Insolvency and Bankruptcy Code, 2016 – s. 12 – Initiation of insolvency resolution process – The respondent no.2-successful resolution applicant defaulted in its obligation – Therefore Adjudicating authority directed reconstitution of Committee of Creditors (COC) of corporate debtor, for reconsideration of Resolution Plan given by resolution applicant (Respondent no.3) – Respondent no.3 was declared as ineligible applicant – Appellate Authority ordered liquidation of corporate debtor – Appeal to Supreme Court by COC – Liquidation proceedings were stayed – As per direction of Supreme Court, in fresh resolution process respondent no.3 was approved as successful resolution applicant – However, respondent no.3 tried to withdraw the resolution plan – Move of respondent no.3 to withdraw from resolution plan was rejected by Supreme Court and the resolution plan of respondent no.3 was approved by Adjudicating authority – Since respondent no.3 did not act upon the resolution plan – COC filed contempt petition and respondent no.3 filed application for rectification of the order of Supreme Cour whereby the Court had rejected application of respondent no.3 for withdrawal from the resolution plan – Applications of COC as well as respondent no.3 were dismissed – Held : As per s. 12 entire resolution process had to be completed within the period stipulated therein – In view of multiple proceedings the time limit has been condoned – In order to avoid further delay, the parties concerned are directed to implement the approved resolution plan.
Disposing of the appeal, the Court
HELD: The entire resolution process has to be completed within the period stipulated under Section 12 of the Insolvency and Bankruptcy Code, 2016 and any deviation would defeat the object and purpose of providing such time limit. However, by earlier order, the time limit has been condoned in view of the various litigations pending between the parties and in the peculiar facts and circumstances of the case. Therefore, any further delay in implementation of the approved resolution plan submitted by the successful resolution applicant (Respondent no.3) Deccan Value Investor (DVI) which as such has been approved by the adjudicating authority in the month of July, 2020 and even the appeal against the same has been dismissed subsequently, any further delay would defeat the very object and purpose of providing specific time limit for completion of the insolvency resolution process, as mandated under Section 12 of the IBC. Therefore, the concerned parties to the approved resolution plan and/or connected with implementation of the approved resolution plan including IMC ate directed to complete the implementation of the approved resolution plan. It is further directed that on implementation of the approved resolution plan and even as per the approved resolution plan, an amount of Rs. 500 crores now deposited by DVI-successful resolution applicant (Respondent no.3) be transferred to the respective lenders/financial creditors as per the approved resolution plan and/or as mutually agreed. [Para 10][750-G-H; 751-A-D]
As published in the Supreme Court Reports, Supreme Court of India. Text from the Indian Supreme Court Judgments open data set (Dattam Labs), CC BY 4.0.
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