Approval of Resolution Plan - Mayfair Leisures Limited

IN THE NATIONAL COMPANY LAW TRIBUNAL AHMEDABAD DIVISION BENCH COURT - 1 ITEM No.144 IA/542(AHM)2022 in CP(IB) 213 of 2018 Proceedings under Section 30(6) & 31 IBC,2016 r.w reg 39(4) IBBI,2016 IN THE MATTER OF: Vinod Agrawal RP For Mayfair leisures Ltd ........Applicant ........Respondent Order delivered on: 13/12/2022 Coram: Dr. Madan B. Gosavi, Hon’ble Member(J) Mr.Kaushalendra Kumar Singh, Hon’ble Member(T)

PRESENT: For the Applicant : For the Respondent : ORDER The case is fixed for the pronouncement of the order. The order is pronounced in the open court, vide separate sheet.

SD/- SD/- KAUSHALENDRA KUMAR SINGH DR. MADAN B GOSAVI MEMBER (TECHNICAL) MEMBER (JUDICIAL)

BEFORE THE ADJUDICATING AUTHORITY NATIONAL COMPANY LAW TRIBUNAL AHMEDABAD BENCH COURT-1

IA/542(AHM)/2022 IN CP (IB) 213 of 2018

IA/542(AHM)/2022 (An application under Section 30 r.w. Section 31 of the Insolvency and Bankruptcy Code, 2016) Mr. Vinod Agrawal Resolution Professional of; M/s Mayfair Leisures Limited, Having his office at 204, Wall Street-1, Near Gujarat College, Ellisbridge, Ahmedabad-380006 ……. Applicant In the matter of: CP (IB) 213 of 2018 (An application under Section 7 of the Insolvency and Bankruptcy Code, 2016) M/s. Bank of India ….Financial Creditor Versus M/s. Mayfair Leisures Limited ….Corporate Debtor Order delivered on 13.12.2022 Coram: Dr. Madan B. Gosavi, Member (Judicial) Kaushalendra Kumar Singh, Member (Technical)

IA/542(AHM)/2022 IN CP (IB) 213 of 2018

Appearance: Mr. Monaal Davawala, Advocate for the Applicant. Mr. Vinod Agrawal resolution applicant.

ORDER 1. This instant application is filed by Mr. Vinod Agrawal Resolution Professional of M/s. Mayfair Leisures Limited under Section 30 r.w. Section 31 of the Insolvency and Bankruptcy Code, 2016 [‘IB Code’] read with regulation 39 (4) of the IBBI (Insolvency Resolution Process for the Corporate Persons) Regulations, 2016 [CIRP Regulations] for approval of the Resolution Plan of M/s. GSEC Limited in consortium with M/s Premjayanti Enterprises Pvt. Ltd. 2. The averments made by the Applicant are summarized as under:- (i) The Corporate Debtor M/s Mayfair Leisure Limited was admitted in the Corporate Insolvency Resolution Process [„CIRP‟] vide order dated 02.06.2020 passed by this Adjudicating Authority and Mr. Chandra Prakash Jain bearing registration no. IBBI/IPA-001/IP00147/2017-18/10311 was appointed as an Interim Resolution Professional [„IRP’]. IRP published form-A for submission of claims by the creditors of the Corporate Debtor and constituted the Committee of Creditors [„CoC‟] which comprised a sole member of the CoC namely the Bank of India. (ii) In the first CoC meeting, it was resolved to replace the IRP. The replacement of the IRP by the Resolution Professional was confirmed by this Adjudicating Authority vide order dated 21.10.2020 in IA 717 of 2020. The Resolution Professional the Applicant herein published form –G on 12.11.2020 for submission of Expression of Interest [„EOI‟] by the Prospective Resolution Applicants [„PRAs‟]. In response to the publication of form-G, the 3 | P age

