravenesany provisionsofthelaw timebeirlginforce? ofthe forthe		(f) No
Section 30(4)	Whether theResolution^plan (a)isfoasibleandviable, accordingtothe CoC? (b)has beenapprovedbythe CoCwith66Yovotingshare?		(a)Yes (b)Yes,by82.20% votingshare E-voting resultis onPageno.84of theapplication
Section31(1)	Whether the Resolution^plan hasprovisionsforits effectiveimplementation plan, according to the CoC		Yes
Regulation35A	Where the resolution profesionalmade a determinationifthecorporate debtorhas been subiected to	I.A No. 414tJPW20L9. Thematteris subiudicedand	Yes,Application has beenfiledby RPbasedonthe Transactional

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	any transactionofthenature coveredundersections43, 45, 50or66,beforetheone hundredandfifteenthdayof the insolvency commencementdate,under intimation totheboard?	listedforthe hearingon 2t.0t.202r beforeHon'ble NCLT-Jaipur Bench	AuditReport
Regulation3S(l)	Whether the Resolution^plan identifies specificsourcesof funds thatwillbe usedto pay the- (a)insolvencyresolution process costs? (b) liquidation valuedueto operational creditors? (c) liquidation valuedueto dissentingfinancial creditors?	a,b,c)Chapter3 Part L (Pg.l10,111,of Applicationof ResolutionPlan andinternalpg no.24and25of theresolution plan)	a) Yes b)Yes c)Yes
Regulation 38(1A)	Whethertheresolution plan includesastatementasto howithas dealtwiththe interestsofallstakeholders?	Chapter3 PartL(Pg.110of Applicationof ResolutionPlan andinternalpage no.24ofthe resolution plan)	Yes
Regulation 38(lB)	(i) WhethertheResolution Applicantoranyofits related parties has failed to implementor contributedtothefailure ofimplementationofany resolution planapproved under theCode. (ii) IfSo,whetherthe ResolutionApplicanthas submittedthestatement givingdetailsofsuch non-implementation?	No	No
Regulation38(2)	Whether the Resolution plan provides: (a) the termofthe planand its implementation schedule?	(a) Chapter3 PartC(P9.96-97 of Applicationof	(a)Yes

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		ResolutionPlan internalpageno. l0andllofthe resolution plan)
	(b)forthemanagementand controlofthebusinessof thecorporatedebtor duringits term?	(b)Chapter3 PartM(Pg.lll of Applicationof ResolutionPlan internalpageno. 25 of the resolution plan)	(b)Yes I I I
	(c)adequate supervising implementation? meansfor its	(c)Chapter3 PartN(Pg. 1llof Applicationof ResolutionPlan internalpageno. 25 of the resolution plan)	(c)Yes
38(3)	Whethertheresolutionplan demonstratesthat-
	(a)itaddressesthecause ofdefault?	Chapter3	a)Yes
	(b)it isfeasibleand viable?	Chapter3 PartA(Pg.94of Applicationof ResolutionPlan)	b)Yes
	(c)ithas provisions for its effective implementation?	Chapter3 PartN(Pg.ll1of Applicationof ResolutionPlan internalpageno. 25 of the resolution plan)	c)Yes
	(d)ithas provisions for approvalsrequired	Chapter6 PartN(Pg.1l8of Applicationof	d)Yes

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	andthetimelinefor t[resame?	ResolutionPlan intemalpageno. 10and11ofthe resolution plan)
	(e)the resolution applicanthasthe capability to implementthe resolutionplan?	Chapter1 PartN(Pg.109, 110 of Applicationof ResolutionPlan)	e)Yes
3e(2)	Whetherthe RPhasfiled applicationsinrespectof transactionsobserved,found ordetermined byhim?	NO	Yes
Regulation39(4)	Provide detailsof performancesecurity received,asreferredtoin sub-regulation(4A)of regulation 368.	10Yoof97 Lakh i.e. Rs. 9,70,0001- receivedfromthe resolution applicanton tt.t2.2020 through electronicbank transfer. Additional affrdavitfiled alongwithproof ofreceiptupon oral directionsof NCLT,Jaipur.	Yes

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2 I .The approval of the resolution plan has been sought under Section 3 1( l ) of

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the Code, which reads as follows:-

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"If the Adjudicating Authority is satisfied that the resolution plan as^qpproved by the committee of creditors under sub-section @) of section 30 meets the requirements as referred to in sub-section (2) of section 30, it shall by order approve the resolution plan which shall be binding on the corporate debtor and its'employees, members, creditors, including the central Government, iny'state Government or any local authority to whom a debt in respect of the payment of dues arising under any law for the time beiig in force

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such as authorities to whom statutory dues are owed, guarantors and other stakeholders involved in the resolution plan.

