Kingston Paptech Private Limited

"The Operational Creditors (including government) will be paid of Rs.61,250/- against admitted claim of Rs.48,94,553/-".

a. Allow the present application;

b. Pass necessary order(s)/directions(s) under Section 31 of the Code, approving the Resolution Plan submitted by the Successful Resolution Applicant - Mr. Afroj Shah & Mr. Mitin Jain (In Consortium), which has been approved with (100%) vote casted in favour by the Committee of Creditors of M/s. Kingston Paptech Pvt. Ltd.;

c. Declare that upon approval of the Resolution Plan by this Hon'ble Adjudicating Authority, the provisions of the Resolution Plan shall be binding on the Company, its creditors, guarantors, members, employees, Statutory Authorities and other stakeholders in accordance with Section 31 of the Code, and shall be given effect to and implemented pursuant to the order of this Hon'ble Adjudicating Authority;

d. To pass necessary order(s) /direction(s) declaring that upon approval of the resolution plan by this Hon'ble Tribunal the liability of the corporate debtor for any offence committed prior to the commencement of CIRP shall cease in accordance with the provisions of section 32 A of the Code;

e. To approve the appointment of the monitoring Committee as stated in the Resolution Plan and confirmed by the Committee of Creditors;

f. To pass necessary order(s) directions(s) vacating the moratorium on Kingston Paptech Private Limited. Imposed under Section 14 of the Code;

g. To pass necessary order(s) /directions(s) discharging the Resolution Professional Mr. Vinod Tarachand Agarwal from the duties of the resolution professional of Corporate Debtor;

h. To pass an order approving reliefs and concession sought by the Resolution Applicant as mentioned in Schedule 5 of the Resolution Plan;

i.

To pass necessary order(s) /directions(s) to the Registrar of Companies to update the status of the Corporate Debtor from 'Under CIRP' to 'Active', upon approval of resolution plan.

j. To pass such other or further order /order(s) as may be deemed fit and proper in the facts and circumstances of the instant case.

FACTS

Resolution no. 1

RESOLVED THAT in terms of section 30(4) of Insolvency & Bankruptcy Code, 2016 and the rules and regulations thereunder, the Committee of Creditors after verifying all the clauses of the plan including relief and concessions, be and is hereby approves the Resolution Plan submitted by "MR. MITIN JAIN & MR. AFROJ SHAH (CONSORTIUM)"

"FURTHER RESOLVED THAT pursuant to the provisions of the Insolvency and Bankruptcy Code, 2016 and the Rules and Regulations thereunder, the members of the Committee of Creditors hereby approves and confirm that feasibility and viability of the resolution plan is checked as mention under the provision of Section 30(4) of the code and under the regulation of 39(3) of CIRP regulations, 2016 and resolution plan approved by CoC is Feasible and Viable."

"FURTHER RESOLVED THAT pursuant to the provisions of the Insolvency and Bankruptcy Code, 2016 and the Rules and Regulations thereunder, the members of the Committee of Creditors hereby confirms' and approves' that the plans submitted by RA were evaluated on the basis of evaluation matrix and afterwards the same is shared with the CoC members"

"FURTHER RESOLVED THAT pursuant to the provisions of the Insolvency and Bankruptcy Code, 2016 and the Rules and Regulations thereunder, the members of the Committee of Creditors hereby authorize the resolution professional to file and application before Hon'ble NCLT for the approval of the resolution plan and cost of the same shall be part of CIRP Cost.

XXXIII. That the instant application is bonafide and being filed in the interest of justice and to advance the objectives of the Code.

I. Whether any proceedings against the Corporate Debtor or the promoters of the Corporate Debtors are pending by any investigation authorities?

As per the information available with the Resolution Professional and based on disclosures received from the Corporate Debtor, its management, and records verified during the Corporate Insolvency Resolution Process, there are no proceedings pending against the Corporate Debtor or its Promoters before any investigation authorities, like the Enforcement directorate, CBI, SFIO, revenue authorities or ROC.

II. Copy of Audited accounts for the last four years prior to the initiation of CIRP?

The Corporate Insolvency Resolution Process (CIRP) of the Corporate Debtor was initiated on 29.08.2024. It is respectfully submitted that no financial statements were prepared or audited after the financial year ended on 31st March 2016. Accordingly, the latest available audited accounts pertain to the financial years 2012-13, 2013-14, 2014-15, and 2015-16. Copies of the audited accounts for the aforesaid four years are annexed herewith and marked as Annexure A (Colly).

III. Cash Flow Statement of the Corporate Debtor for the last five year from the date of initiation of CIRP.

The Corporate Insolvency Resolution Process (CIRP) of the Corporate Debtor was initiated on 29.08.2024. It is respectfully submitted that no financial statements were prepared or audited after the financial year ended on 31st March 2016. Copies of the Cash Flow Statement prepared based upon the bank statement for the year 2019-20, 2020-21, 2021-22, 2022-23 and 2023-24 are annexed herewith and marked as Annexure – B (Colly).