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Applicant received enquiries from the prospective Resolution Applicants viz. Kundan Cares Products Limited, Sankalp Organisers Private Limited and the other Prospective Resolution Applicants. (iii) The 5th CoC meeting was convened on 10.11.2020 wherein it was resolved to publish form-G once again, and the CoC also approved the evaluation matrix. It was also resolved by the CoC to file an application under section 12 of the IB Code to extend CIRP by 90 days beyond 180 days. (iv) One resolution plan was received from M/s Sankalp Organisers Pvt. Ltd. which was discussed by the CoC in its 8th meeting dated 09.02.2021. Since the resolution plan submitted by the said prospective resolution applicant was defective in few aspects, the CoC resolved to decide on a further course of action. (v) The 9th CoC meeting was convened on 19.02.2021, the CoC resolved to publish form-G once again, and also resolved to file an application before this Adjudicating Authority for excluding the CIRP period for the period of attachment of properties made by the Directorate of Enforcement and Central Bureau of Investigation. The only property belonging to the Corporate Debtor is land, and the commercial building bearing Khata No. 847, RS No. 619 Mouje Atladara, District Vadodara (land admeasuring 5722 sq. m) and still under the attachment of the Enforcement Directorate. The Central Bureau of Investigation has filed its closure report stating that there is no fraud played in the matter of the Corporate Debtor. A copy of the order dated 17.05.2022 passed by the CBI Court is annexed with the application. (vi) The Period of 270 days of CIRP was to be ended on 28.06.2021 including the 90 days extension (IA 871 of 2020 order dated 14.12.2020) and exclusion of 90 days for attachment of 4 | P age

IA/542(AHM)/2022 IN CP (IB) 213 of 2018 assets by the ED and CBI (IA 187 of 2021 order dated 30.03.2021). The CoC in its meeting dated 09.06.2021 resolved to file an application before this Adjudicating Authority for further exclusion of 90 days on the ground that the work could not be progressed due to the second wave of the Covid-19 pandemic. This Adjudicating Authority vide order dated 12.07.2021 dismissed the application bearing No. 453 of 2021 & directed the applicant to take further steps in accordance with the law. (vii) In response to the publication of form-G on 22.02.2021, the applicant had received two EOIs from the Prospective Resolution Applicants viz. Farm Organises Ltd. and Khandwala Finstock Pvt. Ltd. The Applicant on 13.04.2021 received a resolution plan from M/s Khandwala Finstock Pvt. Ltd. Thereafter, the Applicant put the resolution plan of the Khandwala Finstock Private Limited before the CoC for approval. However, the same was rejected by the sole member of the CoC. The CoC also resolved to file an application under section 33 of the IB Code for passing the order of liquidation. (viii) The applicant filed an application bearing No. 596 of 2021 before this Adjudicating Authority for the order of liquidation. Meantime, the applicant preferred an appeal to the Hon‟ble National Company Law Appellate Tribunal against the order dated 12.07.2021 passed by this Adjudicating Authority in IA No. 453 of 2021 (exclusion application). The Hon‟ble NCLAT vide order dated 16.02.2022 granted the exclusion of 90 days from the CIRP to revive the Corporate Debtor. (ix) In the meeting dated 05.03.2022, the CoC resolved to withdraw the application bearing No. 596 of 2021 filed by the applicant for passing an order of liquidation, which was allowed to be withdrawn by this Adjudicating Authority vide order dated

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22.03.2022. Thereafter, the applicant again issued form- G (Annexure-I of the application) for submission of EoI(s) by the Prospective Resolution Applicants. In response to the publication of form-G, two resolution plans were received from the prospective resolution applicants viz. Rohit Kumar Deorah and M/s GSEC Limited in a consortium of M/s Premjayanti Enterprises Private Limited. In the 16th meeting dated 12.05.2022, the resolution plan submitted by the aforesaid Prospective Resolution Applicants was discussed by the CoC, and the prospective resolution applicants were directed to submit the resolution plan with a few modifications. Thereafter, on 17.05.2022 both the Prospective Resolution Applicants submitted the modified resolution plan. (x) In the 17th meeting dated 21.05.2021, the applicant informed the CoC that both the resolution plans comply with regulations 37 and 38 of the CIRP regulations and both the resolution applicants are not ineligible to submit the resolution plan under section 29A of the IB Code. In the same meeting, the CoC discussed the plans submitted by both the resolution applicants. The CoC approved the resolution plan of M/s GSEC Limited in consortium with Premjayanti Enterprises Private Limited with 100% votes on 25.05.2022 through e-voting, as per section 30 (4) of the IB Code. (xi) The resolution applicant proposed a payment of Rs. 54.90 crores including 60 Lakhs towards CIRP costs, and Rs. 10 Lakhs to the Operational Creditor including a claim of the statutory authority. An amount of Rs. 54 crores has been proposed to be paid to the secured financial creditor against which Rs. 18 crores as upfront payments and the balance amount shall be paid in two instalments of Rs. 18 crores each at the end of the first and second year.

