JAIPRAKASH ASSOCIATES LTD. & ANR.versusIDBI BANK LTD. & ANR.

312                      [2019]REPORTS
               SUPREME COURT    14 S.C.R. 312              [2019] 14 S.C.R.


A                 JAIPRAKASH ASSOCIATES LTD. & ANR.
                                         v.
                           IDBI BANK LTD. & ANR.
                         (Civil Appeal No. 8437 of 2019)
B                             NOVEMBER 06, 2019
       [A. M. KHANWILKAR AND DINESH MAHESHWARI, JJ.]
             Insolvency and Bankruptcy Code, 2016: s. 7 – Corporate
      Insolvency Resolution Process – Power of the NCLT or NCLAT to
      exclude any period for purpose of counting 270 days Corporate
C
      Resolution Process period – Power to invite fresh resolution plans
      after expiry of statutory period for completion of CIRP – On facts,
      Bank filing application u/s. 7 of the Code against appellant company
      before NCLT as the company had turned NPA (Non-Performing
      Asset) – During pendency, writ petition by home buyers concerning
D     the stated project – Meanwhile issuance of public notice by Interim
      Resolution Professional inviting claims from all the stake holders
      of the appellant company including home buyers – Thereafter,
      application by home buyers before NCLT seeking clarification as
      to manner in which voting percentage of allottes to be reckoned –
      Bank filing another application before NCLT for excluding the
E
      period of pendency of the application for clarification regarding
      the manner of counting votes of the financial creditors from the
      period of 270 days of CIRP – Issuance of direction by NCLT to
      proceed further with CIRP despite pending clarificatory motions
      including the aforesaid application – NCLAT allowed exclusion of
F     90 days for the purpose of counting the period of 270 days of
      CIRP – On appeal, held: In view of the recent legislative changes,
      the scope of resolution plan stands expanded which may now include
      provision for restructuring the corporate debtor including by way
      of merger, amalgamation and demerger and more so the power
      bestowed on the Committee of Creditors-CoC to consider not only
G
      the feasibility and viability of the resolution plan but also the manner
      of distribution proposed, which may take into account the order of
      priority amongst the creditors – In the instant case, finally only two
      bidders had participated and submitted their resolution plan which
      was placed before the CoC and stated to have been rejected –
H
                                        312
          JAIPRAKASH ASSOCIATES LTD. & ANR. v.                           313
                 IDBI BANK LTD. & ANR.

However, applying the principle underlying Regulation 36B(7), it         A
is deemed appropriate to permit the IRP to reissue request for
resolution plans to the two bidders (Suraksha Realty and NBCC)
and/or to call upon them to submit revised resolution plan(s), which
can be then placed before the CoC for its due consideration – In
view of the legislative changes, this Court needs to and must exercise
                                                                         B
the plenary powers to make an attempt to revive the corporate debtor,
lest it is exposed to liquidation process under the Code – There is
inclination to do so because the project has been implemented in
part and out of over 20,000 home buyers, a substantial number of
them have been put in possession and the remaining work is in
progress and in some cases at an advanced stage of completion –          C
Thus, to do substantial and complete justice to the parties and in
the interest of all stakeholders of the appellant company, IRP
directed to complete CIRP within 90 days from the date of this order
– In the first 45 days, IRP would invite revised resolution plan only
from the final bidders, and in second phase of 45 days, margin is
                                                                         D
provided for removing any difficulty and to pass appropriate orders
– Constitution of India – Art 142.
      Chitra Sharma & Ors. v. Union of India & Ors. (2018)
      9 SCALE 490 – relied on.
                       Case Law Reference                                E
(2018) 9 SCALE 490          relied on        Para 11, 13, 14, 15, 20
      CIVIL APPELLATE JURISDICTION: Civil Appeal No. 8437
of 2019.
      From the Judgment and Order dated 30.07.2019 of the National       F
Company Law Appellate Tribunal, New Delhi in Company Appeal (AT)
(Insolvency) No. 536 of 2019.
                                With
      Civil Appeal No. 6486 of 2019.
      Ms. Madhavi Divan, ASG, Ajit Kumar Sinha, Arvind Verma,            G
Siddarth Dave, Fali S. Nariman, Anupam Lal Das, Jaideep Gupta,
Ms. V. Mohana, Sr. Advs., Mrs. Revathy Raghavan, S. Muthu Krishnan,
M. L. Lahoty, Anchit Sripat, Himanshu Shekhar, Ashwarya Sinha,
Ms. Mohini Priya, Ivan, Alok K. Singh, Rahul Kumar, Ilesh Shukla,
                                                                         H
314               SUPREME COURT REPORTS                     [2019] 14 S.C.R.


