Mr. Anil Baldva vs Punjab National Bank & Ors.

Per: Shri Rajeev Mehrotra, Technical Member

The Applicant, namely Mr. Vishnu Upadhyay ('Resolution Professional'), has filed the present Application under Section 112 of the Insolvency and Bankruptcy Code, 2016 ('Code'/ 'IBC') annexing the Report of the meeting of Creditors on the Repayment Plan for the Insolvency Resolution Process of the Personal Guarantor/Debtor namely, Mr. Anil Baldva to the Corporate Debtor M/s Baldva Textiles Private Limited.

It is seen that the Personal Guarantor/Debtor had filed an application bearing CP No. (IB)-16/94/JPR/2022, under section 94(1) of the Code r/w Rule 6 of the Insolvency and Bankruptcy (Application to Adjudicating Authority for Insolvency Resolution Process for Personal Guarantors to Corporate Debtor) Rules, 2019 ('Rules'), seeking initiation of Insolvency Resolution Process against the Applicant/ Debtor who is the Personal Guarantor of the Corporate Debtor, namely M/s Baldva Textiles Private Limited for an amount of Rs.16,73,10,124/- (Rupees Sixteen Crores Seventy-Three Lakhs Ten Thousand One Hundred and Twenty-Four Only) in relation to the credit facility extended by the Punjab National Bank (‘Bank’).

Thereafter, vide Order dated 30.05.2022 this Adjudicating Authority had appointed Mr. Vishnu Upadhyay, bearing Registration No. IBBI/IPA- 003/IP-N000153/2018-19/11843 as the Resolution Professional under Section 97 of the Code. Later, vide order dated 11.01.2023, this Adjudicating Authority admitted the Application under Section 100 of IBC, 2016 and the Individual Insolvency Resolution Process was admitted against the Personal Guarantor Mr. Amar Baldva.

In the view of order dated 11.01.2023, the Resolution Professional was directed to publish a public notice within seven days and invite the claims from all the creditors within 21 days of such issuance in the newspaper. The Resolution Professional was also directed to prepare a list of creditors in accordance with the provisions of the Section 104 of IBC, 2016 within 30 days from the date of the notice. Further it was directed that the Debtor shall prepare a Repayment Plan in consultation with the Resolution Professional as provided under Section 105.

In compliance of the order dated 11.01.2023, the Resolution Professional issued the public notice on 22.01.2023 in “Financial Express” (English) and “Mahanagar Times” (Hindi). The copy of public announcement is annexed as Annexure-B. A list of creditors was also prepared and the final list of Creditors based on claims submitted by the Creditors is annexed as Annexure-C.

Further, the Debtor had submitted its repayment plan on 01.03.2023. The said Repayment Plan was put forth before the Creditors for negotiation. The Debtor had submitted multiple Repayment Plans to the Applicant resulting from the negotiations between the Debtor and the Creditors. The Applicant has received all the repayment plans from the debtor and the same is annexed as Annexure-D. The Report under Section 106 of IBC, 2016 was filed by the Resolution Professional dated 14.06.2023 which was taken on record by this Adjudicating Authority vide order dated 14.06.2023

Thereafter, as per the provisions of Section 107 of IBC, 2016, the Resolution Professional had summoned four (4) meeting of the Creditors on dated 03.05.2023, 10.05.2023, 04.09.2023 and 08.09.2023 in accordance with provisions of Sections 108, 109, 110 and 111. The copies of the notices and Minutes of meetings ('MOM') dated 08.09.2023 is annexed as Annexure-E.

It is submitted that as per the provisions of Section 111 of IBC, 2016, the final Repayment Plan dated 04.09.2023 has been approved by the majority of the creditors. The copy of online voting is annexed as Annexure-F.

The Resolution Professional has prepared its Report of the meeting of creditors on repayment plan under Section 112(1) of the IBC, 2016 which is as follows:

Online voting responses received from the creditors and the list of the creditors who were present or represented at the meeting and submitted their response on the online window for voting are as follows:

The provisions of Section 114 of IBC, 2016 are as under:

The Resolution Professional has filed an IA (IBC) No. 375/JPR/2023 vide Diary No. 1665/2023 dated 07.07.2023 under section 60(1) of the Insolvency and Bankruptcy Code, 2016 read with Rule 11 of the NCLT Rules, 2016 for seeking an extension for further 120 days from the date of admission of the main matter under Section 94(1) of the IBC, 2016 and permission to submit the revised repayment plan.

The Applicant/RP states that an Application was filed under Section 94 of the IBC, 2016, and this Adjudicating Authority vide order dated 11.01.2023 has admitted the said Application. Thereafter, in terms of Section 105 of the Code, a repayment plan was prepared on 01.03.2023 and put forth in the meeting of the Creditors. The Creditors have suggested some changes; accordingly, a revised repayment plan has been prepared on 10.05.2023. The revised repayment plan was yet again placed before the creditors and one of the Secured Financial Creditors, i.e., Punjab National Bank, has suggested some amendments to the said revised repayment plan.

In the meantime, the period of 180 days as prescribed under Regulation 19 of The Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Personal Guarantors to Corporate Debtor Regulation, 2019 has concluded on 09.07.2023. The Applicant further states that a request has been received from the Debtor to re-submit the repayment plan. Hence, the present Application was moved before this Adjudicatory Authority seeking appropriate directions.

