Pioneer Rubchem Pvt Ltd vs Vivek Raheja Resolution Professional ...
- CitationCompany Appeal (AT) (Insolvency) No. 706 of 2020
Ratio decidendi
The rule this decision rests on
The reasoning in this order rests on the following principles, stated in the order the Tribunal takes them: The completion of a corporate insolvency resolution process under the Insolvency and Bankruptcy Code, 2016 is governed by the statutory timelines under Section 12, namely 180 days from commencement, extendable by a further 90 days; the period of up to 330 days referred to in the order is treated as directory, so that every reasonable effort should be made to complete the process within 270 days. An application by a prospective resolution applicant for extension of the time to submit an expression of interest or resolution plan, made after the extended deadline has expired and after the Committee of Creditors has rejected it, may be refused where acceptance would delay the process beyond the statutory outer limit and would open the door to similar applications, thereby defeating the object of the Code. Where two resolution plans have already been received, the requirement of competitive bidding is considered satisfied, and this is a relevant consideration in refusing a further extension of time to submit a plan.
Written by Miss Lucy from the judgment below, not taken from a headnote.
Judgment
As delivered
In the matter of: Pioneer Rubchem Pvt. Ltd Through Authorized representative Having Regd. Office at: 111, Abhishek, C-5, Dalia Estate, Behind Kuber Building, Off New Link Road, Andheri (W), Mumbai - 400053 (MH) ...Appellant
Vs.
1. Vivek Raheja Resolution Professional, Trading Engineers (International) Limited R/o JD-2C,2nd Floor, Pitampura, Delhi - 110034 ...Respondent No.1
2. Committee of Creditors Trading Engineers (International) Limited Through, The Lead Creditor of the Corporate Debtor ....Respondent No.2
Present: For Appellant: Mr.Mayank Kshirsagar and Ms.Pankhuri, Advocates For Respondent: Mr. Vivek Raheja, Resolution Professional. ORDER
(Through Virtual mode)
25.08.2020- The Appellant has approached this Appellate Tribunal for 'Extension of Time' to submit 'Resolution Plan' alongwith 'Expression of Interest' (for short EOI). He has submitted that only two 'Resolution
1 Plan' have been received by the 'Resolution Professional' so far, and if his proposal is not accepted, the object of the Code i.e. Maximization of value of assets, to promote entrepreneurship etc. will not be achieved, in case of the present 'Corporate Insolvency Resolution Process' (for short CIRP) of the Corporate Debtor.
2. The analysis of the Application reveals followings:-
a) CIRP against Corporate Debtor - M/s. Trading Engineers (International) Limited commenced on 04.07.2019 and Mr. Vivek Raheja was appointed as Insolvency Resolution Professional
b) Mr. Vivek Raheja - Resolution Professional('RP') informed this Appellate Tribunal that he has issued calling for prospective Resolution Applicants to submit their EOI by 05.03.2020 and Resolution Plans by 05.04.2020. Since no resolution plan was received during this period Resolution Professional has extended the submission of EOI till 30.06.2020 and Resolution plan by 30.07.2020.
c) Resolution Professional has submitted that the request of the Appellant for Extension of time sought on 13.07.2020 was rejected by Committee of Creditors on 16.07.2020 as the same was received beyond the extended time line for submission of EOI.
d) It is also submitted by the RP that the maximum period of 330 days for CIRP is expiring on 29.08.2020 and allowing EOI at this stage would derail the CIRP.
3. Section 12 of the IBC, 2016 provides for a time line of 180 days for completion of CIRP and even if we consider extended period it is another 90 days and hence within 270 days the CIRP should be completed.
2 4. Although it is directory that CIRP can be completed upto a period of 330 days or so which is largely to consider the time frame of judicial process. Hence, practically all attempt be made to complete the CIRP within 270 days.
5. In the present case already two Resolution Plans have been received and hence the aspect of competitive bidding is complied with, if we permit the present Appellant, it will open a floodgate for such applications & will derail CIRP & purpose of IBC, not only in this case but in other cases also. The Appeal is devoid of any merit.
6. Hence, the Appeal is dismissed.
[Justice Bansi Lal Bhat] Acting Chairperson
[Justice Anant Bijay Singh] Member (Judicial)
[Dr. Ashok Kumar Mishra] Member (Technical)
RK/GC
3
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