A     Chetanya Singh, Jay Kishor, Ms. Zeba Khair, Ms. Madhusmita Bora,
      Pawan Kishore Singh, Vishal Gupta, Subesh Sharma, Sumeet Sharma,
      Divyanshu Gupta, Ajay Jain, Jinendra Jain, Brijesh Yadav, Abhishek Jain,
      Ms. Tannu, Bishwajit Dubey, Ms. Surabhi Khattar, Aditya Marwah,
      M/S. Cyril Amarchand Mangaldas Parijat Kishore, Nikunj Dayal, Vikas
      Mehta, Anushree, Vasanth Bharani, Jay Kishor Singh, L. K. Bhushan,
B     Shyam Sundar, M/s. Dua Associates, Vishal Gupta, Ravindra Kumar,
      Amit Kumar Mishra, Shashank Manish, Ms. Smriti Shah, Ms. Tiwnkle
      Kataria, Shivam Pandey, Yash Kumar, Himanshu Shekhar, Amit Pawan,
      Sumant Batra, Ms. Niharika Sharma, Rabin Majumder, Prashant Singh,
      S.S. Rizi, H.V. Shankar, Arvind Kumar Sharma, Advs. for the appearing
      parties.
C
               Hemant Kumar Singh, Party in person.
                                     ORDER
               The following Order of the Court was passed :
            1. Permission to file the appeal is granted in Diary No.
D     27229/2019.
              2. These appeals emanate from the Corporate Insolvency
      Resolution Process (‘CIRP’ for short) concerning Jaypee Infratech Ltd.
      (‘JIL’ for short) wherein the National Company Law Appellate Tribunal,
      New Delhi (‘NCLAT’ for short) disposed of Company Appeal (AT)(INS)
E     No.536 of 2019 and Company Appeal (AT)(INS) No.708 of 2019 and
      applications therein by a common judgment and order dated 30th July,
      2019. By this judgment, the NCLAT granted relief as sought for by the
      IDBI Bank to exclude period from 17th September, 2018 till 4th June,
      2019 for the purpose of counting 270 days Corporate Resolution Process
      period and issued consequential directions.
F           3. Shorn of unnecessary details, the IDBI Bank had filed an
      application being CP No. (I&B) 77/ALD/2017 under Section 7 of the
      Insolvency and Bankruptcy Code, 2016 (for short, ‘the I & B Code’)
      against JIL before the National Company Law Tribunal, Allahabad
      (‘NCLT’ for short), as the JIL had turned NPA (Non-Performing Asset).
      During the pendency of the said application, writ petitions were filed in
G
      this Court by the home buyers concerning the stated project of JIL,
      which came to be disposed of on 9th August, 2018 in the case of Chitra
      Sharma & Ors. vs. Union of India & Ors.1. This Court issued the
      following directions :-

      1
H         2018 (9) SCALE 490
          JAIPRAKASH ASSOCIATES LTD. & ANR. v.                                  315
                 IDBI BANK LTD. & ANR.

      “42. We, accordingly, issue the following directions:                     A
         (i)    In exercise of the power vested in this Court under Article
                142 of the Constitution, we direct that the initial period of
                180 days for the conclusion of the CIRP in respect of
                JIL shall commence from the date of this order. If it
                becomes necessary to apply for a further extension of           B
                90 days, we permit the NCLT to pass appropriate orders
                in accordance with the provisions of the IBC;
         (ii)   We direct that a CoC shall be constituted afresh in
                accordance with the provisions of the Insolvency and
                Bankruptcy (Amendment) Ordinance, 2018, more
                particularly the amended definition of the expression           C
                “financial creditors”;
         (iii) We permit the IRP to invite fresh expressions of interest
               for the submission of resolution plans by applicants, in
               addition to the three short-listed bidders whose bids or,
               as the case may be, revised bids may also be considered;         D
         (iv) JIL/JAL and their promoters shall be ineligible to
              participate in the CIRP by virtue of the provisions of
              Section 29A;
         (v)    RBI is allowed, in terms of its application to this Court to
                direct the banks to initiate corporate insolvency resolution    E
                proceedings against JAL under the IBC;
         (vi) The amount of Rs 750 crores which has been deposited
              in this Court by JAL/JIL shall together with the interest
              accrued thereon be transferred to the NCLT and continue
              to remain invested and shall abide by such directions as
              may be issued by the NCLT.”                                       F

