Approval of Resolution Plan - Mackeil Ispat & Forging Limited

IN THE NATIONAL COMPANY LAW TRIBUNAL KOLKATA BENCH KOLKATA IA (IB) No.398/KB/2021 in CP (IB) No.213/KB/2019 Application under section 30(6) and section 31(1) of the Insolvency & Bankruptcy Code, 2016 for approval of Resolution Plan In the matter of: State Bank of India … Financial Creditor Versus Mackeil Ispat & Forging Limited CIN: U27109WB2005PLC104575 … Corporate Debtor And In the matter of: Siba Kumar Mohapatra, Resolution Professional of Mackeil Ispat & Forging Limited … Applicant Date of hearing: 30.06.2021 Date of pronouncement: 21.09.2021 Coram: Shri Rajasekhar V.K., Member (Judicial) Shri Harish Chander Suri, Member (Technical)

Appearances (via video conference): For the Applicant/RP : Mr. Ratnanko Banerji, Sr. Advocate Mr. Rahul Auddy, Advocate Mr. RC Prusti, Advocate Ms. Sukruti Dutta, Advocate Mr. Siba Kumar Mohapatra, RP ORDER Per: Rajasekhar V.K., Member (Judicial)

1. This Court convened through video conferencing.

KOLKATA BENCH IA (IB) No.398/KB/2021 in CP (IB) No.213/KB/2019 In re Resolution Plan of Mackeil Ispat & Forging Ltd Preliminary 2. IA (IB) No.398/KB/2021 is an application under section 30(6) of the Code after approval of the resolution plan by the Committee of Creditors (CoC).

3. This application was moved on 30.06.2021 by Mr. Siba Kumar Mohapatra, Resolution Professional of Mackeil Ispat & Forging Limited (CIN: U27109WB2005PLC104575), by invoking the provisions of section 30(6) of the Insolvency and Bankruptcy Code, 2016 (“the Code” or “IBC”) read with regulation 39(4) of the Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) Regulations, 2016 (CIRP Regulations) for approval of a Resolution Plan in respect of Mackeil Ispat & Forging Limited (Corporate Debtor).

4. The underlying Company Petition in CP (IB) No.213/KB/2019 was filed by State Bank of India against Mackeil Ispat & Forging Limited, the Corporate Debtor, under section 7 of the Insolvency and Bankruptcy Code 2016, which was admitted vide order dated 03.02.2020 in CP (IB) No.213/ KB/2019.

5. Initially, Mr. Siba Kumar Mohapatra the Applicant herein (IBBI Reg. No. IBBI/IPA-001/IP-P00837/2017-18/11421) was appointed as the Interim Resolution Professional (IRP). At the first meeting of the CoC on 03.03.2020, the Applicant was appointed as the Resolution Professional (RP) of the Corporate Debtor.

Constitution of CoC 6. The IRP made public announcement on 07.02.2020 in Financial Express (English) (Kolkata Edition) and Bartaman (Bengali) (Kolkata Edition) newspapers regarding initiation of Corporate Insolvency Resolution Process (CIRP) and called proof of claims from the financial and operational creditors, workers and employees of the corporate debtor in the specified forms till 17.02.2020.

KOLKATA BENCH IA (IB) No.398/KB/2021 in CP (IB) No.213/KB/2019 In re Resolution Plan of Mackeil Ispat & Forging Ltd 7. The CoC was constituted on 25.02.2020 and a report of the constitution of the CoC was filed before the Adjudicating Authority on 26.02.2020. The CoC was further reconstituted on 11.08.2020 and 03.10.2020. The final list of members of the CoC are as under:

Sl Name of Creditors Voting share No percentage Secured Financial Creditors 1. S tate Bank of India 56.07 2. In dian Overseas Bank 16.06 3. A ndhra Bank 9.57 4. A llahabad Bank (now Indian Bank) 8.33 5. C ity Union Bank Limited 7.76 Total (Secured Financial Creditors) 97.79 Unsecured Financial Creditors 1. L andmark Commodeal Pvt. Ltd. 0.77 2. R over Commosales Pvt. Ltd. 0.72 3. Z evit Commotrade Pvt. Ltd. 0.22 4. M ascon Fin Pvt. Ltd. 0.22 5. R eliable Merchandise Pvt. Ltd. 0.18 6. In time Vintrade Pvt. Ltd. 0.10 7. B lue Chip Financial Consultants Pvt. Ltd. 0.00 Total (Unsecured Financial Creditors) 2.21 Total Secured (97.79%) + Total Unsecured (2.21%) 100.00

8. The Applicant states that a total of fourteen CoC meetings have been held during CIRP period, as follows:

KOLKATA BENCH IA (IB) No.398/KB/2021 in CP (IB) No.213/KB/2019 In re Resolution Plan of Mackeil Ispat & Forging Ltd Particulars Date of CoC meeting 1st CoC Meeting 03.03.2020 2nd CoC Meeting 21.04.2020 3rd CoC Meeting 10.07.2020 4th CoC Meeting 14.08.2020 5th CoC Meeting 22.09.2020 6th CoC Meeting 17.10.2020 7th CoC Meeting 09.11.2020 8th CoC Meeting 24.11.2020 9th CoC Meeting 27.11.2020 10th CoC Meeting 03.12.2020 11th CoC Meeting 14.01.2021 12th CoC Meeting 22.01.2021 13th CoC Meeting 09.02.2021 14th CoC Meeting 19.03.2021

Collation of claims 9. The amounts claimed and admitted are summarised below: (Amount in Rs./crore) Sl. Particulars Claim Claim No. Filed Admitted 1. Secured Financial Creditors 447.47 447.47 2. Unsecured Financial Creditors 10.15 10.15 (except related party) 3. Staff & Workmen 0.81 0.60 4. Operational Creditors 4.05 3.66 (statutory dues)

KOLKATA BENCH IA (IB) No.398/KB/2021 in CP (IB) No.213/KB/2019 In re Resolution Plan of Mackeil Ispat & Forging Ltd Sl. Particulars Claim Claim No. Filed Admitted 5. Operational Creditors 6.74 6.33 (other than staff/workmen & statutory dues except related party) 6. Related Party 8.53 7.73 (including Unsecured Financial Creditors & Operational Creditor) Grand Total 477.75 475.94

CIRP process and compliances 10. The Applicant submits that in terms of the provisions of section 25(2)(h) of the Code read with regulation 36A(1) of the Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) Regulations, 2016, invitations in Form ‘G’ for Expressions of Interest (EoI) from potential resolution applicants were issued. Form ‘G’ was published on 28.07.2020 for submission of resolution plans for the Corporate Debtor. This was published in Financial Express (English) and Bartaman (Bengali) in Kolkata Edition newspapers of 28.07.2020. The last day of submission of EoI was 12.08.2020. The notice was also published on the website of the Insolvency and Bankruptcy Board of India (IBBI).

11. The Applicant submits that in response to the invitation for EoI, seven EOIs were received and the Resolution Professional submitted the final list of eligible Prospective Resolution Applicants on 06.09.2020. the Information Memorandum, the Request for Resolution Plan and Evaluation Matrix were provided to the Prospective Resolution Applicants on 27.08.2020. The last date for submission of Resolution Plan was 26.09.2020 which was further extended to 16.10.2020. Three Resolution Plans were received till the last date of submission of Resolution Plan from – (1) Samriddhi Metals Private Limited; (2) Rama Overseas Limited; and (3) Amritvani Exim Private Limited.

