IDBI Bank Limited vs BP Bansal Agritech Private Limited

This application is filed on 10.02.2025 by the Applicant (the Resolution Professional) under section 30(6) and 31 of the Insolvency and Bankruptcy Code. 2016 read with regulation 39(4) of the IBBI (Insolvency Resolution Process of Corporate persons) Regulations, 2016 for approval of the Resolution Plan submitted by Dr. Sita Ram Bansal as approved by the Committee of Creditors and seeking the necessary order to make it binding on all the stakeholders of BP Bansal Agritech Private Limited/Corporate Debtor. The Applicant/RP has prayed for the following reliefs: -

The averments made by the Applicant/ resolution professional in the present application and as submitted by the learned counsel are summarised as under: -

Background and Initiation of CIRP: An application under Section 7 of the IBC, 2016, was filed by IDBI Bank Limited, through its Deputy General Manager, Shri Tarun Kumar Prasad, against B.P. Bansal Agritech Private Limited (CIN: U01110MP2012PTC028452), with its registered office at 20B, Maharajpura Industrial Estate, Pinto Park, Gwalior, Madhya Pradesh, India, 474020. The application was admitted by the NCLT, Indore Bench, vide its order dated 01.12.2022, initiating the Corporate Insolvency Resolution Process (CIRP) against the Corporate Debtor. Mr. Keyur Jagdishbhai Shah (IP Registration No.: IBBI/IPA-002/IP-N00244/2017-18/10729) was appointed as the Interim Resolution Professional (IRP) to undertake necessary actions as per the IBC provisions. The default amount admitted was Rs.48,16,75,872/-. Copy of the order passed by the Hon'ble NCLT on 01.12.2022 (Annexure-A).

Public Announcement: Following the admission order, the IRP made a public announcement on 03.12.2022, published in the Sunday Pioneer (Bhopal Edition, English) and People Samachar (Gwalior Edition, Hindi) on 04.12.2022, inviting claims from creditors as per the IBC requirements. Copy of the public announcement dated 03.12.2022 (Annexure-B).

Submission of First Progress Report: On 13.01.2023, the IRP submitted the first progress report through Interlocutory Application (IA) No. 11 (MP) of 2023. The NCLT, Indore Bench, vide its order dated 13.01.2023, took the report on record and disposed of the application. Copy of the order passed by the Hon'ble NCLT on 13.01.2023 (Annexure-C).

Appeal by Suspended Director and NCLAT Orders: A suspended director of the Corporate Debtor challenged the NCLT's admission order dated 01.12.2022 by filing an appeal (Company Appeal (AT) (Insolvency) No. 1541 of 2022) before the National Company Law Appellate Tribunal (NCLAT), Principal Bench, New Delhi. On 23.12.2022, the NCLAT, noting the appellant's intent to settle with the financial creditor, directed the IRP not to constitute the Committee of Creditors (CoC) until further orders. On 24.03.2023, the NCLAT extended this interim order, directing the IRP to maintain the Corporate Debtor as a going concern and not to constitute the CoC until 04.05.2023, to allow further settlement discussions. Copy of the order passed by the Hon'ble NCLAT dated 23.12.2022 (Annexure-D); Copy of the order passed by the Hon'ble NCLAT dated 24.03.2023 (Annexure-E).

Exclusion Application and Approval: Due to the NCLAT's stay orders, the IRP was unable to convene the CoC for 474 days as against the stipulated 180-day CIRP period. Consequently, the RP filed a period exclusion application before the NCLT. On 26.04.2024, the NCLT allowed the exclusion application (IA/144 (MP) 2023), granting an exclusion period due to the stay. Copy of the order passed by the Hon'ble NCLT dated 26.04.2024 (Annexure-F).

First CoC Meeting: After the exclusion application was allowed, the first CoC meeting was held on 06.05.2024. The CoC members reviewed the actions taken by the IRP, including statutory compliance and operational management of the Corporate Debtor. Copy of the minutes of the first CoC meeting held on 06.05.2024 (Annexure-G).

The Committee of Creditors (CoC) was constituted with the following financial creditors having voting percentages based on their debt value as follows: _

Second CoC Meeting and RP Confirmation: The second CoC meeting, held on 31.05.2024, ratified the appointment of Mr. Keyur Jagdishbhai Shah as the Resolution Professional (RP). The RP updated the CoC on the progress of the CIRP, including the appointment of professionals and the submission of the Information Memorandum. Copy of the minutes of the second CoC meeting held on 31.05.2024 (Annexure-H).

Third CoC Meeting and Expression of Interest (EOI): On 18.06.2024, the third CoC meeting approved the publication of an Invitation for Expression of Interest (EOI) under Regulation 36A of the IBBI Regulations, 2016. The CoC unanimously agreed to invite EOIs submissions from eligible prospective resolution applicants and approved the draft EOI, advertisement, and Form G for publication. The public announcement in Form G was made on 02.06.2024. Copy of the minutes of the third CoC meeting held on 18.06.2024 (Annexure-I); Copy of the public announcement in Form G dated 02.06.2024 (Annexure-J).

Fourth CoC Meeting and EOI Developments: The fourth CoC meeting, held on 23.07.2024, reviewed developments in the CIRP, including the receipt of EOIs from prospective resolution applicants. The RP issued a provisional list of eligible Prospective Resolution Applicants (PRAs) on 27.06.2024, after due diligence as per Regulation 36A (10) and (8). Objections raised by PRAs were addressed, and the final list of PRAs was issued on 12.07.2024, in compliance with Regulation 36A(12). Copy of the minutes of the fourth CoC meeting held on 23.07.2024 (Annexure-K).

