In its decision, the Supreme Court said it did not find merit in Ebix’s arguments that Educomp’s resolution professional (RP), Mahender Khandelwal, had failed to disclose information about investigations into the company by law enforcement agencies.
A chronological listing of events that resulted in the investigation by the Enforcement Directorate and the Central Bureau of Investigation Educomp Going public through news reports and stock exchange disclosures, the Supreme Court held that the RP could not have been aware of such an investigation, when it had provided information about the company to potential bidders so that they could have a Informed bidding.
Ebix claims that RP hid information about such investigations from him and cited the investigation as one of the reasons for the company to withdraw its offer.
The Supreme Court noted that Ebix had submitted its resolution plan for Educomp on 19 February 2018. Reports about alleged financial irregularities in the company and subsequent investigations by law enforcement agencies were subsequent incidents.
Based on this the court said, “Finally, Ebix has brought nothing on record to prove that E-RP was aware of the SFIO and CBI investigations, before a regulatory disclosure was made by Educomp.” Therefore, it cannot be said that E-RP faltered in its duty to provide relevant information to Ebix.
The apex court’s decision is significant as it puts an end to speculation whether applicants can withdraw their proposals made under the Insolvency and Bankruptcy Code rules after these proposals are cleared. creditors committee. Several applicants have tried to either withdraw their offers or modify the terms of these proposals citing various reasons in the last one year including the impact of COVID 19. The court has ruled that such withdrawal is not permitted.