KOLKATA BENCH IA (IB) No.398/KB/2021 in CP (IB) No.213/KB/2019 In re Resolution Plan of Mackeil Ispat & Forging Ltd 12. The Resolution Plans were opened in the 6th CoC meeting held on 17.10.2020 and the RP informed the CoC of the liquidation and fair value of the Corporate Debtor.

Evaluation and voting 13. The Resolution Plans were discussed in the 7th CoC meeting held on 09.11.2020 and 8th CoC meeting held on 24.11.2020 and the Prospective Resolution Applicants were asked to improve their offer. The Prospective Resolution Applicants submitted their revised plan/addendum and the revised plans were discussed for a final time by the CoC in its 13th meeting held on 09.02.2021. All the three revised plans were put up for e-voting on 18.02.2021 to 19.02.2021 which was extended till 12.03.2021. The CoC raised queries with regard to the Resolution Plan submitted by Samriddhi Metals Private Limited which were clarified vide an addendum submitted on 22.02.2021.

14. The CoC approved the Resolution Plan filed by Samriddhi Metals Private Limited with 100% voting.1 The Applicant issued the Letter of Intent on 12.03.20212 to the Successful Resolution Applicant which was accepted by the Successful Resolution Applicant on 16.03.2021.

15. In accordance with regulation 36B(4A) of the CIRP Regulations, the Successful Resolution Applicant has submitted the Performance Bank Guarantee on 19.03.2021.3

Compliance of the approved Resolution Plan with various provisions 16. The Applicant has filed a Compliance Certificate in prescribed form, i.e., Form ‘H’ in compliance with regulation 39(4) of the Insolvency &

1 Pages 279-290 of the IA 2 Annexure I at Pages 296-297 of the IA 3 Annexure J at Pages 298-303 of the IA

KOLKATA BENCH IA (IB) No.398/KB/2021 in CP (IB) No.213/KB/2019 In re Resolution Plan of Mackeil Ispat & Forging Ltd Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) Regulations, 2016, which has been annexed to the application as Annexure “L”.4

17. The Applicant has submitted details of various compliances as envisaged within the Code and the CIRP Regulations which a Resolution Plan should adhere to, which is reproduced hereunder:

I. Submission of Resolution Plan in terms of sub-section (2) of section 30 of the Code (as amended vide Amendment dated 16 August 2019):

Clause Requirement How dealt with in the Plan of s.30(2)

1. Plan must provide for payment of Point 3 of Section I at page CIRP cost in priority to 10 and Point 6.2 of Section repayment of other debts of CD II at page 16 of the Financial in the manner specified by the Proposal of the Resolution Board. Plan.

2. (i) Plan must provide for Point 6.6 & 6.7 of Section II repayment of debts of OCs in at Pages 22-26 of the such manner as may be specified Financial Proposal of the by the Board which shall not be Resolution Plan. less than the amount payable to them in the event of liquidation u/s 53;

(ii) Plan must provide for Point 6.7.5 at Page 25 of the repayment of debts of OCs in Financial Proposal of the such manner as may be specified Resolution Plan. by the Board which shall not be 4 Pages 428- 438 of the IA

KOLKATA BENCH IA (IB) No.398/KB/2021 in CP (IB) No.213/KB/2019 In re Resolution Plan of Mackeil Ispat & Forging Ltd Clause Requirement How dealt with in the Plan of s.30(2) not less than 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 (1) of section 53, whichever is higher;

(iii) provides for payment of debts Point 5 at Page 10 of the of financial creditors who do not Financial Proposal of the vote in favour of the resolution Resolution Plan. plan, in such manner as may be specified by the Board.

(c) Management of the affairs of the Section VA at Pages 35-38 Corporate Debtor after approval of the Financial Proposal of of the Resolution Plan. the Resolution Plan.

(d) Implementation and Supervision Section VA at Pages 35-38 of the Financial Proposal of the Resolution Plan.

(e) Plan does not contravene any of Point 10 of Section I at page the provisions of the law for the 11 of the Financial Proposal time being in force. of the Resolution Plan.

(f) Conforms to such other ---requirements as may be specified by the Board.

KOLKATA BENCH IA (IB) No.398/KB/2021 in CP (IB) No.213/KB/2019 In re Resolution Plan of Mackeil Ispat & Forging Ltd II. Measures required for implementation of the Resolution Plan in terms of Regulation 37 of CIRP Regulations:

Particulars Relevant Page of the Revised Resolution Plan dealing aforesaid compliance with Regulation

A resolution plan shall provide for the measures, as may be necessary, for insolvency resolution of the corporate debtor for maximisation of value of its assets, including but not limited to the following: - (a) transfer of all or part of the assets Not specifically proposed in the of the corporate debtor to one or Resolution Plan but reference more persons; made to Section-VII Point (g) at Page 56 of Financial Plan of the Resolution Plan.

(b) sale of all or part of the assets Not specifically proposed in the whether subject to any security Resolution Plan but reference interest or not; made to Section-VII Point (g) at Page 56 of Financial Plan of the Resolution Plan.

(c) restructuring of the corporate Not specifically proposed in the debtor, by way of merger, Resolution Plan but reference amalgamation and demerger; made to Section-VI point 16 at Page 47 of Financial Plan of the Resolution Plan.

(d) the substantial acquisition of Section-II Point 3 at Pages 12-13 of shares of the corporate debtor, or the Financial Plan of the Resolution merger or consolidation of the Plan. corporate debtor with one or more persons;

KOLKATA BENCH IA (IB) No.398/KB/2021 in CP (IB) No.213/KB/2019 In re Resolution Plan of Mackeil Ispat & Forging Ltd Particulars Relevant Page of the Revised Resolution Plan dealing aforesaid compliance with Regulation (e) cancellation or delisting of any Delisting – Not applicable shares of the corporate debtor, if Cancellation - Section II Point 3 at applicable; Pages 12-13 of the Financial Proposal of the Resolution Plan.

(f) satisfaction or modification of any Section II Point 6.3.6at Page 18 security interest; and Point 6.5.6 at Page 22 of the Financial Proposal of the Resolution Plan.

(g) curing or waiving of any breach of Section I Point 9 (vi) at the terms of any debt due from the the Financial Proposal of the corporate debtor; Resolution Plan and Point 2 at Page 1 of the Addendum dated 22.02.2021.

(h) reduction in the amount payable Section-II Point 5 at Pp 14-15 of to the creditors; the Financial Proposal of the Resolution Plan.

(i) extension of a maturity date or a Section-II Point 9 at Pages 27-29 of change in interest rate or other terms the Financial Proposal of the of a debt due from the corporate Resolution Plan. debtor;

(j) amendment of the constitutional Section-III, Point 3.3 at documents of the corporate debtor; the Financial Proposal of the Resolution Plan.

