In the matter of Karur Vyasa Bank vs. Vishnoo Mittal,

Hearing Through: VC and Physical (Hybrid) Mode ORDER IA-1261/2025 & IA-1210/2025: Having considered the application preferred under Section 95(1) of IBC, 2016, this Tribunal appointed Ms. Shruti Gupta IP as RP qua the debtor/PG. The relevant excerpt of the order dated 04.08.2022 reads thus:

Having carried the process in terms of the provisions of Section 99 of IBC, 2016. The RP preferred the report/application under Section 99 of IBC, 2016. The report/recommendation made by the RP for admission of the application preferred under Section 95(1) of IBC, 2016 was accepted in terms of the order dated 02.12.2024 and the application preferred under Section 95(1) of the Code was admitted. The relevant excerpt of the order dated 02.12.2024 reads thus:

Having perused th ejudgment o f Honble Suprem e Court, we are unable to appreciate that in wha t manner, th e Ld. Counsel fo r Personal Guarantor is trying t o draw supportfro mthe same.

13. From the same,as in the s a idjudg mento f the Hon' ble Supreme Court, has nowhere rule d that the orde rs pass edb ythi s Tribunal appointing th eRPs prio rt oth edat e o fth ejudgmentwou ld no tb evalid. 14. I nth e wake, we h ave n o optionbu tt o admit th e captioned appl ications. The applications i.e. IA-1190/2024, IA-332/2024, IA-4000/202 2 and IA- 1110/2 024 p r eferred under Section 99 o f IBC, 2016, are allowed and the petitions i.e. IB-313/ND /2022, IB-33 2/ND/2022, IB-335/ND/2022 and IВ- 336/ND/2022 preferred under Section 95 are admitted. 15. As a sequel of ad mission o fthe prese ntapplication, a moratorium is declared t o th e f o llowing effec t:- (a) an y pending legal action or proceedings in respect o f any debt qua the Respondent shal l be deemed t o hav ebe e n staye d; (b) the cre ditors shal lnot initia te any legal action o r lega l proceedings in respect of any debt qua the Respondent; and (c) the debtors shall not transfer, alienate, encumber or dispose of any of the assets or his legal right or beneficiary interest therein. (d) The moratorium shall cease to have effect at the end of period of 180 days. 16. A public notice shall be issued by the RP within seven days of passing of this order, inviting claim from all creditors within 21 days of such notice. The notice shall include details of the present order, particulars of the Resolution Professional with whom the claims have to be registered and the last date for the submission of the claims. The notice shall be (a) published -in English and one Vernacular Language newspaper which is in circulation in the State where the debtor resides; (b) affixed in the premises of this Adjudicating Authority; and (c) placed on the website of the Adjudicating Authority.

The Applicant preferred IA-1210/2025 espousing that the PG namely Mr. Vishnoo Mittal has not extended any co-operation to RP and did not respond to the missives sent by RP to him. The averments made in application to the effect have been made in paras 8 & 9 of IA-1210/2025. The paras read thus:

Subsequently, the RP preferred IA-1261/2025 under Section 106 of IBC, 2016. The prayer made in the application reads thus:

“Allow the present report and take the present report u/s 106 of IBC on record.”

Also in IA-1261/2025, the RP has taken a stand that no repayment plan has been received by him from the PG/debtor. Para 6 & 9 of the application reads thus: “6. That the Resolution Professional also personally visited on 11.12.2024 at the last known two addresses of the Personal guarantor at Najafgarh, Delhi 110043. Out of that one address turned out to be wrong and in second one, after enquiring from neighbours got the information that this house/address belongs to the parents of the wife of the Personal Guarantor and no one has seen him from last 20 years. Moreover, no one replied from the house. The visit of Resolution Professional on 17.12.2024 at the address of Vasant Kunj of Personal Guarantor also proved vain as the Personal guarantor had left that place in 2019 and some other tenant is residing there (Mr. Soumendra Bobby Jena with his family) since 2019. Photos of the visit undertaken by Resolution Professional are annexed as Annexure-4. **************** 9. That no repayment plan has been received from Personal Guarantor as stipulated under section 106, the Meeting of Creditors was called on 23-1-2025 and their opinion was obtained for further proceedings, the RP till date of filing has not received the voting on resolutions and she is waiting for the decision of Creditors, meanwhile creditors recommended that the RP should proceed with the filing of report before Hon’ble NCLT. A copy of minutes of First Meeting of Creditors is annexed herewith as Annexure-7.”

As can be seen from the provisions of proviso to Section 106(2) of IBC, 2016, for the recorded reason the RP may avoid calling the meeting of the creditors. The Section 106(2) of IBC, 2016 reads thus:

“106. Report of resolution professional on repayment plan. – ****** (2) The report referred in sub-section (1) shall include that- (a) the repayment plan is in compliance with the provisions of any law for the time being in force; (b) the repayment plan has a reasonable prospect of being approved and implemented; and (c) there is a necessity of summoning a meeting of the creditors, if required, to consider the repayment plan:

Provided that where the resolution professional recommends that a meeting of the creditors is not required to be summoned, reasons for the same shall be provided.”

As per proviso of Section 114(1) of the Code, where a meeting of the creditors is not summoned, the Adjudicating Authority shall pass an order on basis of the report prepared by the Resolution Professional under Section 106 of the Code. The Section 114(1) of the Code reads thus:

“114. Order of Adjudicating Authority on repayment plan. – (1) The Adjudicating Authority shall by an order approve or reject the repayment plan on the basis of the report of the meeting of the creditors submitted by the resolution professional under section 112: Provided that where a meeting of creditors is not summoned, the Adjudicating Authority shall pass an order on the basis of the report prepared by the resolution professional under section 106.”

The conjoint reading of provisos to Section 114(1) and Section 106(2) of the Code gives an indication that this tribunal may pass an order either on the basis of the report under Section 112 of IBC, 2016 or the report under Section 106(2) of the Code. However, an amendment was carried in IBBI (Resolution Professional for Personal Guarantor to Corporate Debtor, Regulations 2019 and in terms of the proviso of Regulations 17A of the Regulations, the meeting of creditors is required to be summoned even when no repayment plan is offered by the debtor. Nevertheless, such meeting is required only to notify non-availability of the repayment plan. Even otherwise also when any anomaly between the provisions of the Regulations framed by IBBI and the provisions of IBC, 2016, is there we need to give credence to the provisions of IBC which is an act of the Parliament. As has been noted hereinabove, no repayment plan has been offered by the PG, thus the RP filed his report indicating the position to the effect. Apparently, the ramification of non-availability of the resolution plan would be same as that of rejection of the repayment plan by the creditors, thus the same consequences as are of rejection of repayment plan would follow. In the circumstances, in due deference to the proviso to the provisions of Section 114(1) of the Code, we direct the closure of the Insolvency Resolution Process. The creditors/debtor would initiate process as per provisions of Section 114 & 115 (2) read with Section 121 & 123 of IBC, 2016. Subject to aforementioned order, both the applications are disposed of.

Sd/- Sd/- (MAN MOHAN GUPTA) (ASHOK KUMAR BHARDWAJ) MEMBER (T) MEMBER (J)