# In the matter of Zicom Electronic Security Systems Ltd.

> NCLT judgment dated 2024-03-28. Citation: TCN-2024-NCLT-01921. The case involves an Interlocutory Application (I.A. No. 828 of 2023) filed by Khemani…

- **Court:** NCLT
- **Order date:** 28 Mar 2024
- **Citation:** TCN-2024-NCLT-01921
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/zicom-electronic-security-systems-ltd-8bb9e457

## Summary

### Background

The case involves an Interlocutory Application (I.A. No. 828 of 2023) filed by Khemani Distributors and Marketing Ltd, the Applicant, against Mr. Huzefa Sitabkhan, the Resolution Professional, and others, the Respondents, under Section 60(5) of the Insolvency & Bankruptcy Code, 2016. The Applicant sought several reliefs, including setting aside the decision of the Committee of Creditors (CoC) in its 19th meeting held on August 18, 2023, rejecting the interlocutory application filed by Respondent No. 1 for approval of the resolution plan of the Corporate Debtor, restraining the Respondents from undertaking further steps in the CIRP, keeping the interlocutory application filed by Respondent No. 1 in abeyance, staying the effect of the CoC's decision, and directing

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## Facts

Khemani Distributors and Marketing Ltd. (Applicant) filed an application against Mr. Huzefa Sitabkhan (Resolution Professional/Respondent No. 1) and the Committee of Creditors (CoC/Respondent No. 2) concerning the Corporate Insolvency Resolution Process (CIRP) of Zicom Electronic Security Systems Ltd. The Applicant claimed that the CIRP conducted by the Respondent violated the Insolvency and Bankruptcy Code (IBC) and its regulations. The Applicant submitted a resolution plan initially on 17.02.2023, revised on 27.03.2023. The CoC decided to re-invite expressions of interest (EoIs) because the initial resolution plans were below fair and liquidation value. The Applicant participated in the second round of EoIs, submitting a fresh proposal. The RP sent a list of

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## Issues and analysis

### Issue 1: Whether the act of the RP/CoC of having sent the invitation of Expression of Interest a second time …

**Ratio:** The commercial wisdom of the Committee of Creditors (CoC) is paramount in deciding the

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**Reasoning:** The CoC decided to re-invite expressions of interest because the initial resolution plans

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**Interpretation:** The Insolvency and Bankruptcy Code (IBC) grants significant autonomy to the

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**Application:** In this case, the CoC's decision to re-run the CIRP was based on the need to

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## Parties

- **Judges:** Reeta K…; Madhu S…
- **Appellants:** Khemani Distributo…
- **Respondents:** Zicom Electronic…; Huzefa Sit…

## Timeline

- **2022-07-29 — Appointment…**: Mr. Huzefa Sitabkhan appointed as Resolution…
- **2022-09-27 — Invitation for…**: RP issued the invitation…

## 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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