Fifth CoC Meeting and Resolution Plan Evaluation: The fifth CoC meeting, held on 22.08.2024, focused on evaluating the resolution plans submitted by PRAs. The CoC members discussed the feasibility and viability of the plans. Copy of the minutes of the fifth CoC meeting held on 22.08.2024 (Annexure-L).

Sixth CoC Meeting and Extension Application: On 05.09.2024, the sixth CoC meeting deliberated on the resolution plans and authorised the RP to file an application under Section 12(2) of the IBC for a 90-day extension of the CIRP, as the initial 180-day period was set to end on 14.09.2024. The CoC also approved the re-issuance of the EOI in Form G. The NCLT, vide its order dated 14.10.2024, granted a 90-day extension from 14.09.2024 to 13.12.2024. Copy of the minutes of the sixth CoC meeting held on 05.09.2024 (Annexure-M); Copy of the order passed by the Hon'ble NCLT dated 14.10.2024 (Annexure-N).

Seventh and Eighth CoC Meetings: The seventh CoC meeting, held on 18.10.2024, and the eighth CoC meeting, held on 24.10.2024, involved discussions on the resolution plans and presentations by resolution applicants. Copy of the minutes of the seventh CoC meeting held on 18.10.2024 (Annexure-O); Copy of the minutes of the eighth CoC meeting held on 24.10.2024 (Annexure-P).

Ninth CoC Meeting and Revised Bids: During the ninth CoC meeting on 21.11.2024, the CoC deliberated on the resolution plans. Dr. Sitaram Bansal, a resolution applicant, requested additional time to revise his financial bid, and the CoC granted an extended period for all applicants to submit revised bids. Revised plans were received from Kailadevi Edible Products Pvt. Ltd., Anand Metro Mart Pvt. Ltd., Mr. Manish Goyal on 11.11.2024, and from Dr. Sitaram Bansal on 10.11.2024, with a further revised plan on 22.11.2024. Copy of the minutes of the ninth CoC meeting held on 21.11.2024 (Annexure-Q).

Tenth CoC Meeting and Further Extension: The tenth CoC meeting, held on 04.12.2024, ratified expenses incurred by the RP and reviewed updates on the revised resolution plans. The CoC authorised the RP to seek a further 90-day extension of the CIRP under Section 12(2) of the IBC, as the 270-day period was set to conclude on 13.12.2024. The NCLT, vide its order dated 06.01.2025, allowed a 60-day extension from 14.12.2024 to 11.02.2025 (IA/525 (MP) 2024). Copy of the minutes of the tenth CoC meeting held on 04.12.2024 (Annexure-R); Copy of the order of extension by the Hon'ble NCLT dated 06.01.2025 (Annexure-S).

Eleventh CoC Meeting and Approval of Resolution Plan: On 10.01.2025, the eleventh CoC meeting was held, where the CoC members voted on the revised resolution plans based on the evaluation matrix under Regulation 39(3) of the IBBI Regulations, 2016. The resolution plan submitted by Dr. Sitaram Bansal was approved with 100% voting share of the financial creditors on 29.01.2025, after assessing its feasibility, viability, and compliance with CIRP regulations. Copy of the minutes of the eleventh CoC meeting dated 10.01.2025 (Annexure-T-1); Copy of the voting results on the resolution plans (Annexure-T-2).

Details of the Approved Resolution Plan: The approved resolution plan, revised and finalised on 22.11.2024, provides for a total amount of Rs.11,50,00,000/- against a fair value of Rs.13,68,37,008/- and a liquidation value of Rs.11,50,57,696/-. As per the Applicant, the plan addresses the interests of all stakeholders, including financial creditors (FCs) and operational creditors (OCs), as per Regulation 38(1A). It includes provisions for implementation schedules (Regulation 38(2)(a)), performance security (10% of the plan value, valid as per the plan), and reliefs/concessions with justifications (page 58 of the plan). The plan complies with Section 30(2) of the IBC and Regulation 38(3). The Corporate Debtor, being an MSME, allows the resolution applicant (a related party to the promoter/director) to be eligible under Section 240A, overriding Section 29A(c). Copy of the revised and final resolution plan dated 22.11.2024 (Annexure-U).

Compliance with Regulatory Requirements: The RP filed Form H, certifying compliance with the IBC and IBBI regulations, dated 07.02.2025. The resolution applicant provided an affidavit under Section 29A, an undertaking under Regulation 39(c), and the RP confirmed the submission of the Details of Resolution (DOR) as per Regulation 36A(8). A Letter of Intent (LOI) was signed by the RP and Dr. Sitaram Bansal, accompanied by a bank statement confirming the performance security (10% of the plan value). The Applicant submitted that no avoidance transactions were observed, and no applications related to such transactions are pending. No claims were submitted by statutory authorities or for PF/gratuity dues, rendering related judicial precedents inapplicable. The plan includes provisions for capital reduction (page 28) and regulatory fee compliance under Regulation 31A. Copy of Form H dated 07.02.2025 (Annexure-V); Copy of the LOI and bank statement (Annexure-W).

Reliefs Sought: The RP seeks the following reliefs: (a) Approval of the resolution plan as approved by the CoC under Section 30(6) and 31 of the IBC, read with Regulation 39(4), to make it binding on all stakeholders; and (b) Any other orders deemed necessary by the NCLT in the interest of justice. The application emphasises the IBC’s objective of resolution and value maximisation over liquidation, aligning with the CoC’s commercial wisdom.

