# Approval of Resolution Plan - Maha Associated Hotels Private Limited

> NCLT judgment dated 2024-08-13. Citation: TCN-2024-NCLT-00808. The case involves the Corporate Insolvency Resolution Process (CIRP) of M/s Maha Associated…

- **Court:** NCLT
- **Order date:** 13 Aug 2024
- **Citation:** TCN-2024-NCLT-00808
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/approval-of-resolution-plan-maha-associated-hotels-private-limited-78a83c9b

## Summary

### Background

The case involves the Corporate Insolvency Resolution Process (CIRP) of M/s Maha Associated Hotels Private Limited. The CIRP was initiated following an application by an operational creditor, M/s UVA Engineers Private Limited. Several interlocutory applications (IAs) were filed during the CIRP, including those related to the approval of the resolution plan, objections raised by suspended directors and unsuccessful resolution applicants, and issues related to lease rentals with RIICO (Rajasthan State Industrial Development & Investment Corporation Ltd.). The Committee of Creditors (CoC) adopted a 'Swiss Challenge' method for the approval of the resolution plan, which led to objections from some prospective resolution applicants (PRAs).

## Facts

M/s Maha Associated Hotels Private Limited underwent Corporate Insolvency Resolution Process (CIRP) following an application by M/s UVA Engineers Private Limited, an operational creditor. Mr. Brij Kishore Sharma was initially appointed as the Insolvency Resolution Professional (IRP), later replaced by Mr. Naresh Kumar Munjal. Mr. Tara Chand Meenia eventually took over as the Resolution Professional (RP). The CIRP faced challenges, including applications for exclusion and extension, which were rejected. The CoC adopted a 'Swiss Challenge' method for resolution plan approval, leading to objections from Mr. Sandeep Gupta, an unsuccessful resolution applicant, who argued it lacked transparency and fairness. The suspended directors also raised objections, alleging

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## Issues and analysis

### Issue 1: Whether the adoption of the Swiss Challenge method by the CoC for approving the resolution plan was …

**Ratio:** The CoC has the discretion to adopt a challenge mechanism, such as the Swiss Challenge

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**Reasoning:** The Adjudicating Authority noted that the agenda for adopting the Swiss Challenge Method

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**Interpretation:** This implies that the CoC's commercial wisdom is paramount in choosing a method

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**Application:** The CoC's decision to use the Swiss Challenge method was deemed valid because

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## Parties

- **Judges:** Deep Chandr…; RAJEEV ME…
- **Appellants:** Yashdeep…
- **Respondents:** M/s Maha Associate…; Tara Chand…

## Timeline

- **2018-09-20 — CIRP Init…**: The Adjudicating Authority admitted the application for initiation of Corporate…
- **2018-09-20 — Moratorium…**: Moratorium order passed by the Adjudicating…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 30(6) — Submission of resolution plan](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-30)

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