Approval of Resolution Plan- Schon Ultra Wares Private Limited

I.A/30/ND/2024 IN CP IB-622/ND/2022 [Under Section 30 (6) and 31 of the Insolvency and Bankruptcy Code, 2016 read with Regulation 39(4) of the Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) Regulations, 2016]

IN THE MATTER OF STATE BANK OF INDIA …FINANCIAL CREDITOR Versus M/S SCHON ULTRA WARES PRIVATE LIMITED …CORPORATE DEBTOR AND AND IN THE MATTER OF MR. SANDEEP MAHAJAN RESOLUTION PROFESSIONAL FOR M/S SCHON ULTRA WARES PRIVATE LIMITED … APPLICANT Order Delivered on: 16.10.2025 CORAM: SHRI MAHENDRA KHANDELWAL MS. ANU JAGMOHAN SINGH HON’BLE MEMBER (JUDICIAL) HON’BLE MEMBER (TECHNICAL)

APPEARANCES: For the RP: Mr. Abhishek Anand, Mr. Karan Kohli, Mr. Rajat Gupta, Advs.

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ORDER 1. The present application has been filed under Section 30(6) read with section 31(1) of the Insolvency and Bankruptcy Code, 2016 (‘the Code’) read with Regulation 39(4) of the Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) Regulations, 2016 (‘CIRP Regulations’) on behalf of Mr. Sandeep Mahajan, Resolution Professional (‘Applicant’) of M/s Schon Ultra Wares Private Limited (‘Corporate Debtor’), seeking approval of the Resolution Plan submitted by Mr. Subodh Gupta and Ms. Shipra Gupta (‘Successful Resolution Applicant’) and approved by the Committee of Creditor (‘CoC’) in its 12th meeting held on 15.06.2024 with 100% voting share in favor.

2. Briefly stated facts as averred by the Applicant are as follows:

a) The CIRP was initiated against M/s Schon Ultra Wares Private Limited (‘Corporate Debtor’) by this Adjudicating Authority’s order dated 01.08.2023 in C.P IB-622/ND/2022, under Section 7 of the Code and Mr. Sandeep Mahajan was appointed as the Interim Resolution Professional (IRP) of the Corporate Debtor. The Applicant issued Public Announcement on 04.08.2023 in FORM A and the same was published on 04.08.2023 in newspapers namely, Financial Express Delhi NCR Edition (English), Rastriya Sahara Delhi NCR Edition (Hindi) and Punjab Kesari Neemrana (Hindi), thereby inviting claims from the creditors of the Corporate Debtor, in terms of Regulation 6(1) of the CIRP Regulations. The last date for submission of claim was specified as 16.08.2023. A copy of FORM A is placed on record as Annexure A-2. b) An appeal being “Company Appeal (AT) (Ins.) No. 1076 of 2023” was filed by one of the members of board of directors (power suspended) of the Corporate Debtor before the Hon’ble Appellate Tribunal, whereby vide order dated 16.08.2023 the Hon’ble NCLAT stayed the constitution of Committee of Creditors. Subsequently, the Hon’ble Appellate Tribunal vide order dated 12.09.2023 vacated the said interim order dated 16.08.2023. c) The Applicant collated all the claims submitted by the creditors and after the determination of the financial position of the Corporate Debtor, the Applicant 2 I.A/30/ND/2024 IN CP IB- 622/ND/2022 Order Delivered on: 16.10.2025 had filed a report certifying constitution of the Committee of Creditors as on 12.09.2023, which was taken on record by this Adjudicating Authority vide order dated 22.09.2023. The detail of the Committee of Creditors comprising of the sole Financial Creditor of the Corporate Debtor is as follows:

d) The Applicant convened the 1st CoC meeting of the Corporate Debtor on 20.09.2023 and the CoC in its 1st Meeting confirmed the appointment of Applicant as the Resolution Professional. In the 2nd CoC meeting on 21.10.2023 the Applicant put forth the draft of Expression of Interest for submission of Resolution Plan (“EOI”) in Form G before the members of the CoC for its approval. That following the approval of draft of Form G, the Applicant published the same on 22.10.2023 in newspapers namely, Financial Express Delhi NCR Edition (English) and Jansatta Delhi NCR Region, thereby, inviting Expression of Interest (“EOI”) on 22.10.2024. Copy of FORM-G dated 22.10.2023 is placed on record as Annexure A-7. e) On 02.12.2023 the Applicant convened 3rd meeting of the COC wherein, the Applicant apprised the members of the COC that the Applicant is in receipt of 12 EOI’s as on last date of submission of EOI i.e., 06.11.2023. On 24.01.2024, the Applicant convened the 4th CoC meeting wherein, the Applicant apprised the members of the CoC that till the last date of submission of Resolution Plan viz., 19.01.2024, the Applicant has received Resolution Plan from 4 PRAs out of the 11 PRAs. The list of four PRA’s who have submitted their respective Resolution Plans is reproduced herewith for ready reference:

