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In a victory to promoters and erstwhile developer of Appu Hotels Ltd Periasamy Palani Gounder, the Supreme Court has upheld a verdict by the National Company Law Appellate Tribunal (NCLAT) setting aside the approval given to MGM Healthcare managing director MK Rajagopalan for making a ₹423-crore bid to take over Appu Hotels, which owns and operates Le Meridien in Chennai and Coimbatore.
Justices Dinesh Maheshwari and Vikram Nath in an order said, “the impugned judgement and order dated February 17, 2022 is not interfered with only insofar as the Appellate Tribunal has not approved the resolution plan in question. Other findings, observations and directions of the Appellate Tribunal are set aside.”
The question of dealing with fresh settlement proposal of the promoter, as approved by the CoC in its nineteenth meeting, dated October 12, 2022 after receiving fresh resolution plans, is left open for consideration of the Adjudicating Authority.
In 2020, the National Company Law Tribunal (NCLT) Chennai admitted an insolvency petition against Appu Hotels in a case filed by the Tourism Finance Corporation of India Ltd. It also approved Rajagopalan’s bid to take over Appu Hotels.
However, based on an appeal filed by Periasamy Palani Gounder, the NCLAT had set aside the approval given for the plan. Rajagopalan had moved the Supreme Court against the NCLAT order.
The Apex court also set aside valuation issues against the Resolution Professional raised by the NCLAT.
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