Approval of Resolution Plan - Indian Home Variations & Distributions LLP

MUMBAI BENCH, COURT - I IA 210 of 2022 In CP (IB) 2620/MB/C-I/2019 ORDER Per Coram: 1. The present application is moved by Resolution Professional Mr. Kairav Anil Trivedi (hereinafter called as “the Applicant”) under section 30 (6) of the Insolvency and Bankruptcy Code, 2016 (“code”) r/w Regulation 39(4) of the IBBI (Insolvency Resolution Process for Corporate Persons) Regulations, 2016 for seeking approval of the resolution plan under the provisions of Section 31(1) of the code, for the Corporate Debtor Indian Home Variations & Distributions LLP (hereinafter called as the “Corporate Debtor”) and for passing order/appropriate direction that this Tribunal may deem fit in the present matter. 2. The CIRP was initiated against the Corporate debtor vide Order dated 11.12.2019. The Certified copy of the order was received on 12.12.2019 and consequently CIRP was initiated against the Corporate Debtor. The Interim Resolution Professional (hereinafter referred to as the IRP) made a public announcement in Form A on 14.12.2019. The IRP constituted the Committee of Creditors (hereinafter referred to as the CoC) on 14.03.2020. Subsequently, the First CoC meeting took place on 19.03.2020 wherein the IRP was appointed as the Resolution Professional with 100% CoC voting.

MUMBAI BENCH, COURT - I IA 210 of 2022 In CP (IB) 2620/MB/C-I/2019 3. Thereafter, the Second meeting of the COC was held on 03.10.2020 post which the Resolution Professional in the wake of the Covid-19 pandemic filed an Application bearing no IA No. 452 of 2021 for exclusion of time on 30.11.2020. Further, the RP also filed an Application for extension of CIRP period through IA No. 717 of 2021. The abovementioned Applications were disposed vide a common order dated 14.07.2021 wherein the following reliefs were granted: i. Exclusion of Covid-19 period for 180 days ii. Extension of CIRP period by 90 days iii. Further, an exclusion for a period of 104 days from 01.04.2021 to 14.07.2021 was also granted due to second wave of Covid -19 pandemic. iv. The time spent from the date of filing of the Application i.e 30.11.2020 till the date of the Order i.e. 14.07.2021 is excluded from computing the CIRP period. 4. In the meantime, Form G was published in newspapers on 26.08.2021. The last date for submitting the EOI was fixed on 08.09.2021. Further, the Applicant submits that the last date for submission of Resolution Plan was marked on 23.10.2021. The Applicant received EOI from 5 prospective Resolution Applicants by transferring Rs. 5 Lakhs each in the account of the Corporate

MUMBAI BENCH, COURT - I IA 210 of 2022 In CP (IB) 2620/MB/C-I/2019 Debtor. The Applicants submits that their respective Resolution Plans were received in password protected emails. Further, they enclosed an affidavit stating that they are not barred under Section 29A of the Code. 5. The Applicant submit that in the Sixth CoC meeting which was held on 11.11.2021 the 5 Resolution Plans that were received were presented in brief by the RP. The CoC decided to hold a one-to-one meeting with each of the Resolution Applicants to improve the Total Consideration and payment of CIRP Costs. 6. Accordingly, on 23.11.2021 a meeting was held with 5 Prospective Resolution Applicants and the CoC members wherein a period of 2 days was given to all the Applicants in order to review their quotes. Thus, the Applicant after two days informed that no improved proposal was received. 7. In the Seventh CoC meeting held on 03.12.2021, the CoC resolved under Section 30(4) of IBC to approve the Resolution Plan of Mr. Sitaram Gurjar and Mr. Krishnan Kumar Gurjar being feasible and viable. The details of the plan as are follows: a. The Highest Total consideration of Rs.125 Lakh b. The Highest score of 100 as per Resolution Matrix. c. Payment of the entire CIRP cost, present and future.

MUMBAI BENCH, COURT - I IA 210 of 2022 In CP (IB) 2620/MB/C-I/2019 d. Payment of consideration to all the Financial Creditors i.e. secured/unsecured. e. Payment of consideration to all Operational Creditors including Government and Employees even when the Liquidation value to all other than the Financial Creditors in NIL as per the waterfall mechanism under Section 53 of the Code. f. This Resolution Plan also considers the future working capital and capex requirements in addition to the payment of the above consideration of Rs.25 Lakh. g. At the request of the CoC, the Applicant further reduced the period of payment of consideration to 45 days (Instead of 60 days) from the date of receipt of the Order, provided if no appeal has been filed against the Order. 8. At the request of CoC members during the 7th CoC meeting the Resolution Plan of Mr. Sitaram Gurjar and Mr. Krishnan Kumar Gurjar was also put to vote, the last date of voting results was fixed as 09.12.2021 wherein the CoC members constituting 98.59% approved the Resolution Plan. The minutes of the meeting and voting sheet is placed at page 55-77 of the Petition. Since the plan is approved by 98.59% of CoC members which exceeds the minimum threshold of 66% for approval of Resolution Plan as per Section 30(4).