3 I.A/30/ND/2024 IN CP IB- 622/ND/2022 Order Delivered on: 16.10.2025 f) Pursuant to CoC’s approval the Applicant duly filed an application bearing I.A. No. 934 of 2024 seeking an extension for the CIRP of the Corporate Debtor by a period of 90 (Ninety) days beyond 24.02.2024 before this Adjudicating Authority which was granted by this Adjudicating Authority vide its order dated 28.02.2024. g) On 06.03.2024, the Applicant convened the 6th Meeting of the CoC wherein the Applicant apprised the members of the CoC that due diligence was conducted, as per the Code and the Applicant had shared certain shortcomings in the Resolution Plans which needed to be cured and the deadline to submit the Final Revised Resolution Plans was 13.03.2024. On 16.03.2024, the Applicant convened the 7th Meeting of CoC, and the Applicant apprised the members of the COC that all the four PRAs have submitted their Revised Resolution Plan. During the 8th CoC meeting held on 27.03.2024, a summary of compliance for each plan was presented, and there were certain clarifications sought as an Addendum to the Resolution Plan. h) On 17.04.2024, the Applicant convened the 9th Meeting of CoC, wherein the Applicant apprised the members of the CoC that all the 4 PRAs have submitted the Addendum. However, it was observed that the Addendum submitted by one of the PRAs was inconsistent with the Code and a last opportunity was given to the PRA to submit the revised Addendum within a time period of two days.

4 I.A/30/ND/2024 IN CP IB- 622/ND/2022 Order Delivered on: 16.10.2025 i) The Applicant convened 11th CoC meeting on 21.05.2024, wherein the members of the CoC resolved to seek an extension for 60 days beyond 24.05.2024 till 23.07.2024. The Application regarding the same was filed before this Adjudicating Authority and the extension of 60 days was granted by this Adjudicating Authority vide its order dated 29.05.2024. j) The Applicant convened the 12th CoC meeting on 15.06.2024, wherein the Applicant presented the compliant Resolution Plans for approval as per Section 30(3) of the Code, and as per Regulation 25(3) of CIRP Regulations. The Applicant took vote of the members present in the meeting. The Resolution Plan submitted jointly by Mr. Subodh Gupta and Ms. Shipra Gupta was approved by the CoC with 100% voting share in favour. k) As per the provisions of Clarification Affidavit dated 29.05.2024 as approved by the Members of CoC, a Monitoring Committee shall be constituted comprising of one representative of the assenting financial creditor (to be decided by CoC), one representative nominated by the Resolution Applicant and one representative nominated unanimously by the assenting financial creditors and the Resolution Applicant. Furthermore, it was agreed by the COC that the Applicant would serve as the Chairman of the Monitoring Committee. l) The Resolution Professional has placed on record Section 29A affidavit dated 19.01.2024 obtained from Ms. Shipra Gupta and Mr. Subodh Gupta (SRA) and confirmed that the SRA is eligible under the provisions of Section 29A of the Code. 3. The salient features of the Resolution Plan dated 13.03.2024 along with Addendum to Resolution Plan dated 05.04.2024, 12.04.2024 and clarification affidavit dated 29.05.2024 as approved by the CoC and submitted by Ms. Shipra Gupta and Mr. Subodh Gupta (‘Successful Resolution Applicant’), are as follows:

a) In respect of compliance regarding Regulation 39(4) of the CIRP Regulations, the Applicant has filed an updated compliance certificate in Form-H annexed as Annexure A-2 at Page 6-18 of the Additional Affidavit dated 23.07.2025, certifying that the Resolution Plan submitted by the Successful Resolution Applicant meets the requirements as laid down in various sections of the Code 5 I.A/30/ND/2024 IN CP IB- 622/ND/2022 Order Delivered on: 16.10.2025 and the CIRP Regulations and there are sufficient provisions in the Plan for its effective implementation as required under the Code. The same is extracted as under:

