# In the matter of Viceroy Hotels Ltd., IA No. 281 of 2019 in CP No. IB/219/7/HDB/2017

> NCLT judgment dated 2021-09-01. Citation: TCN-2021-NCLT-01236. The case involves an application (IA No. 281/2019) filed under Sections 30(6) and 31 of the…

- **Court:** NCLT
- **Order date:** 1 Sept 2021
- **Citation:** TCN-2021-NCLT-01236
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/viceroy-hotels-ltd-ia-no-281-of-2019-in-cp-no-ib2197hdb2017-848ab348

## Summary

### Background

The case involves an application (IA No. 281/2019) filed under Sections 30(6) and 31 of the Insolvency and Bankruptcy Code (IBC), 2016, seeking approval of a resolution plan submitted by CFM Asset Reconstruction Private Limited for Viceroy Hotels Limited. The Corporate Insolvency Resolution Process (CIRP) was initiated on 2018-03-12, and the applicant was appointed as the Interim Resolution Professional (IRP). The Committee of Creditors (CoC) confirmed the applicant as the Resolution Professional (RP). Several extensions were granted to the CIRP period. Multiple Prospective Resolution Applicants were shortlisted and asked to revise their bids. The CoC approved the Resolution Plan submitted by CFM ARC, who was the H3 bidder. CFM proposed to collaborate with Tolaram Inc.

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## Facts

Viceroy Hotels Limited is undergoing Corporate Insolvency Resolution Process (CIRP). Asset Reconstruction Company (India) Limited (ARCIL) is a respondent and financial creditor. CFM Asset Reconstruction Private Limited submitted a resolution plan. The CIRP was initiated on 2018-03-12. The Committee of Creditors (CoC) approved the resolution plan submitted by CFM ARC. CFM ARC proposed to collaborate with Tolaram Inc. for infusing equity into the Corporate Debtor. An unsuccessful resolution applicant, Union Hotel Private Limited, raised objections. The key issue is whether CFM ARC can submit a resolution plan without prior approval from the Reserve Bank of India (RBI) under the SARFAESI Act. The Hon'ble High Court granted stay on the further proceedings in IA 281/2019 in

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## Issues and analysis

### Issue 1: Whether CFM Asset Reconstruction Private Limited, being an Asset Reconstruction Company (ARC), is …

**Ratio:** An ARC requires prior approval from the Reserve Bank of India (RBI) to carry on any

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**Reasoning:** The Adjudicating Authority reasoned that the SARFAESI Act requires ARCs to obtain prior

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**Interpretation:** The interpretation focuses on the scope of permissible activities for ARCs

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**Application:** The ratio and reasoning are applied to the specific facts of the case,

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## Parties

- **Judges:** Shrimadan…; Veera Brahma Rao…
- **Appellants:** Asset Reconstructi…
- **Respondents:** Viceroy Hotels…

## Timeline

- **2018-03-12 — CIRP Init…**: Corporate Insolvency Resolution Process (CIRP) of the Corporate Debtor was initiated by…
- **2018-04-09 — CoC Confir…**: The Committee of Creditors (CoC) in its 1st meeting confirmed the Applicant as Resolution…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 5(25) — Definitions](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-5)

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