Commitee Of Creditors Of Bhushan Power ... vs Mahendra Kumar Khandelwal Resolution ...

Commitee of Creditors of Bhushan Power and Steel Ltd. Through Punjab National Bank .....Appellant Vs.

Mahendra Kumar Khandelwal Resolution Professional of Bhushan Power & Steel Ltd. & Ors. ......Respondents

Present :

For Appellant: Mr. Ramji Srinivasan, Senior Advocate assisted by Mr. Bishwajit Dubey, Ms. Srideepa Bhattacharyya, Advocates Ms. Sylona Mohapatra with Mr. Nikhil Ramdev, Advocates

For Respondents: Mr. Abhinav Vashisht, Senior Advocate, Mr. Siddhant Kant, Mr. Anoop Rawal, Mr. Samar Panda, Ms. Srishti Khare, Mr. Shreyas, Advocates. Ms. Manmeet Singh with Ms. Nishtha Chaturvedi, Advocates for R-2 Mr. A.S. Chandhok, Senior Advocate, Ms. Shweta Advocate for RP Ms. Priya Agarwal, Ms. Aditi Mohapatra, Advocates Mr. Arvind Kumar, Ms. Purti Marwaha, Ms. Henna George, for Sanjay Singal & Aarti Singal

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08.03.2019 - After detailed deliberation, this Appellate Tribunal passed order

on 4th February, 2019 in the appeal "Tata Steel Limited Vs. Liberty House Group

Pte. Ltd. and Others" in Company Appeal (AT)(Insolvency) No. 198/2018" and

finally remitted the matter to the Adjudicating Authority (National Company

Law Tribunal) Principal Bench, New Delhi for consideration of the Resolution

Plan submitted by J.S.W Steel in accordance with law. The following

observations and directions was made:-

The case is remitted to the Adjudicating Authority

(National Company Law Tribunal, Principal Bench, New

Delhi, for passing appropriate order under Section 31.

The 'Resolution Professional' will immediately place the

'approved Resolution Plan' before the Adjudicating

Authority for its order.

The Adjudicating Authority at the time of consideration of

the approved 'Resolution Plan' of 'JSW Steel' will only

ensure that all the stakeholders, particularly the

'Operational Creditors' are treated similarly. It should

ensure that no discrimination is being made between the

'Financial Creditors' or the 'Operational Creditors' as

held by this Appellate Tribunal in "Binani Industries

Limited".

2 In case, the Adjudicating Authority is of the opinion that

the discrimination has been made between the

'Financial Creditors' and the 'Operational Creditors', it

may give opportunity to the 'JSW Steel' to improve its

plan and thereby, by substituting the approved

'Resolution Plan' with such improvement.

Let the period of pendency of this appeal i.e. from 7th

May, 2018 till date be excluded for the purpose of

counting of the period of 270 days.

As we have noticed the rival contentions of the parties in

this appeal, the parties cannot re-agitate such

submission again before the Adjudicating Authority at

the time of the approval of the 'Resolution Plan'.

2) It appears that Adjudicating Authority while considering the Resolution

Plan submitted by the 'JSW Steel Limited' as approved by the Committee of

Creditors for its order u/s 31 of the Insolvency & Bankruptcy Code (I&B Code)

by impugned order dated 05.03.2019 adjourned the matter for 12th March,

2019 for deciding certain issues.

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3) Today, it is informed that the Adjudicating Authority has passed another

order on 7th March, 2019 which reads as follows:-

"It has been brought to our notice that Operational

Creditors have not been given opportunity to file

objection to the application. We grant the permission

to all the Operational Creditor to file their reply. Let

the copy of the application be served on the

operational creditors who have already appeared

before the Court in one form or the other."

4) In the present case, we are not inclined to deliberate on any issue as has

been raised, as no final decision has been taken by the Adjudicating Authority

in terms of Section 31 of Insolvency & Bankruptcy Code (I&B Code) and the

matter is pending. However, we make it clear that objection of all the

'Operational Creditors' cannot be considered at the stage of passing order u/s

31, as there may be more than one Operational Creditor.

5) Similar question fell for consideration before this Appellate Tribunal in

"Committee of Creditors of Essar Steel (India) through State Bank of India Vs.

Satish Kumar Gupta & Others" in IA No. 172/2019 in Company Appeal

(AT)(Insolvency) No. 03/2019 wherein this Appellate Tribunal taking into

consideration the similar plea observed and held as follows:- 4

"In the present without expressing any opinion on the

issue raised before us, we are of the view that the

Adjudicating Authority should pass appropriate order

under Section 31 in accordance with the law taking

into consideration our earlier order dated 23rd January,

2019 and IA No. 431 / 2018, on an early date. As per

Section 24(3)(c) as one of the representative of the

Operational Creditors is required to be present in the

meeting of the 'Committee of Creditors', we are of the

view that only the representative of the 'Operational

Creditors' can be given opportunity to highlight

objection, if any, with regard to the Resolution Plan. All

the Creditors and Operational Creditors cannot be

given day to day hearing for passing order under

Section 31".

6) Subsequently, in the case of "Committee of Creditors of Essar Steel India

Limited" (Supra), this Appellate Tribunal passed order on 28.02.2019 relevant

portion of which reads as follows:-

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7) Learned Counsel appearing on behalf of the Appellant brought to our

notice that the order passed in "Committee of Creditors of Essar Steel India

Limited" on 04.02.2019 was challenged by one Mr. Kamaljeet Singh Ahluwalia

before the Hon'ble Supreme Court of India in Civil Appeal No. 4958/2019 and

Civil Appeal Dy. No. 4940/2019 and 4766/2019 etc. The Hon'ble Supreme

Court by its order dated 11.02.2019 refused to entertain the appeals and

dismissed the appeals.

8) In the facts and circumstances, while we are not expressing any opinion

for the present, as observed above, we expect that the Adjudicating Authority

will follow the procedure as observed by this Appellate Tribunal while hearing

the representatives of 'Operational Creditor', Promoters and dissenting

'Financial Creditor(s)', if any.

9) Liberty is given to the Adjudicating Authority to decide as to who should

be heard in the representative capacity of the Operational Creditors and / or

representative of the promoters or representative of the dissenting 'Financial

Creditor', if any.

10) Mr. A.S. Chandhok, learned Senior Counsel appearing on behalf of the

Respondents submits that the matter should be disposed of at an early date to

ensure that the matter is finally decided before this financial year. We expect

that the Adjudicating Authority will give day to day hearing to the

representative of objectors aforesaid. Orders dated 5th and 7th March stands

modified / clarified to the extent above.

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The appeal stands disposed of with the aforesaid observations.

[Justice S. J. Mukhopadhaya] Chairperson

[Justice A. I. S. Cheema] Member (Judicial) ss/gc

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