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FINDINGS OF THIS ADJUDICATING AUTHORITY 4. We have heard the submissions made by the Ld. Counsel for the Applicant and have gone through the documents produced on record. 5. The Applicant/Resolution Professional has filed the instant application seeking approval of the Resolution Plan submitted by Mr. Subodh Gupta and Ms. Shipra Gupta which was approved by the CoC in its 12th meeting with 100% votes in favour. 6. This Adjudicating Authority vide its order dated 05.08.2025 had directed the Resolution Professional to file an addendum to the plan as approved by the CoC to clarify that the CIRP cost shall be paid in priority over other Creditors and to 18 I.A/30/ND/2024 IN CP IB- 622/ND/2022 Order Delivered on: 16.10.2025 clarify if there is any averment in the Resolution Plan which makes it contingent. 7. In compliance of the above, the Resolution Professional has placed on record Addendum to the Resolution Plan dated 26.08.2024 which was approved by the CoC in its 17th meeting convened on 27.08.2025, vide additional affidavit dated 30.08.2025. The Addendum dated 26.08.2024 clarifies that Payment of the Unpaid CIRP Cost will be done in priority over other creditors and states that Unpaid CIRP cost will be paid within a period of 30 days from the effective date i.e. date of approval of the Resolution Plan.

Further, the said Addendum confirms that the Resolution Plan does not contain any averment that makes the Resolution Plan and the Addendums contingent upon happening of any event. 8. Upon perusal of the Resolution plan, it is observed that the Resolution Plan provides for the following: i. Payment of CIRP Cost as specified u/s 30(2)(a) of the Code. ii. Repayment of debts of Operational Creditors as specified u/s 30(2)(b) of the Code. iii. For management of the affairs of the Corporate Debtor, after the approval of Resolution Plan, as specified u/s 30(2)(c) of the Code. iv. The implementation and supervision of the Resolution Plan by the Resolution professional and the CoC as specified u/s 30(2)(d) of the Code. 9. The Applicant/Resolution Professional has filed updated Compliance Certificate in Form-H as Annexure A-2 at Page 6-18 of the Additional Affidavit dated 23.07.2025. 10. We note that application under Section 66 of the Code in relation to fraudulent transactions has been filed and the same is pending adjudication. Clause 6.15 of the Resolution Plan contains a provision stating that the right to pursue all applications filed in regard to avoidance transactions (preferential, undervalued, extortionate credit under Section 43 to 50 and Section 66) or an application regarding fraudulent and/or wrongful trading or fraudulent transaction shall remain with the Resolution Professional or any other authorized Person as 19 I.A/30/ND/2024 IN CP IB- 622/ND/2022 Order Delivered on: 16.10.2025 nominated by the Assenting Financial Creditors unanimously to continue to pursue the said proceedings and all recoveries will be made directly to the Financial Creditors.

11. We note that the Resolution Professional has affirmed that the Resolution Plan is in compliant with the Regulations 38(1), 38(1)(a), 38(1A), 38(1B), 38(2)(a), 38(2)(b), 38(2)(c), 38(2)(d), 38(3)(a), 38(3)(b), 38(3)(c), 38(3)(d) & 38(3)(e) of the CIRP Regulations. 12. The applicant has prayed for number of reliefs and concessions in the Resolution Plan as mentioned in Part D, Page 30 of the Resolution Plan. As to the relief and concessions sought in the resolution plan, by taking into consideration the decision of the Hon’ble Supreme Court in the matter of Embassy Property Development Private Limited v. State of Karnataka & Ors. in Civil Appeal No. 9170 of 2019, we direct the Successful Resolution Applicant to file necessary application before the necessary forum/ authority in order to avail the necessary relief and concessions, in accordance with respective laws. The relevant part of the judgement is reproduced herein below: “39. Another important aspect is that under Section 25 (2) (b) of IBC, 2016, the resolution professional is obliged to represent and act on behalf of the corporate debtor with third parties and exercise rights for the benefit of the corporate debtor in judicial, quasi-judicial and arbitration proceedings.