      4. Consequent thereto, the matter proceeded before the NCLT
being the adjudicating authority. The Interim Resolution Professional
(‘IRP’ for short) had issued public notice inviting claims from all JIL’s
stakeholders including the home buyers. IRP submitted his report on
formation of Committee of Creditors (‘CoC’ for short) before the                G
adjudicating authority on the following basis :
      37.3% in case of Financial Institutions.
      62.3% home buyers and
      0.4% Fixed Deposit holders
                                                                                H
316            SUPREME COURT REPORTS                         [2019] 14 S.C.R.


A            5. One of the home buyers’ Association filed application before
      the NCLT seeking clarification as to the manner in which the voting
      percentage of the allottees (home buyers) will be reckoned. That
      application was filed on 17th September, 2018 before the NCLT. After
      hearing the concerned authorities, the members of NCLT expressed
      difference of opinion on the issue as a result of which reference was
B
      made to the President of the NCLT, to place the matter before the third
      Member. Eventually, an order was passed by the third Member on 24 th
      May, 2019. The said order dated 24th May, 2019 had been challenged by
      Jaypee Green Krescent House Buyers Welfare Associations before the
      NCLAT being Company Appeal (AT)(INS) No.708 of 2019.
C            6. In the meantime, the IDBI Bank filed an application before the
      NCLT for excluding the period of pendency of the application for
      clarification regarding the manner of counting votes of the concerned
      financial creditors from the period of 270 days of Corporate Insolvency
      Resolution Process (‘CIRP’ for short). While the said application was
D     pending, NCLT by order dated 6th May, 2019 called upon the authorities,
      representatives of the allottees and others to file their reply on the
      necessity to proceed further with the CIRP in accordance with law, for
      considering the resolution plan received from the concerned bidder,
      subject to the outcome of the pending application. The IDBI Bank, feeling
      aggrieved by the opinion expressed by the NCLT to proceed further
E     with the CIRP despite pending clarificatory motions before the NCLT/
      NCLAT respectively, including the application to exclude the period during
      the clarificatory application from the total period of 270 days of the
      CIRP, assailed the order passed by the NCLT dated 6th May, 2019 by
      way of Company Appeal (AT)(INS) No.536/2019 before the NCLAT.
F           7. The NCLAT, accordingly, thought it appropriate to proceed
      with both the appeals together for consideration and disposed of the
      same vide the impugned judgment. The relevant discussion and the
      conclusion arrived at by the NCLAT can be discerned from paragraph
      19 onwards of the impugned judgment. The same read, thus :-
G           “19. The only question arises for consideration in these appeals is
            whether in the facts and circumstances of the case and the interest
            of the Allottees, which is of primary importance in this ‘Corporate
            Insolvency Resolution Process’, the ‘Jaypee Infratech Ltd.’
            (Corporate Debtor) should be allowed to go for ‘Liquidation’ on
            the ground that 270 days has expired on 6th May, 2019 or the
H
          JAIPRAKASH ASSOCIATES LTD. & ANR. v.                                  317
                 IDBI BANK LTD. & ANR.