MUMBAI BENCH, COURT - I IA 210 of 2022 In CP (IB) 2620/MB/C-I/2019 9. The Applicant submits that on intimation of approval of the Resolution Plan to the Successful Resolution Applicant, the necessary performance security amount of Rs.12.50 Lakhs has been deposited into the account of the Corporate Debtor. Further, the bid amount of the Successful Resolution Applicant of Rs. 5 lakhs has also been retained till the Resolution Plan. 10. Moreover, the EOI amount received by the other four Applicants of Rs. 5 lakh each and the bid amount received by the other four Applicants of Rs.5 lakh each has been returned back to them through RTGS.

Section 30(2) of the Code 11. In compliance of Section 30(2) of IBC, 2016, the Resolution Professional has examined the Resolution plan of the Successful Resolution Applicant Mr. Sitaram Gurjar and Mr. Krishan Kumar Gurjar and confirms that this Resolution Plan: a) Provides for payment of Insolvency Resolution Process cost in a manner specified by the Board in the priority to the payment of other debts of the corporate debtor; b) Provides for payment of debts of operational creditor in such manner as may be specified by the board which shall not be less than

MUMBAI BENCH, COURT - I IA 210 of 2022 In CP (IB) 2620/MB/C-I/2019 (i) The amount to be paid to such creditors in the event of liquidation of the corporate debtor under Section 53; or (ii) The amount that would have been paid to such creditors, if the amount to be distributed under the Resolution Plan had been distribute in accordance with sub-section (1) of Section 53 in the event of liquidation of the corporate debtor. c) Provides for management of the affairs of the Corporate Debtor after approval of Resolution Plan; d) The implementation and supervision of Resolution Plan; e) Does not prima facle contravene any of the provisions of the law for time being in force, f) Conforms to such other requirements as may be specified by the Board. g) As per the Affidavit received and the further documents submitted, the Resolution applicants are not covered under 29A. 12. In compliance of Regulation 38 of CIRP Regulations, the Resolution Professional confirms that the Resolution plan provides that MUMBAI BENCH, COURT - I IA 210 of 2022 In CP (IB) 2620/MB/C-I/2019 a) The amount due to the Operational Creditors under resolution plan shall be given priority in payment over Financial Creditors. b) It has dealt with the interest of all Stakeholders including Financial Creditors and Operational Creditors of the CD. c) A statement that neither the Resolution Applicants nor any related parties have failed to implement nor have contributed to the failure of implementation of any other Resolution Plan approved by the AA in the past. d) The terms of the plan and its implementation schedule. e) The management and control of the business of the CD during its term. f) Adequate means of Supervising its implementation. g) The Resolution Plan Demonstrate that it addresses i. The cause of the Default ii. It is feasible and viable iii. Provision for effective implementation iv. Provisions for approvals required and the time lines for the same. v. Capability to Implement the Resolution Plan 13. The Resolution Professional has annexed a certificate at Page 44-54 of the Application under Regulation 39(4) In FORM H of the CIRP

MUMBAI BENCH, COURT - I IA 210 of 2022 In CP (IB) 2620/MB/C-I/2019 Regulations to certify that the resolution plan as approved by the CoC meets all the requirements of the IBC and its Regulations.

FORM H COMPLIANCE CERTIFICATE (Under Regulation 39(4) of the Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) Regulations, 2016

I, Kairav Trivedi, an insolvency professional enrolled with [name of insolvency professional agency] and registered with the Board with registration number IBBI/IPA-002/IP-N00728/2018-2019/12332, am the resolution professional for the Corporate Insolvency Resolution Process (CIRP) of Indian Home Variations & Distributions LLP. 2. The details of the CIRP are as under: Sl. No. Particulars Description 1 Name of the CD Indian Home Variations & Distributions LLP 2 Date of Initiation of CIRP 12/12/2019 3 Date of Appointment of IRP 11/12/2019 4 Date of Publication of Public Announcement 14/12/2019 5 Date of Constitution of COC 14/03/2020 6 Date of First Meeting of COC 19/03/2020 7 Date of Appointment of RP 19/03/2020 8 Date of Appointment of Registered Valuers 19/03/2020 9 Date of Issue of Invitation for EOI 24/08/2021 10 Date of Final List of Eligible Prospective 03/10/2021 Resolution Applicants 11 Date of Invitation of Resolution Plan 23/09/2021 12 Last Date of Submission of Resolution Plan 23/10/2021 13 Date of Approval of Resolution Plan by COC 03/12/2021 14 Date of Filing of Resolution Plan with 21/01/2021 Adjudicating Authority 15 Date of Expiry of 180 days of CIRP 08/06/2020 16 Date of Order extending the period of CIRP 14/07/2021 17 Date of Expiry of Extended Period of CIRP 05/02/2022 18 Fair Value Rs. 165 Lacs 19 Liquidation value Rs.105 Lacs 20 Number of Meetings of COC held Seven