Section 25(1) and 25(2)(b) reads as follows: “25. Duties of resolution professional – (1) It shall be the duty of the resolution professional to preserve and protect the assets of the corporate debtor, including the continued business operations of the corporate debtor. (2) For the purposes of sub-section (1), the resolution professional shall undertake the following actions:- (a)…………. (b) represent and act on behalf of the corporate debtor with third parties, exercise rights for the benefit of the corporate debtor in judicial, quasi-judicial and arbitration proceedings.” This shows that wherever the corporate debtor has to exercise rights in judicial, quasi-judicial proceedings, the resolution

20 I.A/30/ND/2024 IN CP IB- 622/ND/2022 Order Delivered on: 16.10.2025 professional cannot short-circuit the same and bring a claim before NCLT taking advantage of Section 60(5). 40. Therefore in the light of the statutory scheme as culled out from various provisions of the IBC, 2016 it is clear that wherever the corporate debtor has to exercise a right that falls outside the purview of the IBC, 2016 especially in the realm of the public law, they cannot, through the resolution professional, take a bypass and go before NCLT for the enforcement of such a right.” In the light of the decision of the Hon’ble Supreme Court in the Embassy Property Development Private Limited (Supra), as to the relief and concessions sought in the Resolution Plan, it is clarified that this Adjudicating Authority is not inclined towards granting any such relief prayed for except for what is provided in the Code itself. However, the Successful Resolution Applicant may approach and file the necessary application before the necessary forum/authority in order to avail the necessary relief and concessions, in accordance with respective laws.

13. In so far as the approval of the resolution plan is concerned, this Adjudicating Authority is not sitting on an appeal against the decision of the Committee of Creditors and this Adjudicating Authority is duty bound to follow the judgment of the Hon’ble Supreme Court in the matter of K. Sashidhar v. Indian Overseas Bank (2019) 12 CC 150, wherein the scope and interference of the Adjudicating Authority in the process of the approval of the Resolution Plan is elaborated as follows:- “35. Whereas, the discretion of the adjudicating authority (NCLT) is circumscribed by Section 31 limited to scrutiny of the resolution plan “as approved” by the requisite percent of voting share of financial creditors. Even in that enquiry, the grounds on which the adjudicating authority can reject the resolution plan is in reference to matters specified in Section 30(2), when the resolution plan does not conform to the stated requirements. Reverting to Section 30(2), the enquiry to be done is in respect of whether the resolution plan provides : (i) the payment of insolvency resolution process costs in a specified manner in priority to the repayment of other debts of the corporate debtor, (ii) the 21 I.A/30/ND/2024 IN CP IB- 622/ND/2022 Order Delivered on: 16.10.2025 repayment of the debts of operational creditors in prescribed manner, (iii) the management of the affairs of the corporate debtor, (iv) the implementation and supervision of the resolution plan, (v) does not contravene any of the provisions of the law for the time being in force, (vi) conforms to such other requirements as may be specified by the Board.

The Board referred to is established under Section 188 of the I&B Code. The powers and functions of the Board have been delineated in Section 196 of the I&B Code. None of the specified functions of the Board, directly or indirectly, pertain to regulating the manner in which the financial creditors ought to or ought not to exercise their commercial wisdom during the voting on the resolution plan under Section 30(4) of the I&B Code. The subjective satisfaction of the financial creditors at the time of voting is bound to be a mixed baggage of variety of factors. To wit, the feasibility and viability of the proposed resolution plan and including their perceptions about the general capability of the resolution applicant to translate the projected plan into a reality. The resolution applicant may have given projections backed by normative data but still in the opinion of the dissenting financial creditors, it would not be free from being speculative. These aspects are completely within the domain of the financial creditors who are called upon to vote on the resolution plan under Section 30(4) of the I&B Code.” 14. Further, the Hon’ble Supreme Court of India in the matter of Committee of Creditors of Essar Steel India Limited vs. Satish Kumar Gupta & Ors., Civil Appeal No. 8766-67 of 2019, vide its judgment dated 15.11.2019 has observed as follows: “38.

This Regulation fleshes out Section 30(4) of the Code, making it clear that ultimately it is the commercial wisdom of the Committee of Creditors which operates to approve what is deemed by a majority of such creditors to be the best resolution plan, which is finally accepted after negotiation of its terms by such Committee with prospective resolution applicants.” 15. Further, the Hon’ble Supreme Court in the matter of Jaypee Kensington Boulevard Apartments Welfare Association v NBCC {India) Limited, (2022) 1 SCC 401 has held as under: 22 I.A/30/ND/2024 IN CP IB- 622/ND/2022 Order Delivered on: 16.10.2025