      period from ‘17th September, 2018 to 4th June, 2019’ during which         A
      the matter remained pending for consideration before the
      Adjudicating Authority relating to voting share of the Allottees
      should be excluded for the purpose of counting 270 days in the
      light of the decision “Quinn Logistics India Pvt. Ltd. vs. Mack
      Soft Tech Pvt. Ltd. & Ors.” – ‘Company Appeal (AT)
      (Insolvency) No.185 of 2018’ wherein this Appellate Tribunal              B
      observed:
      “9. From the decisions aforesaid, it is clear that if an application is
      filed by the ‘Resolution Professional’ or the ‘Committee of
      Creditors’ or ‘any aggrieved person’ for justified reasons, it is
      always open to the Adjudicating Authority/Appellate Tribunal to           C
      ‘exclude certain period’ for the purpose of counting the total period
      of 270 days, if the facts and circumstances justify exclusion, in
      unforeseen circumstances.
       10. For example, for following good grounds and unforeseen
circumstances, the intervening period can be excluded for counting of           D
the total period of 270 days of resolution process:-
         (i)     If the corporate insolvency resolution process is stayed
                 by ‘a court of law or the Adjudicating Authority or the
                 Appellate Tribunal or the Hon’ble Supreme Court.
         (ii)    If no ‘Resolution Professional’ is functioning for one or      E
                 other reason during the corporate insolvency resolution
                 process, such as removal.
         (iii)   The period between the date of order of admission/
                 moratorium is passed and the actual date on which the
                 ‘Resolution Professional’ takes charge for completing          F
                 the corporate insolvency resolution process.
         (iv) On hearing a case, if order is reserved by the Adjudicating
              Authority or the Appellate Tribunal or the Hon’ble
              Supreme Court and finally pass order enabling the
              ‘Resolution Professional’ to complete the corporate               G
              insolvency resolution process.
         (v)     If the corporate insolvency resolution process is set aside
                 by the Appellate Tribunal or order of the Appellate
                 Tribunal is reversed by the Hon’ble Supreme Court and
                 corporate insolvency resolution process is restored.
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318      SUPREME COURT REPORTS                           [2019] 14 S.C.R.


A        (vi) Any other circumstances which justifies exclusion of
              certain period.
      However, after exclusion of the period, if further period is allowed
      the total number of days cannot exceed 270 days which is the
      maximum time limit prescribed under the Code”.
B     20. Admittedly, no regulation was framed under the ‘Insolvency
      and Bankruptcy Code’ as to how the voting share of thousands of
      Allottees will be counted, all of whom come within the meaning
      of ‘Financial Creditors’ and thereby are members of the
      ‘Committee of Creditors’. It was in this background the Allottees
C     Association preferred the application before the Adjudicating
      Authority (National Company Law Tribunal), Allahabad Bench
      on 17th September, 2018 to decide such issue. The two Hon’ble
      Members of NCLT differed on the principle on 13th December,
      2018 as noticed above and referred the matter to the Principal
      Bench for placing the matter before Third Hon’ble Member who
D     has delivered its decision by the order dated 24th May, 2019. In
      the meantime, 270 days lapsed, if counted from the date the
      proceeding was remitted by the Hon’ble Supreme Court, i.e. 6th
      May, 2019.
      21. This is an extra-ordinary situation when the law was silent
E     and there was no guideline, which caused difference of opinion
      between the two Hon’ble Members and finally decided by the
      Third Hon’ble Member. In ‘Quinn Logistics India P. Ltd. vs.
      Macksoft Tech P. Ltd.’ taking into consideration different
      situations including extra ordinary situation, this Appellate Tribunal
F     held that certain period can be excluded while counting the total
      period of 270 days. The aforesaid principle has also been followed
      by the Hon’ble Supreme Court in the case of ‘Arcelormittal
      India Private Limited vs. Satish Kumar Gupta &” Ors.’ –
      (2019) 2 SCC 1 as also in the case of ‘Chitra Sharma’ (Supra).

G     22. In view of aforesaid extra ordinary situation, we are of the
      view that the period from 17th September, 2018 i.e. the date of
      application filed by the Association of the allottees for clarification
      for the order and till the final decision i.e. 4th June, 2019 i.e. the
      date the matter was finally decided by the Third Hon’ble Member
      (Total 260 days), can be excluded for the purpose of counting the
H     270 days. However, as the matter is pending since long, we are
    JAIPRAKASH ASSOCIATES LTD. & ANR. v.                                   319
           IDBI BANK LTD. & ANR.

