# In the matter of Tourism Finance Corporation of India Ltd. Vs. Rainbow Papers CA (AT) (Insolvency) No. 354 of 2019

> NCLAT judgment dated 2019-12-19. Citation: TCN-2019-NCLAT-00005. These appeals arise from the approval of a resolution plan for Rainbow Papers Limited.…

- **Court:** NCLAT
- **Order date:** 19 Dec 2019
- **Citation:** TCN-2019-NCLAT-00005
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclat-new-delhi/tourism-finance-corporation-of-india-ltd-vs-rainbow-papers-ca-6650acd7

## Summary

### Background

These appeals arise from the approval of a resolution plan for Rainbow Papers Limited. Tourism Finance Corporation of India Limited (TFCI), Virag Enterprise, State Tax Officer, and Regional Provident Fund Commissioner-I filed appeals challenging the plan. TFCI claimed it was wrongly categorized as an unsecured creditor. Virag Enterprise, an operational creditor, alleged wrong distribution and delayed payment. The State Tax Officer sought payment of outstanding dues. The Regional Provident Fund Commissioner-I challenged the plan regarding provident fund payments. The Adjudicating Authority approved the resolution plan, leading to these appeals.

## Facts

Rainbow Papers Limited underwent Corporate Insolvency Resolution Process (CIRP). The Resolution Professional filed an application for approval of the Resolution Plan submitted by Kushal Limited. Tourism Finance Corporation of India Ltd. (TFCI) claimed to be a secured creditor but was categorized as unsecured. TFCI had provided a corporate loan of Rs.30 Crores to Rainbow Papers, secured by pledge of equity shares and corporate guarantee. The loan defaulted, and TFCI issued notices. Virag Enterprise, an operational creditor, alleged wrong distribution and delayed payment under the Resolution Plan. The State Tax Officer (1) sought payment of Rs.47,35,72,314/- towards Value Added Tax/Central Sales Tax. The Regional Provident Fund Commissioner-I challenged the plan

…

## Issues and analysis

### Issue 1: Whether the Adjudicating Authority …

**Ratio:** The appellate tribunal cannot interfere with the commercial wisdom of the Committee of

…

**Reasoning:** The appellate tribunal's jurisdiction is limited to reviewing whether the resolution plan

…

**Interpretation:** This clarifies the limited scope of judicial review over decisions made by the

…

**Application:** The NCLAT found that the appeals did not demonstrate any contravention of law,

…

## Parties

- **Judges:** S.J. Mukhop…; Bansi Lal…; +1 more
- **Appellants:** Tourism Finance…
- **Respondents:** Rainbow Papers…; Rainbow Papers…

## Timeline

- **2017-09-12 — Moratorium D…**: The Adjudicating Authority declared a moratorium under Section 13(1)(a) and Section 14 of…
- **2018-05-26 — Resolution Pl…**: The ‘Resolution Plan'…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 30(6) — Submission of resolution plan](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-30)

---

This is a preview. The full structured summary, issues, precedents and source judgment are available on CaseEase - Legal Intelligence Simplified: https://caseease.in/cases/ibc/nclat-new-delhi/tourism-finance-corporation-of-india-ltd-vs-rainbow-papers-ca-6650acd7