IV. Number of the Employees of the Corporate Debtor and the expensed on salaries of these employees, if any, during the last five years from the initiation of the CIRP.

As per the records of the Corporate Debtor available at the site and information received, there are no employees with the Corporate Debtor since last five years (Financial year 2019-20 to 2023-24) from the date of initiation of CIRP and no salaries has been paid. As per claim form submitted by EPFO last salary payment was done in May 2015.

V. Name of the Stakeholders who will benefit from the approval of the resolution plan and to what extent ?

Stakeholder Category	Amount as per Liquidation Value	Amount as per Resolution Plan	Benefit (Compared to recovery in Liquidation)
Secured Financial Creditors (M/s Raj Radhe Finance Limited) Claim 80.92 Crore	7,40,34,161 (Liq. Value - CIRP Cost - PF Claim)	8,47,00,000	1,06,65,839 + Actual Liquidation Cost
Unsecured Financial Creditors (Mr. Nagindas Patel & Family) Claim - 55 Lakh	Nil (As LV is less then claim of Secured Creditors)	58,750	58,750
Operational Creditors (Excl. Workmen & Employees)	Nil	40,072	40,072

Claims: Balaji Chem Solutions Private Limited - 4.39 Lakh AKG Exim Ltd - 35.68 Lakh
Government Dues Claims: PF Dues - 0.12 Lakh Income Tax - 5.05 Lakh GST - 3.70 Lakh	12,429 (Only PF Dues)	21,178 (100 % to PF Dues)	8,749
Employees / Workmen	Nil	Nil	Restart of business activity may generate new employments.
Promoters / Guarantors			Reduction of liability of personal Guarantors to the extent plan recovery.
CIRP Cost	46,80,000	46,80,000	-
	7,87,26,590	8,95,00,000	1,07,73,410

VI. Whether any plant and machinery of the corporate debtor have been sold during the Financial Year 2017-18 onwards?

As per bank statements and other records available, no plant and machinery were sold after 01.04.2017. Furthermore, CIRP was admitted earlier as well on 15th March 2021, wherein the undersigned deponent was only appointed as the Resolution Professional. Hence, it is submitted that there is no reduction in plant and machinery since 01.04.2017 till date.

VII. Report on the approval of the plan of a particular resolution applicant and rejection of the other plans of the commercial wisdom of the CoC in regard to the same.

Total 5(Five) resolution plan were received and put up before CoC after Challenge Mechanism for the purpose of evaluation. Brief of the Plan Value, Term of the Plan and Marking as per EM are as below:-

Sr. No	Name of Resolution Applicant	Total Plan Value (In Crore)	Term of payment Plan	Total Score (100%)	Rank as per EM	Rank as per Financial

Note: Copy of Evaluation Matrix is annexed herewith as Annexure - C.

- For Sr. No.2: Reason for Lower Quantitative marking is longer payment terms compared to Sr. No.1, and reason for lower qualitative marking is Low Net Worth. - For Sr. No.3 and 4: Reason for Lower Quantitative marking is 90% of total payment were proposed after 6 months of approval, and reason for lower qualitative marking is Low Net Worth.

Copy of detailed Clarification/ Justification from Secured Financial Creditor (having highest voting share) is annexed at Annexure-D.

VIII. Whether CoC has considered the sale of the plant and machinery or building as assets, in place of the sale of the corporate debtor as a going concern or the business of the corporate debtor in case of liquidation.

In 11th Meeting of CoC dated 21.07.2025, CoC unanimously resolved that "in the event of a liquidation order being passed by the Hon'ble NCLT against the Corporate Debtor, the assent of the Committee of Creditors, be and is hereby accorded to sell the Business/ corporate debtor as a going concern.", by 100% voting in favor. Aforesaid relevant Resolution No.9 of the Minutes of 11th CoC Meeting are annexed with the captioned IA in Vol. No. 4 at Page No. 500 -501 of the application.

IX. Lastly, annexures of the Resolution Plan which were inadvertently not annexed with the present application, are annexed herewith for consideration of this Tribunal and annexed at Annexure-E.

X. Accordingly, in view of the aforesaid compliances of the provisions of the Insolvency and Bankruptcy Code, 2016 along with IBBI Rules and Regulations framed thereunder, this Hon'ble Tribunal may be pleased to taken on record the present Affidavit in compliance of Order dated 29.08.2025, and pass necessary orders/ directions under Section 31 of the Code inter-alia approving the Resolution Plan submitted by the Successful Resolution Applicant i.e., Mr. Afroj Shah & Mr. Mitin Jain (in Consortium).

I. The SRA vide letter dated 14.10.2025 has clarified/provided the proposed shareholding pattern, upon successful implementation of the resolution plan which is as follow:

Sl No.	Name of Shareholders	% of Holding
1.	Mitin Jain	90%
2.	Afroj Salim Shah	10%

II. The aforesaid proposed shareholders also being the Successful Resolution Applicants, have already provided their affidavits qua compliance of Section 29A of the Code, which is annexed at Annexure-T of the application.