KOLKATA BENCH IA (IB) No.398/KB/2021 in CP (IB) No.213/KB/2019 In re Resolution Plan of Mackeil Ispat & Forging Ltd Particulars Relevant Page of the Revised Resolution Plan dealing aforesaid compliance with Regulation (k) issuance of securities of the Section-II Point 3 at Pages 12-13 of corporate debtor, for cash, property, the Financial Proposal of the securities, or in exchange for claims Resolution Plan. or interests, or other appropriate purpose;

(l) change in portfolio of goods or Not proposed in the Resolution services produced or rendered by the Plan corporate debtor;

(m) change in technology used by the Not proposed in the Resolution corporate debtor; and Plan (n) obtaining necessary approvals Section-III Point 2.1.6 at Page 31 from the Central and State of the Financial Proposal of the Governments and other authorities. Resolution Plan.

III. Mandatory contents of Resolution Plan in terms of Regulation 38 of CIRP Regulations:

Ref to Requirement How dealt with in the Plan relevant Reg.

38(1) The amount due to the Section I Point 4 at Page 10 operational creditors under a and Section II at page 25 of the resolution plan shall be given Financial Proposal of the priority in payment over Resolution Plan. financial creditors.

KOLKATA BENCH IA (IB) No.398/KB/2021 in CP (IB) No.213/KB/2019 In re Resolution Plan of Mackeil Ispat & Forging Ltd Ref to Requirement How dealt with in the Plan relevant Reg.

38(1A) A resolution plan shall Point 6 & 7 of Section-II at include a statement as to how Pages 16-27 of the Financial it has dealt with the interests Proposal of the Resolution of all stakeholders, including Plan. financial creditors and operational creditors of the corporate debtor.

38(1B) A resolution plan shall Point 2 of Section I at Page 10 include a statement giving of the Financial Proposal of the details if the resolution Resolution Plan. applicant or any of its related parties has failed to implement or contributed to the failure of implementation of any other resolution plan approved by the Adjudicating Authority at any time in the past.

38(2) A resolution plan shall provide:

(a) the term of the plan and its Section IV at Page 34 of the implementation schedule; Financial Proposal of the Resolution Plan.

(b) the management and Section V Pages 35-37 of the control of the business of Financial Proposal of the the corporate debtor Resolution Plan. during its term; and KOLKATA BENCH IA (IB) No.398/KB/2021 in CP (IB) No.213/KB/2019 In re Resolution Plan of Mackeil Ispat & Forging Ltd Ref to Requirement How dealt with in the Plan relevant Reg.

(c) adequate means for Point 2 of Section VB at Page supervising its 38 of the Financial Proposal of implementation. the Resolution Plan.

38(3) A resolution plan shall demonstrate that – (a) it addresses the cause of Section II at Page 21 of the default; Business plan of the Resolution Plan.

(b) it is feasible and viable; Section IV at Pages 28-29 of the Business Plan of the Resolution Plan.

(c) it has provisions for its Section IV at Page 34 of the effective implementation; Financial Proposal of the Resolution Plan.

(d) it has provisions for Section IV at Page 34 of the approvals required and the Financial Proposal of the timeline for the same; and Resolution Plan.

(e) the Resolution Applicant Section I at Pages 14-17 of the has the capability to Business Plan of Resolution implement the resolution Plan plan.

18. The Resolution Applicant has submitted affidavit of eligibility under section 29A of the Code, which is annexed to the Supplementary affidavit affirmed on 25.06.2021.

KOLKATA BENCH IA (IB) No.398/KB/2021 in CP (IB) No.213/KB/2019 In re Resolution Plan of Mackeil Ispat & Forging Ltd Details of Resolution Plan/Payment Schedule 19. The Applicant submits that the Resolution Applicant has filed a Resolution Plan on 16.01.2021 in two parts i.e., Business Plan and Financial Proposal, two addendums have been filed 11.02.2021 and 22.02.2021.

20. The relevant information with regard to the amount claimed, amount admitted and the amount proposed to be paid by the Resolution Applicant, i.e., Samriddhi Metals Private Limited [CIN: U74999WB2010PTC155684] under the said Resolution Plan is tabulated as under:

Sl. Name of Claimant Claim Amount Amount No. admitted proposed provided (in (in (%) Rs./lakhs) Rs./lakhs) 1. C IRP Cost 235.00 235.00 100.00%

2. W orkmen & 60.41 60.41 100.00% Employees Dues

3. S ecured Financial 44,747.18 3,253.25 7.27% Creditors

4. U nsecured Financial 1,015.39 32.49 3.20% Creditors

5. O perational Creditors (Statutory 366.42 7.33 2.00% Dues)

6. O perational Creditors (Other than 632.80 12.66 2.00% Statutory dues & Workmen/ Employees )

7. R elated Party Dues 772.73 3.86 0.50%

KOLKATA BENCH IA (IB) No.398/KB/2021 in CP (IB) No.213/KB/2019 In re Resolution Plan of Mackeil Ispat & Forging Ltd Sl. Name of Claimant Claim Amount Amount No. admitted proposed provided (in (in (%) Rs./lakhs) Rs./lakhs) 8. W orking --- 2,100.00 Capital/Capex

Total --- 5705.00

21. Summary of the financial proposal/payment under the Resolution Plan dated 16.01.2021, is tabulated hereunder:

Particulars Amount Admissible Debt to be paid to the The Resolution Applicant shall pay CIRP the CIRP Cost, upfront i.e., within 45 days of Effective Date. Admissible Debt to be paid to the The RA proposes to pay full amount Workman / Employees (other of ₹60.41 lakh towards settlement of than related parties of CD) dues against the same, within 45 days of Effective Date. Admissible Debt to be paid to The RA proposes to pay an amount of Operational Creditors (Statutory ₹7.33 lakh upfront i.e., within 45 days Dues) of Effective Date. Admissible Debt to be paid to The RA proposes to pay an amount of Operational Creditors (Other than ₹12.67 lakh upfront i.e., within 45 Workman & Employee and days of Effective Date. Statutory Dues) Admissible Debt to be paid to The RA proposes to pay an amount Secured Financial Creditors of ₹3253.25 lakh in two tranches - ₹2163.00 lakh (i.e., 66% of the settlement amount) will be paid

KOLKATA BENCH IA (IB) No.398/KB/2021 in CP (IB) No.213/KB/2019 In re Resolution Plan of Mackeil Ispat & Forging Ltd Particulars Amount upfront i.e. within 45 days of Effective Date. - Balance amount of ₹1090.25 lakh (i.e., 34% of the settlement amount) will be paid between 46 days and 6 months of the effective date. Admissible Debt to be paid to The RA proposes to pay an amount Unsecured Financial Creditors of ₹32.49 lakh in two tranches - an amount of ₹21.32 lakh (i.e., 66% of the settlement amount) will be paid upfront i.e., within 45 days of Effective Date. - Balance amount of ₹11.17 lakh (i.e., 34% of the settlement amount) will be paid between 46 days and 6 months of the effective date. Admissible Debt to be paid to The RA proposes to pay an amount of Related Party Rs.3.85 lakh upfront i.e., within 45 days of Effective Date.

22. The Resolution Plan defines “Effective Date” as the date of approval of this Plan by Adjudicating Authority.

Details on Management/Implementation and Reliefs as per the Resolution Plan – Salient Features 23. The Resolution Plan also provides for – a. Management of company after resolution in Section-VA at Pages 35-37 of the Financial Proposal of the Resolution Plan.