not inclined to exclude the total period of 260 days and instead in        A
the interest of the Allottees, we exclude 90 days for the purpose
of counting the period of 270 days of ‘Corporate Insolvency
Resolution Process’, which should be counted from the date of
receipt of the copy of this order.
23. The aforesaid period is excluded to enable the ‘Resolution             B
Professional’/‘Committee of Creditors’ to call for fresh ‘resolution
plans’ and to consider them, if so required after negotiations pass
appropriate order under sub-section (5) of Section 30 of the I&B
Code preferably within a period of 45 days. Rest of the period of
45 days margin is given to remove any difficulty and appropriate
order as may be passed by the Adjudicating Authority.                      C

The voting share of the allottees should be counted in terms of
‘I&B Code’ as existing on the date of voting/’Regulation’ and/or
in accordance with majority decision of the Adjudicating Authority.
24. It is made clear that all the earlier ‘resolution plan(s)’ including   D
the plan submitted by the ‘NBCC’, cannot be considered, having
been rejected by the ‘Committee of Creditors’. However, it will
be open to the ‘NBCC’ to file a fresh improved ‘resolution plan.
It is informed that ‘Adani Infra (I) Ltd.’ also proposed to file
‘resolution plan’ but we are not expressing any opinion with regard
to the same. We have given opportunity to all the eligible persons         E
to file ‘expression of interest’/(improved) ‘resolution plan’,
individually or jointly or in concert with any person, but those who
are ineligible in terms of Section 29A, are barred from filing such
plan. No liberty is given to ‘Jaiprakash Associates Ltd.’, in view
of the aforesaid observation and decision of Hon’ble Supreme               F
Court in ‘Chitra Sharma’ (Supra)
25. In view of the aforesaid observations, we are not inclined to
interfere with the impugned order dated 24th (sic) May, 2019.
Order of exclusion having already passed by this Appellate Tribunal,
C.A. No.115 of 2019 in C.P. No.(IB) 77/ALD/2017 preferred by               G
the ‘Resolution Professional’ and the order dated 6 th May, 2019
as impugned in ‘Company Petition (AT) (Insolvency) No.536 of
2019’ are declared infructuous.
Both the appeals stand disposed of with aforesaid observations
and directions.”
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320             SUPREME COURT REPORTS                           [2019] 14 S.C.R.


A             8. This judgment is assailed by Jaiprakash Associates Ltd. (‘JAL’
      for short). JIL is the subsidiary of JAL. Another appeal has been filed by
      the Wish Town Home Buyers Welfare Society (one of the home buyers’
      Association). In the appeal filed by the JAL, two principal questions of
      law have been urged. The first is as to whether the NCLAT had power
      or authority in law to exclude 90 days from the statutory period of the
B
      CIRP, much less for the reasons stated in the impugned judgment. The
      second question is as to whether despite rejection of resolution plans of
      Suraksha Realty and NBCC by the CoC on 5th May, 2019 and 10th June,
      2019 respectively, could the NCLAT, after excluding 90 days period
      from the total CIRP period, again start the CIRP afresh by allowing the
C     two bidders to submit their revised resolution plans and/or invite fresh
      resolution plan from eligible persons and to call upon the CoC to reconsider
      the same, if so required, after negotiations. The home buyers’Association,
      in its appeal have also questioned the power of NCLAT to disregard the
      mandatory provisions of I & B Code and to issue directions for inviting
      fresh resolution plans after expiry of the statutory period for completion
D
      of the CIRP.
             9. The limited issue that needs to be examined in these appeals is
      about the power of the NCLT or NCLAT, as the case may be, to exclude
      any period from the statutory period in exercise of inherent powers sans
      any express provision in the I & B Code in that regard. Further, is it open
E     to allow the bidder whose resolution plan has already been rejected by
      the CoC to submit revised plan or to invite fresh resolution plans to be
      considered by the CoC after the statutory period specified for submission
      of such plans? Learned counsel appearing for the concerned parties
      have invited our attention to the relevant provisions of the I & B Code to
F     buttress their respective arguments.
             10. After cogitating over the submissions, it has become clear to
      us that the inevitable fall out of accepting the stand taken by the appellants
      would be to set aside the impugned judgment and relegate the parties to
      a situation where the only option would be to proceed with the liquidation
G     process concerning JIL under Chapter III of Part II of the I & B Code,
      on the premise that no resolution plan has been received before the
      expiry of the Insolvency Resolution Process under Section 12 of the I &
      B Code or being a case of rejection of the resolution plan under Section
      31 of the I & B Code. However, during the arguments, there has been
      complete unanimity between all the stakeholders including the appellants
H
           JAIPRAKASH ASSOCIATES LTD. & ANR. v.                               321
                  IDBI BANK LTD. & ANR.

