# Approval of Resolution Plan - Farmax India Limited (IA 515 OF 2023 in CP (IB) NO.223-9-HDB-2021)

> NCLT judgment dated 2023-06-22. Citation: TCN-2023-NCLT-02841. The case pertains to IA (IBC) 515/2023 filed in Company Petition IB/223/2021 under Section…

- **Court:** NCLT
- **Order date:** 22 Jun 2023
- **Citation:** TCN-2023-NCLT-02841
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/approval-of-resolution-plan-farmax-india-limited-ia-515-of-2023-in-cp-ib-no223-9-a573b3d4

## Summary

### Background

The case pertains to IA (IBC) 515/2023 filed in Company Petition IB/223/2021 under Section 30(6) and 31(1) of the Insolvency & Bankruptcy Code, 2016, read with regulation 39(4) of the IBBI (Insolvency Resolution Process for Corporate Persons) Regulations, 2016. The petition was filed by the Resolution Professional of M/s. Farmax India Limited, seeking approval of the Resolution Plan submitted by Mr. Reddy Srinivasa Reddy, which was approved by the Committee of Creditors with 100% voting share. The Corporate Insolvency Resolution Process (CIRP) was initiated against Farmax India Limited based on a petition filed by Vasthi Trading Private Limited under Section 9 of the IBC, 2016, which was admitted on 01.07.2022.

## Facts

Vasthi Trading Private Limited initiated Corporate Insolvency Resolution Process (CIRP) against Farmax India Limited under Section 9 of the IBC, which was admitted on 01.07.2022. Mr. Chinna Gurappa was appointed as the Resolution Professional. The Resolution Professional made a public announcement inviting claims from creditors and constituted the Committee of Creditors (CoC). The CoC comprised of Reliance Asset Reconstruction Company Limited, holding 100% voting share. The Resolution Professional received a Resolution Plan from Mr. Reddy Srinivasa Reddy, which was approved by the CoC with 100% voting share on 09.03.2023. The Resolution Applicant submitted a demand draft of Rs. 5,50,000/- as performance guarantee. The Resolution Plan proposed a total plan amount of Rs.

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## Issues and analysis

### Issue 1: Whether the Resolution Plan submitted by Mr. Reddy Srinivasa Reddy meets the requirements of …

**Ratio:** The Resolution Plan must comply with Section 30(2) of the Code and Regulations 37, 38,

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**Reasoning:** The NCLT reviewed the Resolution Plan and found that it satisfies the requirements of

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**Interpretation:** Section 30(2) of the IBC outlines the mandatory requirements for a Resolution

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**Application:** The NCLT applied the ratio to the specific facts of the case, examining the

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## Parties

- **Judges:** Venkata Ramakrishn…; SH. CHARAN…
- **Respondents:** Farmax Ind…

## Timeline

- **2021-01-01 — Company Petiti…**: Company Petition…
- **2022-07-01 — Admission of…**: Petition filed under Section 9 of IBC, 2016 by M/s Vasthi Trading Private Limited…

## 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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