Home Case Index All Cases Insolvency and Bankruptcy Insolvency and Bankruptcy + Tri Insolvency and Bankruptcy - 2021 (10) TMI Tri This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2021 (10) TMI 1310 - Tri - Insolvency and BankruptcyFraudulent Trading or Wrongful trading - whether any fraud is committed with the creditors only which has caused any loss to the creditors and the creditors of the Corporate Debtor ought to have suffered the financial loss arising out of the alleged Fraudulent Trading or Wrongful Trading? - HELD THAT:- The provision of Section 66 deals with fraudulent trading or wrongful trading, therefore, “intent to defraud the creditors” is essential as it is imperative to prove that the business is conducted or a transaction has been made in a fraudulent manner in order to intentionally defraud the creditors of the Corporate Debtor - The Respondent No.1 has also not been able to satisfy the bench with respect to the various cash withdrawal made through the Account of the Janta Co-operative Bank Ltd, who is also Respondent No. 4 in the present application and has been proceeded ex parte. These facts support that there was an intention to defraud the creditors by keeping these assets of the Corporate Debtor beyond the reach of the Creditors or any such person who is entitled to make a claim against the Corporate Debtor - thus, these transactions are covered under the provisions of the 66 of the Code - application allowed. Appropriate order under Section 44 &46 of the Code - reversal of property gone into preferential transaction and undervalued transaction and vest into the assets of the Corporate Debtor M.K. Overseas Pvt. Ltd. - HELD THAT:- It has been observed that the Sale of the Mumbai Plant could not be realized and hence stands cancelled as the buyer paid ₹ 62.25 lakh and YES bank kept such amount: under lien till the balance amount of ₹ 10.37 crore is received and due to initiation of the CIRP the buyer failed to pay the consideration in full. Hence, the amount was forfeited. It has been observed that the sales of the items of the inventory were made at a price lower than the purchase price paid, consequently such transactions have led to a loss of 4.57 crore and the Respondents have defended some but not been able to provide a satisfactory reason for doing the same - the Corporate Debtor entered into an undervalued transaction at a book loss of ₹ 2.32 crore with respect to the sale of the Daryaganj property vide various sale deeds from February 2018 to May 2019,which is till 4 months prior to the insolvency commencement date of the Corporate Debtor i.e. 19.09.2019 hence, it is within the look back period. Further it has been observed that the sale of the vehicle below the Book value to the extent of ₹ 1.90 Crore has been made from March 2019 to September 2019 which is prior to the insolvency Commencement date of the Corporate Debtor i.e. 19.09.2019 hence, it is within the look back period - the ex-management of the Corporate Debtor were well aware of the fact that an application has been filed and the same is pending for initiation of CIR process against the Corporate Debtor, therefore the ex-management continued with undervalued transaction with respect to sale of the vehicle as some of the vehicles have also been sold after the Application to initiate CIRP of the Corporate Debtor has been filed. It is directed to the Respondents who were directors/ shareholders of the Corporate Debtor and in control of the Corporate Debtor to retrieve the amounts set off against the benefitted creditors of the Corporate Debtor along with the liabilities assumed/accepted from Al dua processing Pvt. Ltd to the tune of ₹ 0.33 Crore during Financial Year 2017-18 and 2018-19 to the Resolution Professional within 3 weeks from the date of this order - application allowed.
|