KOLKATA BENCH IA (IB) No.398/KB/2021 in CP (IB) No.213/KB/2019 In re Resolution Plan of Mackeil Ispat & Forging Ltd b. Term of the resolution plan in Section-IV at Page 34 of the Financial Proposal of the Resolution Plan. c. Implementation and Supervision of the resolution plan in Section VB at Page 38 of the Financial Proposal of the Resolution Plan. Relinquishment/Waiver of liabilities and Approvals 24. The Reliefs, Exemptions and Waivers sought by the Resolution Applicant from the Adjudicating Authority are set out below for the successful implementation of the Resolution Plan. The orders thereon are indicated against each.

Sl. Relief, concessions and Orders thereon No. approvals sought 1. All utility suppliers, including Granted in terms of the but not limited to DVC, shall Ghanashyam Mishra and Sons commit supplies on and from the Pvt Ltd v Edelweiss Asset Effective Date. No utility Reconstruction Company Ltd, 5 supplier, including but not wherein the Hon'ble Supreme limited to DVC, should withhold Court has held that once a / delay supply of utility on the resolution plan is duly approved ground of non-payment of dues by the Adjudicating Authority prior to the Effective Date. under sub-section (1) of section The Resolution Applicant 31, the claims as provided in the proposes to revive the unit and to resolution plan shall stand resume production facilities to frozen and will be binding on achieve the broader objective of the Corporate Debtor and its the IB Code. It is not feasible to employees, members, creditors, operate the plant without the including the Central Govt, any support & co-operation of utility State Govt or any local suppliers, especially DVC. The authority, guarantors and other Resolution Plan, once approved, stakeholders. On the date of will be binding on all approval of resolution plan by stakeholders and all the utility the Adjudicating Authority, all such claims, which are not a 5 2021 SCC OnLine SC 313 decided on 13.04.2021.

KOLKATA BENCH IA (IB) No.398/KB/2021 in CP (IB) No.213/KB/2019 In re Resolution Plan of Mackeil Ispat & Forging Ltd Sl. Relief, concessions and Orders thereon No. approvals sought suppliers, including DVC, part of resolution plan, shall should consider approval of this stand extinguished and no Resolution Plan as direction of person will be entitled to initiate Adjudicating Authority to or continue any proceedings in supply respective utilities, respect to a claim, which is not including Power. part of the resolution plan. The Hon'ble Supreme Court also held that all the dues including the statutory dues owed to the Central Govt, any State Govt or any local authority, if not part of the resolution plan, shall stand extinguished and no proceedings in respect of such dues for the period prior to the date on which the Adjudicating Authority grants its approval under section 31 could be continued.

2. The Corporate Debtor and the If there is any such condition in Resolution Applicant (as its any specific contract, then this shareholder) shall be entitled to should be specifically modify contracts which: (i) are mentioned in the Resolution entered into with parties prior to Plan. A carte blanche of this the Insolvency Commencement nature cannot be granted. Date, and (ii) impose onerous conditions hindering the resolution process / turnaround process, day-to-day operations for the Corporate Debtor.

3. Resolution Applicant and the This shall be in terms of section Corporate Debtor after the 32A of the Code. successful acquisition by the Resolution Applicant shall not

KOLKATA BENCH IA (IB) No.398/KB/2021 in CP (IB) No.213/KB/2019 In re Resolution Plan of Mackeil Ispat & Forging Ltd Sl. Relief, concessions and Orders thereon No. approvals sought be responsible for any defaults for the period prior to effective date any nature under any law as may be applicable from time to time including but not limited to ED/ RBI/ CBI/ CVC/ PMLA/ FEMA/ FERA, customs, excise, VAT, GST, ST/ CST/ Octroi, Property Tax and any other law/ enforcement agencies even if not mentioned here.

4. The unit of the CD (MIFL) to be Granted, since the objective of treated as new enterprise eligible the Code is to enable the under the West Bengal Incentive Corporate Debtor to make a Scheme - Banglashree for fresh start in business. MSMEs and/or any other such scheme of the State Govt. Accordingly MIFL should be eligible for all the benefits extended by State Govt like Capital Subsidy, Interest Subsidy, Power Subsidy, SGST, Waiver of Electricity Duty, PF and ESI benefits and/or any other benefits.

5. The unit of the CD (MIFL) is to Granted, since the objective of be treated as New Enterprise and the Code is to enable the all the benefits accrued to a new Corporate Debtor to make a enterprise in terms of the various fresh start in business. Central Government Policies including but not limited to Direct and Indirect Taxation policy etc.

KOLKATA BENCH IA (IB) No.398/KB/2021 in CP (IB) No.213/KB/2019 In re Resolution Plan of Mackeil Ispat & Forging Ltd Sl. Relief, concessions and Orders thereon No. approvals sought 6. From the Information Not granted. It was really upto Memorandum and/or the Resolution Applicant to Statement of Accounts made conduct its due diligence and available to the Resolution satisfy itself as to whether the Applicant it is apparent that the title to the land in question was Durgapur property is the perfect or not. If it has not done primary asset of the Corporate so, then it must suffer the Debtor. Accordingly, it is consequences thereof. The necessary that the title and Resolution Applicant cannot be ownership of the CD in respect permitted to withdraw from of the Durgapur property implementation of the Plan on (around 26.63 acres of land) is this ground. This flippant good and marketable and free request is, therefore, not from all Encumbrances and that acceptable. Mackeil Ispat & Forging Limited has unrestricted right to own, hold, possess, use for any purpose, transfer and deal with the same or any part thereof in any manner whatsoever without any interference or hindrance or requirement of any consent or no objection from any Person. Anything contrary to the above will jeopardize RA’s plan to revive the unit. Accordingly, the RA reserve the right not to implement the Plan in case anything to the contrary is found in the due course. The Refundable Deposit money & Performance Guarantee Money submitted/to be submitted by the RA, should not be withheld in such cases and the RA should not be hold responsible for non-

KOLKATA BENCH IA (IB) No.398/KB/2021 in CP (IB) No.213/KB/2019 In re Resolution Plan of Mackeil Ispat & Forging Ltd Sl. Relief, concessions and Orders thereon No. approvals sought implementation of the Plan in such cases (sic).

7. The Durgapur Property shall be This is not within the deemed to be exempted from jurisdiction of this Adjudicating applicability of any ceiling limit Authority. under any Applicable Law and all ceiling limits shall be waived and all necessary permissions, consents, approvals, no objections, applications and compliances required under any Applicable Law for purchasing, owning, holding, using in any manner and transferring the same without any restriction shall be deemed to have been granted and/or complied with by all concerned Persons.

8. All statutory and other liabilities Granted in terms of the and dues relating to the Ghanashyam Mishra and Sons Durgapur Property including but Pvt Ltd v Edelweiss Asset not limited to land revenue, Reconstruction Company Ltd, 6 khazana, municipal taxes, wherein the Hon'ble Supreme mutation fees, conversion fees, Court has held that once a etc. whether outstanding or resolution plan is duly approved demanded till date or not, or by the Adjudicating Authority whether recorded in the books of under sub-section (1) of section accounts or not, including all 31, the claims as provided in the interest, penalties, fines, etc. as resolution plan shall stand also all other taxes, levies, frozen and will be binding on charges, outgoings, etc. by the Corporate Debtor and its 6 2021 SCC OnLine SC 313 decided on 13.04.2021

KOLKATA BENCH IA (IB) No.398/KB/2021 in CP (IB) No.213/KB/2019 In re Resolution Plan of Mackeil Ispat & Forging Ltd Sl. Relief, concessions and Orders thereon No. approvals sought whatsoever name called and employees, members, creditors, payable to any Government including the Central Govt, any Authority or any other Person State Govt or any local under any Applicable Law for authority, guarantors and other the time be waived and/or the stakeholders. On the date of liability in respect of the same be approval of resolution plan by fully extinguished upon approval the Adjudicating Authority, all of the Plan by Adjudicating such claims, which are not a Authority 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 part of the resolution plan. The Hon'ble Supreme Court also held that all the dues including the statutory dues owed to the Central Govt, any State Govt or any local authority, if not part of the resolution plan, shall stand extinguished and no proceedings in respect of such dues for the period prior to the date on which the Adjudicating Authority grants its approval under section 31 could be continued.