before this Court that the liquidation of JIL must be eschewed as it          A
would do more harm to the interests of the stakeholders, in particular the
large number of home buyers, who aspire to have their home at the
earliest.
       11. Considering the position taken by the stakeholders before this
Court and the pendency of other writ petitions and miscellaneous              B
applications filed by the home buyers and also by JAL to issue directions
and pass orders and, if necessary, in exercise of power under Article
142 of the Constitution of India to salvage the situation and provide for a
wholesome solution which will subserve the interests of all concerned
and in particular of large number of home buyers who have voting share
of 62.3% (as mentioned in the report submitted by IRP) being constituent      C
of CoC, it may not be appropriate nor necessary for us to dilate on the
submissions made across the Bar by the concerned parties and to answer
the questions of law urged by the appellants noted hitherto. Instead, we
may exercise our plenary powers under Article 142 of the Constitution
of India to effectuate the exposition in Chitra Sharma (supra) and to         D
do substantial justice to the parties before us. In doing so, we may have
to adopt the same course as noted in paragraphs 22 to 24 of the impugned
judgment with some modulation thereto.
      12. We are conscious of the fact that a section of the home buyers
have come up in appeal against the impugned judgment as they entertain        E
bona fide apprehension that the entire process would get delayed further
due to inviting fresh offers from eligible persons. However, we must
immediately note that we are not in favour of inviting fresh resolution
plans from other eligible persons, as noted by the NCLAT, for being
considered by the CoC afresh. We shall elaborate on this a little later.
                                                                              F
       13. We also take note of the suggestion given by the home buyers
Association, appellants before this Court, that the entire process be kept
outside the I & B Code dispensation and to be monitored directly by this
Court. The temptation of accepting the said submission, however, is
fraught with being in conflict with the opinion expressed by the three-
Judge Bench of this Court in Chitra Sharma (surpa). In paragraph 39           G
of the said decision, the Court observed, thus :-
      “39. …Learned counsel for the IRP submitted that in the CoC
      which will be reconstituted under the amended IBC, the home
      buyers would have a substantial voting power so as to be able to
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322             SUPREME COURT REPORTS                          [2019] 14 S.C.R.


A           effectively protect their interests. Moreover, this Court should
            follow the discipline of the IBC which has been enacted by
            Parliament specifically to streamline the resolution of corporate
            insolvencies. Matters involving corporate insolvencies require
            expert determination. The legislature has made specific provisions
            which are conceived in public interest and to facilitate good
B
            corporate governance. The Court should not take upon itself the
            burden of supervising the intricacies of the resolution process.
            Accepting the suggestion of Mr. Nariman (and one of the two
            options proposed by Mr. Tripathi) of the Court appointing a
            Committee to supervise the resolution process outside the IBC
C           will involve the Court in an insuperable burden of evaluating
            intricate matters of financial expertise on which Parliament has
            legislated to create specific mechanisms. We are emphatically of
            the view that it would not be appropriate for the Court to appoint
            a Committee to oversee the CIRP and assume the task of
            supervising the work of the Committee. We must particularly be
D
            careful not to supplant the mechanisms which have been laid down
            in the IBC by substituting them with a mechanism under judicial
            directions. Such a course of action would in our view not be
            consistent with the need to ensure complete justice under Article
            142, under the regime of law. Hence, the power under Article 142
E           should be utilised at the present stage for the limited purpose of
            recommencing the resolution process afresh from the stage of
            appointment of IRP by the order dated 9 August 2017 and
            resultantly renew the period which has been prescribed for the
            completion of the resolution process...”
F            The revival of CIRP in relation to JIL is on account of this decision
      in Chitra Sharma and would, therefore, be binding on all concerned. It
      is between the same parties.
             14. We are conscious of the fact that adopting the course indicated
      in the impugned judgment as our direction, may also have the effect of
G     modifying the directions given in paragraph 42(i) in Chitra Sharma (supra)
      reproduced above, namely, that the initial period of 180 days for the
      conclusion of the CIRP in respect of JIL shall commence from the date
      of the order, i.e., 9th August, 2018 and the further extension could be
      only for 90 days. However, it is one thing to accept the stand of the
      stakeholders to provide mechanism outside the I & B Code than to say
H
           JAIPRAKASH ASSOCIATES LTD. & ANR. v.                                 323
                  IDBI BANK LTD. & ANR.

