# In the matter of Aristo Texcon Private Limited C.A. (IB) No. 709-KB-2019 in C.P. (IB) No. 570-KB-2018

> NCLT judgment dated 2019-08-20. Citation: TCN-2019-NCLT-01907. The case pertains to an application filed by the Resolution Professional under Sections 30(6)…

- **Court:** NCLT
- **Order date:** 20 Aug 2019
- **Citation:** TCN-2019-NCLT-01907
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/aristo-texcon-private-limited-ca-ib-no-709-kb-2019-in-cp-ib-no-570-kb-2018-9fd238ea

## Summary

### Background

The case pertains to an application filed by the Resolution Professional under Sections 30(6) and 31 of the Insolvency & Bankruptcy Code, 2016, seeking approval of the Resolution Plan as approved by the Committee of Creditors (CoC) for Aristo Texcon Private Limited. The Corporate Insolvency Resolution Process (CIRP) was initiated after the company was unable to pay its debts to financial creditors, amounting to Rs. 29,00,00,000/-. The CIRP was initiated under Section 10 of the Insolvency and Bankruptcy Code, 2016.

## Facts

Aristo Texcon Private Limited faced financial difficulties and was unable to pay its debts to financial creditors, amounting to Rs. 29,00,00,000/-. Consequently, an application was filed under Section 10 of the Insolvency and Bankruptcy Code, 2016, to initiate the Corporate Insolvency Resolution Process (CIRP). The Adjudicating Authority admitted the company into CIRP and issued a moratorium under Section 14. Mr. Ram Ratan Modi was initially appointed as the Interim Resolution Professional (IRP) but was later replaced by Ms. Mamta Binani as the Resolution Professional (RP). The RP prepared an Information Memorandum and invited resolution plans. Four resolution plans were received, and the CoC approved the plan submitted by M/s Jagannath Financial Advisory Private

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## Issues and analysis

### Issue 1: Whether the objection raised by Canara Bank against the approval of the resolution plan can be …

**Ratio:** The Adjudicating Authority cannot sit in appeal against the financial decisions taken by

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**Reasoning:** The Adjudicating Authority relied on the Apex Court's ruling in K. Sashidhar Vs. Indian

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**Interpretation:** The commercial wisdom of the CoC is paramount in deciding the distribution of

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**Application:** The Adjudicating Authority rejected Canara Bank's objection, as the decision to

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## Parties

- **Judges:** Madan B.…; Virendra Kumar…
- **Respondents:** Aristo Texcon…

## Timeline

- **2018-08-31 — Admission in…**: The Adjudicating Authority admitted the Corporate Person into CIRP and issued a…
- **2018-09-28 — Change o…**: In the first meeting of the Committee of Creditors (CoC), IRP Mr. Ram Ratn Modi was…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 14 — Moratorium](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-14)

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