Nitrex Chemicals India Ltd. v. Ravindra Beleyur

INSOLVENCY AND BANKRUPTCY CODE, 2016

--Duties of Resolution Professional --Rejection of resolution planNo opportunity of representation provided to resolution applicant--Violation of principle of natural justice--Though resolution applicant was not allowed to vote in the meeting of CoC and it was CoC to approve or reject the resolution plan, however, reasonable opportunity of being heard was to be provided to resolution applicant to attend the CoC meeting and to express his view point on resolution plan submitted to CoC.--CIRP was initiated against the corporate debtor. NCIL (resolution applicant) submitted its resolution plan along with the declaration under section 29A to the Resolution Professional (RP). Due to some reason, NCIL did not attend the meeting of Committee of Creditors (CoC). In the meeting, resolution plan of NCIL was rejected and plan of another resolution applicant was approved. NCIL sought copies of all minutes of CoC meetings, but the RP declined its request. Therefore, NCIL filed the application contending that the RP did not grant the opportunity of being heard to it regarding entire process related to consideration and approval of the resolution plan, thus, the conduct of RP was in violation of the principle of natural justice. Held: Though, NCIL had no voting right in the meeting of CoC and it was the CoC to approve or reject the resolution plan, however, an opportunity was to be provided to NCIL to attend meeting of CoC, to make his representation and to express his view point on the resolution plan submitted to the CoC. Therefore, the application was allowed and the CoC was directed to consider the plan afresh submitted by NCIL by providing it reasonable opportunity of being heard.