A resolution plan must value all assets of the corporate debtor, including third-party interests, to ensure fair treatment of secured creditors.

JUDGEMENT

JUSTICE YOGESH KHANNA, MEMBER (JUDICIAL)

The present appeals have been filed by the Appellant under Section 61 of the I&B Code, 2016 against an impugned order dated 31.03.2023 passed by the Ld. NCLT, Mumbai Bench in IA No.2238 of 2022 and IA No.1841 of 2022 in CP(IB) No.4447/MB/2018, whereof the Ld. NCLT had rejected the application of the appellant and had rather allowed the application filed by the Respondent No.1 qua approval of resolution plan.

2. The facts are the Appellant granted financial assistance to M/s Heera Constructions Company Pvt. Ltd. (Corporate Debtor), a real estate company, to the tune of Rs. 50 Crores, by way of a Corporate Loan Agreement; which loan was secured by various mortgages in respect of following properties:

(i) 5.46 Acres of land at Attipra Village, Thiruvananthapuram, Kerala ("Attipra Land") (a third party asset);

(ii) 0.60 Acres of land at Poonithura Village, Ernakulam, Kerala ("Poonithura Land") (CD's asset);

(iii) 0.30 Acres of land at Nedumangad Village, Thiruvananthapuram, Kerala (Ex-Promoter of CD's asset);

(iv) 6 residential flats at Heera Windfaire, Vytilla, Ernakulam, Kerala (Ex-Promoter of CD's asset).

3. Admittedly there were default by the Corporate Debtor; hence a petition under Section 7 of IBC was filed by the appellant viz Company Petition No.4447/MB/2018 and it stood admitted by Ld. NCLT, Mumbai vide order dated 27.03.2019. The Committee of Creditors, primarily, comprised of home buyers to an extent of 73.13% voting shares and also of secured financial creditor viz the appellant herein having 20.55% voting share plus other financial institutions viz State Bank of India, Kerala Financial Corporation, Tata Capital Housing Finance Ltd and Indian Overseas Bank with a voting share of 3.81%, 0.02%, 1.43% and 1.06% respectively.

4. The Committee of Creditors in its 9^th Meeting held on 22.06.2022 had approved the Resolution Plan, as submitted by the Successful Resolution Applicant, with a voting of 74.19%. The appellant, being a financial creditor with largest voting share, however, dissented to the said Resolution Plan. The appellant rather filed IA No.2238 of 2022 challenging approval of Resolution Plan, but it was dismissed vide the impugned order passed by the Ld. NCLT.

5. Heard.

6. The Resolution Plan, primarily, dealt with two properties viz Attipra land and Poonithura land. The Attipra land ad-measures 5.46 acres at Attipra Village, Thiruvananthapuram, Kerala and Poonithura land is at Poonithura Village, Ernakulam, Kerala, ad-measuring 0.60 acres of land.

7. Upon the Attipra land, a project namely M/s Heera Nature was to come and whereas upon Poonithura land a project namely M/s Heera River Park was to be developed.

8. Attipra land was admittedly a third party asset, a highly valuable property valued at approximately Rs.50 cores, as is evident by the valuation report obtained by the appellant. The Corporate Debtor had developmental rights over Attipra land vide a joint venture agreement dated 30.11.2012 executed between the Corporate Debtor and the owners of such land. Admittedly, the said land was mortgaged in favour of the appellant by its third party owners but because of the joint venture agreement dated 30.11.2012, entered into as above, the Resolution Professional, though included this land in the CIRP and dealt with it in the Resolution Plan but assigned NIL value to it and rather vide its Clauses 6.9 and 6.11 of such plan, the exclusive security/mortgage of the appellant over Attipra land was extinguished.

9. It was the argument of the learned senior counsel for the appellant the Resolution Professional not only wrongly dealt with a