The National Company Law Appellate Tribunal ( NCLAT ), New Delhi Bench observed that the adjudicating authority empowered to extend payment timelines under the resolution plan without express concurrence of the committee of creditors ( CoC ).
A reply was sent on behalf of the SBI that amount of Performance Guarantee of INR 0.4 crores cannot be permitted to be utilized for payment of fourth tranche and further amount of Rs.23,65,865/-, which is yet to be paid to various creditors cannot be used. However, with regard to two payments, i.e. Rs.28,50,119/- and Rs.1,32,500/-, the Bank expressed its no objection.
The Appellant again wrote to the SBI on 26.02.2024, where an offer was made to sell factory at Shirwal and on sale of Shirwal factory an amount of Rs.6 Crores would be realized, which may be utilized for payment of fourth and fifth tranches and there will be also balance for payment of sixth tranche.
It was submitted by the appellant that the appellant has given sufficient reason for extension of timeline for making the payment of balance amount under the Resolution Plan, which Application has been rejected on the erroneous ground that CoC has not agreed for extension and that the CoC being 100% consist of SBI, who ought to have collaborated and extended its cooperation to the SRA to implement the Resolution Plan.
The Counsel appearing for SBI submitted that Appellant had not made the payment of fourth tranche which was due on 15.04.2023, hence the Bank had filed IA No.4034 of 2023 for liquidation and that subsequent request received from the Appellant to utilize the amount lying in different accounts, which included the utilization of Performance Guarantee of Rs.40 lakhs was duly replied by the Bank. It was submitted that Appellant having not paid the amount, SBI has rightly initiated proceedings for liquidation.
A Two-Member Bench comprising Justice Ashok Bhushan, Chairperson and Arun Baroka, Member (Technical) observed that “We, thus, are satisfied that Adjudicating Authority has jurisdiction to grant extension of timeline in making the payment in a Resolution Plan and the view of the Adjudicating Authority that granting of extension of the timeline is modification of the terms of the Resolution Plan is not a correct view. Further, for extension of timeline it is not necessary that CoC should express its concurrence, only then the Adjudicating Authority can exercise its jurisdiction. The jurisdiction is there with the Adjudicating Authority in appropriate case.”
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