National Company Law Appellate Tribunal
Bharat Sharma Resolution Applicant vs Reshma Mittal & Anr on 31 October, 2022
Author: Ashok Bhushan
Bench: Ashok Bhushan
NATIONAL COMPANY LAW APPELLATE TRIBUNAL
PRINCIPAL BENCH, NEW DELHI
Company Appeal (AT) (Insolvency) No. 1275 & 1276 of 2022
IN THE MATTER OF:
Bharat Sharma, ...Appellant
Resolution Applicant
Versus
Reshma Mittal, RP (Now Liquidator) & Anr. ...Respondents
Present:
For Appellant: Mr. Abhishek Anand, Mr. Nipun Gautam, and
Mohak Sharma, Advocates
For Respondent: Liquidator-Reshma Mittal with Advocate Mohan
Lalit, Advocate Videh Vaish and Advocate Aakansha.
ORDER
31.10.2022: This Appeal has been filed challenging the Order dated 26th August, 2022 passed by the National Company Law Tribunal, Principal Bench, New Delhi. By which Order, the Adjudicating Authority has allowed the Application I.A. No. 2479/2021 filed by the Chairperson, Monitoring Committee and has rejected Application I.A. No. 1151/2021 filed by the Appellant-Bharat Sharma- Resolution Applicant where direction was sought to the Respondent-Resolution Professional to convene the meeting of the Committee of Creditors to place the Resolution Plan for consideration submitted by the Applicant on 23rd October, 2021.
2. In the Corporate Insolvency Resolution Process of the Corporate Debtor, the Resolution Plan was submitted by the Appellant jointly with another Resolution Applicant which was ultimately approved but could not be implemented and stood cancelled by Order dated 1st July, 2021. In the Order dated 1st July, 2021, the Adjudicating Authority has made observations that -2- any viable plan that is submitted, can be placed for consideration before the Liquidation. It appears that on 29th May, 2021, the Monitoring Committee has also resolved to go for liquidation which fact was not brought before the Adjudicating Authority on 1st July, 2021. In pursuance of the Monitoring Committee Resolution dated 29th May, 2021, Application was filed for liquidation which has been allowed by the Impugned Order.
3. Mr. Abhishek Anand, Learned Counsel for the Appellant submits that the Appellant-Corporate Debtor being MSME an opportunity ought to have been given for placing Resolution Plan submitted by the Appellant for consideration which has wrongly been rejected. It is alternatively submitted that under Regulation 2B of Insolvency and Bankruptcy Board of India (Liquidation Process), Regulations, 2016, the Appellant ought to have been given opportunity to submit a scheme of compromise/arrangement but the Liquidator proceeded for auction without giving any opportunity.
4. Learned Counsel for the Liquidator opposing the submissions of Learned Counsel for the Appellant contends that the Plan having been failed to be implemented by the Appellant who was joint applicants, there was no option except to direct for liquidation which has been directed by the Impugned Order. It is submitted that in pursuance of the Impugned Order, notice for auction has already been issued and large number of Applicants have submitted their EMD.
5. We have heard the Learned Counsel for the parties and have perused the record. In the facts of the present case, we are of the view that ends of justice will be served in giving liberty to the Appellant to submit a scheme of compromise/arrangement as contemplated under Section 230 of the Company Appeal (AT) (Insolvency) No. 1275-1276/2022 -3- Companies Act to the Liquidator within one month from today as well as to the Financial Creditors for their approval as contemplated under Section 230 of the Companies Act. Let entire process be completed within three months' period as has been allowed under Regulation 2B of the IBBI (Liquidation Process) Regulations, 2016 from today. The Liquidator who has already issued notice fixing Auction on 10th November, 2022, shall differ the proposed auction. It will be open for the Liquidator to proceed with the Auction further, if any, only after completion of the process under Regulation 2B of the IBBI (Liquidation Process) Regulations, 2016 after period of 3 months.
The Appeal stands disposed of, with the aforesaid direction(s).
[Justice Ashok Bhushan] Chairperson [Mr. Barun Mitra] Member (Technical) Basant/nn Company Appeal (AT) (Insolvency) No. 1275-1276/2022