Jurisdiction and Limitation: The RP declares that the subject matter of the IA falls within the jurisdiction of the NCLT, Indore Bench, as the Corporate Debtor’s registered office is in Gwalior, Madhya Pradesh, and the NCLT passed the admission order. The application is not barred by limitation.

RP’s Responsibilities and Compliance: The RP has submitted that that he has diligently protected and preserved the Corporate Debtor’s assets, managed its operations as a going concern, and adhered to strict IBC timelines. The RP believes the approved resolution plan complies with all statutory requirements and provides for monitoring and supervision of its implementation. The application was filed under urgency to meet IBC deadlines, with a request to allow amendments if needed.

In compliance with this Tribunal order dated 17.03.2025, the Applicant/Resolution Professional filed an additional Affidavit, dated 21.03.2025, addressing queries raised during the hearing of the Resolution Plan and submitting additional documents for clarification. The affidavit was filed to comply with this Tribunal directions issued on 17.03.2025, which required the RP to respond to queries raised during the hearing, convene a meeting of the Committee of Creditors (CoC), if necessary, seek approval for unresolved issues related to the Resolution Plan, and submit a revised Form-H via an additional affidavit. The RP provided clarification on the viability and feasibility of the Resolution Plan and submitted supporting documents as directed. The details of which are as under: -

Annexure-A: Minutes of the 12th CoC Meeting dated 19.03.2025, confirming the feasibility and viability of the Resolution Plan.

Annexure-B: Minutes of the 9th CoC Meeting dated 21.11.2024, detailing prior deliberations on the Resolution Plan’s feasibility and viability.

Annexure-C: Forensic Audit Report by M/s CA Dipak Agarwal & Co., confirming no observations of preferential, undervalued, extortionate, or fraudulent transactions under Sections 43, 45, 50, or 66 of the IBC.

Annexure-D: 5-Year Projection Report provided by Dr. Sita Ram Bansal, the Resolution Applicant, outlining the financial projections for the Corporate Debtor’s revival.

Annexure-E: Section 29A undertaking by Dr. Sita Ram Bansal, confirming eligibility to submit the Resolution Plan.

Annexure-F: Receipt of Fixed Deposit made by the RP as Performance Guarantee.

Annexure-G: Copy of Udyam Aadhar Registration of the Corporate Debtor.

Annexure-H & (Revised Form H as Annexure-A):, certifying compliance of the Resolution Plan with the IBC and CIRP Regulations annexed with Affidavit dated 25.04.2025.

The Applicant/Resolution Professional (RP) also filed Additional Affidavit, dated 25.04.2025, to comply with directions issued by the Insolvency and Bankruptcy Board of India (IBBI) via an email dated 23.04.2025, requiring the submission of additional documents, specifically the Revised Form H, to facilitate the adjudication of the resolution plan pending before the tribunal. The affidavit is supported by two as, Annexure A (Copy of Revised Form H) and Annexure B (Copy of IBBI Email). The details of which are as under: -

It is stated in the affidavit that on 23.04.2025, the IBBI sent an email to the RP, informing him of the recent amendments introduced through the Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) (Second Amendment) Regulations, 2025, notified on 03.04.2025. These amendments revised Form H (Compliance Certificate) to provide comprehensive details of the resolution plan, aiding the Adjudicating Authority (NCLT) in making timely decisions. The IBBI noted that the resolution plan for B.P. Bansal Agritech Private Limited, where Mr. Shah serves as RP, is pending before the NCLT. The IBBI directed the RP to file the Revised Form H as additional information to facilitate early adjudication. The affidavit was filed to comply with this directive, and the email from IBBI is annexed as Annexure B.

In compliance with the IBBI's directions, the RP submitted two key documents for the tribunal's perusal:

The RP affirms that the statements and documents provided are true to his knowledge and based on the company's records.

Although not detailed in the affidavit's main body, the Revised Form H (Annexure A) provides critical details about the CIRP and resolution plan, which are relevant to the affidavit's purpose. Key points include: -

It is stated by the Applicant/RP that the Additional Affidavit dated 25.04.2025, filed by Mr. Keyur Jagdishbhai Shah, serves as a procedural compliance with IBBI's directive dated 23.04.2025, ensuring that the NCLT has access to the Revised Form H and related correspondence to expedite the adjudication of the resolution plan for B.P. Bansal Agritech Private Limited. The affidavit is supported by Annexure A (Revised Form H) and Annexure B (IBBI Email), which collectively provide the necessary documentation to facilitate the tribunal's decision-making process. The affidavit underscores the RP's adherence to regulatory requirements and the integrity of the CIRP process.

We have heard the learned counsel for the Applicant/RP, and on perused the material records.

It is noted that the CoC approved the resolution plan of Dr. Sita Ram Bansal by 100% voting, and it is not necessary for us to go into details of the commercial wisdom of CoC. We proceed to examine the plan in light of provisions contained in sections 30(2) and 31 of the IBC r.w. Regulation 38 of the IBBI (CIRP of the Corporate Debtor Regulation, 2016). The RP has placed on record the compliance certificate in revised Form-H. It shows that the fair value of the assets of the corporate debtor is Rs.13,68,37,008/-, whereas the liquidation value is Rs.11,50,57,696/-. The successful resolution applicant has proposed payment of Rs.11,50,00,000/- in the resolution plan.