MUMBAI BENCH, COURT - I IA 210 of 2022 In CP (IB) 2620/MB/C-I/2019 3. I have examined the Resolution Plan received from Resolution Applicant Mr. Sitaram Gurjar & Mr. Krishna Kumar Gurjar. and approved by Committee of Creditors (COC) of Indian Home Variations & Distributions LLP. 4. I hereby certify that- (i) the said Resolution Plan complies with all the provisions of the Insolvency and Bankruptcy Code 2016 (Code), the Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) Regulations, 2016 (CIRP Regulations) and does not contravene any of the provisions of the law for the time being in force. (ii) the Resolution Applicant Mr. Sitaram Gurjar & Mr. Krishna Kumar Gurjar. has submitted an affidavit pursuant to section 30(1) of the Code confirming its eligibility under section 29A of the Code to submit resolution plan. The contents of the said affidavit are in order. (iii) the said Resolution Plan has been approved by the COC in accordance with the provisions of the Code and the CIRP Regulations made thereunder. The Resolution Plan has been approved by [state the number of votes by which Resolution Plan was approved by COC] % of voting share of financial creditors after considering its feasibility and viability and other requirements specified by the CIRP Regulations. (iv) The voting was held in the meeting of the COC of 03/12/21 [state the date of meeting] from 03 /12/21 till 9/12/2021 where all the members of the COC having 98.59% were present. or I sought vote of members of the COC by electronic voting system which was kept open at least for 24 hours as per the regulation 26. – NA [strike off the part that is not relevant] 5. The list of financial creditors of the CD Indian Home Variations & Distributions LLP being members of the COC and distribution of voting share among them is as under: Sl. Name of Creditor Voting Share Voting for Resolution Plan No. (%) (Voted for / Dissented / Abstained) 1 The Cosmos Co- 73.03% Approved the Resolution Plan operative Bank Ltd 2 Forefront Financial 25.37% Approved the Resolution Plan Services LLP 3 Tatkal Loans 0.19% Approved the Resolution Plan Total Approved % 98.59% Approved by COC members 4 IndusInd Bank Ltd 0.22% Neither attended the meeting nor voted 5 Times Metals Pvt. Ltd 1.19% Neither attended the meeting nor voted Neither attended nor 1.41% voted

MUMBAI BENCH, COURT - I IA 210 of 2022 In CP (IB) 2620/MB/C-I/2019 6. The Resolution Plan includes a statement under regulation 38(1A) of the CIRP Regulations as to how it has dealt with the interests of all stakeholders in compliance with the Code and regulations made thereunder. Sr. Description Amount (in INR No. Lakhs) 1. IRP Costs (estimated upto December 47.00 2021 or at actuals) 2. Operational Creditor & Statutory 3.00 Liability & Workmen & Employees 3. Financial Creditor 75.00 4. Any Other Liability 0.00 Total - A 125.00 5. Supervision and Implementation of 2.50 Resolution Plan 6. Capital Expenditure by Resolution 10.00 Applicant 7. Working Capital Margin 15.00 Total - B 27.50 8. Total outlay under the Resolution Plan 152.50 (A+B) Sources of Fund 9. Internal Accruals, Including Cash & 152.50 Cash Equivalents, Loans, Bonds or Debt Instruments Total 152.50

Period of payment of consideration is within 45 days from the date of receipt of the Certified true copy of the Order, provided no appeal have been filed against the order of Approval of Resolution Plan, or within 45 days from the date of disposal of the said Appeal, if an appeal has been filed against this order for approval of Resolution Plan. 7. The amounts provided for the stakeholders under the Resolution Plan is as under: (Amount in Rs. lakh) Sl. Category of Sub-Category Amount Amount Amount Am No. Stakeholder* of Stakeholder Claimed Admitted Provided ount under the Prov Plan# ided to the Am ount Clai med (%) (1) (2) (3) (4) (5) (6) (7) 1 Secured (a) Creditors