that the mechanism provided by I & B Code be modulated in some                  A
respect whilst ensuring that such modulation does not do any violence to
the legislative intent and at the same time, subserve the cause of justice
and provide a window to find out a viable solution to all the stakeholders.
        15. We are also conscious of the fact that the recent amendment
to the I & B Code has come into effect, thereby amending Section 12 to          B
freeze or peg the maximum period of CIRP to 330 days from the
insolvency commencement date which in this case must be taken as 9th
August, 2018 in light of the direction given in Chitra Sharma (supra).
It is, however, noticed from several amendments made to the I & B
Code from time to time that the Legislature has also continually worked
upon introducing changes to the I & B Code so as to address the problems        C
faced in implementation of the new legislation introduced as recently as
in 2016. The case on hand is a classic example of how the entire process
has got embroiled in litigation initially before this Court and now before
the NCLT and NCLAT respectively, because of confusion or lack of
clarity in respect of foundational processes to be followed by the CoC.         D
That becomes evident from the time consumed by IRP or the adjudicating
and appellate authority to remove the doubts on matter such as how the
vote share of CoC be computed on account of inclusion of allottees/
home buyers as financial creditors. The home buyers have also expressed
some doubt about their status as secured creditors. All these issues are
being ironed out by the adjudicating authority. It is also a matter of record   E
that NCLT was functioning only on two days of the week and when it
took decision on the application for clarification, there was difference of
opinion between the members which was then required to be resolved
by the President of the NCLT. It is not a case where one party was
trying to march over the other by resorting to unnecessary or avoidable         F
litigation. The fact remains that the application for clarification made by
the home buyers on 17th September 2018 at the earliest opportunity after
commencement of the resolution process pursuant to the order dated 9th
August, 2018 passed by this Court in Chitra Sharma (supra), remained
pending for quite some time. That delay is attributable to the law’s delay.
Neither the home buyers nor the other financial creditors can be blamed         G
for the pendency of the proceedings before the NCLT and later on before
the NCLAT. The NCLT realizing the uncertainty in resolving the said
issue, wanted to proceed with the resolution plan subject to the outcome
of the pending IA as is manifest from its order dated 6th May, 2019.
Even that became subject matter of challenge in the appeal filed by the         H
324             SUPREME COURT REPORTS                          [2019] 14 S.C.R.


A     IDBI before the NCLAT which was finally disposed of vide the impugned
      judgment.
             16. Suffice it to note that an extraordinary situation had arisen
      because of the constant experimentation which went about at different
      level due to lack of clarity on matters crucial to the decision making
B     process of CoC. Besides that, in view of the recent legislative changes,
      the scope of resolution plan stands expanded which may now include
      provision for restructuring the corporate debtor including by way of merger,
      amalgamation and demerger and more so the power bestowed on the
      CoC to consider not only the feasibility and viability of the resolution
      plan but also the manner of distribution proposed, which may take into
C     account the order of priority amongst the creditors. Additionally, the
      recently inserted Section 12A enables the adjudicating authority to allow
      the withdrawal of an application filed under Section 7 or Section 9 or
      Section 10, on an application made by the applicant with the approval of
      90% voting share of the CoC. Similarly, sub-clause (7) of Regulation
D     36B inserted with effect from 4th July, 2018, dealing with the request for
      resolution plans unambiguously postulates that the Resolution Professional
      may, with the approval of the Committee, reissue request for resolution
      plans, if the resolution plans received in response to earlier request are
      not satisfactory, subject to the condition that the request is made to all
      prospective resolution applicants in the final list. In the present case,
E     finally only two bidders had participated and submitted their resolution
      plan which was placed before the CoC and stated to have been rejected.
      However, applying the principle underlying Regulation 36B(7), we deem
      it appropriate to permit the IRP to reissue request for resolution plans to
      the two bidders (Suraksha Realty and NBCC) and/or to call upon them
F     to submit revised resolution plan(s), which can be then placed before the
      CoC for its due consideration.
            17. In the present case, as aforementioned, there is unanimity
      amongst all the parties appearing before this Court including the resolution
      applicant that liquidation of JIL must be eschewed and instead an attempt
G     be made to salvage the situation by finding out some viable arrangement
      which would subserve the interests of all concerned.
             18. In view of the legislative changes referred to above, we are
      of the considered opinion that we need to and must exercise our plenary
      powers to make an attempt to revive the corporate debtor (AIL), lest it
H     is exposed to liquidation process under Chapter III of Part II of the I &
           JAIPRAKASH ASSOCIATES LTD. & ANR. v.                                325
                  IDBI BANK LTD. & ANR.

