Bharat Sharma Resolution Applicant vs Reshma Mittal & Anr

Bharat Sharma, ...Appellant Resolution Applicant

Versus

Reshma Mittal, RP (Now Liquidator) & Anr. ...Respondents

Present:

For Appellant: Mr. Abhishek Anand, Mr. Nipun Gautam, and Mohak Sharma, Advocates For Respondent: Liquidator-Reshma Mittal with Advocate Mohan Lalit, Advocate Videh Vaish and Advocate Aakansha.

ORDER

31.10.2022: This Appeal has been filed challenging the Order dated

26th August, 2022 passed by the National Company Law Tribunal, Principal

Bench, New Delhi. By which Order, the Adjudicating Authority has allowed

the Application I.A. No. 2479/2021 filed by the Chairperson, Monitoring

Committee and has rejected Application I.A. No. 1151/2021 filed by the

Appellant-Bharat Sharma- Resolution Applicant where direction was sought

to the Respondent-Resolution Professional to convene the meeting of the

Committee of Creditors to place the Resolution Plan for consideration

submitted by the Applicant on 23rd October, 2021.

2. In the Corporate Insolvency Resolution Process of the Corporate Debtor,

the Resolution Plan was submitted by the Appellant jointly with another

Resolution Applicant which was ultimately approved but could not be

implemented and stood cancelled by Order dated 1st July, 2021. In the Order

dated 1st July, 2021, the Adjudicating Authority has made observations that -2-

any viable plan that is submitted, can be placed for consideration before the

Liquidation. It appears that on 29th May, 2021, the Monitoring Committee has

also resolved to go for liquidation which fact was not brought before the

Adjudicating Authority on 1st July, 2021. In pursuance of the Monitoring

Committee Resolution dated 29th May, 2021, Application was filed for

liquidation which has been allowed by the Impugned Order.

3. Mr. Abhishek Anand, Learned Counsel for the Appellant submits that

the Appellant-Corporate Debtor being MSME an opportunity ought to have

been given for placing Resolution Plan submitted by the Appellant for

consideration which has wrongly been rejected. It is alternatively submitted

that under Regulation 2B of Insolvency and Bankruptcy Board of India

(Liquidation Process), Regulations, 2016, the Appellant ought to have been

given opportunity to submit a scheme of compromise/arrangement but the

Liquidator proceeded for auction without giving any opportunity.

4. Learned Counsel for the Liquidator opposing the submissions of

Learned Counsel for the Appellant contends that the Plan having been failed

to be implemented by the Appellant who was joint applicants, there was no

option except to direct for liquidation which has been directed by the

Impugned Order. It is submitted that in pursuance of the Impugned Order,

notice for auction has already been issued and large number of Applicants

have submitted their EMD.

5. We have heard the Learned Counsel for the parties and have perused

the record. In the facts of the present case, we are of the view that ends of

justice will be served in giving liberty to the Appellant to submit a scheme of

compromise/arrangement as contemplated under Section 230 of the

Company Appeal (AT) (Insolvency) No. 1275-1276/2022 -3- Companies Act to the Liquidator within one month from today as well as to

the Financial Creditors for their approval as contemplated under Section 230

of the Companies Act. Let entire process be completed within three months'

period as has been allowed under Regulation 2B of the IBBI (Liquidation

Process) Regulations, 2016 from today. The Liquidator who has already issued

notice fixing Auction on 10th November, 2022, shall differ the proposed

auction. It will be open for the Liquidator to proceed with the Auction further,

if any, only after completion of the process under Regulation 2B of the IBBI

(Liquidation Process) Regulations, 2016 after period of 3 months.

The Appeal stands disposed of, with the aforesaid direction(s).

[Justice Ashok Bhushan] Chairperson

[Mr. Barun Mitra] Member (Technical)

Basant/nn

Company Appeal (AT) (Insolvency) No. 1275-1276/2022