The Tribunal considers that the resolution plan should adhere to the following requirements as per Section 30(2) of the Code r.w. CIRP Regulation 38:

Such other requirements of the resolution plan as detailed in IBBI (Resolution Process for Corporate Persons) Regulations, 2016, which are not covered above, are as under: -

Taking into account the above provisions of the Code, the resolution plan submitted before us has been examined as follows:

Key Features of the Resolution Plan: The Resolution Plan, submitted by Dr. Sita Ram Bansal on 16.08.2024 and approved by the Committee of Creditors (CoC) with 100% voting share on 29.01.2025 is designed to ensure the revival of B.P. Bansal Agritech Private Limited as a going concern, in alignment with the objectives of Section 30 of the Insolvency and Bankruptcy Code, 2016 (IBC) (Annexure-A: Revised Form-H, annexed with Affidavit dated 25.04.2025).

Acquisition as a Going Concern: The Plan prioritizes the continuation of the Corporate Debtor's operations, leveraging its established infrastructure for milling wheat, gram, and other grains, and manufacturing food products such as biscuits and confectionery. The Plan envisions operational continuity to preserve economic value and employment, which are critical for an MSME like the Corporate Debtor (Annexure 2: MSME Certificate).

Total Financial Outlay: The SRA proposes a total payment of Rs. 11.50 crores to settle dues of unsecured financial creditors, as detailed in Section IV (Page 201 of the IA). This allocation is supported by the CoC's 100% approval, as recorded in (Annexure-A: Revised Form-H, annexed with Affidavit dated 25.04.2025).

Equity Share Transfer: The Plan provides for the transfer of 100% equity shares to the SRA or his nominees/affiliates, without altering the Corporate Debtor's issued, subscribed, and paid-up share capital of Rs. 1,54,70,000 (Section IV, Page 204 of the IA). This transfer complies with Regulation 37(c) of the Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) Regulations, 2016 (CIRP Regulations), which permits substantial acquisition of shares as part of a resolution plan.

Implementation Timeline: The Plan stipulates full implementation within 60 days from the NCLT Approval Date, provided no appeals are pending before appellate authorities (Section XIII, Page 194 of the IA). This timeline adheres to Regulation 38(2)(a) of the CIRP Regulations, ensuring timely execution to minimise disruption to the Corporate Debtor's operations.

Governance and Management: The Plan establishes a reconstituted Board and an Implementation and Monitoring Committee (IMC) to oversee post-approval operations and ensure compliance with the Plan's terms (Section XI, Page 192 of the IA). These mechanisms align with Section 30(2)(d) of the IBC, which mandates provisions for the management of the Corporate Debtor's affairs post-resolution.

Reliefs and Waivers: The Plan seeks waivers from procedural requirements under the Companies Act, 2013, such as those under Section 66 for future capital reduction, and extinguishment of all liabilities not covered by the proposed payments. These reliefs are consistent with the IBC’s clean slate principle, as upheld in Committee of Creditors of Essar Steel India Limited v. Satish Kumar Gupta [(2020) 8 SCC 531].

The Plan’s comprehensive structure, as certified by the Resolution Professional (RP) in Annexure-1 & Revised Form-H as Annexure-A annexed with Affidavit dated 25.04.2025, promises the Corporate Debtor’s revival, in line with the IBC’s objectives under Section 4.

Dr. Sita Ram Bansal, the Successful Resolution Applicant (SRA), is operating Shri Ram Nursing Home in Dholpur. His net worth of Rs. 7.08 crores, certified by a chartered accountant, underscores his financial capacity to implement the Resolution Plan (Page 201 of the IA, Annexure-3: SRA’s Net Worth Certificate).

Detailed Eligibility Assessment: The SRA is a related party to the Corporate Debtor, being the brother of the promoter/directors, Mr. Prem Prakash Bansal and Mrs. Usha Bansal, as defined under Section 5(24) read with Section 5(24A) of the IBC, Annexure-4: Additional Affidavit).

Section 29A(c) of the IBC typically disqualifies related parties from submitting resolution plans to prevent the backdoor entry of defaulting promoters. However, the Corporate Debtor’s status as an MSME provides an exemption.

MSME Exemption Under Section 240A: The Corporate Debtor is registered as an MSME with UDYAM Registration No. UDYAM-MP-20-0008102 (Annexure-2: MSME Certificate). Section 240A of the IBC, inserted by the Insolvency and Bankruptcy Code (Amendment) Act, 2018, exempts MSMEs from the disqualifications under Section 29A(c) and (h). The RP’s verification confirms the applicability of this exemption (Annexure-A: Revised Form-H, annexed with Affidavit dated 25.04.2025).

Compliance with Section 29A: The RP conducted a thorough eligibility check under Section 29A, confirming that the SRA is not an undischarged insolvent (Section 29A(a)), wilful defaulter (Section 29A(b)), or subject to other disqualifications under Section 29A(a) to (j), Annexure-A (with Affidavit dated 25.04.2025). The SRA submitted an affidavit on 16.08.2024, affirming his eligibility and compliance with these provisions (Annexure-5: SRA’s Affidavit).

Industry Experience and Capability: The SRA possesses relevant experience in the flour milling industry through his family’s business and connections with industry peers, enhancing his ability to manage and revive the Corporate Debtor’s operations. This experience was a key factor in the CoC’s evaluation of the SRA’s suitability, as per Section 25(2)(h) of the IBC, which requires the RP to invite resolution plans from eligible applicants.

No Adverse Findings: The RP’s due diligence, including a review of the SRA’s financial and legal standing, revealed no adverse findings regarding preferential, undervalued, fraudulent, or extortionate (PUFE) transactions involving the SRA, ensuring compliance with Section 29A(g).

This Adjudicating Authority is satisfied that the SRA’s eligibility, supported by the MSME exemption and compliance checks, aligns with the IBC’s framework, as evidenced by Annexure-1 & Revised Form-H as Annexure-A annexed with Affidavit dated 25.04.2025 and Annexure-5 (SRA’s Affidavit).