MUMBAI BENCH, COURT - I IA 210 of 2022 In CP (IB) 2620/MB/C-I/2019 Financial not having a Creditors right to vote The assets under sub-secured as section (2) of Collaterals section 21 against these (b) Other than Facilities are (a) above: the Personal (i) who did not properties of vote in favour the of the Designated resolution Partners/ Plan (ii) who voted Associates, in favour of 16,57,99,956 16,57,99,956 54,77,535 3.30 thus these the resolution assets are plan not covered 1. The under CD CIRP except Cosmos for Stock etc Co-and action Operati under ve Bank SARFAESI Limited Act is being taken by the Total[(a) + (b)] 16,57,99,956 16,57,99,956 54,77,535 3.30 Bank for recovery from these Properties 2 Unsecured (a) Creditors Financial not having a Creditors right to vote under sub-section (2) of section 21 (b) Other than (a) above: (i) who did not vote in favour of the resolution Plan (ii) who voted in favour of 5,76,06,683 5,76,06,683 3.30 the resolution plan 4,35,288 4,35,288 3.30 1. Forefro nt Financial 19,02,750 service LLP

14,365

MUMBAI BENCH, COURT - I IA 210 of 2022 In CP (IB) 2620/MB/C-I/2019 2. Tatkal 4,93,937 4,93,937 3.30 Loans 26,98,427 26,98,427 3.30 (iii)who neither attended the meeting nor voted at all, 16,300 even when 89,050 voting sheets were shared & reminders sent 1. Indus Bank Ltd 2. Time Metals Pvt Ltd Total[(a) + (b)] 6,12,34,235 6,12,34,235 20,22,465 3.30 3 Operational (a) Related NIL NIL NIL NIL Creditors Party of Corporate Debtor (b) Other than (a) above: 1. Synergy 19,61,426 19,61,426 3,805 0.19 Fabrics Pvt 1,63,58,538 1,63,58,538 31,738 0.19 Ltd 99,65,707 99,65,707 19,334 0.19 2. GHCL Limited 3. Arnav 12,31,35,791 12,31,35,791 2,38,899 0.19 Indusrise Pvt Ltd 28,41,024 28,41,024 5,513 0.19 (i)Government 0 0 0 0 1. Deputy Commissioner 30,000 30,000 58 0.19 of State Tax 2.Employees 2,02,736 2,02,736 393 0.19 State 1,33,355 1,33,355 259 0.19 Insurance Corporation (ii)Workmen (iii)Employees 1. Amar Kumar Sharma 2. Bilal Asrari 3. Ankit

MUMBAI BENCH, COURT - I IA 210 of 2022 In CP (IB) 2620/MB/C-I/2019 Nandawat (iv) ……… Total[(a) + (b)] 15,46,28,577 15,46,28,577 3,00,000 0.19 4 Other debts and dues – 47,00,000 100 Insolvency Resolution Process Cost estimated till December 21 & to be paid till approval of Resolution Plan by AA Grand Total 38,16,62,768 38,16,62,768 1,25,00,000 (1+2+3+4) *If there are sub-categories in a category, please add rows for each sub-category. # Amount provided over time under the Resolution Plan and includes estimated value of non-cash components. It is not NPV.]

8. The interests of existing shareholders have been altered by the Resolution plan as under: Sl. Category of Share Holder Partner’s Voting Voting N Capital Share Share (%) o (%) held held after before CIRP CIRP A Partner’s Capital 1. Anjana Merchant 1,24,00,000 41.87% 0 2. Narendra 49,90,000 16.85% 0 Bhandari 3. Rajiv Merchant 2,25,000 0.76% 0 4. Vikram Bhandari 1,20,00,000 40.52% 0 Total 2,96,15,000 100.00% 0 B Partner’s Current Account (-ve) 1. Anjana Merchant (12,18,41,307 0 ) 2. Narendra (7,29,16,328) 0 Bhandari 3. Rajiv Merchant (3,05,63,640) 0 4. Vikram Bhandari (5,41,91,897) 0

9. The compliance of the Resolution Plan is as under: Section Requirement with respect Clause of Resolution Plan Co of the to Resolution Plan mpli

MUMBAI BENCH, COURT - I IA 210 of 2022 In CP (IB) 2620/MB/C-I/2019 Code / ance Regulati (Yes on No. / No) 25(2)(h) Whether the Resolution The Resolution Applicant Applicant meets the meets the criteria approved Yes criteria approved by the by the COC in regard to COC having regard to the complexity and scale the complexity and scale of operations of business of operations of business of the CD, as per RFPR of the CD? Clause 1 and the format given in RFPR Format IIIA Section Whether the Resolution Affidavit received in the Yes 29A Applicant is eligible to format given in RFPR submit resolution plan as Format IIIA – per final list of Undertaking By Resolution Applicant or Resolution Applicant Order, if any, of the Adjudicating Authority? Section Whether the Resolution Affidavit received in the Yes 30(1) Applicant has submitted format given in RFPR an affidavit stating that it Format IIIA – is eligible? Undertaking By Resolution Applicant Section Whether the Resolution Plan- 30(2) (a) provides for the payment of (a) The Format VA and insolvency resolution process Clause 18, 27, of the - Yes costs? Resolution Plan provides for the payment of (b) provides for the payment to insolvency resolution the operational creditors? process costs? (b) The Format VA and Clause 18, 27, of the Yes (c) provides for the payment to Resolution Plan provides the financial creditors who did for the payment to the not vote in favour of the operational creditors? resolution plan? (c) The Format VA and Clause 18, 27, of the Resolution Plan provides (d) provides for the management for the payment to the of the affairs of the corporate financial creditors who did debtor? not vote in favour of the Yes resolution plan? (e) provides for the (d) The Format VA and implementation and supervision Clause 18, 27, of the of the resolution plan? Resolution Plan provides for the management of the affairs of the corporate debtor (f) contravenes any of the Yes

