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2020 (1) TMI 1540 - Tri - Companies LawMaintainability of application filed by the IRP without prior concurrence of CoC - termination of work orders - invocation of bank guarantees - HELD THAT:- It is seen that in Section 14(1)(a) the word 'proceedings' is used, whereas in Section 33(5) the phrase 'legal proceeding' is used. The Legislature has itself made a distinction between the two terms in Sections 14(1)(a) and 33(5) of the Code which clarifies that both signify different meanings. If it so intended to provide for legal proceedings only under Section 14(1)(a), it would have explicitly stated the same. The word 'proceeding' or 'proceedings' is used in different hues and perspectives in IBC, 2016. Such usage in the Code includes arbitration, disciplinary, legal, bankruptcy, insolvency, liquidation, CoC meetings, under repealed/other acts, before Adjudicating Authority or IBBI or special/other courts, winding-up, in Schedules of amendments, etc. - proceedings under Section 14(1)(a) has a larger canvas and it covers various authorities. Since, the termination provisions/proceedings are void ab-initio, consequent action of invoking bank guarantees is non-est in law and liable to be set aside - Award of fresh tender by Respondent No. 1 under such circumstances, to the detriment of the Corporate Debtor, is also liable to be set aside. The actions of Respondent No. 1 are in violation of letter and spirit of IBC, 2016. The invocation of bank guarantees to the detriment of Corporate Debtor is also completely unsustainable - Provisions for termination included in or connected with instruments of Work Orders No. 1 and 2, are inconsistent inter-alia with Section 20 of IBC, 2016 and are invalid and prohibited under Section 238 of the Code. Moreover, termination proceedings could not be initiated or continued by Respondent No. 1 under bar of moratorium of Section 14 of the Code - Termination of Work orders 1 and 2 and all communication, including notices, in this regard is/are held to be inoperative and null - application disposed off.
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