1.1. Summary of Treatment of Creditors:-

Description	Amount submitted (₹ CR)	Amount admitted (₹ CR)
Secured financial creditors (other than financial creditors belonging to any class of creditors)	80.82	80.82
Unsecured financial creditors (other than financial creditors belonging to any class of creditors)	0.55	0.55
Workmen and employee's dues	0.00	0.00
Operational Creditors of the Company (Government dues)	0.09	0.09
Operational Creditors of the Company (Excluding workmen and employees dues)	3.96	0.40
Total Claims	85.42	81.86

2.4.

The Indicative Timeline of Events for Implementation of Proposed Resolution Plan is as under:-

2.4.1

Implementation of the Resolution Plan shall commence from the NCLT Approval Date. 2.4.2 Unless waived (where permissible under Applicable Law) by the Resolution Applicants, the consumption and completion (including disbursement of Upfront Cash Infusion for settlement of dues of the Corporate Debtor) of the Resolution Plan is contingent on the following conditions ("Conditions Precedent) having been fulfilled:

(i)

Regulatory Approvals and Filings:

(a)

Occurrence of Final Approval Date; and

(b)

Receipt of a copy of the order of the relevant adjudicating authority approving this Resolution Plan

In view of Section 238 of the Code, the Resolution Applicants have assumed that the Code is a complete code in itself and the NCLT order approving a resolution plan will constitute a single window clearance for all actions required under a resolution plan. Accordingly, the NCLT order sanctioning this Resolution Plan will be final and binding on all stakeholders and third parties to the extent permitted under the Applicable Law.

Pursuant to Section 32A of the Insolvency and Bankruptcy Code, upon approval of this Resolution Plan, the liability of a corporate debtor for an offence committed prior to the commencement of the corporate insolvency resolution process shall cease, and the corporate debtor shall not be prosecuted for such an offence from the date the resolution plan has been approved by the Adjudicating Authority under section 31.

Furthermore, it is expressly stated that all properties and assets owned by the Corporate Debtor, as contemplated under this resolution plan, shall be free from any attachment, encumbrance, or claims of any nature, providing the Resolution Applicant with clear and unencumbered ownership rights.

The Applicant assumes that the Resolution Professional will take all necessary actions and execute all documents/agreement as may be required to maintain the Company as a going concern until the Applicant acquires control over the Company in the manner set out in this Resolution Plan.

Subject to the above, provided below is an indicative timeline of events for implementation of the Resolution Plan:

Step	Action	Timeline (in business days)
Step 1	Approval of the Resolution Plan by Adjudicating Authority	T
Step 2	Payment of CIRP costs	T+30 business days
Step 3	Capital reduction of equity share capital of the Company	T+30 business days
Step 4	Infuse of funds by ways of equity or convertible securities or subordinate convertible loans or any other appropriate means	T+30 business days
Step 5	Upfront Payment to the Financial Creditors of the Company and allotment of proposed equity shares to the Financial Creditors	T+30 business days
Step 6	Payment of Deferred Amount of Financial Creditors	As per Payment Terms as set out in Para 4.3
Step 7	Receipt of NOC / No Due Certificate upon payment of amount proposed in this plan.	T+ 30 Days + 15 business days

T means date of approvals of the Resolution Plan by the NCLT. All Dates are tentative dates and are subject to change.

3.7. The Supervision of the Plan will as follows:-

"..b. Supervision of Plan: On or after approval of this Resolution Plan by NCLT and until the Plan Implementation Date, Monitoring Committee consists of One Representative from Consenting Secured Financial Creditor having highest voting share, One Representative of Resolution Applicant and Resolution Professional to supervise the Implementation Plan. All major business decisions impacting the interest of Secured financial creditors shall be made by said committee in consultation with Resolution Applicant only. Examples of major decision include but not limited to, sale of assets, assuming of non-trade liabilities etc. Monitoring Committee shall decide about the frequency of reporting and meeting to have effective implementation and supervision of Resolution Plan. .."

4.1. Payment of Insolvency Resolution Process Cost:

4.1.2.

As informed by Resolution Professional the estimated CIRP cost including fees to be paid to Insolvency & Bankruptcy Board of India (IBBI) to be 46,80,000/- (Rupees Forty Six Lakhs and Eighty Thousands Only). Any change in the CIRP cost (increase or decrease) would be proportionately adjusted against the payments to be made to Secured Financial Creditors so that overall financial obligation of the Resolution Applicant remains unchanged.

4.1.3.

Once the CIRP Costs have been paid in full, it is clarified that no claims, liabilities, fines, costs, expenses or any other payment of such nature or otherwise, that are or are claimed to constitute CIRP Costs shall be payable by the Resolution Applicants.

4.2. Proposal for Workmen/Employees

4.2.1.

As per the Information Memorandum and the other information provided by RP, the total employee and Workmen dues admitted by the Resolution Professional is Nil. ("Admitted Employees and Workmen Dues).

