# In the matter of Maxim Infrastructure & Real Estate Ltd. I.A. No. 43-2019 in CP (IB) 04-GB-2018

> NCLT judgment dated 2019-08-06. Citation: TCN-2019-NCLT-02078. The case involves an application (I.A.No.43/2019) filed by Mr. Pankaj Jhunjhunwala, Managing…

- **Court:** NCLT
- **Order date:** 6 Aug 2019
- **Citation:** TCN-2019-NCLT-02078
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/maxim-infrastructure-real-estate-ltd-ia-no-43-2019-in-cp-ib-04-gb-2018-76e3bc30

## Summary

### Background

The case involves an application (I.A.No.43/2019) filed by Mr. Pankaj Jhunjhunwala, Managing Director of H.M. Cements Private Limited, seeking a declaration that the Resolution Plan submitted by the applicant is eligible for consideration on commercial merits by the Committee of Creditors (COC). The applicant, also the promoter of the Corporate Debtor, M/s Maxim Infrastructure & Real Estate Ltd., claimed exemption from ineligibility under Section 29A of the Insolvency & Bankruptcy Code, 2016, arguing that H.M. Cements Pvt. Ltd. falls under the Micro, Small, and Medium Enterprises (MSME) category. The COC rejected the Resolution Plan after due deliberations and legal opinion. The applicant then challenged the COC's decision, contending that neither the

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## Facts

H.M. Cements Private Limited, through its Managing Director Mr. Pankaj Jhunjhunwala, filed an application seeking a declaration that its Resolution Plan for M/s Maxim Infrastructure & Real Estate Ltd. is eligible for consideration by the COC. H.M. Cements, the resolution applicant, is also the promoter of Maxim Infrastructure & Real Estate Ltd., the Corporate Debtor. H.M. Cements claimed MSME status to gain exemption from ineligibility under Section 29A of the IBC. The COC rejected the Resolution Plan after obtaining legal opinion. The applicant obtained an acknowledgment of MSME status from the District Industries and Commerce Centre, Government of Assam, after the rejection of the Resolution Plan and only in respect of the Guwahati project of the Corporate

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## Issues and analysis

### Issue 1: Whether the Resolution applicant can be considered as a bona fide MSME unit simply basing on the …

**Ratio:** The spirit of Section 240A of the IBC is to protect genuine MSME entrepreneurs, not

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**Reasoning:** The Tribunal reasoned that allowing ex-promoters or Directors to register as MSME units

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**Interpretation:** Section 240A of the IBC is interpreted to protect genuine MSME entrepreneurs

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**Application:** The Tribunal applied this principle to the facts, finding that the applicant's

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## Parties

- **Judges:** Hari Venkata…; Ashutosh C…
- **Appellants:** H.M. Cements Pvt.…
- **Respondents:** M/s Maxim…; Bank of…

## Timeline

- **2019-04-27 — Expression of…**: Applicant submitted an Expression of Interest (EOI) in the matter of resolution of Maxim…
- **2019-07-19 — 6th COC M…**: Applicant provided an acknowledgment obtained from the Office of the General Manager,…

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