MUMBAI BENCH, COURT - I IA 210 of 2022 In CP (IB) 2620/MB/C-I/2019 provisions of the law for (e) The Format VA and the time being in force? Clause 18, 27, of the Resolution Plan provides for the implementation and supervision of the resolution plan Yes (f) The Resolution Plan DOES NOT contravenes any of the provisions of the law for the time being in force NO

Section Whether the Resolution 30(4) Plan (a) The COC in Seventh (a) is feasible and viable, Meeting RESOLVED according to the CoC? THAT, the Resolution Yes Plan put forward by Mr. Sitaram Gurjar and Mr. Krishan Kumar Gurjar, having Payment Plan of Rs 125 Lacs, being feasible and viable and in compliance of the requirements of the code, (b) has been approved by be and is hereby by the COC with 66% approved under section voting share? 30(4) of IBC.” Yes (b) The resolution Plan has been approved by the CoC with 98.59% voting share Section Whether the Resolution According to the COC the Yes 31(1) Plan has provisions for Resolution Plan under its effective Clause 19,20 and 24 has implementation plan, provisions for its effective according to the COC? implementation plan Regulati Where the resolution Yes Yes on 35A profesional made a determination if the corporate debtor has been subjected to any transaction of the nature covered under sections 43, 45, 50 or 66, before the one hundred and fifteenth day of the insolvency commencement date, under intimation to the Board?

MUMBAI BENCH, COURT - I IA 210 of 2022 In CP (IB) 2620/MB/C-I/2019 Regulati Whether the amount due to the Clause 7.3 (g) of the Yes on 38 operational creditors under the Resolution Plan states that (1) resolution plan has been given the amount due to the priority in payment over operational creditors under financial creditors? the resolution plan shall be given priority in payment over financial creditors Regulati Whether the resolution plan Clause 7 of the Resolution Yes on includes a statement as to how it Plan states how it has dealt 38(1A) has dealt with the interests of all with the interests of all stakeholders? stakeholders Regulati (i) Whether the Resolution Neither the Resolution N/ on Applicant or any of its related Applicant nor any of its A 38(1B) parties has failed to implement related parties has failed to or contributed to the failure of implement or contributed implementation of any to the failure of resolution plan approved under implementation of any the Code. resolution plan approved under the Code, thus (ii) If so, whether the Resolution Regulation 38(1B) Not Applicant has submitted the Applicable statement giving details of such non-implementation?

Not Applicable N/ A Reg(ual)a ti Whether the Resolution Plan on 38(2) provides: (a) Clause 24 of the Yes (a) the term of the plan and its Resolution Plan states implementation schedule? term of the plan and its implementation schedule (b) for the management and (b)Clause 18 of the Yes control of the business of the Resolution Plan states for corporate debtor during its term? the management and control of the business of (c) adequate means for the corporate debtor supervising its implementation? during its term (c) Clause 18 of the Yes Resolution Plan states the adequate means for supervising its implementation 38(3) Whether the resolution plan Clause 15,19,20,24,27 of Yes demonstrates that – the Resolution Plan states (a) it addresses the cause that of default? (b) it is feasible and (a)it addresses the cause of viable? default (c) it has provisions for (b) it is feasible and viable its effective (c) it has provisions for its MUMBAI BENCH, COURT - I IA 210 of 2022 In CP (IB) 2620/MB/C-I/2019 implementation? effective implementation (d) it has provisions for (d) it has provisions for approvals required and approvals required and the the timeline for the same? timeline for the same (e) the resolution applicant (e) the resolution has the capability to applicant has the implement the resolution capability to implement plan the resolution plan?

