In the matter Of Solidaire India Limited And Ors

It is an MA filed by the Resolution Professional/Applicant (herein after called as "RP") seeking approval of the Resolution Plan already approved by CoC in 5th meeting held on 17.04.2019.

It is submitted that the Corporate Insolvency Resolution Process (CIRP) was initiated against this Corporate Debtor on 26.10.2018, thereafter, CoC was constituted and claims were collated. In furtherance of it, the RP determined the liquidation value at Rs. 6,10,77,265 basing on the valuation given by two registered Valuers appointed in accordance with law. In the liquidation value given to the Corporate Debtor, the RP determined the value of the land lying in the possession of the Corporate Debtor at Rs. 31,710, treating the fees paid towards assignment as value of the land. In respect to the machinery and equipment, it has been valued at Rs. 3.75 lakhs and building valued at Rs. 57.06 Lakhs at Perungudi Electronic Estate.

In 2nd meeting of the CoC held on 21.01.2019, the RP placed a draft Information Memorandum and the same was approved in the said meeting. The draft Information Memorandum disclosing the net worth of the prospective Resolution Applicant as on the date of 31.03.2018 should not be less than Rs. 10 Crores and the prospective Resolution Applicant should be doing the same line of business particularly manufacturing electronic products, TV related products. When the RP issued invitation for Expression of Interest (EOI), this prospective Resolution Applicant has come forward with a Resolution Plan proposing to infuse Rs. 12.56 crores towards payment of resolution process costs and payment of Secured Creditors/Financial Creditors. When this Resolution Plan came before the CoC in 5th meeting held on 17.04.2019, the CoC, having felt that this plan is feasible and viable, it has been approved with a voting share of 79.35% in favour. As against this approval, though this Applicant Bank was present in the meeting, it abstained from casting its voting share of 20.65% either in favour or against the approval.

Since this plan has been demonstrating the implementation schedule, management and control of the business of the Corporate Debtor during its term of three years, adequate amount for approval and implementation provisions for its effective implementation, provisions for approval required timeline for the same and also the capacity to implement the Resolution Plan and all the compliance that is required under Regulation 38 of CIRP Regulations has been incorporated in the Resolution Plan and the same being approved by the CoC, I am of view that this plan is in compliance with the Regulations of CIRP.

On perusal of this Resolution Plan, it has also further demonstrated that the Provident Fund (PF) dues have been shown as contingent liability. As to this liability, since PF dues cannot be shown as liquidation estate, this Resolution Applicant, instead of showing provision in the Resolution Plan, this Applicant shall disburse this money to the PF Authorities within seven days hereof.

With regard to the exemptions mentioned in this Resolution Plan, they are exempt to the extent that is permissible under law, if at all any of the exemptions mentioned in this Resolution Plan are inconsistent with the provisions of this Code or any other law, then it has to be construed that they are not considered by this Bench.

As to capacity of this Resolution Applicant, it seems that this Applicant has already deposited Rs. 5 crores within seven days from the date of 5th CoC meeting held on 17.04.2019 and it has also been mentioned in the Resolution Plan that the remaining balance which is to be given to the Financial Creditor will be deposited in the escrow account within 90 days from the date of the approval by this Bench.

Therefore in view of the reasons mentioned above, this application is hereby allowed by approving the Resolution Plan already approved by the CoC on 17.04.2019.