4.2.. Employees and Workmen are required to be paid not less than such amounts as would have been paid to them in case of liquidation of the Corporate Debtor in accordance with the Code. Subject to Section 30 of the Code and Regulation 38 of the IBBI (CIRP) Regulations, under this Resolution Plan, all such amounts (including dues payable to workmen for a period of 24 months immediately preceding Insolvency Commencement Date) will be paid to the Employees and Workmen of the Corporate Debtor as would have been paid to them in case of liquidation of the Corporate Debtor ("Workmen Liquidation Dues) as required under the Code. With respect to the remaining Employees and Workmen Dues, while the Liquidation Value of the same is NIL.

4.2.3.

Other than the admitted Employees and Workmen Dues, any and all claims or demands made by, or liabilities or obligations owed or payable to, (including any demand for any losses or damages, or interest, back wages, compensation, penal interest, liquidated damages already accrued/accruing or in connection with any third party claims, or any claims made by any person who may claims to be a creditor by way of exercise of rights under Applicable Laws or equity) any present or past, direct or indirect, permanent or temporary employee and/or workman of the Corporate Debtor, whether admitted or not, due or contingent, asserted or unasserted, crystallised or uncrystallised, known or unknown, secured or unsecured, disputed or undisputed, present or future, whether or not set out in the Information Memorandum, the balance sheets of the Corporate Debtor or the profit and loss account statements of the Corporate Debtor, in relation to any period prior to the Insolvency Commencement Date, will be written off in full and shall be, and be deemed to be, permanently extinguished, restructured, restated, converted, assigned, written down or written-off, as the case may be, with effect from the NCLT Approval Date, by virtue of the order of the NCLT approving this Resolution Plan. The Corporate Debtor or the Resolution Applicants shall at no point of time be, directly or indirectly, held responsible or liable in relation thereto.

4.3. Proposal for Financial Creditors

4.3.1.

Given below is the amount claimed by the Financial Creditors of the Company and admitted thereof as per the IM.

Sr. No	Category of creditor	Amount claimed (in ₹ Cr)	Amount of claim Admitted (in ₹ Cr)
1.	Financial Creditors	81.37	81.37

4.3.2.

According to the list of Financial Creditors, the total claims filed by the Financial Creditors is INR 81.37 Cr and claim of INR 81.37 Cr has been verified and admitted by the Resolution Professional ("Admitted Financial Debt"). The Applicant understand that there are no non-fund-based bank guarantees / letter of credit invoked/uninvoked other than those included in the Admitted Financial Debt and accordingly the Admitted Financial Debt would not get modified during the process or after the implementation of the Resolution Plan.

4.3.3. Proposal for Secured Creditors

a. Proposal for Secured financial Creditors

(Rs. In Crore)

Particulars	Admitted Financial Debt	Amount -Proposed to be Paid
Secured Financial Creditors	80.82	The Applicant proposed to pay Rs. 847 Lakhs to the Secured Financial Creditors within a period of 30 days from the date of approval of Resolution Plan by NCLT.

b. Proposal for Unsecured Financial Debts (Excluding Debt due to Related Parties)

b. Proposal for Unsecured Financial Debts (Excluding Debt due to Related Parties)

Particulars	Admitted Financial Debt	Amount - Proposed to be Paid
Unsecured Financial Debts (Excluding Debt due to Related Parties)	55,00,000	58,750

Payment Schedule / Terms of Payment to Unsecured Financial Creditors (Excluding Related Parties):-

- ₹ 58,750/- proposed to be paid upfront within 30 days from the approval of Resolution Plan by Adjudicating Authority.

4.4. Proposal for Operational Creditors:

"4.5.1.

As per the IM, Operational Creditor (excluding employees, workmen) claims aggregating to approximately Rs.0.49 crore ("Operational Creditor Debt) have been admitted for the purposes of CIRP by the Resolution Professional..."

4.13. Proposal for Acquiring Management Control:-

4.13.1.

Upon approval of the Resolution Plan by the Adjudicating Authority and payment of the first installment as envisaged under this Resolution Plan, the Resolution Applicant shall be handed over the charge and operations of the Company and all assistance in this regard would be provided by the Resolution Professional and Committee of Creditors for the same.

4.13.2.

The existing Board of Directors of the Company shall resign from the Board and co-operate with the Resolution Applicant in complying with the provisions of the Companies Act, 2013 with regards to filing of necessary forms with the office of Registrar of Companies. If the existing Board of Directors fail to submit their resignation, they shall be deemed to have ceased to be the Directors of the Company and Company would be entitled to file necessary forms with the office of ROC. If any technical issues arise for such filing the office of the Registrar of Companies shall provide necessary assistance to the Resolution Applicant for the change of Board including but not restricted to opening of special window to permit the incoming directors to complete the change in Director(s) as envisaged under the present Resolution Plan.

4.13.3

Simultaneously with the resignation / cessation of the existing Board the Resolution Applicant shall appoint following Directors on the board of the company as per the provisions of the Companies Act, 2013.