Detailed Assessment of Feasibility and Viability: The CoC, comprising financial creditors holding 100% voting share, approved the Resolution Plan on 29.01.2025, as documented in Annexure-A: (Revised Form-H, annexed with Affidavit dated 25.04.2025). This unanimous approval reflects the CoC’s assessment of the Plan’s feasibility and viability under Section 30(4) of the IBC.

Operational Cash Flows and Revival Potential: The CoC evaluated the Corporate Debtor's financial performance, noting revenues of Rs. 65,38,858.78 in FY 2021-22 and Rs. 88,01,400.43 in FY 2022-23, with net profits of Rs. 75,649.61 and Rs. 1,88,170.95, respectively (Page 188 of the IA). These figures indicate that the CD has sufficient cash flows to sustain operations, which is critical for an MSME engaged in flour milling and food production (Page 191 of the IA). The Plan's focus on operational continuity ensures the preservation of this revenue stream, aligning with Regulation 38(3)(a) of the CIRP Regulations.

SRA's Financial Capability: The SRA's net worth of Rs. 7.08 crores, coupled with his ability to raise additional funds while maintaining a sustainable debt-equity ratio, was deemed adequate by the CoC to meet the Rs. 11.50 crore payment obligation (Page 201 of the IA, Annexure-3: SRA's Net Worth Certificate). The CoC's confidence in the SRA's financial resources underscores the Plan's implementability, as required under Section 30(4)(b).

CoC's Commercial Wisdom: The 100% voting approval reflects the CoC's collective business judgment, which is paramount under the IBC, as held in K. Sashidhar v. Indian Overseas Bank [(2019) 12 SCC 150, Para 62]. The CoC's resolution balances the interests of stakeholders, prioritizing financial creditors' recovery while preserving the Corporate Debtor’s economic value, in line with Section 30(4)(a).

Regulatory Compliance: The CoC ensured that the Plan complies with Section 30(2) requirements, including priority payment of CIRP costs, settlement of creditor dues, and provisions for management and implementation, as certified by the RP (Page 197 of the IA & Annexure-A: (Revised Form-H, annexed with Affidavit dated 25.04.2025).

The CoC’s rigorous evaluation, supported by financial data and market analysis, confirms the Plan’s feasibility and viability, as documented in Annexure-A: (Revised Form-H, annexed with Affidavit dated 25.04.2025), making it worthy of approval under Section 31 of the IBC.

Detailed Financial Proposal: The Resolution Plan proposes a total financial outlay of Rs. 11.50 crores to address stakeholder claims, as detailed in Section IV (Page 201 of the IA & Annexure-A (with Affidavit dated 25.04.2025). This proposal reflects the CoC’s commercial prioritization, permissible under Section 30(4) of the IBC.

Unsecured Financial Creditors: The Plan allocates Rs. 11.50 crores to unsecured financial creditors against admitted claims of Rs. 2,71,75,20,199, resulting in a 4.23% recovery rate (Revised Form-H Annexure-A (with Affidavit dated 25.04.2025). This payment, to be made within 45 days from the NCLT Approval Date, complies with Section 30(2)(b), which mandates payment of financial creditors' dues as approved by the CoC.

Operational Creditors: No payment is proposed against admitted operational creditor claims of Rs. 1,14,880 (Page 203 of the IA). While Section 30(2)(b) read with Regulation 38(1) requires operational creditors to receive at least the liquidation value, the CoC's approval of nil payment does not in any way jeopardize the interest of the operational creditors because the CD is an operational entity and the payments of operational creditors are and will be made on regular basis. The CoC confirmed that the liquidation value for operational creditors under Section 53(1) of the IBC is negligible, as their claims rank below secured creditors and no surplus would be available in liquidation, justifying the nil payment as compliant with Section 30(2)(b).

Employees and Workmen: No claims were received from employees or workmen, resulting in nil payment (Page 217 of the IA). This is consistent with Regulation 38(1)(b), which requires payment only for admitted claims.

Government and Statutory Dues: Two claims related to government dues were admitted, but no payment is proposed (Page 217 of the IA). The Plan's treatment of statutory dues aligns with the CoC's discretion under Section 30(4), subject to compliance with Section 30(2)(b).

Shareholders: Existing shareholders will receive no payment, and their 100% equity shares will be transferred to the SRA or his nominees (Page 204 of the IA). This aligns with Regulation 37(c) of the CIRP Regulations, facilitating the SRA's control over the Corporate Debtor.

Other Creditors: No payment is proposed for other creditors, whose claims, if any, are extinguished on the Effective Date (Page 217 of the IA). This extinguishment is permissible under Section 31(1), which binds all stakeholders to the approved plan.

Extinguishment of Debt: Upon payment, all financial creditor debt, including principal, interest, and charges, will be fully extinguished, as per Section 31(1) of the IBC. Securities provided by the Corporate Debtor will be transferred to the SRA or his nominee on existing terms, ensuring a clean transfer of assets (Page 202 of the IA).

Waiver of Additional Charges: All accrued interest, penal interest, fees, commissions, and charges post-CIRP commencement (01.12.2022) will be permanently extinguished, preventing further liability accrual to the Corporate Debtor or SRA (Page 214 of the IA). This aligns with the IBC's objective of providing a fresh start, as noted in Essar Steel (supra).

The total proposed payment of Rs. 11.50 crores against admitted claims of Rs. 2,71,75,20199 (4.23% recovery) reflects the CoC’s strategic allocation, as documented in Annexure-1 & Revised Form-H as Annexure-A annexed with Affidavit dated 25.04.2025. All residual liabilities are extinguished on the Effective Date, ensuring a clean slate for the Corporate Debtor.