39(2(b) ) Whether the RP has filed NO NO applications in respect of transactions observed, found or determined by him? (c) Provide details of performance In compliance of the Yes Regulati security received, as referred to clause 6 B of RFPR the on 39(4) in sub-regulation (4A) of successful resolution regulation 36B. applicant as deposited in the bank account of CD per romance security Rs 12.50 lacs on on 17/12/2021 within the timelines stipulated in RFPR 10. The CIRP has been conducted as per the timeline indicated as under: Section of the Description of Activity Latest Actual Date Code / Timeline under Regulation No. regulation 40A Section 16(1) Commencement of CIRP and T 19/03/2020 Appointment of IRP Regulation 6(1) Publication of Public Announcement T+3 14/12/2019 Section 15(1)(c) Submission of Claims T+14 23/09/2021 /Regulation 12 (1) Regulation Verification of Claims T+21 14/03/2020 13(1) Section 26(6A) Application for Appointment of T+23 N/A / Regulation Authorized Representative, if necessary 15A Regulation Filing of Report Certifying T+23 14/03/2020 17(1) Constitution of COC Section 22(1) First Meeting of the COC T+30 19/03/2020 and regulation 17(2) Regulation 35A Determination of fraudulent and other T+115 N/A transactions Regulation 27 Appointment of two Registered Valuers T+47 19/03/2020 Regulation 36 Submission of Information T+54] 23/09/2021 (1) Memorandum to COC

MUMBAI BENCH, COURT - I IA 210 of 2022 In CP (IB) 2620/MB/C-I/2019 Regulation 36A Invitation of EoI T+75 24/08/2021 Publication of Form G T+75 26/08/2021 Provisional List of Resolution T+100 18/09/2021 Applicants Final List of Resolution Applicants T+115 03/10/2021 Regulation 36B Issue of Request for Resolution Plan, T+105 23/09/2021 which includes Evaluation Matrix and Information Memorandum to Resolution Applicants Section 30(6) / Submission of COC approved T+165 21/01/2022 Regulation Resolution Plan 39(4) Section 31(1) Approval of Resolution Plan T=180 As per NCLT Order

11. The time frame proposed for obtaining relevant approvals is as under: Sl. Nature of Approval Name of Name of Authority When to be No applicable Law who will grant obtained. Approval 1 Carried forward and Income Tax On approval of On approval of the set off of losses under Act Resolution Plan by Resolution Plan Income Tax Act AA after providing by AA. After an opportunity of serving the notice being heard as the of the application name included as for approval of Respondent and a Resolution Plan Copy of the and opportunity of application will be heard being served provided, 2 GST number GST Act GST Department Immediately after Mumbai approval of Resolution Plan order 12. The Resolution Plan is not subject to any contingency. or The Resolution Plan is subject to the following contingencies (Elaborate the contingencies): NA I. Approval: The responsibility of approving a resolution plan rests with the CoC, which will approve it with not less than 66 percent voting in favor of it. ………………………………………………………………… II. Effect of Approval: If the Adjudicating Authority is satisfied that the resolution plan as approved by the committee of creditors under sub section (4) 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, 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, such as authorities to whom statutory dues are owed, guarantors and other

MUMBAI BENCH, COURT - I IA 210 of 2022 In CP (IB) 2620/MB/C-I/2019 stakeholders involved in the resolution plan. [Sec 31(1)] ………………………………………………………………... 13. Following are the deviations / non-compliances of the provisions of the Insolvency and Bankruptcy Code, 2016, regulations made or circulars issued thereunder (If any deviation/ non-compliances were observed, please state the details and reasons for the same): Sl. Deviation/Non-compliance Section of the Reasons Whethe No. observed Code / r Regulation rectified No. / or not Circular No. 1 Delay in Submission of Regulation 36 Accountant for 2018- Yes Information Memorandum (1) 19 2019-20 to be to CoC prepaid & Audited 2 Invitation of EoI Publication Regulation COVID-19 & Time Yes of Form G Provisional List 36A taken by Hon’ble of Resolution Applicants NCLT in approving Final List of Resolution Exclusion & Applicants Extension Application 3 Issue of Request for Regulation COVID-19 & Time Yes Resolution Plan, which 36B taken by Hon’ble includes Evaluation Matrix NCLT in approving and Information Exclusion & Memorandum to Resolution Extension Applicants Application 3 Submission of CoC approved Section 30(6) COVID-19 & Time Yes Resolution Plan / Regulation taken by Hon’ble 39(4) NCLT in approving Exclusion & Extension Application 4 Approval of Resolution Plan Section 31(1) COVID-19 & Time Yes taken by Hon’ble NCLT in approving Exclusion & Extension Application 14. The Resolution Plan is being filed 35 days before the expiry of the period of CIRP provided in section 12 of the Code. 15. Provide details of section 66 or avoidance application filed / pending. Sl. Type of Transaction Date of Filing Date of Order Brief of the No with of the Order. Adjudicating Adjudicating Authority Authority 1 Preferential transactions N/A N/A N/A MUMBAI BENCH, COURT - I IA 210 of 2022 In CP (IB) 2620/MB/C-I/2019 under section 43 2 Undervalued transactions N/A N/A N/A under section 45 3 Extortionate credit N/A N/A N/A transactions under section 50 4 Fraudulent transactions N/A N/A N/A under section 66