B Code. We are inclined to do so because the project has been                  A
implemented in part and out of over 20,000 home buyers, a substantial
number of them have been put in possession and the remaining work is
in progress and in some cases at an advanced stage of completion. In
this backdrop, it would be in the interest of all concerned to accept a
viable plan reflecting the recent legislative changes.
                                                                               B
       19. Indeed, the third proviso to Section 12(3) predicates time limit
for completion of Insolvency Resolution Process, which has come into
effect from 16th August, 2019.The same reads thus :
      “Provided also that where the insolvency resolution process of a
      corporate debtor is pending and has not been completed within            C
      the period referred to in the second proviso, such resolution process
      shall be completed within a period of ninety days from the date of
      commencement of the Insolvency and Bankruptcy Code
      (Amendment) Act, 2019.”
       Taking an overall view of the matter, we deem it just, proper and       D
expedient to issue directions under Article 142 of the Constitution of
India to all concerned to reckon 90 days extended period from the date
of this order instead of the date of commencement of the Insolvency
and Bankruptcy Code (Amendment) Act, 2019. That means, in terms of
this order, the CIRP concerning JIL shall be completed within a period
of 90 days from today.                                                         E

       20. We do not deem it necessary to dilate on the arguments of
the respective counsel for the nature of order that we intend to pass,
including about the locus standi of JAL which, in our opinion, already
stands answered against JAL by virtue of Section 29A of the Act as
expounded in Chitra Sharma (supra).                                            F
       21. Accordingly, we pass the following order to do substantial and
complete justice to the parties and in the interest of all the stakeholders
of JIL:
      i)   We direct the IRP to complete the CIRP within 90 days from
                                                                               G
           today. In the first 45 days, it will be open to the IRP to invite
           revised resolution plan only from Suraksha Realty and NBCC
           respectively, who were the final bidders and had submitted
           resolution plan on the earlier occasion and place the revised
           plan(s) before the CoC, if so required, after negotiations and
           submit report to the adjudicating authority NCLT within such        H
326                SUPREME COURT REPORTS                        [2019] 14 S.C.R.


A                  time. In the second phase of 45 days commencing from 21st
                   December, 2019, margin is provided for removing any difficulty
                   and to pass appropriate orders thereon by the Adjudicating
                   Authority.
              ii) The pendency of any other application before the NCLT or
B                 NCLAT, as the case may be, including any interim direction
                  given therein shall be no impediment for the IRP to receive
                  and process the revised resolution plan from the above-named
                  two bidders and take it to its logical end as per the provisions
                  of the I & B Code within the extended timeline prescribed in
                  terms of this order.
C
              iii) We direct that the IRP shall not entertain any expression of
                   interest (improved) resolution plan individually or jointly or in
                   concert with any other person, much less ineligible in terms
                   of Section 29A of the I & B Code.
D             iv) These directions are issued in exceptional situation in the facts
                  of the present case and shall not be treated as a precedent.
              v) This order may not be construed as having answered the
                 questions of law raised in both the appeals, including as
                 recognition of the power of the NCLT/NCLAT to issue
E                direction or order not consistent with the statutory timelines
                 and stipulations specified in the I & B Code and Regulations
                 framed thereunder.
             22. Both the appeals are disposed of in terms of this order with
      no order as to costs. Along with the appeals, applications filed therein
F     also stand disposed of.


      Nidhi Jain                                                  Appeals disposed of.




G




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