CoC’s Approval: The CoC’s 100% voting approval confirms that the proposed payment adequately balances financial creditors’ interests, as required by Regulation 38(1)(b) (Annexure-A (with Affidavit dated 25.04.2025).

Detailed Provisions for CIRP Costs: The Resolution Plan addresses the payment of CIRP costs in Section VI (Page 213 of the IA, Annexure-A (with Affidavit dated 25.04.2025), prioritizing these costs as mandated by Section 30(2)(a) of the IBC.

Assumption of Coverage: The Plan assumes that all CIRP costs incurred from 01.12.2022 to date of approval of the plan have been met through the Corporate Debtor’s operational cash flows, given its status as a going concern generating revenues (Page 213 of the IA). This assumption is based on the RP’s financial oversight during the CIRP, as per Section 25(2)(c).

Unpaid Costs Mechanism: If any CIRP costs remain unpaid as on approval of the plan, the RP will quantify these within 60 days and adjust them from the financial creditors' entitlements of Rs. 11.50 crores (Page 191 of the IA). This mechanism ensures compliance with Regulation 31 of the CIRP Regulations, which prioritizes CIRP costs.

Regulatory Fees: The SRA undertakes to pay regulatory fees as per Regulation 31A of the CIRP Regulations, including fees for the Insolvency and Bankruptcy Board of India (IBBI) and other statutory authorities (Pages 15 and 25 of the Resolution Plan, Annexure-1). This commitment reinforces the Plan's adherence to regulatory requirements.

RP's Certification: The RP has certified that the provisions for CIRP costs are adequate, ensuring that all expenses, including professional fees, public announcement costs, and CoC meeting expenses, are covered in Annexure-A: (Revised Form-H, annexed with Affidavit dated 25.04.2025.

The provisions for CIRP costs are robust, ensuring priority payment as required by Section 30(2)(a) and Regulation 31, as evidenced by Annexure-1 & Revised Form-H as Annexure-A annexed with Affidavit dated 25.04.2025.

Shareholder Proposal Details: The Resolution Plan addresses the treatment of equity shareholders in Section VI (Page 204 of the IA, Annexure-A (with Affidavit dated 25.04.2025), aligning with Regulation 37(c) of the CIRP Regulations.

Share Capital Structure: The Corporate Debtor’s issued, subscribed, and paid-up share capital of Rs. 1,54,70,000 remains unchanged post-approval, ensuring continuity in the company’s legal structure (Page 204 of the IA).

Equity Share Transfer: The Plan proposes the transfer of 100% equity shares to the SRA or his nominees/affiliates, with no payment to existing shareholders (Page 204 of the IA). This transfer facilitates the SRA’s control over the Corporate Debtor, a common feature in resolution plans to ensure effective management and revival.

Execution Mechanism: The transfer will be managed by the Monitoring Committee, with the names of new shareholders provided during its proceedings, ensuring transparency and compliance with corporate governance norms (Page 204 of the IA).

Waiver of Procedural Requirements: The Plan seeks a waiver from compliance with Section 66 of the Companies Act, 2013, for any future capital reduction, if proposed. This waiver, to be effective upon NCLT approval, streamlines post-resolution restructuring and is permissible under Section 31(1) of the IBC (Page 204 of the IA).

Legal Justification: Shareholders, as residual claimants under Section 53(1) of the IBC, typically receive no payment in insolvency resolution unless surplus funds remain after satisfying higher-priority creditors. The CoC's approval of this proposal reflects its commercial judgment, as upheld in Jaypee Kensington Boulevard Apartments Welfare Association v. NBCC (India) Ltd. [(2021) ibclaw.in 24 SC, Para 77.6.1].

The shareholder proposal is legally sound and aligns with the IBC's framework, as evidenced by Annexure-1 & Revised Form-H as Annexure-A annexed with Affidavit dated 25.04.2025.

Detailed Implementation Timeline: The Resolution Plan provides a clear implementation timeline in Section XIII (Page 210 of the IA, Annexure-A (with Affidavit dated 25.04.2025), ensuring compliance with Regulation 38(2)(a) of the CIRP Regulations.

Financial Creditors: Payment of Rs. 11.50 crores will be completed within 45 days from the date of approval of Plan, ensuring timely settlement of financial creditor dues (Page 210 of the IA).

Total Implementation: The Plan will be fully implemented within 60 days from the date of approval of the Plan, provided no appeals are pending before the NCLAT or Supreme Court (Page 194 of the IA). This timeline ensures expeditious resolution, aligning with the IBC’s time-bound framework under Section 12.

Contingency Measures: The Plan includes provisions for the Monitoring Committee to address any delays or disputes, ensuring robust implementation (Page 194 of the IA).

The timeline is practical and compliant with the IBC’s objectives, as certified by the RP in Annexure-1 & Revised Form-H as Annexure-A annexed with Affidavit dated 25.04.2025.

Governance Structure Details: The Resolution Plan establishes governance structures in Section XI (Page 192 of the IA & Annexure-A (with Affidavit dated 25.04.2025), ensuring effective management post-resolution as required by Section 30(2)(d) of the IBC.

Implementation and Monitoring Committee (IMC): The IMC will comprise one nominee from the consortium of banks representing financial creditors, nominees proposed by the SRA, and the RP. The IMC’s role is to oversee Plan implementation, coordinate payments, and ensure compliance with the 60-day timeline (Page 192 of the IA). This aligns with Regulation 38(2)(b), which requires supervision provisions.