KOLKATA BENCH IA (IB) No.398/KB/2021 in CP (IB) No.213/KB/2019 In re Resolution Plan of Mackeil Ispat & Forging Ltd Sl. Relief, concessions and Orders thereon No. approvals sought 9. Necessary direction be given to None of the parties involved – complete mutation & conversion the RP, CoC and the RA – have process of the Durgapur even done a basic inspection to Property (if pending) in the name see whether any such of Mackeil Ispat & Forging application for mutation or Limited by the relevant Govt conversion is pending before the Authorities including the authorities concerned. They concerned Block Land & Land instead push the onus onto the Reforms Office without Adjudicating Authority hoping requirement of payment of any to take a blank cheque in this mutation fees, charges, costs etc. regard. In any case, there or any past dues on any account cannot be a direction to any and the same be fully authority not to take mutation waived/exempted. fee and other charges payable, if any under any other statute. This relief is, therefore, refused.

10. All the original Title Deeds and Granted. related documents of MIFL whether mortgaged or unencumbered are to be handed over by Financial Creditors to MIFL on payment of settlement amount as contemplated in this Plan. In case if any Title Deeds are with any other individual or entity other than the Financial Creditors, then RP should ensure that the same is peacefully handed over to MIFL on or before the closing date.

11. The Resolution Applicant seeks the following reliefs and concessions from NCLT and from the other relevant government authorities –

KOLKATA BENCH IA (IB) No.398/KB/2021 in CP (IB) No.213/KB/2019 In re Resolution Plan of Mackeil Ispat & Forging Ltd Sl. Relief, concessions and Orders thereon No. approvals sought A. In terms of the third proviso The reliefs at 11A to 11F are for to sec. 79 of the Income Tax the Income Tax authorities to Act, 1961, the resolution consider, keeping the spirit of applicant is not required to the IBC in view. comply with the provisions of sec. 79 for carry forward and set off of loss of the corporate debtors. Reasonable opportunity of being heard may be provided to the jurisdictional Principal Commissioner or Commissioner of Income Tax as required under the said provisions of the IT Act. B. Allow setting off of losses and unabsorbed depreciation for the purpose of computation of book profit as permitted under sec. 115JB of Income Tax Act, 1961. C. Exemption from any tax liability arising due to implementation of the Resolution Plan both in computing total income under the normal provisions of the IT Act and in the computation of book profit under sec. 115JB of the IT Act. D. Allow filing return of income and/or revised return of income, for the Assessment Years prior to the Effective Date, if the said returns have

KOLKATA BENCH IA (IB) No.398/KB/2021 in CP (IB) No.213/KB/2019 In re Resolution Plan of Mackeil Ispat & Forging Ltd Sl. Relief, concessions and Orders thereon No. approvals sought not been filed within the due date of filing the said returns; or have been filed on the basis of financial statements prepared by the Corporate Debtor in violation of the provisions of sec. 129 and sec. 134 of the Companies Act, 2013. E. Allow the benefit of carry forward of losses quantified in the returns and/or revised returns filed as per D above. F. The brought forward Business Loss as on the Effective Date shall be deemed to be the Business Loss for the previous year in which the Effective Date falls.

G. Waiver of any income-tax In Ghanashyam Mishra & Sons and Minimum Alternate Tax Pvt Ltd v Edelweiss Asset (MAT) liability or Reconstruction Company Ltd, 7 consequences (including the Hon'ble Supreme Court interest, fine, penalty, etc) on held that once a Resolution MIFL., Resolution Applicant Plan is approved, a creditor and its shareholders on cannot initiate proceedings for account of various steps as recovery of claims which are proposed in the Resolution not part of the Resolution Plan. Plan, including but not limited to liabilities if any under Section 41 (1), Section 56, Section 43, Section 43 B,

7 2021 SCC OnLine SC 313 decided on 13.04.2021

KOLKATA BENCH IA (IB) No.398/KB/2021 in CP (IB) No.213/KB/2019 In re Resolution Plan of Mackeil Ispat & Forging Ltd Sl. Relief, concessions and Orders thereon No. approvals sought Section 28, Section 115JB and Section 79 of the Income-tax Act, 1961, including, without limitation waiver of MAT and income tax implication arising due to write back/write off of liabilities in the books of accounts of MIFL without any impact on brought forward tax and book loss / depreciation, pursuant to this Resolution Plan.

12. Any requirements to obtain This is for the Income Tax waivers from any Tax authorities to consider, keeping Authorities including in terms of the spirit of the IBC in view. section 79 of the IT Act is deemed to have granted upon approval of this Resolution Plan on the Closing Date.

13. Any approvals that may be Unless specific reliefs are required from Governmental identified and placed for Authorities (including tax decision, it is not possible for authorities) in connection with the Adjudicating Authority to the implementation of the exercise its mind on the matter, Resolution Plan including on especially in a situation where account of change in ownership the Resolution Applicant is not / control of MIFL. shall be sure of the approvals that would deemed to have been granted on be required. the Effective Date.

14. The Corporate Debtor & Granted, so long as any such act Resolution Applicant be allowed is not in violation of any labour to re-build the Human Capital as laws, since no resolution plan per the requirement without any which is in violation of any

KOLKATA BENCH IA (IB) No.398/KB/2021 in CP (IB) No.213/KB/2019 In re Resolution Plan of Mackeil Ispat & Forging Ltd Sl. Relief, concessions and Orders thereon No. approvals sought obligations. existing law can be approved by this Adjudicating Authority.

15. All Government Authorities to Unless specific cases of non-waive the Non-Compliances of compliances are identified, it is the Corporate Debtor prior to the difficult to grant reliefs of this effective date. nature.

16. Post-acquisition of CD, the new Section 31(4) of the Code allows management shall require 12 a period of one year from the months for appointment of date of approval of the Auditors, Company Secretary resolution plan by the and other Statutory Adjudicating Authority to Compliances. The RA should obtain all necessary approvals therefore be allowed 12 months’ required for the business of the time from the effective date to corporate debtor. All actions comply with all statutory should be consistent with the approval and requirements provisions of the Code. including but not limited to filing of Balance Sheet, without any charges, penalties, interest, etc.