Sr. No.	Name of Director	DIN
1	Mitin Jain	00236675
2	Afroj Shah	01946875

4.13.4.

The Company's issued, subscribed and fully paid cup share capital as on 31.03.2016 is as follows:-Thus, the issues, subscribed and fully paid up share capital of the Share

Sr. No.	Particulars	Amount in Lacs
	Equity Share Capital
	Authorised:
1.	45,00,000 equity shares of INR 10 each	450.00
2.	Issued, subscribed and fully paid up:
	45,00,000 equity shares of INR 10 each	450.00
	Total	450.00

Capital of the Company aggregates to INR 4.50 Cr (share capital). We understand that there is no change in issued, subscribed and paid up share capital of the Company post the above date.

(1) Capital Reduction

a. As provided earlier in this Resolution the Liquidation value of the Company is not sufficient to cover debt of the Financial Creditors of the Company in full. Therefore, the Liquidation Value of the Equity Shareholder is estimated to be Nil.

b. It is proposed that the entire existing shareholding shall be fully cancelled and stand reduced to Zero.

c. The Capital reduction shall be effected as part of this Resolution Plan itself, without having follow the process under Section 66 of the CA 2013 separately, and the order of the NCLT sanctioning this Resolution Plan shall be deemed to be an and order under Section 66 of the CA 2013 confirming the capital reduction. The Company will comply with any procedural requirement with respect to filing of requisite forms of required with the office of Registrar of Companies.

d. The approval of this Resolution Plan by the NCLT shall be deemed to have waived all the procedural requirement in terms of Section 66 of CA 2013 and the NCLT (Procedure for Reduction of Share Capital) Rules 2016.

e. The amount of reduction in the equity share capital of the Company shall be credited to Capital Reserves of the Company.

f. For Avoidance of doubt, the approval of COC to the Resolution Plan shall be deemed to be the consent of the all the authorities from whom such approval is necessitated whether arising from any agreement or applicable laws.

2) Infusion of Fund by Applicant

(i)

To enable the implementation of the Resolution Plan, Applicant may incorporate / use a Special Purpose Vehicle ("SPV"). The SPV shall be funded by way of equity infusion by Applicant or its Promoters/Relatives/Associates/Investors ("Subscribers") and debt raised at the SPV/ Applicant Level.

(ii)

Simultaneously, with the Capital Reduction, the Applicant will make necessary subscription for allotment of 50,000 (Fifty Thousands) equity shares of Rs 10 each at par aggregating to Rs. 5,00,000 (Rupees Five Lakhs only) in order to enable the Company to make necessary allotment of equity shares to the Subscribers. The Applicant submit that he will subscribe for 50,000 equity shares of Rs. 10 each at part.

(iii)

It is clarified that the approval of NCLT shall constitute adequate approval for issuance and allotment of equity shares by the Company to the Subscribers in accordance with Section 42 and Section 62(1) (e) of CA 2013 and LODR Regulations, if applicable and accordingly, no approval or consent shall be necessary under any Applicable Law for making such allotment other than from the Implementation Monitory Committee constituted as per the terms of this Resolution Plan or Board of Directors of the Company constituted post approval of the Resolution Plan.

9.5. Avoidance Transactions:-

If the Adjudicating Authority reverses or sets aside any avoidable transactions under Sections 43, 45, 47, 49, 50 or 66 of the Code, then such assets or proceeds from transaction shall be a pass-through to the all the Stakeholders of the Corporate Debtor as per the provision of IBC. Such proceeds, if any, shall be over and above the total amount proposed in this resolution plan by the Applicant. The Resolution Applicant agree to continue any such application for the benefit of all the stakeholders of the Corporate Debtor provided the applicant shall be reimbursed for any cost incurred by it for such application. It is further clarified that the secured financial creditors shall reimburse the cost of pursuing PUFE application if any.

11. Management of the Company:

a. Formation of Board

i.

It is proposed that upon the Applicant acquiring control over the Company, the existing board or interim board will be replaced by a new board of directors constituted with adequate representation from the members of the group and independent directors in compliance with Applicable Laws. The existing director shall assist for filing of relevant forms/documents with the Registrar of Companies for change in Directorship.

b. Appointment of Auditors (Statutory and Internal)

i.

After the Acquisition of the Corporate Debtor by the Resolution Applicants, the management of the Corporate Debtor shall appoint reputed and credible accountancy firms as statutory in accordance with Applicable Law. In accordance with Section 30 of the Code, approval of the shareholders of the Corporate Debtor for removal and appointment of auditors as required under the Companies Act, 2013 or any other law shall be deemed to have been given and no further action shall be required in this regard.

c. Appointment of Employees

i.

Upon Acquisition of the control over the Company by the Applicant in this manner set out in this Resolution Plan, the Applicant proposes to employ requisite employee in the Company to bring in operational efficiencies in the Company.