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IA/542(AHM)/2022 IN CP (IB) 213 of 2018 (xii) The resolution applicant has proposed to additionally issue 0.001% unsecured redeemable bonds to the secured financial creditor with a tenure of 35 years aggregating Rs. 100 crores with a right of redemption at NPV of 20% per annum, which if, discounted will be valued @ Rs. 20 lakhs. (xiii) The following reliefs and concessions have been sought under the resolution plan. a) Upon the approval of the resolution plan by this Adjudicating Authority, it would be deemed that the Corporate Debtor has complied with the provisions prescribed under the Companies Act, 2013 for the issuance of new shares to the resolution applicant, its nominees and affiliates. b) Since the commencement of the Corporate Insolvency Resolution Process, certain permit of the Corporate Debtor has lapsed, expired, suspended, cancelled, revoked, terminated or the Corporate Debtor has failed to comply with in relation thereof. Accordingly, the relevant government authority is to provide a reasonable time period to the Corporate Debtor for the regularization of such permits. c) Upon the approval of the resolution plan, all the beneficiaries of the guarantees issued by the company and all liabilities of the Corporate Debtor with respect to such guarantees shall stand extinguished and such recipients shall not thereafter be entitled to raised any claim against the Corporate Debtor. d) Upon the approval of the resolution plan by this Adjudicating Authority, all the matters pending before the labour authorities shall be disposed of, and the Corporate

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Debtor/ Resolution Applicant shall not be liable to make any payment including any penalty, damages costs or otherwise. e) All the proceedings, inquiries or investigations initiated against the Corporate Debtor including any attachment made by the government department(s) including attachment made by the Enforcement Directorate, relating to the period prior to the approval of the resolution plan shall immediately, irrevocably and unconditionally stand extinguished and settled by virtue of the order of this Adjudicating Authority. The assets of the Corporate Debtor shall stand released from such attachment upon approval of the resolution plan by this Adjudicating Authority. f) Changes in the shareholding of the Corporate Debtor shall not lapse the brought forward loss of the Corporate Debtor. g) The Central Board of Direct Tax [„CBDT‟], Central Board of Indirect Taxes [„CBIC‟], Customs, Value Added Taxes Authorities, State Government Tax Authority, to grant reliefs/ exemptions/ waivers from the applicability of section 41, 79, 170 and any other relevant provisions of the Income Tax Act, 1961. The resolution applicant be allowed to file the previous Income Tax Return under the Income Tax Act, 1961 which has not been filled till the approval of the resolution plan by this Adjudicating Authority without being subject to any tax or interest or penalty or penal liability, if any, under any applicable laws. h) Income Tax Department to quash assessment or re-assessment in consequent to special audit or any other proceedings against the Corporate Debtor post initiation of 8 | P age

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CIRP against the Corporate Debtor and consequently, all pending assessments and re-assessments u/s 147, 153-A and other relevant provisions of the Income Tax Act shall be deemed to be completed and dropped. i) The CBIC to grant GST credit to the Corporate Debtor filed through the transitional form without any adjustments made during the CIRP period. j) The Central Board of Direct Taxes (CBDT) and GST Department shall give exemptions for the applicability of payment of all taxes including MAT and GST liability which may arise for the acquisition of the Corporate Debtor under the IB Code, and allow the company to enjoy all future tax. k) All the approval granted by VMSS, fire agencies, airport authorities and all local agencies shall stand approved and extended without any fees. l) The Corporate Debtor and/ or Resolution Applicant and its affiliates shall not in any manner be implicated in, or in any manner be adversely affected by, or have any liability in relation to any investigation, proceedings, orders or any matter whether known or unknown, relating to the past management or the promoter group or holding companies, associate companies and /or group companies of the corporate debtor and the assets and properties of the corporate debtor be attached pursuant to any such investigation. m) All the government authorities to grant relief/ concessions from payment of taxes, levies, a fee, charges, transfer premiums, stamp duty, and registration fees (including a fee payable to the jurisdictional ROC) for the various action contemplated under the resolution plan.