'273.1. The adjudicating authority has limited jurisdiction in the matter of approval of a resolution plan, which is well-defined and circumscribed by Sections 38{2) and 31 of the Code. In the adjudicatory process concerning a resolution plan under IBC, there is no scope for interference with the commercial aspects of the decision of the CoC; and there is no scope for substituting any commercial term of the resolution plan approved by the Committee of Creditors. If, within its limited jurisdiction, the adjudicating authority finds any shortcoming in the resolution plan vis-a-vis the specified parameters, it would only send the resolution plan back to the Committee of Creditors, for re-submission after satisfying the parameters delineated by the Code and exposited by this Court.' (emphasis supplied) The above view of the Hon’ble Supreme Court in Jaypee Kensington Boulevard Apartments Welfare Association v NBCC {India) Limited (Supra)is reaffirmed by the Hon’ble Supreme Court in its recent decision dated 21.11.2023 in the case of Ramkrishna Forgings Limited Vs Ravindra Loonkar, Resolution Professional of ACIL Limited & Anr., 2022 SCC Online SC 2142.

16. Furthermore, the Hon’ble Supreme Court in the matter of Ghanashyam Mishra and Sons Private Limited Vs. Edelweiss Asset Reconstruction Company Limited, (2021) 9 SCC 657 has categorically held as under: “102.1 That once a resolution plan is duly approved by the Adjudicating Authority under sub-section (1) of Section 31, the claims as provided in the Resolution plan shall stand frozen and will be binding on the Corporate Debtor and its employees, members, creditors, including the Central Government, any State Government or any local authority, guarantors and other stakeholders. On the date of approval of resolution plan by the Adjudicating Authority, all such claims, which are not a part of resolution plan, shall stand extinguished and no person will be entitled to initiate or continue any proceedings in respect of a claim, which is not part of the resolution plan. 102.3 Consequently all the dues including the statutory dues owed to the Central Government, any State Government or any local authority, if not part of the resolution plan, shall stand extinguished and no 23 I.A/30/ND/2024 IN CP IB- 622/ND/2022 Order Delivered on: 16.10.2025 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.” 17. Thus, from the judgments cited supra, it is amply clear that only limited judicial review is available to the Adjudicating Authority under Section 30(2) read with Section 31 of the Code, 2016 and this Adjudicating Authority cannot venture into the commercial aspects of the decisions taken by the committee of the creditors.

18. It is further observed that the CoC has approved the Resolution Plan with 100% voting. 19. Therefore, in our considered view, there is no impediment to giving approval to the instant Resolution Plan. Accordingly, we hereby approve the Resolution Plan along with its Addendums dated 05.04.2024, 12.04.2024 and 26.08.2024 along with clarification affidavit dated 29.05.2024, which shall be binding on the corporate debtor and its employees, shareholders of the corporate debtor, creditors including the Central Government, any State Government or any local authority to whom statutory dues are owed, Successful Resolution Applicant and other stakeholders involved. In view of the above, I.A. 30/ND/2024 stands allowed. 20. It is declared that the moratorium order passed by this Adjudicating Authority under Section 14 of the Code shall cease to have effect from the date of pronouncement of this order. 21. While approving the resolution plan as mentioned above, it is clarified that the resolution applicant shall pursuant to the resolution plan approved under section 31(1) of the Code, 2016, obtain all the necessary approvals as may be required under any law for the time being in force within the period as provided for in such law.

22. The Resolution Professional shall forward all records relating to the Corporate Insolvency Resolution Process of the corporate debtor and the Resolution Plan to IBBI to be recorded in its database in terms of Section 31(3) (b) of the Code. The Resolution Professional is further directed to handover all the records, premises, and properties of the corporate debtor to the Successful Resolution Applicant to 24 I.A/30/ND/2024 IN CP IB- 622/ND/2022 Order Delivered on: 16.10.2025 ensure a smooth implementation of the resolution plan. 23. The approved Resolution Plan shall become effective from the date of passing of this order. The Approved Resolution Plan shall be a part of this order, subject to our observations regarding concessions, reliefs and waivers sought therein. 24. As per the amended Regulation 38(4) of the CIRP Regulations as substituted by the IBBI vide its Notification dated 03.02.2025, the monitoring committee shall submit quarterly reports to the Adjudicating Authority regarding the status of implementation of resolution plan. In view of the above, the I.A./30/ND/2024 in CP IB-622/ND/2022 stands approved in terms of the aforesaid discussion and is accordingly disposed off.

Let the copy of the order be served to the parties.

Sd/- Sd/- (ANU JAGMOHAN SINGH) (MAHENDRA KHANDELWAL) MEMBER (TECHNICAL) MEMBER (JUDICIAL)

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