12. Other key terms:

"..g. The Applicant furnishing herewith EMD of 25 Lakh as per the terms set out in the RFRP along with this Resolution Plan over and above 2 Lakhs already deposited at the time submission of Expression of Interest.

h. As set out in the RFRP, The Resolution Applicant agree to provide a Performance Guarantee in form of Fixed Deposit or Cash Deposit or a guarantee by schedule bank of 15% of Resolution Plan Amount in addition to the amount of Rs. 2,00,000 deposited along with the Expression of Interest and Rs. 25,00,000 deposited as EMD at the time of submitting the Resolution Plan, within 7 (Seven) working days of issuance of Letter of Intent (LoI) by the Resolution Professional, in favour of Kingston Paptech Private Limited. (In CIRP)..."

10. SOME ADDITIONAL FACTS

Date of initiation of CIRP: 29.08.2024 Date of constitution of CoC: 20.09.2024 Date of approval of Resolution Plan by CoC : 21.07.2025 Date of expiry of 180 days of CIRP: 25.02.2025 Fair value of CD: Rs.12,27,89,189.25 - Liquidation value of CD: Rs.7,87,26,590.66 Number of meetings of CoC held: Eleven - The total admitted claims as Corporate Guarantee is NIL and the total admitted claims other than Corporate Guarantee is Rs.81,86,37,179/- The SRA is Mr. Mitin Jain & Mr. Afroj Shah (Consortium). Total plan value is Rs.8,95,00,000. - The Resolution Applicant has filed an affidavit confirming its eligibility under section 29A of the Code to submit a resolution plan. The RP has also filed a due diligence certificate under section 29A of the IBC for the SRA. The said resolution plan has been approved by the CoC with 100% voting after considering its feasibility and viability and other requirements specified by the CIRP Regulations.

12. LEGAL BASIS FOR APPROVAL/REJECTION OF THE RESOLUTION PLAN

"31. Approval of Resolution Plan

(1)

If the Adjudicating Authority is satisfied that the resolution plan as approved by the committee of creditors under sub-section (4) of section 30 meets the requirements as referred to in sub-section (2) of section 30, it shall by order approve the resolution plan which shall be binding on the corporate debtor and its employees, members, creditors, including the Central Government, any State Government or any local authority to whom a debt in respect of the payment of dues arising under any law for the time being in force, such as authorities to whom statutory dues are owed, guarantors and other stakeholders involved in the resolution plan.

Provided that the Adjudicating Authority shall, before passing an order for approval of resolution plan under this sub-section, satisfy that the resolution plan has provisions for its effective implementation.

(2)

Where the Adjudicating Authority is satisfied that the resolution plan does not confirm to the requirements referred to in sub-section (1), it may, by an order, reject the resolution plan.

(3)

After the order of approval under sub-section (1),—

(a)

the moratorium order passed by the Adjudicating Authority under section 14 shall cease to have effect; and

(b)

the resolution professional shall forward all records relating to the conduct of the corporate insolvency resolution process and the resolution plan to the Board to be recorded on its database.

(4)

The resolution applicant shall, pursuant to the resolution plan approved under sub-section (1), obtain the necessary approval required under any law for the time being in force within a period of one year from the date of approval of the resolution plan by the Adjudicating Authority under sub-section (1) or within such period as provided for in such law, whichever is later.

Provided that where the resolution plan contains a provision for combination, as referred to in section 5 of the Competition Act, 2002, the resolution applicant shall obtain the approval of the Competition Commission of India under that Act prior to the approval of such resolution plan by the committee of creditors."

"30. Submission of resolution plan.

(2)

The resolution professional shall examine each resolution plan received by him to confirm that each resolution plan—

(a)

provides for the payment of insolvency resolution process costs in a manner specified by the Board in priority to the payment of other debts of the corporate debtor;

(b)

provides for the payment of debts of operational creditors in such manner as may be specified by the Board which shall not be less than-

(i)

the amount to be paid to such creditors in the event of a liquidation of the corporate debtor under section 53; or

(ii)

the amount that would have been paid to such creditors, if the amount to be distributed under the resolution plan had been distributed in accordance with the order of priority in sub-section (1) of section 53, whichever is higher, and provides for the payment of debts of financial creditors, who do not vote in favour of the resolution plan, in such manner as may be specified by the Board, which shall not be less than the amount to be paid to such creditors in accordance with sub-section (1) of section 53 in the event of a liquidation of the corporate debtor.

Explanation 1.-For removal of doubts, it is hereby clarified that a distribution in accordance with the provisions of this clause shall be fair and equitable to such creditors.

Explanation 2.-For the purpose of this clause, it is hereby declared that on and from the date of commencement of the Insolvency and Bankruptcy Code (Amendment) Act, 2019, the provisions of this clause shall also apply to the corporate insolvency resolution process of a corporate debtor-

(i)

where a resolution plan has not been approved or rejected by the Adjudicating Authority;

(ii)

where an appeal has been preferred under section 61 or section 62 or such an appeal is not time barred under any provision of law for the time being in force; or

(iii)

where a legal proceeding has been initiated in any court against the decision of the Adjudicating Authority in respect of a resolution plan;

(c)

provides for the management of the affairs of the corporate debtor after approval of the resolution plan;

(d)

the implementation and supervision of the resolution plan;

(e)

does not contravene any of the provisions of the law for the time being in force;

(f)

conforms to such other requirements as may be specified by the Board.

