When a Resolution Plan is approved by the CoC in its commercial wisdom, it has to be presumed that the approval was given to a viable and feasible plan. Once approved, the Tribunal cannot interfere with the commercial wisdom.
As per proviso to Section 12 of the IBC, the insolvency resolution process shall mandatorily be completed within a period of 330 days from the insolvency commencement date, including any extension of the period of CIRP granted under Section 12 of the IBC.
The Adjudicating Authority cannot allow or approve the application regarding modifications or withdrawals of CoC-approved Resolution Plans once the plan has been submitted before NCLT.
Claims that do not form part of the resolution plan will be extinguished on the date of the adjudicating authority’s acceptance of the resolution plan. This ruling has reaffirmed the IBC’s goal, which is for the Corporate Debtor to start over with a clean slate based on the resolution plan.
Supreme Court’s decision in Maharashtra Seamless Limited shows that the commercial wisdom of the CoC will be given top priority when deciding on the feasibility and viability of the resolution plan.
The NCLAT, in its Order dated 23.04.2019, ruled that GMSPL’s (Ghanshyam Mishra and Sons Pvt. Ltd.) Resolution Plan is better compared to the other Applicants. However, NCLAT noted that the parties’ claims that are not covered in the Resolution Plan may be raised before the relevant forums.
A resolution plan under Regulation 37, shall provide for the measures, for insolvency resolution of the corporate debtor for maximization of value of its assets.
No further legal action shall be permissible by creditor, whose claim has been rendered unsatisfied as per the resolution plan.
Resolution applicants enter the CIRP and prepare “Resolution Plans,” which are effectively instruments for taking over a corporate debtor, paying its creditors’ debts, and completing its recovery and restructuring.
RCom burdened with over Rs 46,000 crore of debt after the failure of its asset monetisation plans with Reliance Jio in March 2019 is undergoing insolvency proceedings with its assets up for sale.
The resolution plan can be challenged by an aggrieved person as per the grounds mentioned in Sub-Section (3) of Section 61 of the Code.
Once the resolution plan is approved and is implemented under IBC, no issue can be raised at a later stage when resolution Process Costs and fees of the Resolution Professional.
The Appellants cannot be permitted to pursue alternative remedy of suit/arbitration proceeding even if pending as Resolution Plan is binding on all the stakeholders.
The former directors of the corporate debtor shall not merely provide the financial status of the corporate debtor but more than that so that they are aware of the terms to which they are bound.
NCALT in the appeal filed in the matter of Kamineni’s reversed the order passed by NCLT and remanded the matter back to go through the liquidation process.
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