15A. The committee has approved a plan providing for contribution under regulation 39B as under: a. Estimated liquidation cost: Rs N/A. b. Estimated liquid assets available: Rs N/A c. Contributions required to be made: Rs N/A d. Financial creditor wise contribution is as under: Rs NA 15B. The committee has recommended under regulation 39C as under: a. Sale of corporate debtor as a going concern: Yes / No --- NA b. Sale of business of corporate debtor as a going concern: Yes / No ----NA The details of recommendation are available with the resolution professional. 15C. The committee has fixed, in consultation with the resolution professional, the fee payable to the liquidator during the liquidation period under regulation 39D.]- NA 16. I, Kairav Trivedi hereby certify that the contents of this certificate are true and correct to the best of my knowledge and belief, and nothing material has been concealed therefrom.

(Signature) Name of the Resolution Professional:- Kairav Anil Trivedi IP Registration No:- IBBI/IPA-002/IP-N00728/2018-2019/12332 Address as registered with the Board Residence :- 23A 5th Floor Jyoti, Wadala East Mumbai 400037 Office Address:- 413-414 Shramjeevan B-5, Opp Lodha New Cuffe, Parade, Wadala (E), Mumbai 400037 Email id as registered with the Board: Kairavtrivedi2002@yahoo.co.in 14. As regards the Secured Financial Creditor having a claim of Rs 16.57 Crs during CIRP and a voting strength of 73.03% in the COC namely The Cosmos Co-operative Bank Ltd, the major valuable

MUMBAI BENCH, COURT - I IA 210 of 2022 In CP (IB) 2620/MB/C-I/2019 Securities/Assets Charged for this Secured loan given to the CD under CIRP are the PERSONAL PROPERTIES of the Erstwhile Designated partners and their relatives/ associates and thus these assets do not appear in the Books of account of the CD under CIRP and therefore these have neither been valued nor been included in the Resolution Plan. These facts have been mentioned in the Information Memorandum and known to all the RA. 15. Further the said Secured Financial Creditor of the CD Under CIRP i.e. The Cosmos Co-operative Bank Ltd has initiated SERFASEI action for taking charge of these personal properties and the same is being dealt with separately as these assets mortgaged are not under CIRP of the Corporate Debtor. 16. The RP with the approval of the COC appointed 2 Independent valuers registered with IBBI, i) Mr Kedar Chikodi and ii) Mr Prashant, to ascertain the Liquidation value and Fair market value of the Corporate Debtor. As per the valuation reports, the average liquidation value of the Corporate Debtor is stated to be Rs 105 Lacs and the average Fair Market value is stated to be Rs 164 Lacs Against whereas the Successful Resolution applicant has proposed a consideration of Rs 125 Lacs to be paid to the all the Creditors and further investments in additional Working Capital margin and Capital Expenditure of Rs 25 Lacs and supervision and MUMBAI BENCH, COURT - I IA 210 of 2022 In CP (IB) 2620/MB/C-I/2019 Implementation of Rs 2.50 lacs leading to a total Resolution Plan Outlay of Rs 152.50 lacs and the Plan envisages disbursement is to all the Creditors (Secured & Unsecured Financial Creditors, all Operational Creditors Including Employees and Government Departments) whose claims have been received in the manner agreed in the Plan and as approved by the CoC. 17. The Financial Offer under the Approved Resolution Plan is Total disbursement of Rs 125.00 Lacs and the Total Investment envisaged in this CD of Rs 152.50 Lacs, from Internal Sources as follows:

Sr. Description Amount (in INR No. Lakhs) 10. I RP Costs (estimated upto 47.00 December 2021 or at actuals) 11. O perational Creditor & Statutory 3.00 Liability & Workmen & Employees 12. F inancial Creditor 75.00 13. A ny Other Liability 0.00 Total - A 125.00 14. S upervision and Implementation 2.50 of Resolution Plan 15. C apital Expenditure by 10.00 Resolution Applicant 16. W orking Capital Margin 15.00 Total - B 27.50 17. T otal outlay under the Resolution 152.50 Plan (A+B)

MUMBAI BENCH, COURT - I IA 210 of 2022 In CP (IB) 2620/MB/C-I/2019 Sources of Fund 18. I nternal Accruals, Including Cash 152.50 & Cash Equivalents, Loans, Bonds or Debt Instruments Total 152.50

18. On perusal of the Resolution Plan, it is observed that the Resolution Plan provides for the following: a) Payment of CIRP Cost as specified u/s 30(2)(a) of the Code. b) Repayment of Debts of Operational Creditors as specified u/s 30(2)(b) of the Code. c) For management of the affairs of the Corporate Debtor, after the approval of Resolution Plan, as specified U/s 30(2)(c) of the Code. d) The implementation and supervision of Resolution Plan by the RP and the CoC as specified u/s 30(2)(d) of the Code.