Reconstituted Board: A new Board, including SRA-nominated directors, will assume control on the Takeover date, defined as the date of NCLT approval or as agreed with the RP/CoC. The Board will manage day-to-day operations, ensuring operational continuity (Page 192 of the IA). 1.4. Coordination and Reporting: The Board will report to the IMC on implementation progress, maintaining transparency and accountability until all Plan obligations are fulfilled (Page 192 of the IA). The IMC will dissolve upon completion of implementation, as per the Plan's terms. 1.5. Legal Compliance: The governance structure complies with Section 30(2)(d) and Regulation 38(2)(b), ensuring that the Corporate Debtor's affairs are managed effectively post-resolution (Page 192 of the IA). 1.6. CoC's Oversight: The CoC's approval of these provisions reflects its confidence in the governance framework, ensuring the Plan's successful execution (Annexure-A (with Affidavit dated 25.04.2025). 1.7. The IMC and reconstituted Board provide a robust mechanism for Plan implementation, as evidenced by Annexure-1 & Revised Form-H as Annexure-A annexed with Affidavit dated 25.04.2025.

Valuation Details: The Fair Value and Liquidation Value of the Corporate Debtor are assessed as Rs.13,68,37,008/- as Fair Value and Rs.11,50,57,696/- as Liquidation Value, respectively by valuers , as per Annexure-1 & Revised Form-H as Annexure-A annexed with Affidavit dated 25.04.2025.

CoC’s Consideration: The CoC reviewed these valuations to assess the Plan’s alignment with the Corporate Debtor’s asset value and revival potential, approving the Rs. 11.50 crore payment as adequate as mentioned in Annexure-A (with Affidavit dated 25.04.2025).

Regulatory Compliance: The valuation process adhered to Regulation 35, ensuring transparency and independence, as certified by the RP (Annexure-A (with Affidavit dated 25.04.2025).

The valuation framework supports the Plan’s financial structure, ensuring compliance with the IBC, as documented in Annexure-1 & Revised Form-H as Annexure-A annexed with Affidavit dated 25.04.2025.

Detailed Compliance Analysis: The Resolution Plan's compliances with the IBC and CIRP Regulations are certified in Annexure-1 & Revised Form-H as Annexure-A annexed with Affidavit dated 25.04.2025, ensuring adherence to statutory requirements.

Section 25(2)(h): The SRA meets the CoC's eligibility criteria, considering the Corporate Debtor's operational complexity and market potential as per Annexure-A Revised Form H).

Section 29A: The SRA is eligible under the MSME exemption of Section 240A, as confirmed by an affidavit Annexure-5: SRA's Affidavit).

Section 30(1): The SRA submitted an affidavit on 16.08.2024, affirming eligibility under Section 29A, which is annexed as Annexure-5.

Section 30(2): The Plan provides for: (a) priority payment of CIRP costs (Page 20); (b) settlement of operational and financial creditor dues, even if nil for some (Page 20); (c) management of affairs via the IMC and Board (Pages 21-22); (d) implementation within 60 days (Page 23); and (e) non-contravention of any law (Page 23).

Section 30(4): The Plan is feasible and viable, approved by 100% voting share, reflecting the CoC's commercial wisdom (Pages 55-57, Annexure-1).

Section 31(1): The Plan provides for effective implementation through the IMC and timeline (Pages 72-75, Annexure-1).

Regulation 38(1): Operational creditors' dues have priority, though nil payment is proposed, as approved by the CoC (Page 25).

Regulation 38(1A): The Plan addresses all stakeholders' interests, including shareholders via equity transfer (Pages 211-214).

Regulation 38(1B): The SRA has not failed MSME to implement any prior resolution plan, ensuring reliability (Page 25).

Regulation 38(2): The Plan includes terms, implementation schedule, and management provisions (Page 37).

Regulation 38(3): The Plan addresses default causes, feasibility, approvals, and the SRA's capability (Pages 26, 55-57, 72-75).

Regulation 39(2): No PUFE transactions were observed, as per the forensic audit.

Regulation 39(4): Performance security has been provided, ensuring commitment (Page [Insert Page Number]). 15.3. The Plan's comprehensive compliances, as certified in Annexure-1 & Revised Form-H ensure its legal validity and alignment with the IBC's framework.

Funding Source Details: The SRA's funding sources for the Resolution Plan are detailed in Section IV (Page 201 of the IA & Annexure-A (with Affidavit dated 25.04.2025), ensuring financial viability under Section 30(4)(b).

Personal Reserves: The SRA will utilize his certified net worth of Rs. 7.08 crores, supplemented by confirmed bank financing or other liquid assets, to fund the Rs. 11.50 crore payment obligation, as verified by the CoC, demonstrating strong financial capacity (Page 201 of the IA, Annexure-3: SRA's Net Worth Certificate).

Additional Borrowings: If additional funds are required, the SRA will raise borrowings while maintaining a prudent debt-equity ratio, ensuring the Corporate Debtor's financial stability post-resolution (Page 201 of the IA).

Working Capital Utilization: The Corporate Debtor's existing bank balance, as noted in the Information Memorandum, will be used as working capital to support operational continuity, reducing the need for external funding (Page 201 of the IA).

CoC's Due Diligence: The CoC conducted due diligence on the SRA's funding sources, confirming their adequacy and reliability, as reflected in the 100% voting approval (Page 201 of the IA & Annexure-A (with Affidavit dated 25.04.2025).

Legal Compliance: The funding strategy complies with Regulation 38(3)(c), which requires the resolution plan to demonstrate the SRA's capability to implement the plan (Annexure-A, with Affidavit dated 25.04.2025).