17. Since the Resolution Applicant It is incredulous that the has been provided with limited resolution applicant claims to information in relation to the have been provided with Business Permits and their “limited information” about the current status, it is probable that business permits etc. If so, it was certain of the Business Permits / for the Resolution Applicant to Statutory Approvals of the undertake proper due diligence, Corporate Debtor have lapsed, and not thrust its own expired, suspended, cancelled, carelessness on the revoked or terminated or the Adjudicating Authority and Corporate Debtor has Non-expect concessions in this Compliances in relation thereto. regard. Having said that, it is up Accordingly, all Government to the Resolution Applicant to Authorities (i) to provide make necessary applications to KOLKATA BENCH IA (IB) No.398/KB/2021 in CP (IB) No.213/KB/2019 In re Resolution Plan of Mackeil Ispat & Forging Ltd Sl. Relief, concessions and Orders thereon No. approvals sought reasonable time period of at least the concerned regulatory or 12 months after the effective statutory authorities for renewal Date in order to enable of such business permits in Resolution Applicant to assess terms of section 31(4) of the the status of these Business IBC, and such authority shall Permits / Statutory Approvals also consider the same keeping and ensure that the Corporate in mind the objectives of the Debtor is compliant with the Code. The actions of such terms of such Business Permits / authorities shall also be Statutory Approvals and consistent with the provisions of Applicable Law (ii) should not section 32A of the Code. initiate any investigations, actions or proceedings in relation to such Non-Compliances (iii) should co-operate with the CD to renew / obtain for such permits / approvals, (iv) permit the Resolution Applicant to continue to operate the business of the Corporate Debtor pending such permits / approvals at least till a period of 12 months from the Effective Date & (v) not to charge any charges, penalty, interest, etc till the time such Permits / Approvals are received.

The Resolution Applicant shall, pursuant to approval of the resolution plan by the Adjudicating Authority obtain the necessary approvals required under any law for the time being in force within a period of one year from the date of such

KOLKATA BENCH IA (IB) No.398/KB/2021 in CP (IB) No.213/KB/2019 In re Resolution Plan of Mackeil Ispat & Forging Ltd Sl. Relief, concessions and Orders thereon No. approvals sought approval or within such period as provided for in such law, whichever is later.

18. Neither the Resolution It is not clear as to which law Applicant, nor any of its debars the Resolution Applicant Affiliates or connected persons, or indeed its affiliates or will be disqualified from or connected persons from considered ineligible under the proposing or implementing any Code for proposing and/ or resolution plan of person. implementing a plan in relation to the insolvency resolution of any Person (other than the Corporate Debtor), merely on account of the implementation of this Plan by the Resolution Applicant.

19. It is assumed from the effective No orders can be passed on the Date, all accounts of the assumptions of the Resolution Corporate Debtor shall stand Applicant. regularised and their Asset Classification is “Standard” for the purpose of Applicable RBI Laws.

20. On discharge of all the liabilities Granted. to the secured financial creditors, all the charges registered with ROC to be satisfied.

21. The Central Board of Direct Granted, since the object of the Taxes to - (i) not void or take any Code is to enable the Corporate other actions with respect to the Debtor to have a fresh start in transactions contemplated under business. this Plan under Section 281 of KOLKATA BENCH IA (IB) No.398/KB/2021 in CP (IB) No.213/KB/2019 In re Resolution Plan of Mackeil Ispat & Forging Ltd Sl. Relief, concessions and Orders thereon No. approvals sought the IT Act; (ii) exempt the Resolution Applicant from any liability pursuant to Sections 56 and 170 of the IT Act; and (iii) not levy any Tax (including minimum alternate tax) arising as a result of giving effect to, or otherwise in relation to, the Plan, in the hands of Corporate Debtor or the Resolution Applicant. The Central Board of Excise and Customs to not void or take any other actions with respect to the transactions contemplated under this Plan (including the Merger and the sale of Collateral) under section 81 of the Central Goods and Services Tax Act, 2017 and not to impose any successor liability on the Resolution Applicant and the Corporate Debtor

22. Neither the Resolution Any resolution plan should be Applicant nor MIFL, nor their consistent with extant law. respective directors, officers and Therefore, there is no question employees appointed as on or of grant of any immunity on or after the Effective Date shall be after the Effective Date in liable for any violations, respect of violation of any law liabilities, penalties, interests on applicable for the time being in statutory payments and/ or fines force. The authorities with respect to or pursuant to concerned are free to take any any order of any Governmental action, so long as the same is Authority or on account of non-consistent with section 32A of compliance of Applicable Laws the Code. by MIFL or due to MIFL not

KOLKATA BENCH IA (IB) No.398/KB/2021 in CP (IB) No.213/KB/2019 In re Resolution Plan of Mackeil Ispat & Forging Ltd Sl. Relief, concessions and Orders thereon No. approvals sought having in place requisite approvals and licenses (excluding the Pollution Control Board approval for which the necessary steps will be taken by RA) to undertake its business as per Applicable Law.

23. All Government Authorities This is for the appropriate (including the RBI) to grant any authorities to consider. relief, concession or dispensation as may be required for implementation of the transactions contemplated under the Plan in accordance with its term and conditions.

24. The jurisdictional Registrar of The duties of the Registrar of Companies to take on record and Companies do not include implement the Plan, upon taking on record and approval of the Plan by NCLT, implementing the Plan. In so far without any further as compliances are concerned, compliances. all necessary forms along with filing fees shall be filed with the Registrar of Companies to enable him to take the same on record.

25. All Designated Authorised No specific orders are necessary Dealer Category-I Banks to grant in this regard. any approval or dispensation as may be required for actions contemplated under the Plan in accordance with its terms and conditions.

KOLKATA BENCH IA (IB) No.398/KB/2021 in CP (IB) No.213/KB/2019 In re Resolution Plan of Mackeil Ispat & Forging Ltd Sl. Relief, concessions and Orders thereon No. approvals sought 26. All creditors of the Corporate Whatever protection is Debtor to withdraw all legal available to the corporate debtor proceedings commenced against in terms of section 32A of the the Corporate Debtor in relation Code will in any case continue to claims, including all criminal to be available. Therefore, no proceedings, proceedings under specific orders are necessary in section 138 of the Negotiable this regard. Instruments Act, 1881 and proceeding under SARFAESI and RDDBFI, within 30 (thirty) days of the Closing Date.

27. In terms of sec. 32 A of the Code, notwithstanding anything to the contrary contained in this code or any other law for the time being in force, the liability of a corporate debtor for an offence committed prior to the commencement of the corporate insolvency resolution process shall cease, and the corporate debtor shall not be prosecuted for such an offence from the date the resolution plan has been approved by the AA. The criminal proceedings of the company shall not continue after the approval of the resolution plan according to section 32A.