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IA/542(AHM)/2022 IN CP (IB) 213 of 2018 n) The Collector of Stamps, Revenue Department of State Government & Ministry of Corporate Affairs provide the exemption(s) from the levy of stamp duty and fee in relation to this resolution plan. 3. Heard, the Ld. Counsel of the applicant and perused the material on record. It is noted that the Corporate Debtor was admitted into CIRP on 02.06.2020, and Mr. Chandra Prakash Jain was appointed as an Interim Resolution Professional who was replaced by the CoC in its first CoC meeting. The replacement of the IRP was confirmed by this Adjudicating Authority vide order dated 12.11.2020 in IA 717 of 2020. and Mr. Vinod Agrwal was appointed as a Resolution Professional. The Resolution Plan summited by M/s GSEC Limited in consortium with M/s Premjayanti Enterprises Pvt. Ltd. was approved by the sole member of the CoC (Bank of India) in the 17th CoC meeting dated 21.05.2022 with 100% votes (through e-voting on 25.05.2022). The resolution applicant is not ineligible to submit a resolution plan as per section 29A of the IB Code. An undertaking of the Resolution Applicant under section 29A of the IB Code is on record. As per form-H, the fair value of the Corporate Debtor is Rs. 54,86,85,127/- and the liquidation value is Rs. 39,65,56,127/- The resolution applicant proposed to pay an amount of Rs. 54.70 crores as a plan value. The resolution applicant proposed to pay an amount of Rs. 54 crores to the financial creditor (Bank of India) against the total admitted claim of Rs. 95.07 crores, and 18 crores shall be paid upfront and the remaining amount is to be paid in two years in instalments of Rs. 18 crores each, and no interest will be paid on the deferred amount. The resolution applicant also proposed to issue unsecured redeemable bonds to the financial creditor which shall mature at the end of 35 years aggregating 100 crores carrying coupon rate @0.001%. The resolution applicant retains the exclusive right to 10 | P age

IA/542(AHM)/2022 IN CP (IB) 213 of 2018 repurchase such bonds at the net present value discounted @20% per annum at any point in time within the prescribed period of 35 years through its designated entities or investors as may be deemed fit by them. 4. The resolution applicant proposed to pay an amount of Rs. 10 lakhs to the operational creditors including the payment to the statutory authorities against the total admitted operational debt of Rs. 1,00,15,238/-, Rs. 60 lakhs has been proposed for the CIRP costs or actual costs towards the entire outstanding CIRP costs. If the proposed amount of CIRP costs exceeds or is less, that shall be adjusted from the amount proposed to the financial creditor. 5. As per clause 2.9 of the resolution plan, there is no amount outstanding for workmen and employees. The details of the amount admitted and proposed to the creditors are as under; The amounts provided for the stakeholders under the Resolution Plan are as under: (Amount in Rs. lakh)

Amount Amount Provided to SI. Category of Sub-Category of Amount Amount Provided the No. Stakeholder* Stakeholder Claimed Admitted under the Amount Plan# Claimed (%) (1) (2) (3) (4) (5) (6) (7) 1 Secured (a) Creditors not having a Financial right to vote under sub- Creditors section (2) of section 21 NA NA NA NA (b) Other than (a) above: (i) who did not vote in NA favour of the resolution NA NA NA Plan (ii) who voted in favour of the resolution plan 10,496.21 9,507.19 5,420.00 51.64%

Total[(a) + (b)] 10,496.21 9,507.19 5,420.00 51.64%

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2 Unsecured (a) Creditors not having a Financial right to vote under sub- Creditors section (2) of section 21 NA NA NA NA (b) Other than (a) above: (i) who did not vote in favour of the resolution Plan NA NA NA NA (ii) who voted in favour of the resolution plan NA NA NA NA

Total[(a) + (b)]

NA NA NA NA

3 Operational (a) Related Party of Creditors Corporate Debtor NA NA NA NA (b) Other than (a) above: (i)Govemment - ESI Corporation 2.15 1.26 0.13 4.66%

- Employees Provident 0.06 0.06 0.06 100% Fund Organization (ii)Workmen NA NA NA NA (iii)Employees NA NA NA NA (iv) Other Operational 211.28 98.84 9.81 4.66% Creditors Total[(a) + (b)] 213.49 100.16 10 4.68% 4 Other debts and dues NA NA NA NA