19. The RP has complied with the requirement of the Code in terms of Section 30(2)(a) to 30(2)(f) and Regulations 38(1), 38(1)(a), 38(2)(a), 38(2)(b), 38(2)(c) & 38(3) of the Regulations.

20. The RP has filed Compliance Certificate in Form-H along with the Plan. On perusal the same is found to be in order. The Resolution Plan has been approved by the CoC in the 7th meeting held on 09.12.2021 with 98.59% (Ninety-Eight point fifty nine percent).

21. In K Sashidhar v. Indian Overseas Bank & Others (in Civil Appeal No.10673/2018 decided on 05.02.2019) the Hon’ble Apex Court held that if the CoC had approved the Resolution Plan by requisite percent of voting share, then as per section 30(6) of the Code, it is MUMBAI BENCH, COURT - I IA 210 of 2022 In CP (IB) 2620/MB/C-I/2019 imperative for the Resolution Professional to submit the same to the Adjudicating Authority (NCLT). On receipt of such a proposal, the Adjudicating Authority is required to satisfy itself that the Resolution Plan as approved by CoC meets the requirements specified in Section 30(2). The Hon’ble Court observed that the role of the NCLT is ‘no more and no less’. The Hon’ble Court further held that the discretion of the Adjudicating Authority is circumscribed by Section 31 and is limited to scrutiny of the Resolution Plan “as approved” by the requisite percent of voting share of financial creditors. Even in that enquiry, the grounds on which the Adjudicating Authority can reject the Resolution Plan is in reference to matters specified in Section 30(2) when the Resolution Plan does not conform to the stated requirements.

22. In CoC of Essar Steel (Civil Appeal No. 8766-67 of 2019 decided on 15.11.2019) the Hon’ble Apex Court clearly laid down that the Adjudicating Authority would not have power to modify the Resolution Plan which the CoC in their commercial wisdom have approved. In para 42 Hon’ble Court observed as under:

“Thus, it is clear that the limited judicial review available, which can in no circumstance trespass upon a business decision of the majority of the Committee of Creditors, has to be within the four corners of section 30(2) of the Code, insofar as the Adjudicating Authority is concerned, and section 32 read with section 61(3) of the Code, insofar as the Appellate Tribunal is concerned, the parameters of such review having been clearly laid down in K. Sashidhar(supra).”

MUMBAI BENCH, COURT - I IA 210 of 2022 In CP (IB) 2620/MB/C-I/2019 23. In view of the discussions and the law thus settled, the instant Resolution Plan meets the requirements of Section 30(2) of the Code and Regulations 37, 38, 38 (1A) and 39 (4) of the Regulations. The Resolution Plan is not in contravention of any of the provisions of Section 29A of the Code and is in accordance with law. The same needs to be approved. Hence ordered.

ORDER The Application IA No. 210 of 2022 in CP 2620 of 2019 be and the same is allowed. The Resolution Plan annexed to the Application is hereby approved. It shall become effective from this date and shall form part of this order. i. It 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. ii. Further in terms of the Judgment of Hon’ble Supreme Court in the matter of Ghanshyam Mishra and Sons Private Limited v/s Edelweiss Asset Reconstruction Company Limited, on the date of approval of the Resolution Plan by the Adjudicating Authority, all such claims which are not a part of Resolution Plan, shall stand extinguished and no person will be entitled to initiate or continue any proceedings in respect to a claim which is not a part of the Resolution Plan. iii. The Memorandum of Association (MoA) and Articles of Association (AoA) shall accordingly be amended and MUMBAI BENCH, COURT - I IA 210 of 2022 In CP (IB) 2620/MB/C-I/2019 filed with the Registrar of Companies (RoC), Mumbai, Maharashtra for information and record. The Resolution Applicant, for effective implementation of the Plan, shall obtain all necessary approvals, under any law for the time being in force, within such period as may be prescribed. iv. The moratorium under Section 14 of the Code shall cease to have effect from this date. v. The Applicant shall supervise the implementation of the Resolution Plan and file status of its implementation before this Authority from time to time, preferably every quarter. vi. The Applicant shall forward all records relating to the conduct of the CIRP and the Resolution Plan to the IBBI along with copy of this Order for information. vii. The Applicant shall forthwith send a certified copy of this Order to the CoC and the Resolution Applicant, respectively for necessary compliance.

Sd/- Sd/- SHYAM BABU GAUTAM JUSTICE P. N. DESHMUKH Member (Technical) Member (Judicial) 18.11.2022 SAM