NCLT Mumbai Approves Ashdan Properties' Rs 900 Crore Plan To Revive Rolta India
Pranav B Prem
The National Company Law Tribunal (NCLT), Mumbai Bench, has approved a ₹900 crore resolution plan submitted by Ashdan Properties Pvt. Ltd. for the revival of Rolta India Ltd., holding that once a resolution plan complies with the requirements of the Insolvency and Bankruptcy Code, 2016, the Adjudicating Authority cannot interfere with the commercial wisdom exercised by the lenders. The Tribunal observed that the plan satisfied all statutory conditions and was approved by the Committee of Creditors (CoC) in accordance with law.
The order was passed by a Bench comprising Judicial Member Sushil Mahadeorao Kochey and Technical Member Prabhat Kumar, which recorded that the resolution plan met the requirements of Section 30(2) of the IBC and Regulations 37, 38, 38(1A) and 39(4) of the CIRP Regulations. Approving the plan, the Tribunal observed, “The instant Resolution Plan meets the requirements of Section 30(2) of the Code and Regulations 37, 38, 38 (1A) and 39 (4) of the CIRP Regulations. The Resolution Plan is not in contravention of any of the provisions of Section 29A of the Code and is in accordance with law. The same needs to be approved.”
Rolta India Ltd., an Indian multinational technology company headquartered in Mumbai, is engaged in providing IT solutions in the areas of geospatial systems, defence-related technologies, business intelligence, big data analytics and engineering services. The company was admitted into the corporate insolvency resolution process on 19 January 2023 on a petition filed by Union Bank of India, after it defaulted on repayment of its loan facilities.
Mamta Binani was appointed as the Interim Resolution Professional and was later confirmed as the Resolution Professional. A public announcement inviting claims was issued on 21 January 2023, and the Committee of Creditors was constituted on 9 February 2023. The total admitted claims against Rolta India stood at nearly ₹14,000 crore, including claims arising out of corporate guarantees and other creditor dues.
After evaluating multiple resolution plans, the Committee of Creditors approved the proposal submitted by Ashdan Properties Pvt. Ltd. on 2 August 2024. A letter of intent was thereafter issued and accepted on 9 August 2024, accompanied by the furnishing of a performance security of ₹25 crore. The Resolution Professional placed the approved plan before the Tribunal for sanction.
Under the approved resolution plan, Ashdan Properties is required to make an upfront payment within 30 days from the date of approval by the Tribunal. The plan provides for payment of ₹808.55 crore to secured financial creditors and ₹64.20 crore to unsecured financial creditors. Unpaid insolvency resolution process costs amounting to ₹2.5 crore have been earmarked as a separate corpus fund, and the claims of government authorities and employees are also proposed to be settled in accordance with the plan.
Several stakeholders raised objections to the resolution plan, questioning the valuation methodology adopted by the registered valuers, the extinguishment of the existing share capital without consideration, and the manner of distribution of proceeds among creditors. These objections were opposed by the Resolution Professional, who submitted that the plan complied with Sections 30(2) and 29A of the IBC, and that no preferential, undervalued, fraudulent or extortionate transactions survived consideration.
The Resolution Professional further pointed out that the value offered under the plan exceeded both the fair value and the liquidation value of Rolta India, and that the plan was approved by the CoC after due deliberation. Accepting these submissions, the Tribunal rejected the objections and reiterated that it cannot reassess valuation or substitute its own view for that of the lenders once the Committee of Creditors has taken a commercial decision in conformity with law.
Holding that the resolution plan was compliant with the IBC and the applicable regulations, the NCLT approved the plan and directed the Resolution Professional to handover all records, assets and documents of Rolta India Ltd. to Ashdan Properties Pvt. Ltd. to ensure time-bound and effective implementation of the revival process. The corporate insolvency resolution process was accordingly brought to a close with the approval of the resolution plan.
Appearance
For Applicant: Advocates Sandeep Bajaj, Akanksha Nehra, Gunjan Nayyar, Shubham Jaiswal, Vishal Nagpal, Muskan Sengar along with Mamta Binani
For CoC: Advocates Laveena Tejwani, Abdul Basit Kudalkar
For Income Tax Dept: Advocate Manoj Laxman Shirsat
For SRA: Advocates Sameer Pandit, Chandni Turakmiya i/b Wadiya Ghandy and Co.
Cause Title: Union Bank of India vs Rolta India Limited
Case No: IA(IBC) (Plan) 65 of 2024 in CP (IB) No. 530 of 2020
Coram: Judicial Member Sushil Mahadeorao Kochey, Technical Member Prabhat Kumar