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Provided that the Adiudicating Authority shall, before passing an order for approval of resolution plan under this sub-section, satisfy that the resolution plan has provisions for its effective implementation" "

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22.The conditions provided in Section 31(1) of the Code for approval of

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resolution plan are as follows:-

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(a) The Resolution Plan is approved by the CoC under Section 30@) of the Code;

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(b) The Resolution Plan so approved meets the requirements qs referred to in Section 30(2) of the Code;

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The satisfaction of the conditions is discussed below.

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23.|t is submitted by the RP that the resolution plan has been approved by a

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vote of 82.2% of voting share of the financial creditors and therefore, the

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conditions provided for by section 30(4) of the code are satisfied.

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24.The provisions of Section 30(2) of the code are as follows:-

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" (2) The resolution professional shall examine each resolution plan received by him to confirm thqt each resolution plan -

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(a) provides for the payment of insolvency resolution process costs in a manner specified by the Board in priorie to the payment of other debts of the corporate debtor,.

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(b) provides for the payment of debts of operational creditors in such menner as may be specified by the Board which shall not be less than-

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(i) the amount to be paid to such creditors in the event of a liquidation of the corporate debtor under section 53; or

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(ii) the amount that would have been paid to such creditors, if the amount to be distributed under the resolution plan had been distributed in accordance with the order of priority in sub-section (I) of section 53,

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whichever is higher, and provides for the payment of debts of financial^{creditors, who} do not vote infavour of the resolution plan, in such mnnner^qs may be specified by the Board, which shall not be less than the amount to be paid to such creditors in accordance with sub-section (l) of section 53 in the event of a liquidation of the corporate debtor.

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Explanation l. - Far removal of doubts, it is hereby clarified that a distribution in accordance with the provisions of this clause shall befair and equitable to such creditors.

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Explanation 2. - Far the purpose of this clause, it is hereby declared that on and from tke date of commencement of the Insolvency and Banlcruptcy code (Amendment) Act, 2019, the provisions of this clause shall also apply to the corporate insolvency resolution process of a corporate debtor-

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(i) where a resolution plan has not been approved or rejected

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by the Adjudicating Authority;

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(ii) where an qppeol has been preferred under section 6l or section 62 or suah an appeal is not time barred under any provision of law for the time being inforce; or

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(iii) where a legal proceeding has been initiated in any court

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against the decision of the Adjudicating Authority in respect of a resolution plan;

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(d) The implementation and supervision of the resolution plan;

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(e) does not contravene any of the provisions of the law for the time being inforce

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(fl confirms to such other requirements as may be specified by the Board.

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Explanation. - For the purposes of crause (e), if any approval of shareholders is required under the Companies Act, 2013(lg of 2013) or any other law for the time being in force for the

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implementation of actions under the resolution plan, such approval shall be deemed to have been given and it shall not be a contravention of that Act or law."

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25.The compliance of Section 30(2) ofthe Code is given in paraNo. 9 of Form H (supra). The same is being further examined as under:-

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a. section 30(2)(a): The resolution plan (chapter 3 part B at page 95 of the application) states that Resolution Applicant shall provide funds for payment of cIRP cost and the cIRp cost shall be fully paid and discharged before any payment is made to any of the creditors.