Accordingly, all enquiries, investigations, notices, causes of action, suits, claims, liabilities, demand, obligations, penalties, disputes, litigations, arbitrations

KOLKATA BENCH IA (IB) No.398/KB/2021 in CP (IB) No.213/KB/2019 In re Resolution Plan of Mackeil Ispat & Forging Ltd Sl. Relief, concessions and Orders thereon No. approvals sought or other judicial, regulatory or administrative proceedings against, the CD or the affairs of the CD, pending or threatened, present or future (including without limitation, any investigation by Central Bureau of Investigation or the Serious Fraud Investigation Office), whether or not on account of acts or omissions in breach of applicable law (including but not limited to environmental laws, foreign exchange laws and regulations, labour and employment laws, and laws relating to anti-corruption and prevention of money laundering) and including but not limited to the proceedings specifically set out in point no.v of Section II of Part A of this Plan (Details of Pending Litigation) in relation to any period prior to the Effective Date shall stand extinguished and accordingly, all such proceedings, inquires, investigations, etc. shall be disposed of and all liabilities or obligations in relation thereto, whether or not set out in the Provisional Balance Sheet, the balance sheet of the CD or the profit and loss account statements of the CD or the List of Creditors, shall, in accordance with Regulation 37 of the CIRP

KOLKATA BENCH IA (IB) No.398/KB/2021 in CP (IB) No.213/KB/2019 In re Resolution Plan of Mackeil Ispat & Forging Ltd Sl. Relief, concessions and Orders thereon No. approvals sought Regulations, be deemed to have been written off in full and permanently extinguished by virtue of the order of NCLT approving this plan and the Resolution Applicant, shall at no point of time be, directly or indirectly, held responsible or liable in relation thereto. By virtue of the order of the NCLT approving this Resolution Plan, all new inquiries, investigations, notices, suits, claims, disputes, litigations, arbitration or other judicial, regulatory or administrative proceedings will not be initiated or admitted if these relate to any period prior to the Effective Date or on account of the acquisition of control by Resolution Applicant over the CD pursuant to this Resolution Plan, against the CD or any of its employees or directors who are appointed or who remain in employment or directorship after the Effective Date or pursuant to the implementation of the Resolution Plan.

In case approval of Plan does not mean automatic abatement etc. and for those cases which are subject matter of concerned competent authority having its own jurisdiction, RA will take up

KOLKATA BENCH IA (IB) No.398/KB/2021 in CP (IB) No.213/KB/2019 In re Resolution Plan of Mackeil Ispat & Forging Ltd Sl. Relief, concessions and Orders thereon No. approvals sought the matter with respective authorities for abatement of the same upon NCLT approving the Plan and pursuant to the NCLT Order.

28. It is clarified that the existing Whatever protection is promoters, shareholders, available to the corporate debtor managers, directors, officers or in terms of section 32A of the such other person in charge of Code will in any case continue the affairs and management of to be available. Therefore, no the CD (including any person who specific orders are necessary in was an ‘officer in default’ or this regard. ‘occupier’) prior to the Effective Date shall continue to be responsible and liable for all the liabilities, claims, demand, obligations, penalties etc. arising out of any – (i) proceedings, inquiries, investigations, orders, show causes, notices, suits, litigation etc. (including those arising out of any orders passed by the NCLT pursuant to sections 43, 45, 49, 50, 66, 68, 70, 71, 72, 73, 74 of the IBC (including without limitation, any investigation by Central Bureau of Investigation or the Serious Fraud Investigation Office) or any acts or omissions in breach of applicable law (including but not limited to environmental laws, foreign exchange laws and regulations, labour and employment laws, and laws relating to anti-corruption and KOLKATA BENCH IA (IB) No.398/KB/2021 in CP (IB) No.213/KB/2019 In re Resolution Plan of Mackeil Ispat & Forging Ltd Sl. Relief, concessions and Orders thereon No. approvals sought prevention of money laundering or diversion of funds) which occurred prior to the Effective Date, whether civil or criminal, pending before any authority, court, tribunal or any other forum prior to the effective Date or (ii) that may arise out of any proceedings, inquiries investigations, orders, show cause, notices, suits, litigation etc. (including any orders passed by the NCLT pursuant to Sections 43, 45, 49, 50, 66, 68, 70, 71, 72, 73, 74 of the IBC), whether civil or criminal, that may be initiated or instituted post the approval of the Resolution Plan by the NCLT on account of any transactions entered into, or decisions or actions taken by, such existing promoters, shareholders, managers, directors, officers, employees, workmen or other personnel of the CD, and the Resolution Applicant shall at no point of time be, directly or indirectly, held responsible or liable in relation thereto.

KOLKATA BENCH IA (IB) No.398/KB/2021 in CP (IB) No.213/KB/2019 In re Resolution Plan of Mackeil Ispat & Forging Ltd Sl. Relief, concessions and Orders thereon No. approvals sought 29. There might be certain The Adjudicating Authority litigations/proceeding against cannot exercise its mind upon the CD regarding the CD may speculation of the Resolution have conducted its business in Applicant, without any specific breach of certain applicable laws; cases being placed for judicial and (b) an adverse outcome of consideration. such proceedings would interrupt the business of the CD as a going concern. Accordingly, all such proceedings should be extinguished/dropped immediately on approval of the Plan by the Adjudicating Authority.

30. All domain names, servers, All of these shall be strictly in being currently used by the CD terms of the underlying to the extent not owned shall contracts entered into, nothing continue to be available for use more and nothing less. by the CD for a period of 3 months for the Effective Date.

31. There is no adverse effect on the The implication of this waiver is rights of the CD over its not clear. immovable properties.

32. Upon approval of this Granted. Resolution Plan by NCLT, the rights of any person (whether exercisable now or in the future), either directly or indirectly, and whether contingent or not, to call for the allotment, issue, sale or transfer of shares of the CD or whether through any exchange or otherwise, shall stand

KOLKATA BENCH IA (IB) No.398/KB/2021 in CP (IB) No.213/KB/2019 In re Resolution Plan of Mackeil Ispat & Forging Ltd Sl. Relief, concessions and Orders thereon No. approvals sought unconditionally and irrevocably extinguished. All employee stock options shall stand extinguished.

33. All concerned state revenue or Not granted. The Resolution stamp authorities to waive Plan cannot be in violation of penalties for non-registration any law for the time being in and inadequate or non-stamping force. Therefore, if there are of documents executed by the any documents on which stamp Corporate Debtor. duty is required to be paid, or in respect of which non-registration will have adverse consequences, they shall apply with full force and no waiver can be granted in this regard.

34. If Corporate Debtor applies for Granted, since the object of the credit rating / grading with any Code is to enable the Corporate agency/bank/financial Debtor to have a fresh start in institutions etc., past business. performance (during the closure period for around 3 years) should not be considered for fiscal fillip. The New Promoters or New Promoters Group and its controlled company/concerns who are proposed to be the shareholders of corporate debtor has got certain synergy with corporate debtors as has been mentioned in Resolution Plan. Therefore, it is possible that some of the products of Resolution Applicant or its associate concern may be KOLKATA BENCH IA (IB) No.398/KB/2021 in CP (IB) No.213/KB/2019 In re Resolution Plan of Mackeil Ispat & Forging Ltd Sl. Relief, concessions and Orders thereon No. approvals sought common with the products of the corporate debtor. Therefore, to attain the financial stability of the corporate debtor, exemption will be available to the Resolution Applicant and its members/associates as well as Corporate Debtor with regard to provisions of the conflict of Interest due to common shareholding of the corporate debtor and Resolution Applicant including its associates from all the customers- – including but not limited to Government/ Semi- Government / PSUs/ Non-Government/ Research & Development Centres / Subsidiaries / Division/ Zones/ Workshop/ Sheds or any other entities not mentioned here.

35. All Departments and authorities, Granted, since the object of the including but not limited to Code is to enable the Corporate Government/ Semi- Debtor to have a fresh start in Government / PSUs/ Non-business. Government/ Research & Development Centres / Subsidiaries / Division/ Zones/ Workshop/ Sheds or any other entities not mentioned here, shall allow the Corporate Debtor to submit their offers / Proposal / tenders etc., for the period of 3 (three) years from the date of NCLT order, without insisting

KOLKATA BENCH IA (IB) No.398/KB/2021 in CP (IB) No.213/KB/2019 In re Resolution Plan of Mackeil Ispat & Forging Ltd Sl. Relief, concessions and Orders thereon No. approvals sought for the details on past revenue, profitability records, net worth and supply and performance records or any other credentials, as Resolution Applicant will be starting the business for the Products of the Corporate Debtor afresh as there had been discontinuity in the business for past few years.

