# In the matter of Shree Vindhya Paper Mills Limited I.A. No. 784 of 2020 in C.P. (IB) 2045-NCLT-MB-2018

> NCLT judgment dated 2020-10-05. Citation: TCN-2020-NCLT-00460. This case involves an application filed by Invent Asset Securitization and Asset Reconstruction…

- **Court:** NCLT
- **Order date:** 5 Oct 2020
- **Citation:** TCN-2020-NCLT-00460
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/shree-vindhya-paper-mills-limited-ia-no-784-of-2020-in-cp-ib-2045-nclt-mb-2018-9118ea21

## Summary

### Background

This case involves an application filed by Invent Asset Securitization and Asset Reconstruction Private Limited, a Financial Creditor of Shree Vindhya Paper Mills Limited (Corporate Debtor), before the National Company Law Tribunal (NCLT), Mumbai Bench. The applicant challenges the resolution plan approved by the Committee of Creditors (CoC), primarily concerning the settlement amount offered to the second charge holders, including the applicant. The applicant claims that the offer of 0.5% on the principal outstanding is inadequate and seeks a revision of the resolution plan to improve the settlement amount. The Corporate Debtor was admitted into Corporate Insolvency Resolution Process (CIRP) on 07.06.2019.

## Facts

1. Invent Asset Securitization and Asset Reconstruction Private Limited is a Financial Creditor of Shree Vindhya Paper Mills Limited (Corporate Debtor).
2. The Corporate Debtor was admitted into Corporate Insolvency Resolution Process (CIRP) on 07.06.2019.
3. The applicant's claim was admitted for Rs. 46,89,86,949/-, holding a second charge on the Corporate Debtor's immovable property.
4. The Resolution Plan approved by the Committee of Creditors (CoC) provides a payment of only 0.5% of the principal outstanding to the applicant.
5. The applicant contends that the 0.5% offer is inadequate and seeks a revision of the Resolution Plan.
6. The Corporate Debtor created a first charge over its assets in favor of some Financial Creditors.
7. The principal outstanding amount due to

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## Issues and analysis

### Issue 1: Whether the NCLT should direct the Resolution Applicant to revise the Resolution Plan to improve …

**Ratio:** The commercial wisdom of the Committee of Creditors (CoC) in approving a resolution plan

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**Reasoning:** The NCLT relies on the Supreme Court's judgment in Committee of Creditors of Essar Steel

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**Interpretation:** This interpretation emphasizes the limited scope of judicial review over the

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**Application:** In this case, the NCLT applies the principle that it cannot interfere with the

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## Parties

- **Judges:** Janab Mohammed…; V. Nallasen…
- **Appellants:** Invent Asset…
- **Respondents:** Shree Vindhya…; Vijendra Kumar…

## Timeline

- **2019-06-07 — CIRP Init…**: Corporate Insolvency Resolution Process (CIRP) initiated against Shree Vindhya Paper…
- **2020-01-22 — 6th CoC M…**: The 6th CoC meeting was held, where the issue of improving the offer of 0.5% on the…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 60(5) — Adjudicating Authority for corporate persons](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-60)

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