# In the matter of Rana Heavy Engineering Pvt. Ltd.

> NCLT judgment dated 2024-02-14. Citation: TCN-2024-NCLT-02593. The case pertains to IA No. 668/2023 in CP (IB) No. 50/ALD/2022, an application filed under…

- **Court:** NCLT
- **Order date:** 14 Feb 2024
- **Citation:** TCN-2024-NCLT-02593
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/rana-heavy-engineering-pvt-ltd-72462a28

## Summary

### Background

The case pertains to IA No. 668/2023 in CP (IB) No. 50/ALD/2022, an application filed under Section 30(6) r/w Section 60(5) of the Code and Regulation 30(4) of the CIRP Regulations and Rule 11 of the NCLT Rules. The application seeks approval of a Resolution Plan based on the resolution passed by the Committee of Creditors (CoC). The matter was reserved on 19.01.2024. The resolution plan's amount, including CIRP costs, unsecured financial creditors, unsecured operational debt, and operational debt of contingent claims, totals Rs. 6.70 cr, which is less than the liquidation value of Rs. 7.69 cr. The liquidation assets include Plant, Machinery, Land, and Building.

## Facts

The application, IA No. 668/2023 in CP (IB) No. 50/ALD/2022, was filed seeking approval of a Resolution Plan under the Insolvency and Bankruptcy Code. The Resolution Plan was based on the resolution passed by the Committee of Creditors (CoC). The matter was reserved on 2024-01-19. The amount of the Resolution Plan was Rs. 6.70 cr, which included CIRP costs, unsecured financial creditors, unsecured operational debt, and operational debt of contingent claims. The liquidation value was Rs. 7.69 cr, and the liquidation assets comprised Plant, Machinery, Land, and Building. The CoC was solely formed by the Unsecured Financial Creditor, who was also the Successful Resolution Applicant (SRA). This fact is relevant because it raises concerns about the fairness and impartiality

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## Issues and analysis

### Issue 1: Whether the resolution plan, with a value less …

**Ratio:** The resolution plan should ideally provide a value that is at least equivalent to the

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**Reasoning:** The tribunal noted that the resolution plan's value was less than the liquidation value,

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**Interpretation:** The interpretation is that while the commercial wisdom of the CoC is important,

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**Application:** In this case, the resolution plan's value was less than the liquidation value.

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## Parties

- **Judges:** Praveen…; Ashish…
- **Appellants:** Hemi G…
- **Respondents:** RANA HEAVY…; HADIRAH STEELS…
- **Advocates:** Sumit S…; Sanjeev…

## Timeline

- **2024-01-19 — Matter Re…**: The matter was reserved…
- **2024-02-14 — Order Pron…**: Order pronounced on 14th February, 2024, directing SRA to match plan value with…

## 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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