36. All Government Authorities to Not granted. waive non-compliance of the Corporate Debtor prior to the Effective Date.

37. Resolution Applicant shall not Generally, the principles be liable and will be kept enunciated in section 32A of the indemnified financially or Code will apply. otherwise against any of the negative impact / observation / findings of Forensic Audit and/or transaction audit. Further neither the Corporate Debtor nor any member of the New Promoters or New Promoters group shall be made party to any of the legal cases arising out of such forensic audit.

38. It is further clarified that the As far as meetings of approval of the NCLT shall shareholders for issue of such constitute adequate approval for new equity shares and for issuance of New Equity Shares cancellation of existing equity and cancellation of existing shares of the corporate debtor equity shares of the CD issued to are concerned, approval to the KOLKATA BENCH IA (IB) No.398/KB/2021 in CP (IB) No.213/KB/2019 In re Resolution Plan of Mackeil Ispat & Forging Ltd Sl. Relief, concessions and Orders thereon No. approvals sought the existing promoter group & Resolution Plan accorded by others, if any, in accordance with this Adjudicating Authority applicable law and accordingly, shall be deemed to be requisite no approval or consent shall be approval for all such meetings necessary from any other Person or dispensation from / Government Authority in conducting meetings of relation to either of these actions shareholders. However, all under any agreement, the regulatory compliances such as Constitutional documents of the filing with the RoC, payment of Corporate Debtor or under any filing fees on documents etc. Applicable Law. will have to be complied with. RoC cannot be expected to grant automatic approval for such activities without the forms being filed on behalf of the corporate debtor. This fact has also been recognised to be so by the Ministry of Corporate Affairs vide General Circular No.IBC/01/2017 dated 25.10.2017 issued under File No.30/14/2017-Insolvency.

25. The Applicant further states that the Resolution Applicant in the addendum filed on 11.02.2021 has stated as follows:

“1. B. The following shall be inserted as new paragraph in Financial Plan at page 19 of Financial Plan: “6.3.9 As informed by RP, an application with respect to preferential transactions made by the CD aggregating to Rs. 157.47 lakhs has been filed with the Hon’ble NCLT on the 22nd October 2020 which is still pending. If recoveries are made against such preferential transactions, then the same may be distributed to the secured financial creditors to the limit of their admitted claims and not in excess. Further, in case, no recoveries are made and /or no amount is received against such preferential transactions, RA

KOLKATA BENCH IA (IB) No.398/KB/2021 in CP (IB) No.213/KB/2019 In re Resolution Plan of Mackeil Ispat & Forging Ltd shall not, in any manner, be liable and/or responsible for any payment against such transactions.” 26. The Applicant has filed an applicant under section 43 of the Code, which has been registered and numbered as IA (IB) No.101/KB/2021. Necessary orders will be passed thereon separately.

Orders 27. On hearing the submissions made by the Ld. Counsel for the Resolution Professional, and perusing the record, we find that the Resolution Plan has been approved with 100% voting share. As per the CoC, the plan meets the requirement of being viable and feasible for revival of the Corporate Debtor. By and large, all the compliances have been done by the RP and the Resolution Applicant for making the plan effective after approval by this Bench.

28. We are, however, constrained to observe that many of the waivers, reliefs and concessions sought are without any application of mind. The RP would have been well-advised to look into these aspects and advise the CoC in this regard. For example, Sl No.24 at page 31 supra seems to cast a duty on the RoC to “take on record and implement the Plan, upon approval of the Plan by NCLT, without any further compliances.” How the RoC can be thrust with this duty is baffling, to say the least. Second, Sl No.6 at pages 20-21 supra plans for an exit route without any implications or penalties for the Resolution Applicant even when the Resolution Applicant is expected to do the most basic due diligence. A condition such as this one should never have passed muster. Third, even though section 32A of the Code grants immunity in respect of the corporate debtor and its property in a case where there is a fresh start through a resolution plan resulting in change of management, there are innumerable clauses under the waivers, concessions and reliefs section stating the same thing. These are quite unnecessary and involves wastage of resources on the part of the Adjudicating Authority,

KOLKATA BENCH IA (IB) No.398/KB/2021 in CP (IB) No.213/KB/2019 In re Resolution Plan of Mackeil Ispat & Forging Ltd which can otherwise be profitably employed in disposing of other applications which are in crying need of attention. These have been routinely observed in previous cases involving approval of resolution plans. Therefore, the IBBI may like to think of issuing appropriate directions to the insolvency professionals in this regard.

29. On perusal of the documents on record, we are satisfied that the Resolution Plan is in accordance with sections 30 and 31 of the IBC and also complies with regulations 38 and 39 of the IBBI (Insolvency Resolution Process for Corporate Persons) Regulations, 2016.

30. As far as the question of granting time to comply with the statutory obligations or seeking approvals from authorities is concerned, the Resolution Applicant is directed to do so within one year from the date of this order, as prescribed under section 31(4) of the Code.

31. In case of non-compliance of this order or withdrawal of Resolution Plan, the payments already made by the Resolution Applicant shall be liable for forfeiture.

32. Subject to the observations made in this Order, the Resolution Plan is hereby APPROVED by this Bench. The Resolution Plan shall form part of this Order. The Resolution Plan thus approved shall be binding on the Corporate Debtor and other stakeholders involved so that revival of the Debtor Company shall come into force with immediate effect.

33. The Moratorium imposed under section 14 of the Code shall cease to have effect from the date of this order.

34. The Resolution Professional shall submit copies of the records collected during the commencement of the proceedings to the Insolvency & Bankruptcy Board of India for their record and also return to the Resolution Applicant or New Promoters.

KOLKATA BENCH IA (IB) No.398/KB/2021 in CP (IB) No.213/KB/2019 In re Resolution Plan of Mackeil Ispat & Forging Ltd 35. Certified copy of this Order be issued on demand to the concerned parties, upon due compliance.

36. Liberty is hereby granted for moving any application if required in connection with implementation of this Resolution Plan.

37. A copy of this Order is to be submitted to the Registrar of Companies, West Bengal.

38. The Resolution Professional shall stand discharged from his duties with effect from the date of this Order.

39. The Resolution Professional is further directed to handover all records, premises/factories/documents to the Resolution Applicant to finalise the further line of action required for starting of the operation. The Resolution Applicant shall have access to all the records and premises of the corporate debtor through the Resolution Professional to finalise the further line of action required for starting of the operation.

40. IA (IB) No.398/KB/2021 and the main Company Petition, i.e., CP (IB) No.213/KB/2019 shall stand disposed of accordingly.

41. The Registry is directed to send e-mail copies of the order forthwith to all the parties and their Ld. Counsel for information and for taking necessary steps.

42. Certified copy of this order may be issued, if applied for, upon compliance of all requisite formalities.

43. File be consigned to the record.

Harish Chander Suri Rajasekhar V.K. Member (Technical) Member (Judicial) GGRB[LRA] 21.09. 2021