Explanation. -For the purposes of clause (e), if any approval of shareholders is required under the Companies Act, 2013 (18 of 2013) or any other law for the time being in force for the implementation of actions under the resolution plan, such approval shall be deemed to have been given and it shall not be a contravention of that Act or law."

13. FINDINGS OF THIS TRIBUNAL

"19... In the present case, however, our focus must be on the dispensation governing the process of approval or rejection of resolution plan by the CoC. The CoC is called upon to consider the resolution plan under Section 30(4) of the I&B Code after it is verified and vetted by the resolution professional as being compliant with all the statutory requirements specified in Section 30(2).

62.

...In the present case, however, we are concerned with the provisions of I&B Code dealing with the resolution process. The dispensation provided in the I&B Code is entirely different. In terms of Section 30 of the I&B Code, the decision is taken collectively after due negotiations between the financial creditors who are constituents of the CoC and they express their opinion on the proposed resolution plan in the form of votes, as per their voting share. In the meeting of the CoC, the proposed resolution plan is placed for discussion and after full interaction in the presence of all concerned and the Resolution Professional, the constituents of the CoC finally proceed to exercise their option (business/commercial decision) to approve or not to approve the proposed resolution plan. In such a case, non-recording of reasons would not per-se vitiate the collective decision of the financial creditors. The legislature has not envisaged challenge to the "commercial/business decision" of the financial creditors taken collectively or for that matter their individual opinion, as the case may be, on this count."

"55.

Whereas, the discretion of the adjudicating authority (NCLT) is circumscribed by Section 31 limited to scrutiny of the resolution plan "as approved" by the requisite per cent of voting share of financial creditors. Even in that enquiry, the grounds on which the adjudicating authority can reject the resolution plan is in reference to matters specified in Section 30(2), when the resolution plan does not conform to the stated requirements. Reverting to Section 30(2), the enquiry to be done is in respect of whether the resolution plan provides: (i) the payment of insolvency resolution process costs in a specified manner in priority to the repayment of other debts of the corporate debtor, (ii) the repayment of the debts of operational creditors in prescribed manner, (iii) the management of the affairs of the corporate debtor, (iv) the implementation and supervision of the resolution plan, (v) does not contravene any of the provisions of the law for the time being in force, (vi) conforms to such other requirements as may be specified by the Board. The Board referred to is established under Section 188 of the I&B Code. The powers and functions of the Board have been delineated in Section 196 of the I&B Code. None of the specified functions of the Board, directly or indirectly, pertain to regulating the manner in which the financial creditors ought to or ought not to exercise their commercial wisdom during the voting on the resolution plan under Section 30(4) of the I&B Code. The subjective satisfaction of the financial creditors at the time of voting is bound to be a mixed baggage of variety of factors. To wit, the feasibility and viability of the proposed resolution plan and including their perceptions about the general capability of the resolution applicant to translate the projected plan into a reality. The resolution applicant may have given projections backed by normative data but still in the opinion of the dissenting financial creditors, it would not be free from being speculative. These aspects are completely within the domain of the financial creditors who are called upon to vote on the resolution plan under Section 30(4) of the I&B Code.

58.

Indubitably, the inquiry in such an appeal would be limited to the power exercisable by the resolution professional under Section 30(2) of the I&B Code or, at best, by the adjudicating authority (NCLT) under Section 31(2) read with Section 31(1) of the I&B Code. No other inquiry would be permissible. Further, the jurisdiction bestowed upon the appellate authority (NCLAT) is also expressly circumscribed. It can examine the challenge only in relation to the grounds specified in Section 61(3) of the I&B Code, which is limited to matters "other than" enquiry into the autonomy or commercial wisdom of the dissenting financial creditors. Thus, the prescribed authorities (NCLT/NCLAT) have been endowed with limited jurisdiction as specified in the I&B Code and not to act as a court of equity or exercise plenary powers." (emphasis supplied)

"..76. The expositions aforesaid make it clear that the decision as to whether corporate debtor should continue as a going concern or should be liquidated is essentially a business decision; and in the scheme of IBC, this decision has been left to the Committee of Creditors, comprising of the financial creditors. Differently put, in regard to the insolvency resolution, the decision as to whether a particular resolution plan is to be accepted or not is ultimately in the hands of the Committee of Creditors; and even in such a decision making process, a resolution plan cannot be taken as approved if the same is not approved by votes of at least 66% of the voting share of financial creditors. Thus, broadly put, a resolution plan is approved only when the collective commercial wisdom of the financial creditors, having at least 2/3rd majority of voting share in the Committee of Creditors, stands in its favour.

77.

In the scheme of IBC, where approval of resolution plan is exclusively in the domain of the commercial wisdom of CoC, the scope of judicial review is correspondingly circumscribed by the provisions contained in Section 31 as regards approval of the Adjudicating Authority and in Section 32 read with Section 61 as regards the scope of appeal against the order of approval.