The SRA's robust funding plan, as certified in Annexure-1 & Revised Form-H as Annexure-A annexed with Affidavit dated 25.04.2025, ensures the Plan's successful implementation.

Details of Reliefs Sought: The Resolution Applicant has sought various reliefs and concessions from this Authority. The granting or non-granting of these reliefs/concessions is based on the provisions of section 32A of the IBC, 2016 and the "clean slate principle" laid down by the Hon'ble Supreme Court in the case of Ghanshyam Mishra and Sons Private Limited Versus Edelweiss Asset Reconstruction Company Limited in Civil Appeal No. 8129/2019 with Civil Appeal No. 1554/2021 and 1550-1553/2021 decided on 13.04.2021 (2021) 9SCC 657. The Resolution Applicant has given an undertaking that the submission of the Resolution Plan is unconditional, and the granting or refusal of the relief/concessions will not affect the implementation of the Plan.

The Resolution Plan seeks various waivers, reliefs, and concessions, Annexure-A (with Affidavit dated 25.04.2025), aligning with the IBC's clean slate principle. The power of this Adjudicating authority cannot go beyond section 32A and the decision of the Hon'ble Supreme Court in the case of Ghanshyam Mishra as discussed above.

The Tribunal has carefully considered the waivers, reliefs and concessions sought by the SRA. It is stated that the SRA has submitted its proposal irrespective of the grant of any waivers, reliefs, and concessions by the Adjudicating Authority.

The Corporate Debtor is eligible to the reliefs against liability of the Corporate Debtor for an offence committed prior to the commencement of the CIRP and liability on such an account shall cease and the corporate debtor shall not be prosecuted for such an offence from the date of the resolution plan is approved by this Tribunal under section 31 of the IBC,2016.

Hence, Concessions and Reliefs as sought by the SRA through RP are granted, which are in consonance with provisions of Section 32A and the decision of the Hon’ble Supreme Court in the case of Ghanshyam Mishra.

Detailed Findings: This Adjudicating Authority has examined the Resolution Plan, Annexure-1 & Revised Form-H as Annexure-A annexed with Affidavit dated 25.04.2025, Annexure-5 (SRA’s Affidavit), and other documents to ensure compliance with the IBC and CIRP Regulations.

Section 30(2) Compliance: The Plan satisfies all requirements of Section 30(2): (a) priority payment of CIRP costs (Page 20); (b) settlement of operational and financial creditor dues, even if nil for some (Page 20); (c) management via the IMC and Board (Pages 21-22); (d) implementation within 60 days (Page 23); and (e) no contravention of law (Page 23). These provisions align with Regulation 38 (Annexure-A with Affidavit dated 25.04.2025).

CoC’s Commercial Wisdom: The 100% voting approval reflects the CoC’s assessment of the Plan’s feasibility, viability, and alignment with the IBC’s objectives, as per K. Sashidhar (supra, Para 62). The CoC’s prioritization of financial creditors is within its discretion (Annexure-A (with Affidavit dated 25.04.2025).

MSME Exemption: The SRA's eligibility under Section 240A, supported by the Corporate Debtor's MSME status (Annexure-2), facilitates revival, critical for economic growth and employment, as noted in Jaypee Kensington (supra).

Clean Slate Principle: The Plan's extinguishment of liabilities, transfer of securities, and waivers align with Essar Steel (supra), as well as Ghanshyam Mshra (supra) ensuring the Corporate Debtor starts afresh (Page 214 of the IA).

CIRP Process Integrity: The RP's conduct, including the forensic audit and valuation, ensures transparency and compliance. No material irregularities were observed Annexure-A (Revised Form-H annexed with Affidavit dated 25.04.2025).

The Plan is legally sound, feasible, and aligned with the IBC's objectives of maximizing asset value, promoting entrepreneurship, and balancing stakeholder interests, as certified in Annexure-1 & Revised Form-H as Annexure-A annexed with Affidavit dated 25.04.2025.

The Resolution Plan, submitted by Dr. Sita Ram Bansal and approved by the CoC with 100% voting share, complies with Sections 30(2) and 31 of the IBC and the CIRP Regulations, as evidenced by Annexure-1 & Revised Form-H as Annexure-A annexed with Affidavit dated 25.04.2025.

IA (Plan) 01 (MP) of 2025 is allowed, and the Resolution Plan is approved under Section 31(1) of the IBC. 22.2.2. The SRA shall implement the Plan within 60 days from the date of this order, subject to no stay in pending appeals before the NCLAT or the Supreme Court.

In the event of a stay by the NCLAT or Supreme Court, the RP shall inform this Tribunal within 7 days, and the implementation timeline shall be extended by the duration of the stay, subject to further orders from this Tribunal or the appellate authority.

The RP shall constitute the Implementation and Monitoring Committee and the reconstituted Board as per the Plan, ensuring a seamless transition of management control within in period or as agreed.

All liabilities not covered by the Plan's payments are extinguished on the Effective Date, i.e., on approval of the Plan, and all securities, guarantees, and encumbrances are transferred to the SRA or his nominee, as per the Plan's terms.

The SRA shall comply with all statutory filings and approvals required post-implementation, including filings with the Registrar of Companies and other authorities.

The RP shall submit a compliance report to this Tribunal within 15 days of Plan implementation, detailing adherence to the Plan’s terms.

The Registry is directed to communicate this order to the RP, SRA, CoC, and IBBI through e-mail within 7 days for information and for taking necessary steps. Files be consigned to the record. No order as to costs.