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Grand Total 10,709.70 9,607.35 5,430.00 50.70% # Amount provided over time under the Resolution Plan and includes an estimated value of non-cash components. It is not NPV.] 6. The Resolution applicant has proposed to pay an amount of Rs. 6,042/- to the EPFO Department which shall be over and above the proposed amount under the resolution plan. 7. The upfront cash will be infused for payment of the amount proposed under the resolution plan on or before the trigger date („trigger date’ is defined in clause 1.1 of the resolution plan). Upfront cash is inclusive of Rs. 0.20 cores NPV being offered as consideration for redemption of bond on trigger date. Upon approval of the resolution plan entire shareholding of the existing shareholders shall be cancelled and extinguished. 8. At clause 4.4 of the resolution plan, it is stated that an amount of Rs. 10,00,000/- was deposited as an Earnest Money Deposit (EMD- 1) by the resolution applicant at the time of submission of the EoI, and Rs. 2,75,00,000/- was deposited as Earnest Money Deposit (EMD-2) at the time of submission of resolution plan. The amount of EMD-1 and EMD-2 shall be adjusted in an upfront payment. Further, the resolution applicant has proposed to provide a performance guarantee of Rs. 2,75,00,000/- either in form of the Bank Guarantee or the Demand draft of RTGS within 7 days of receipt of written intimation by way of a letter of intent of the CoC. 9. We have considered the resolution plan, an amount of Rs. 1.26 lakh has been earmarked for ESI claim. We have considered this aspect in view of the judgment in the matter of “State Tax Officer Versus Rainbow Papers Limited” [2022 SCC online SC 1162]. In Rainbow Paper (Supra) judgment the Hon‟ble Supreme Court has observed that the payment receivable by the Government from the Corporate Debtor has to be considered as Government being a Secured Creditor. In our considered opinion the ESI claim cannot be 13 | P age

IA/542(AHM)/2022 IN CP (IB) 213 of 2018 equated with the statutory dues of the Government because the ESI is the scheme which has to be implemented by the corporate bodies for the welfare of their employees only and the Government machinery is to supervise the implementation of that scheme. Hence, we hold that the ESIC dues are classified as operational debt and not debt as secured debt. 10. It is also noted that in the resolution plan under the reliefs and concessions there is one clause which says that upon approval of the resolution plan by this Adjudicating Authority, it would be deemed that any proceeding initiated by the government authority including the attachment by the Enforcement of Directorate shall be extinguished and settled, and the assets shall stand released from such attachments. However, a separate application bearing No. 608 of 2020 has been filed by the IRP/ RP for releasing the property of the Corporate Debtor attached by the Enforcement of Directorate. In response to the clarification of the aforesaid point by the Adjudicating Authority vide order dated 21.09.2022, the resolution applicant has filed an affidavit dated 04.11.2022 wherein it is stated that the property of the Corporate Debtor shall not be automatically released upon approval of the resolution plan by this Adjudicating Authority. The resolution applicant would approach the concerned authority or appropriate judicial forum to get the attachment released in accordance with the law in view of section 32A of the IB Code. 11. It is to be noted that for getting the approval of the Adjudicating Authority the resolution plan should adhere to the following requirements as per section 30(2) of the Code read with CIRP Regulations: (i) It should provide for the payment of insolvency resolution process costs in priority to the payment of other debts of the corporate debtor.

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[Section 30(2)(a) of IB Code]; (ii) The repayment of the debts of operational creditors and dissenting financial creditors should not be less than the amount to be paid to such respective creditors in the event of liquidation of the corporate debtor under section 53 of the Code. Moreover, the payment to the operational creditor is to be made in priority over the financial creditor; and the payment to dissenting financial creditor is to be made in priority to the consenting financial creditors. [Section 30(2)(b) of the IB Code read with regulation 38(1)(a) & 38(1)(b) CIRP Regulations]; (iii) Provides for the management of the affairs of the corporate debtor after approval of the resolution plan. [Section 30(2)(c) of the IB Code read with regulations 38(2)(b) CIRP Regulations]; (iv) The implementation and supervision of the resolution plan. [Section 30(2)(d) of the IB Code read with 38(2)(c) CIRP Regulations]; (v) It does not contravene any of the provisions of the law for the time being in force. [Section 30(2)(e) of the IB Code]; (vi) It conforms to such other requirements as may be specified by the Board. [Section 30(2)(f) of the IB Code] Such other requirements of the resolution plan as detailed in IBBI (Resolution Process for Corporate Persons) Regulations, 2016 which are not covered above, are as under:

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IA/542(AHM)/2022 IN CP (IB) 213 of 2018 (a) The resolution plan should include a statement as to how it has dealt with the interests of all stakeholders including financial creditors and operational creditors of the Corporate Debtor. [38 (1A) of CIRP Regulations] (b) The resolution plan should include a statement giving details as to whether the resolution applicant or any of its related parties has at any time failed to implement or caused to the failure of implementation of any other resolution plan which was approved by the Adjudicating Authority. [38 (1B) of CIRP Regulations] (c) The resolution plan should provide the term of the plan and its implementation schedule. [Regulation 38(2)(a) of CIRP Regulations] (d) The resolution plan should also demonstrate that it addresses the cause of default; is feasible and viable; has provisions for its effective implementation; has provisions for approvals required and the timeline for the same. Further that the resolution applicant has the capability to implement the resolution plan. [38(3) CIRP Regulations] 12. In view of the above provisions of the IB Code, the resolution plan submitted before us has been examined as follows:

(i) On perusal of the Resolution plan, we observed that clause 3.3 (payment of outstanding CIRP costs) of the Resolution Plan provides that Rs. 60,00,000/- as a CIRP cost is to be paid in priority over the payments to any other creditors. If any amount exceeds or less the CIRP costs that shall be adjusted from the amount proposed to the financial creditor. Thereby, the resolution plan complies with section 30 (2) (a) of the IB Code. 16 | P age

IA/542(AHM)/2022 IN CP (IB) 213 of 2018 (ii) There is a sole financial creditor who has approved the resolution plan (100% votes). However, clause 3.1.1 (upfront cash, para 4) of the resolution plan states that the financial creditors who did not vote in favour of the Resolution Plan would not be paid less than the amount to be paid to such creditors in accordance with the sub-section (1) of section 53 in the event of the liquidation of the Corporate Debtor. Sub-clause 2 of clause 3.4.2 of the Resolution Plan states that payment to the Operational Creditors in such a manner as may be specified by the Board shall not be less than the amount to be paid to such operational creditors in the event of a liquidation of the Company under section 53 of the IB Code. Hence, the resolution plan complies with section 30 (2) ( b) of the IB Code read with the regulation 38(1) (a) & 38 (1) (b) of CIRP Regulations, 2016. (iii) Clause 6.2.1 of the resolution plan states that on and from the approval date of the resolution plan by this Adjudicating Authority till the trigger date, the day-to-day functioning of the Corporate Debtor shall be controlled and managed by the Monitoring Committee comprises of one representative from the financial creditor, one representative from the Resolution Applicant, and a Resolution Professional in accordance with the terms of the resolution plan. Hence, the resolution plan complies with section 30 (2) (c) of the IB Code read with Regulation 38 (2) (b) of the CIRP Regulations. (iv) Upon the approval of the Resolution Plan by this Adjudicating Authority, the implementation of the resolution plan shall be supervised by the monitoring committee consisting of one representative from the financial creditor, one representative from the Resolution Applicant, and a Resolution Professional. After the trigger date, the monitoring committee shall be responsible for 17 | P age

IA/542(AHM)/2022 IN CP (IB) 213 of 2018 only monitoring the deferred cash payments due under the resolution plan. Once the entire deferred payment (including) any payment is paid by the resolution applicant, the monitoring committee shall cease to exist. Thereby the resolution plan complies with section 30 (2) (d ) of the IB Code read with regulations 38 (2) (c ) of the CIRP Regulations. (v) Clause 7.8.1 of the Resolution Plan states that the Resolution Plan is not in contravention of provisions of the Applicable law for time being in force. Thereby it complies with section 30 (2) (e) IB Code. (vi) The plan conforms to section 30 (2) (f) of the IB Code with regard to other requirements as specified by the Board in the CIRP regulations. Such other requirements of the Resolution Plan as detailed in CIRP Regulations which are not covered above are as under; a) Clause 7.8.4 of the resolution plan states that it has dealt with the interest of all stakeholders including financial and Operational Creditors as per the terms set out in the resolution plan which complies with Regulation 38 (1A) of CIRP Regulations, 2016. b) Clause 7.8.2 of the resolution plan states that the resolution applicant and /or any of the related parties of the resolution applicant has not failed to implement or contribute to the failure of implementation of any other resolution plan approved by the Adjudicating Authority meaning thereby the resolution plan complies with regulation 38 (1B) of CIRP Regulations. c) The Resolution applicant has proposed to pay the CIRP cost, the amount proposed to the operational creditor and Rs.

