# In the matter of PRC International Hotels Pvt. Ltd. MA-39-2019 In CP-540-IB-2018

> NCLT judgment dated 2019-01-28. Citation: TCN-2019-NCLT-05135. The applicant sought a direction to the respondent to accept the Expression of Interest (Eol)…

- **Court:** NCLT
- **Order date:** 28 Jan 2019
- **Citation:** TCN-2019-NCLT-05135
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/prc-international-hotels-pvt-ltd-ma-39-2019-in-cp-540-ib-2018-2997dd69

## Summary

### Background

The applicant sought a direction to the respondent to accept the Expression of Interest (Eol) of the applicant. The applicant submitted that he responded to the Eol dated 26.12.2018. The Resolution Professional (RP) stated that the proposal was placed before the Committee of Creditors (CoCs) in its 5th meeting dated 07.01.2019. The applicant was declared ineligible on 29.12.2018 because he could not provide a demand draft for Rs. 10 lakhs and a non-refundable fee of Rs. 2500, which were mandatory conditions. The applicant stated that his father was admitted to the hospital and discharged on 30.12.2018, and he requested the RP to consider his proposal, but it was not considered. The applicant referred to Insolvency Resolution Regulation, 2016, which states that there is

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## Facts

M.Gagan Bothra filed an application (MA/39/2019) seeking a direction for Ebenezer Inbaraj (Resolution Professional) to accept his Expression of Interest (Eol). Bothra submitted an Eol on 26.12.2018. The RP presented the proposal to the CoC in its 5th meeting on 07.01.2019. Bothra was declared ineligible on 29.12.2018 for failing to provide a demand draft of Rs. 10 lakhs and a non-refundable fee of Rs. 2500, mandatory conditions for the bid. Bothra claimed his father's hospitalization on 30.12.2018 prevented him from meeting the requirements and requested the RP to reconsider. He argued that the CoC's demand for fees contradicted the Insolvency Resolution Regulation, 2016, which doesn't require such payments for Eol submission. The CIRP period of 180 days was completed

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## Issues and analysis

### Issue 1: Whether the CoCs' decision to declare the applicant ineligible for failing to submit a demand draft …

**Ratio:** The Insolvency Resolution Regulation, 2016, specifically Regulation 36A(4)(d), does not

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**Reasoning:** The tribunal found that the CoCs' requirement for a demand draft and non-refundable fee

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**Interpretation:** The interpretation of Regulation 36A(4)(d) is that it aims to facilitate

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**Application:** The CoCs' decision to disqualify the applicant based on the non-payment of fees

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## Parties

- **Judges:** CH. MOHD SHARIEF…
- **Appellants:** M.Gagan B…
- **Respondents:** PRC INTERNATIONAL…; Ebenezer I…

## Timeline

- **2018-12-26 — Eol Submi…**: Applicant submitted…
- **2018-12-29 — Applicant Declared…**: Applicant declared ineligible by CoCs for failing to submit demand draft and…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 60 — Adjudicating Authority for corporate persons](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-60)

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