The Karad Urban Cooperative Bank Ltd. Vs. Swwapnil Bhingardevay & Ors.
[Civil Appeal No. 2955 of 2020]
The Karad Urban Cooperative Bank Ltd, a financial creditor, filed an application on 04.09.2017 under Section 7 of the Insolvency and Bankruptcy Code (IBC) before the National Company Law Tribunal (NCLT) against M/s. Khandoba Prasanna Sakhar Karkhana Limited, which is the corporate debtor. NCLT admitted the application and on 06.03 .2018 appointed Mr. Jitendra Palande as Interim Resolution Professional. On 30.03.2018 the Resolution Professional issued an advertisement on inviting Expression of Interest (interest of Buyer’s Company to acquire the seller's Company through a formal offer.).Thereafter a Director of the corporate debtor moved the High Court by way of a writ petition challenging the orders of the NCLT dated 06.03.2018, which was later dismissed by High Court 23.08.2018. Several meetings of Committee of Creditors were held and on 09.02.2019 they decided to approve Resolution Plan submitted by one M/s. Sai Agro (India) Chemicals and an application was moved before NCLT, subsequently, the corporate debtor also came up with their Resolution plan but it got rejected and former’s application was approved on 01.08.2019. Director of the corporate debtor appealed before the National Company Law Appellate Tribunal (NCLAT) in Company against the order of the NCLT dated 01.08.2019. NCLAT allowed the appeal and remanded the matter back to the adjudicating authority, with a direction to send back the Resolution Plan to the Committee of Creditors.
The impugned order made on 01.08.2019 was set aside and it was remitted to Adjudicating Authority. The authority was asked to place the matter before the Committee of Creditors for resubmitting the Resolution Plan within the limited time frame. It was asked to follow the directions made by the Hon'ble Supreme Court in the Judgment in the matter of "Essar Steel" and IBC. The Hon’ble Supreme Court enunciated that if all the necessary factors are taken into account by CoC to determine if the corporate debtor can be kept running as a going concern, then adjudicating authority have to consider that and the order passed on 01.08.2019 must be approved otherwise not.