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Judgment
This Application has been filed seeking extension of time period for completion of CIRP of the Corporate Debtor i.e., Gonglu Agro Private Limited for a further period of 30 days from 12.11.2023 or the date on which this Application is allowed.
It is stated that this Tribunal vide order dated 12.09.2023 extended the CIRP for period of 60 days till 11.11.2023. It is stated that the pursuant thereto eight resolution applications came which were placed before the CoC and one of the resolution applicants as submitted a resolution plan on 06.11.2023 which is in active consideration by the CoC.
It is stated that since in the present case, one resolution plan has been received, the CoC in the meeting held on 23.10.2023 has resolved to seek extension for consideration of the resolution plan which resolution has been approved with 98.59% voting.
Heard the submissions of the Learned Counsel for the Applicant and perused the record.
The object of IBC, 2016 is to maximize the value of assets for the benefit of the stakeholders. The Hon’ble Supreme Court in the matter of Swiss Ribbons Pvt. Ltd. & Anr –Vs- Union of India & Ors. (2019) 4 SCC 17 has observed in para 11 as follows;
“As is discernible, the Preamble gives an insight into what is sought to be achieved by the Code. The Code is first and foremost, a Code for reorganization and insolvency resolution of corporate debtors. Unless such reorganization is effected in a time-bound manner, the value of the assets of such persons will deplete. Therefore maximization of value of the assets of such persons so that they are efficiently run as going concerns is another very important objective of the Code. This, in turn, will promote entrepreneurship as the persons in management of the corporate debtor are removed and replaced by entrepreneurs. When, therefore, a resolution plan takes off and the corporate debtor is brought back into the economic mainstream, it is able to repay its debts, which, in turn, enhances the viability of credit in the hands of banks and financial institutions. Above all, ultimately, the interests of all stakeholders are looked after as the corporate debtor itself becomes a beneficiary of the resolution scheme – workers are paid, the creditors in the long run will be repaid in full, and shareholders/investors are able to maximize their investment. Timely resolution of a corporate debtor who is in the red, by an effective legal framework, would go a long way to support the development of credit markets. Since more investment can be made with funds that have come back into the economy, business then eases up, which leads, overall, to higher economic growth and development of the Indian economy. What is interesting to note is that the Preamble does not, in any manner, refer to liquidation, which is only availed of as a last resort if there is either no resolution plan or the resolution plans submitted are not up to the mark. Even in liquidation, the liquidator can sell the business of the corporate debtor as a going concern. [See ArcelorMittal (supra) at paragraph 83, footnote 3].”
Keeping in view the object of IBC, 2016 and also in view of the fact that one Resolution Plan has been received by the CoC and is under consideration by the CoC, this Tribunal by relying upon the decision of the Hon'ble Supreme Court in the matter of Committee of Creditors of Essar Steels through Authorized Signatory Vs Sathish Kumar Gupta & Others (2020) 8 SCC 531, extend the CIRP period in respect of the Corporate Debtor for a period of 30 days from 11.11.2023, only for the limited purpose of considering the Resolution Plan submitted by the Prospective Resolution Applicant.
It is made clear that this extension is granted keeping in view the peculiar facts and circumstances of the present case.
Accordingly, IA(IBC)/2133(CHE)2023 stands disposed off.