# In the matter of Sainath Estates Pvt. Ltd. IA (IBC)-43-2021 in CP (IB) No. 651-7-HDB-2018

> NCLT judgment dated 2021-11-09. Citation: TCN-2021-NCLT-00573. The Corporate Insolvency Resolution Process (CIRP) for Sainath Estates Private Limited was…

- **Court:** NCLT
- **Order date:** 9 Nov 2021
- **Citation:** TCN-2021-NCLT-00573
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/sainath-estates-pvt-ltd-ia-ibc-43-2021-in-cp-ib-no-651-7-hdb-2018-0b4ed37a

## Summary

### Background

The Corporate Insolvency Resolution Process (CIRP) for Sainath Estates Private Limited was initiated by the NCLT Hyderabad Bench-1 on 08.07.2019. Bank of India filed an application under Section 7 of the Insolvency and Bankruptcy Code, 2016. The applicant was appointed as Interim Resolution Professional (IRP). Public announcement of CIRP commencement was made on 11.07.2019, leading to claims from 4 Financial Creditors and 1 Operational Creditor. The NCLAT initially allowed settlement and directed the IRP not to constitute a Committee of Creditors (CoC). However, NCLAT later upheld the admission order on 13.11.2019. The CoC was formed on 18.09.2019, confirming the applicant as Resolution Professional (RP). The CIRP term ended on 26.02.2020, extended to 04.11.2020 after

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## Facts

The Corporate Insolvency Resolution Process (CIRP) was initiated against Sainath Estates Private Limited on 08.07.2019. Bank of India filed the application. The applicant was appointed as Interim Resolution Professional (IRP). Claims were received from 4 Financial Creditors and 1 Operational Creditor. The Committee of Creditors (CoC) was formed on 18.09.2019. The CIRP term ended on 26.02.2020, extended to 04.11.2020. Form-G was published on 05.12.2019, resulting in five expressions of interest (EOIs). The promoter of Sainath Estates Private Limited, Mr. K. Prem Sagar Rao, submitted a resolution plan on 23.07.2020, claiming eligibility under the MSME category. The CoC approved the resolution plan with 100% voting in favor. The resolution plan involves an amount of INR

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## Issues and analysis

### Issue 1: Whether the resolution plan submitted by Mr. K. Prem Sagar Rao, the promoter of Sainath Estates …

**Ratio:** The resolution plan must comply with the requirements specified in Section 30(2) of the

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**Reasoning:** The NCLT found that the resolution plan provides for the priority payment of CIRP costs,

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**Interpretation:** Section 30(2) of the Code sets out the mandatory requirements for a resolution

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**Application:** In this case, the NCLT found that the resolution plan submitted by Mr. K. Prem

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## Parties

- **Judges:** Venkata Ramakrishn…; Veera Brahma Rao…
- **Appellants:** Bank of…
- **Respondents:** Sainath Estates…; Sainath Estates…

## Timeline

- **2019-07-08 — CIRP Init…**: The Corporate Insolvency Resolution Process (CIRP) of the Corporate Debtor was initiated…
- **2019-07-11 — Public Announcement of…**: The Applicant made public announcement of…

## 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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