Case Law Details
Axis Bank Limited Vs GVK Power (Goindwal Sahib) Ltd (NCLT Hyderabad)
Revised Form-H submitted by Punjab State Power Corporation Limited was approved due to inconsistency in original Form-H and medical emergency of Resolution Professional (RP)
Conclusion: Due to inconsistency in the original Form-H, the revised Form-H submitted by Punjab State Power Corporation Limited (“Successful Resolution Applicant”) along with annexure, schedules forming part of the Resolution Plan annexed to the Application and order as under and shall be binding on the Corporate Debtor, its employees, members, creditors, including the Central Government, any 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 is due, guarantors and other stakeholders involved in the Resolution Plan. All crystallized liabilities and unclaimed liabilities of the Corporate Debtor as on the date of this order shall stand extinguished on the approval of this Resolution Plan.
Held: Application was filed by Mr. Ravi Sethia, Resolution Professional (“Applicant”) of GVK Power Limited (“Corporate Debtor”) under Section 30(6) of the Insolvency and Bankruptcy Code, 2016 (“Code”) read with Regulation 39(4) of the IBBI (Insolvency Resolution Process for Corporate Persons), 2016, (“CIRP Regulations”) for approval of the resolution plan submitted by Punjab State Power Corporation Limited under Section 31 (1) of the Code along with Certificate in Form H of the CIRP Regulations. Tribunal vide its order admitted the application filed by Axis Bank Limited /Financial Creditor under Section 7 of the Code and Corporate Insolvency Resolution Process (CIRP) against the Corporate Debtor further to which moratorium was declared and the Applicant was appointed as the Interim Resolution Professional. During the CIRP of the Corporate Debtor, the Applicant received claims from financial creditors, operational creditors, employees, workmen and other creditors. During the continuance of CIRP of the Corporate Debtor, the Admission Order was challenged before the National Company Law Appellate Tribunal, Chennai (“NCLAT”) by the holding company of the Corporate Debtor i.e. GVK Energy Limited and suspended director of the Corporate Debtor, by Company Appeal. NCLAT vide its order dismissed the said appeal and upheld the Admission Order. As per Regulation 35(1)(c) of the CIRP Regulations, the Applicant had calculated the average liquidation value of the Corporate Debtor which amounted to INR 1,347.97 Cr (Indian Rupees One Thousand Three Hundred Forty-Seven Crores and Ninety Seven Lakhs). Thereafter, the Applicant carried out Invitation for Expression of Interest (Form G) wherein the last date of submission for the expression of interest for submission of resolution plan. Resolution Applicant was eligible to submit the Resolution Plan under Section 29A of the Code. On perusal of Form-H, it was found that few of the clauses and page nos. mentioned in Form-H did not tally with page nos. against the clauses/page nos. mentioned in Resolution Plan. This inconsistency in the Form-H was brought to the attention of the Resolution Professional who had submitted the revised Form-H with corrections. However, the Resolution Professional being engaged in a medical exigency, could not submit it through an Affidavit under his signature and sought one week’s time for submitting the same. Therefore, the revised Resolution Plan submitted by Punjab State Power Corporation Limited (“Successful Resolution Applicant”) along with annexure, schedules forming part of the Resolution Plan annexed to the Application and order as under, subject to the above said compliance of submission of revised Form-H was approved. It was held that the Resolution Plan along with annexures and schedules forming part of the plan shall be binding on the Corporate Debtor, its employees, members, creditors, including the Central Government, any 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 is due, guarantors and other stakeholders involved in the Resolution Plan. All crystallized liabilities and unclaimed liabilities of the Corporate Debtor as on the date of this order shall stand extinguished on the approval of this Resolution Plan. The approval of the Resolution Plan should not be construed as waiver of any statutory obligations/ liabilities of the Corporate Debtor and should be dealt with by the appropriate Authorities in accordance with law. Any waiver sought in the Resolution Plan, should be subject to approval by the Authorities concerned as held by Hon’ble Supreme Court in the matter of Ghanashyam Mishra And Sons Private Limited Versus Edelweiss Asset Reconstruction Company Limited in CIVIL APPEAL NO.8 129 OF 2019 dated 13.04.2021. Post approval of the resolution plan, any pending avoidance applications should be continued by the Assenting Financial Creditors or the erstwhile Resolution Professional as provided under Clause of the plan. The moratorium under Section 14 of the Code should cease to have effect from this date. Applicant should forthwith send a copy of this order to the CoC and the Resolution Applicant.
FULL TEXT OF THE NCLT JUDGMENT/ORDER
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