In the abovesaid facts, it is observed that the date of commencement of insolvency proceedings against the Debtor is 11.01.2023. As per Regulation 19, the period of 180 days comes to an end on 09.07.2023. The Creditors have not been able to deliberate on the repayment plan on various occasions. However, we cannot let such indecisive conduct come in the way of a successful resolution of the Debtor.

The Respondent to IA No. 375/JPR/2023 has filed reply vide diary no. 1898/2023 dated 07.08.2023 and stated that the Insolvency Process is a time bound process and the Applicant/RP failed to conduct the resolution process in the specified time period in the view of Regulation 19 of IBBI (Insolvency Resolution Process for Personal Guarantors to Corporate Debtors) Regulations, 2019. Further it submitted that the meetings of creditors shall be conducted in accordance with the provisions of Section 108, 109, 110 and 111 of the IBC, 2016.

Thereafter the Applicant has filed its rejoinder to the reply filed by Respondent vide dairy no. 2061/2023 dated 22.08.2023 and stated that the objector/financial institution has no locus to object the present IA for the extension of time period, wherein PNB having voting share of 86.79% and has asked the debtor submit the revised repayment plan. It is pertinent to note that the other guarantors i.e., Mr. Amar Baldva and Mr. Anshul Baldva of the Corporate Debtor vide order dated 13.07.2023 have granted extension of 90 days for submission of the repayment plan.

Further the Resolution professional has filed an IA(IBC) No. 489/JPR/2023 vide diary no. 2169/2023 dated 05.09.2023 wherein the seeking amendment in the prayer clause of IA No. 375/JPR/2023 in terms of liberty granted vide order dated 23.08.2023 wherein liberty has been given for the amendment in the said IA. The Applicant herein states that the prayer “that the period of insolvency process may be extended for further 120 days from the date of admission of the matter of Mrs. Basanti Devi Baldva filed u/s 94 and be granted to submit the revised repayment plan” may be amended as “that the period of insolvency process may be extended for further 120 days to submit the revised repayment plan”

It is observed that this Application was filed on 07.07.2023 seeking extension of 120 days for the insolvency process of the Debtor and while both these IAs were pending, the Applicant filed the repayment plan vide IA No. 528/JPR/2023 dated 20.09.2023. Through the present order we are approving the Repayment Plan, hence there is no need to extend the insolvency period any further. It shall be assumed that the period from when the Insolvency process was ending till the date of filing of the repayment plan i.e., 20.09.2023 shall stand extended in the interest of justice. In the view of forgoing IA(IBC)No.375/JPR/2023 & IA(IBC)No.489/JPR/2023 stands disposed off.

Further, the secured financial Indiabulls Housing Finance Limited herein referred as IBHL creditor has filed an IA (IBC) No. 536/JPR/2023 vide dairy No. 2349/2023 dated 26.09.2023 for seeking following reliefs:

The repayment plan mentions that the source of funds of Rs. 272 Lakhs include (i) Sale proceeds from residential house situated at 4-Kashipuri, Bhilwara amounting to Rs. 262 Lakhs and (ii) Loan from relatives amounting to Rs. 10 Lakhs. Hence the total amount used for the resolution process is Rs. 272 Lakhs. The IA No. 536/JPR/2023 was filed by Indiabulls Housing Finance Limited seeking permission to proceed on the basis of symbolic possession notice dated 25.06.2022 and possession order dated 03.02.2023 towards property situated at 701/702, 8th Floor Balaji Apartment Plot No. 1-2, Pansal Road, Bhilwara, Rajasthan. It is clear that the repayment plan does not in any way mention that the resolution cost of 272 lakhs includes the property mortgaged to IBHL. This Adjudicating Authority does not have the power to permit the Applicant as sought in the prayer therefore the present Application IA(IBC)No.536/JPR/2023 is being rejected and disposed off. The Applicant may approach the appropriate authority for the relief sought earlier in the Application.

Further, Section 114(1) of the IBC, 2016 provides that the Adjudicating Authority shall approve or reject the Repayment Plan on the basis of the meeting of the Creditors submitted by the Resolution Professional under Section 112 of the IBC, 2016, r/w Regulation 19 of IBBI (IRP for Personal Guarantors to Corporate Debtors) Regulations, 2019. We have perused the report of the meeting of the Creditors on the Repayment Plan under Section 112 of the IBC, 2016 and the same is taken on record. The resolution passed in the meeting dated 08.09.2023 has also been considered. According to this report and the resolution, the Creditor have approved the Repayment Plan submitted by the Personal Guarantor.

The report has been filed by the RP in compliance with Section 112 of the Code. This Adjudicating Authority is passing this order under Section 114 of the Code, hereby, approving the repayment plan on the basis of the report of the meeting of Creditors submitted by the resolution professional. The directions for implementation of the repayment plan are as follows: -

A. A notice that the repayment plan has been fully implemented.

B. A copy of a report summarising all receipts and payments made in pursuance of the repayment plan and extent of the implementation of such plan with the repayment plan approved by the meeting of creditors.

C. The Resolution Professional may apply before this Adjudicating Authority to extend the time mentioned above.

Accordingly, the Application filed by the Resolution Professional under Section 112 of the Code numbered as IA(IBC) No. 528/JPR/2023 is allowed and stands disposed off.