NCLT Mumbai Sanctions Promoter's Resolution Plan for Srithak Ispat Pvt Ltd.

NCLT Mumbai Sanctions Promoter's Resolution Plan for Srithak Ispat Pvt Ltd.

The National Company Law Tribunal, Mumbai Bench (in short NCLT) while adjudicating a petition filed in the matter of Swastik Coal Corporation Pvt. Ltd. vs. Srithik Ispat Pvt. Ltd., allowed the resolution plan submitted by the Promoter of the Srithik Ispat Pvt (hereinafter referred to as 'Corporate Debtor/Applicant').

The corporate debtor is a Micro, Small, Medium Enterprise (MSME) company, engaged in the business of manufacturing sponge iron in Goa and Maharashtra. Swastik Coal Corporation Pvt. Ltd., (hereinafter referred to as 'Financial Creditor') had filed a petition under Section 9 of the Insolvency and Bankruptcy Code, 2016 (in short IBC) sought to initiate Corporate Insolvency Resolution Process against the corporate debtor. Mr. Raj Kumar Dad was appointed as an Interim Resolution Professional (IRP) and later confirmed as the Resolution Professional.

The Promoter of the Corporate Debtor- Mrs. Girija Agarwal ("Successful Resolution Applicant/SRA" submitted a Resolution Plan, which was approved by the Committee of Creditors (in short CoC) on 6 March, 2021.

The Resolution Plan submitted by the SRA is for a total amount of Rs. 8,70,00,000/-. The plan proposes to pay the Secured Financial Creditors Rs. 8,20,00,000/- as against the admitted amount of Rs. 32,63,64,000/-. The operational creditors (Government) are proposed to be paid Rs. 7 lakh as against the admitted amount of Rs. 32,63,64,000/-. The operational creditors (Government) are proposed to be paid Rs. 7 lakh as against an admitted claim of Rs. 10,44,83,597/-. While operational creditors other than the Government, Employees and Workmen are proposed to be paid Rs. 1,50,000/- as against an admitted amount of Rs. 4,17,00,000/-.

The Applicant further stated that there were no dues to be paid to the workers as wages or salaries. The statutory dues towards labor, including the dues towards the Provident Fund Department being more than 2 years old are covered under Operational Creditors (Statutory Creditors). Hence no amount was to be paid towards the same.

The Resolution Professional filed an application under Section 31 of IBC before Adjudicating Authority for approval of the resolution plan.

The Tribunal after going through the records and the law thus settled, the instant Resolution Plan meets the requirements of Section 30(2) of the IBC and Regulations 37, 38, 38 (1A) and 39 (4) of the IBBI (Insolvency Resolution Process for Corporate Persons) (Third Amendment) Regulations, 2020.

The Tribunal observed that the Resolution Plan was not in contravention of any of the provisions of Section 29A of the IBC and is in accordance with law and vide its order approved the Resolution Plan submitted by the Corporate Debtor's Promoter and ordered that Resolution Plan shall be binding on the Corporate Debtor, 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 is due, guarantors and other stakeholders involved in the Resolution Plan. Further added that the, moratorium under Section 14 of the IBC shall cease to have effect from the date of the order.