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18 crores to the financial creditor from the upfront payment which shall be infused on or before the trigger date. The remaining amount shall be paid in two instalments of Rs. 18 crores each in two years which complies with Regulations 38 (2) (a) of the CIRP regulations. d) Clause 7.8.3 of the resolution plan deals with the cause of the default of the corporate debtor which was due to the liquidity crunch leading to project delays and the working capital gap. Clause 7.8.4 of the resolution plan states that the Resolution Plan is feasible and viable. Part-I of the resolution plan gives the details of the resolution applicant and its group companies and describes the financial position of the resolution applicant. The net worth of the resolution applicant shows that it has the capability to arrange the fund and implement the Resolution Plan. 13. As far as reliefs and concessions claimed by the Resolution Applicant, the law has been well settled by the Hon'ble Supreme Court in the case of Ghanashyam Mishra and Sons Private Limited Vs. Edelweiss Asset Reconstruction Company Limited and Ors. reported in MANU/SC/0273/2021 in the following words: (i) “The legislative intent behind this is, to freeze all the claims so that the resolution applicant starts on a clean slate and is not flung with any surprise claims. If that is permitted, the very calculations on the basis of which the resolution applicant submits its plans would go haywire and the plan would be unworkable. (ii) We have no hesitation to say, that the word "other stakeholders" would squarely cover the Central Government, any State Government, or any local authorities. The legislature, noticing that on account of obvious omission, 19 | P age

IA/542(AHM)/2022 IN CP (IB) 213 of 2018 certain tax authorities were not abiding by the mandate of I & B Code and continuing with the proceedings, has brought out the 2019 amendment so as to cure the said mischief…” 14. In view of the above, we hold that the Resolution Applicant cannot be saddled with any previous claim against the Corporate Debtor prior to the initiation of its CIRP. The permits, licenses, leases, or any other statutory right vested in the Corporate Debtor shall remain with the Corporate Debtor and for the continuation of such statutory rights, the Resolution Applicant has to approach the concerned statutory authorities under relevant laws. 15. In view of the above, we are of the considered view that the Resolution Plan has complied with the provision of Section 30(2) of the IB Code and Regulations 38 and 39 (1) of CIRP Regulations. Accordingly, we allowed this present application with the following orders:-

I. Application is allowed. II. The resolution plan of M/s. GSEC Limited in consortium with Premjayanti Enterprises Private Limited for Corporate Debtor i.e., M/s Mayfair Leisures Limited stands allowed as per Section 30(6) of the IBC, 2016. III. The approved „Resolution Plan‟ shall become effective from the date of passing of this order. A copy of this approved plan is enclosed with this order. IV. The order of moratorium dated 02.06.2020 passed by this Adjudicating Authority under Section 14 of the IB Code shall cease to have effect from the date of passing of this order.

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V. The Resolution Professional shall forthwith send a copy of this order to the participants and the Resolution Applicant(s). VI. The Resolution Professional shall forward all records relating to the conduct of the Corporate Insolvency Resolution Process and Resolution Plan to the Insolvency and Bankruptcy Board of India to be recorded in its database VII. Accordingly, IA/542 (AHM)/2022 in CP(IB) 213 (AHM)/2018 is allowed and stands disposed of in terms of the above directions. VIII. A certified copy of this order, if applied for, is to be issued to all concerned parties upon compliance with all requisite formalities.

SD/- SD/- KAUSHALENDRA KUMAR SINGH DR. MADAN B GOSAVI MEMBER (TECHNICAL) MEMBER (JUDICIAL)

Ramashish

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