Case Note & Summary
This case involves five company appeals filed before the National Company Law Appellate Tribunal, Principal Bench, New Delhi, arising out of the corporate insolvency resolution process of Reliance Broadcast Network Limited. The corporate debtor was admitted into CIRP on 24 February 2023 on an application under Section 7 of the Insolvency and Bankruptcy Code, 2016 filed by IDBI Trusteeship Services Ltd. The Resolution Professional issued Form G on 14 April 2023 inviting expressions of interest. Several prospective resolution applicants, including the appellants Abhijit Realtors & Infraventure Pvt. Ltd. and Creative Channel Advertising & Marketing Pvt. Ltd., submitted their EoIs. On 15 June 2023, the RP issued the request for resolution plans along with evaluation matrix and information memorandum. Six resolution plans were received, with bids ranging from Rs.37.17 crores to Rs.104.28 crores. The Committee of Creditors decided to hold a challenge process as per the RFRP. On 12 October 2023, the RP issued a Challenge Process Document setting a base price of Rs.240 crores. On 27 October 2023, during the tenth CoC meeting, three rounds of bidding were conducted. Sapphire Media Ltd. emerged as the highest bidder with Rs.251 crores. Following negotiations, revised financial proposals were received on 4 November 2023. The CoC voted on the plans, and on 16 November 2023, the plan of Sapphire Media Ltd. was approved with 88.97% vote share. The RP filed IA No. 5391 of 2023 before the NCLT Mumbai for approval of the plan. The consortium of Abhijit Realtors and ENIL challenged the process, alleging irregularities in the conduct of the challenge process and sought setting aside of the CoC decision. Creative Channel Advertising & Marketing Pvt. Ltd., which did not participate in the challenge process but did in negotiations, contended that Sapphire Media Ltd. was ineligible under Section 29A of the IBC. The NCLT Mumbai, by three separate orders dated 6 May 2024, dismissed the objections raised in IA Nos. 5572/2023, 614/2024, and 290/2024, and also approved the resolution plan submitted by Sapphire Media Ltd. in IA No. 5391/2023. Aggrieved, the unsuccessful resolution applicants filed the present appeals before the NCLAT. The text of the judgment as provided does not include the NCLAT’s analysis or final decision on the appeals.
Issue of Consideration
Whether the challenge process and negotiation were conducted fairly and in accordance with RFRP; whether Sapphire Media Ltd. was eligible under Section 29A of the Insolvency and Bankruptcy Code, 2016; whether the Adjudicating Authority erred in approving the resolution plan.
Case Details
2024 LawText (NCLAT) (01) 128
Company Appeal (AT) (Insolvency) No. 923 of 2024 and batch
Krishnendu Dutta, Abhijeet Sinha, Gaurav Mitra (for appellants); Neeraj Kishan Kaul, Sudhir K. Makkar, Ardhendmauli Kumar Prasad, Anupam Lal Das, Ramji Srinivasan (for respondents)
Abhijit Realtors & Infraventures Pvt. Ltd., Creative Channel Advertising & Marketing Pvt. Ltd.
Rohit Mehra (RP of Reliance Broadcast Network Ltd.), CoC, Sapphire Media Ltd.
Subscribe to unlock Case Details (Citation, Judge, Date & more)
Subscribe Now
Nature of Litigation
Appeals against NCLT Mumbai orders approving the resolution plan of Sapphire Media Ltd. and dismissing objections by unsuccessful resolution applicants in the CIRP of Reliance Broadcast Network Limited.
Remedy Sought
Appellants sought to set aside the CoC decision and NCLT order approving the resolution plan; prayed for recommencement of the process or declaration that Sapphire Media Ltd. was ineligible.
Filing Reason
Alleged irregularities in the challenge process conducted on 27.10.2023 and claims that the successful resolution applicant was ineligible under Section 29A of the Insolvency and Bankruptcy Code, 2016.
Previous Decisions
NCLT Mumbai Bench, Court-V, by orders dated 06.05.2024, dismissed IA Nos. 5572/2023, 614/2024, 290/2024 and approved the resolution plan of Sapphire Media Ltd. in IA No. 5391/2023.
Issues
Whether the challenge process and subsequent negotiation were conducted in accordance with the RFRP and without material irregularity.
Whether Sapphire Media Ltd. was eligible to submit a resolution plan under Section 29A of the Insolvency and Bankruptcy Code, 2016.
Whether the Adjudicating Authority erred in approving the resolution plan and dismissing the objections.
Submissions/Arguments
The consortium of Abhijit Realtors and ENIL contended that the challenge process held on 27.10.2023 was irregular and vitiated the CoC’s decision to approve Sapphire Media Ltd.’s plan.
Creative Channel Advertising & Marketing Pvt. Ltd. argued that Sapphire Media Ltd. was ineligible under Section 29A of the IBC to submit a resolution plan.
The Resolution Professional and Committee of Creditors supported the process and the plan approval.
Judgment Excerpts
The Adjudicating Authority by the impugned order dated 06.05.2024 has approved the Resolution Plan submitted by the Sapphire Media Ltd.
On 27.10.2023 during the 10th CoC Meeting Challenge Process was conducted and three round of bidding was conducted.
Procedural History
Corporate Debtor admitted to CIRP on 24.02.2023. RP issued Form G on 14.04.2023. Resolution plans received; challenge process conducted on 27.10.2023. Sapphire Media Ltd. emerged highest bidder with Rs.251 crores; negotiations held, revised bids received; CoC approved Sapphire’s plan with 88.97% votes on 16.11.2023. RP filed IA 5391/2023 for plan approval. Consortium and Creative Channel filed objections. NCLT dismissed objections and approved plan on 06.05.2024. Appeals filed before NCLAT.
Acts & Sections
- Insolvency and Bankruptcy Code, 2016: 7