77.1.

Such limitations on judicial review have been duly underscored by this Court in the decisions above-referred, where it has been laid down in explicit terms that the powers of the Adjudicating Authority dealing with the resolution plan do not extend to examine the correctness or otherwise of the commercial wisdom exercised by the CoC. The limited judicial review available to Adjudicating Authority lies within the four corners of Section 30(2) of the Code, which would essentially be to examine that the resolution plan does not contravene any of the provisions of law for the time being in force, it conforms to such other requirements as may be specified by the Board, and it provides for: (a) payment of insolvency resolution process costs in priority; (b) payment of debts of operational creditors; (c) payment of debts of dissenting financial creditors; (d) for management of affairs of corporate debtor after approval of the resolution plan; and (e) implementation and supervision of the resolution plan.

77.2.

The limitations on the scope of judicial review are reinforced by the limited ground provided for an appeal against an order approving a resolution plan, namely, if the plan is in contravention of the provisions of any law for the time being in force; or there has been material irregularity in exercise of the powers by the resolution professional during the corporate insolvency resolution period; or the debts owed to the operational creditors have not been provided for; or the insolvency resolution process costs have not been provided for repayment in priority; or the resolution plan does not comply with any other criteria specified by the Board

77.6.1.

The assessment about maximisation of the value of assets, in the scheme of the Code, would always be subjective in nature and the question, as to whether a particular resolution plan and its propositions are leading to maximisation of value of assets or not, would be the matter of enquiry and assessment of the Committee of Creditors alone. When the Committee of Creditors takes the decision in its commercial wisdom and by the requisite majority; and there is no valid reason in law to question the decision so taken by the Committee of Creditors, the adjudicatory process, whether by the Adjudicating Authority or the Appellate Authority, cannot enter into any quantitative analysis to adjudge as to whether the prescription of the resolution plan results in maximisation of the value of assets or not. The generalised submissions and objections made in relation to this aspect of value maximisation do not, by themselves, make out a case of interference in the decision taken by the Committee of Creditors in its commercial wisdom

78.

To put in a nutshell, the Adjudicating Authority has limited jurisdiction in the matter of approval of a resolution plan, which is well defined and circumscribed by Sections 30(2) and 31 of the Code read with the parameters delineated by this Court in the decisions above referred. The jurisdiction of the Appellate Authority is also circumscribed by the limited grounds of appeal provided in Section 61 of the Code. In the adjudicatory process concerning a resolution plan under IBC, there is no scope for interference with the commercial aspects of the decision of the CoC; and there is no scope for substituting any commercial term of the resolution plan approved by the CoC. Within its limited jurisdiction, if the Adjudicating Authority or the Appellate Authority, as the case may be, would find any shortcoming in the resolution plan vis-à-vis the specified parameters, it would only send the resolution plan back to the Committee of Creditors, for re-submission after satisfying the parameters delineated by Code and exposited by this Court.

"73.

There is no doubt whatsoever that the ultimate discretion of what to pay and how much to pay each class or sub-class of creditors is with the Committee of Creditors, but, the decision of such Committee must reflect the fact that it has taken into account maximising the value of the assets of the corporate debtor and the fact that it has adequately balanced the interests of all stakeholders including operational creditors. This being the case, judicial review of the Adjudicating Authority that the resolution plan as approved by the Committee of Creditors has met the requirements referred to in Section 30(2) would include judicial review that is mentioned in Section 30(2)(e), as the provisions of the Code are also provisions of law for the time being in force. Thus, while the Adjudicating Authority cannot interfere on merits with the commercial decision taken by the Committee of Creditors, the limited judicial review available is to see that the Committee of Creditors has taken into account the fact that the corporate debtor needs to keep going as a going concern during the insolvency resolution process; that it needs to maximise the value of its assets; and that the interests of all stakeholders including operational creditors has been taken care of. If the Adjudicating Authority finds, on a given set of facts, that the aforesaid parameters have not been kept in view, it may send a resolution plan back to the Committee of Creditors to re-submit such plan after satisfying the aforesaid parameters. The reasons given by the Committee of Creditors while approving a resolution plan may thus be looked at by the Adjudicating Authority only from this point of view, and once it is satisfied that the Committee of Creditors has paid attention to these key features, it must then pass the resolution plan, other things being equal." (emphasis supplied)

86.

"...The legislative intent behind this is, to freeze all the claims so that the resolution applicant starts on a clean slate and is not flung with any surprise claims. If that is permitted, the very calculations on the basis of which the resolution applicant submits its plans, would go haywire and the plan would be unworkable.

87.

We have no hesitation to say, that the word "other stakeholders" would squarely cover the Central Government, any State Government or any local authorities. The legislature, noticing that on account of obvious omission, certain tax authorities were not abiding by the mandate of I&B Code and continuing with the proceedings, has brought out the 2019 amendment so as to cure the said mischief..."