Resolution Professional (RP) of TMT Ltd. filed an application seeking approval of the resolution plan submitted by a resolution applicant, who is a Financial Creditor with 82.7% voting share in the CoC. The plan provided

The facts of the present case are similar to that of Edelweiss Asset Reconstruction Company Ltd. v. Bharati Defence and Infrastructure Ltd , wherein the Resolution Professional (RP) filed an application seeking approval of the resolution plan submitted by a resolution applicant, who is a Financial Creditor with 82.7% voting share in the CoC. The plan provided that the resolution applicant will sell the corporate debtor in two years. NCLT, Mumbai Bench noted that the plan does not give due consideration to the interest of all stakeholders, seeks several exemptions, and contains a lot of uncertainties and speculations. It provides for generation of income from ongoing operations and no upfront money is brought in by the resolution applicant. The NCLT Bench also noted that the resolution applicant has proposed to hold majority equity in the corporate debtor, run its operations, enhance its value and over a period endeavour to find a suitable investor/buyer for the same. Relying on the judgment in the matter of Binani Industries Limited , the NCLT Bench observed: ".. resolution plan is for insolvency resolution of the Corporate Debtor as a going concern and not for the addition of value and intended to sale the corporate debtor". It observed that resolution applicant is essentially extending the CIRP period to find an investor, which is not the intention of the legislature. It further observed: "if the ultimate object in the resolution plan is to sell the company, then it can be achieved by sale as a going concern during the liquidation process". Accordingly, it rejected the resolution plan and ordered for liquidation. Thus, it can be concluded that the resolution plan will not be approved by NCLT.