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b. section 30(2)(b): From the resolution plan (chapter 3 parr D at page 99 ofthe application) it could be seen that the outstanding of operational creditors is Rs. 85,22,4241- (includes any additional claim on whatsoever account and nature would be settled by the Resolution Applicant)" The, Resolution Applicant has proposed to pay an amount of Rs. 2,00,0001- (2 quarterly installments of Rs. 1,00,0001- at the end of each quarter) to the Operational Creditors against full and final settlement of all claims. With respect to payment to financial creditors who did not vote in favour of the Resolution Plan (Chapter 3 part C at Page 98 of the Application), it is seen that liquidation value due to financial creditors was not known to Resolution Applicant. Hence, in case of any secured financial creditors dissenting from approval of resolution plan, liquidation value due to that creditor was proposed to

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be paid first from amount of Rs. 90,00,000/- envisaged for secured financial creditors and no further amount was earrnarked to be paid to them over and above Rs. 90,00,000/-.

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c. section 30(2)(c): Resolution plan (chapter 3 part M at pg.lll of Application) provides that the management and control of business of the Corporate Debtor shall be handed over to the Board of Directors of Resolution Applicant for proper running and operations of the business of the corporate Debtor subject to approval of the coc and this Adjudicating Authority"

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d' Section 30(2)(d): In Chapter 3 Part N Pg.l I I of Resolution plan, it is stated that subject to approval of the coc and this Adjudicating Authority, the Board of Directors of the Resolution Applicant shall supervise the implementation and execution of the Resolution plan.

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e. Section 30(2)(e): In Form H para 4, the Rp has certified that the Resolution Plan does not contravene any of the provisions of the law for the time being in force.

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26'The RP has also certified that Mr. YusufKhan, the resolution applicant has submitted an affidavit pursuant to Section 30(l) of the Code confirming its eligibility under Section 29A of the Code to submit the resolution plan and the contents of the said affidavit are in order.

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27 'As per the requirement of Regulation 3g(4) of the Regulations for performance security, it is stated in Form H that l}yo ofRs. 97,00,000/i'e', Rs' 9,70,OOOI- has been received from the Resolution Applicant on ll'12'2020 through electronic bank transfer. It is also stated that additional affidavit has been filed along with proof of receipt upon oral directions of this Adjudicating Authority.

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28'with regard to the compliance under Regulation 35A, it is stated that IA No' 4l4lJPR/2019 filed under sections 60(5) and66of the Code, is pending before this Adjudicating Authority and the same could be continued even after approval of the resolution plan.

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29'Aperusal of Regulation 38 would clearly show that by virtue of mandatory contents of resolution plan as discussed in the preceding paragraphs in relation to Section 30 and Section 31 of the Code, the requirement of Regulation 38 also stands fulfilled. Thus, the resolution plan fulfills all the requirements of Regulation 3g of the cIRp Regulations.

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30.The Resolution plan inter-alia entails the following:

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a' Corporate Restructuring through cancellation of present share capital of the Corporate Debtor and issuance of new share capital in favour of the Resolution Applicant and its/ his/ their associates.

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b' Cancellation of any other equity-linked securities whether convertible

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or exchangeable and extinguishment of the same without any payment or further action.

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Reset of financial debt and operational debt as per the parameters of the Resolution Plan.

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d. Extinguishment of anyl all ciaims against the corporate Debtor arong with related legal proceedings, including criminal proceedings and other proceedings which shall stand abated, settled and extinguished.

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e. change of Board of Directors and handing over of management to the Resolution Applicant upon sanction of the Plan from the effective date, the effective date being the date ofhandover by the Rp to the Resolution Applicant.

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f' Continuity of business wherein the Resolution Applicant has requested that any requisite business permits that may not have been granted or cancelled/ terminated/ revoked/ suspended may be granted/ restored/ renewedl reinstated. In this respect the Resolution Applicant is directed to follow up with the concerned authorities, for maint aininglsustaining operations as a going concern, in accordance with applicable laws, rules and procedure.

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g' The term of the Plan and its implementation schedule is envisaged to be a period of 24 months.

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31'In view of the above discussion, the Resolution plan submitted by Mr.

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Yusuf Khan as approved by the CoC under Section 30(4) of the Code is hereby approved. The Resolution Plan so approved shall be binding on the Corporate Debtor and its employees, members, creditors, including the

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Central Government, Ly State Government or any local authority to whom a debt in respect of the payment of dues arising under any law for the time being in force such authorities to whom statutory dues are owed, guarantors and other lders involved in the Resolution Plan.

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