Resolution Plan - Meaning, Content, Drafting and Submission

 

Section 5(26) of the IBC, 2016 - "Resolution plan" means a plan provided by the resolution applicant for the corporate debtor's bankruptcy resolution as a going concern in line with Chapter II of Part II of the Insolvency and Bankruptcy Code. A resolution applicant, in simple terms, is "anyone who submits a resolution proposal to the resolution professional."

A Resolution Plan is a rehabilitation plan for a corporate debtor (CD) that is going into insolvency. It is a report based on the information memorandum provided by the Resolution Professional that focuses on legal, financial, management, and technical methods to help the CD get back on its feet. It must be approved by the committee of creditors ("COC") and meet the IBC's required conditions.

Preparation and Submission of the Resolution Plan

A Resolution Applicant must submit information in accordance with the RFRP (Request for Resolution Plan) which is shared by RP after Coc’s approval along with the requirements set forth in the IBC, 2016 and CIRP Regulations. The applicant must sign and date each document in the place given therein and also sign each page of all documents. (The Resolution Applicant must submit any undertakings, authorizations, forms, documents, and information needed by Applicable Law and available in this RFRP.) Documents connected to the Resolution Plan should be signed in the manner specified in the relevant format of such document in this RFRP, either by the Resolution Applicant or an Authorised Representative of the Resolution Applicant. All requisite forms, documents, and authorizations must be signed and stamped by the Authorised Representative of the Resolution Applicant. (Each Resolution Applicant shall submit an affidavit in support of the IBC, 2016 related Undertaking, which should be certified and notarized by a notary public.) A Resolution Applicant should give the requested information to prove the Resolution Applicant's competence and ability to manage and administer the company to the satisfaction of the CoC. Strict adherence to forms, documentation, or authorizations stipulated in the RFRP is needed. Where information is sought in specified forms/documents/authorizations, the Resolution Applicant must refrain from using any brochures/pamphlets. Non-compliance with forms, documentation, or authorizations, as well as the submission of inadequate material, may result in the Resolution Plan being declared non-responsive. Each form, paper, or authorization must be signed by the Resolution Applicant and correctly stamped / corporate seal affixed.

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