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2022 (8) TMI 835 - AT - Insolvency and BankruptcyNon-production of Additional Documents/ Additional Evidence - Party negligent in preferring the documents and not filing the same, despite knowledge at appropriate time - screenshots - admissible evidence or not - It is the plea of the 1st Respondent that Applicant/Appellant has exhibited its Legal Bias and the Fraudulent Actions are visible from the Reports filed by the 2nd Respondent - failure to establish any reason for not bringing the Additional Documents/Evidence before the Adjudicating Authority at the appropriate time - HELD THAT:- In the instant case, the Appellant has come out with a plea that the Respondents No. 1 and 2 have joined together in declaring the 3rd Respondent as the Successful Highest Bidder. The Appellant before the Adjudicating Authority had relied upon the screenshots, which were System generated to fall back upon its contention that the auction was closed at 05:43:17 hours (Indian Standard Time) which was not accompanied by a Certificate as per the ingredients of Section 65B (4) of the Indian Evidence Act, 1872. As a matter of fact, it is evident from the Bid History, that the Bids Sum was made known as Rs.17,80,00,000/-. On 21.01.2021, the snapshots of the screen were taken at 05:43:17 hours (Indian Standard Time), which is not backed up by a furnishing of Certificate, as per Section 65B (4) of the Indian Evidence Act. In reality, the onus is upon the Appellant/Applicant to ascertain the Equipment / System through which the snap shots were generated and a Certificate ought to have been filed by the Appellant / Applicant in terms of Section 65B of the Indian Evidence Act, 1872, coupled with the Information Technology Act, 2000. Unfortunately, the Appellant had not produced the Certificate in question, as per the requirement of aforesaid Acts before the Adjudicating Authority. Sections 65A and 65B of the Indian Evidence Act, 1872 are brought in, under Schedule II to the Information Technology Act, 2000. Section 5 of the Indian Evidence Act, 1872, provides that an evidence can be given regarding only facts that are at issue or of relevance. Section 136 of the Indian Evidence Act, 1872, empowers a Judge to determine on admissibility of evidence, in a given case. The contents of Electronic Record may be proved as per Section 65B of the Indian Evidence Act, 1872. In the present case, it is brought to the fore from the System generated ‘Log Report’ that the ‘Appellant’ had logged in at 17:37:20 hours. It placed its Bid at 17:37:34 hours. The Appellant logged in at 17:57:59 and for nearly 20 minutes and 25 seconds, had logged out for a considerable time (there being no activity on its part), of course in breach of the E-auction terms and conditions - One cannot ignore the important fact that as per the E-auction conditions, the Auction screen ought not be shared with any Third Party and in fact, the Third Party Application ZOOM was active / operated at the time of Auction Process and also that various other Applications were running at the same time during active Auction. During the period of inactivity for about 20 minutes, the 3rd Respondent had increased the Bid by Rs.10,00,000/- to Rs.17,90,00,000/-. The 3rd Respondent had placed its Bid at 17:41:01 hours. Indeed, the Appellant’s last Bid at 17:37:34 hours for Rs.17,80,00,000/-. It cannot be gainsaid that Schedule I Mode of Sale (under Regulation 33 of the Insolvency and Bankruptcy Board of India (Liquidation Process) Regulations 2016, Serial No. 10, it is mentioned as ‘If the Liquidator is of the opinion that an auction where bid amounts are not visible is likely to maximize realizations from the sale of assets and is in the best interests of the creditors, he may apply, in writing, to the Adjudicating Authority for the permission to conduct an auction in such manner’. It is to be borne in mind that the 1st Respondent/’Liquidator had not resorted to the recourse of preferring an Application, based on the ground that the Bid Sums were not discernible, as per the stand taken on behalf of the Appellant/Applicant. A charge of Fraud must be substantially proved as laid and when one kind of Fraud is charged, another kind of Fraud cannot be substituted - A party guilty of fraud can insist of his rights under the Contract, when the Party defrauded insists on the Performance of Contract. As a matter of fact, the term Material means Real and not merely Formal and Academic, as opined by this Tribunal. An Irregularity which may be termed as Material, ought to be such as it affects the ultimate decision of the given Proceedings or Case. As far as the present case is concerned, the Appellant/Applicant had admitted that Yes, I am getting logged out frequently (vide Vol. II Page 237 - translated version of the Transcript from Hindi in Preliminary Reply Affidavit of R2 / Linkstar Infosys Private Limited to I.A. No. 74/2021 in CP/508/IB/2017), which is certainly an unfavorable circumstance against it. ‘Admissions’ are admissible even though they are self harming. Admission is substantive evidence Pro Prie Vigore. In law, it is impermissible for an Unsuccessful Bidder in Auction (after taking part in the Auction) to question the validity and legality of whole Auction Process, especially after the completion of the Auction Sale. Under the pretext of maximisation of value from the Sale of Assets, the Appellant/Applicant is not to be permitted to question the Auction Sale, when the 3rd Respondent had made payment of full balance sum, in the teeth of Process Memorandum on 15.02.2021 and 16.02.2021, respectively and that the 1st Respondent/Liquidator was to act as per Clause 13 Schedule I of Regulation 33 of Liquidation Regulations. In the instant case, after the conclusion of Auction Sale, the same was acted upon and the fact of the matter is, the amount received was disbursed, in terms of the Waterfall Mechanism, as per Section 53 of the I & B Code, 2016. This Tribunal on the basis of surrounding facts and circumstances of the case, keeping in mind of the prime fact that if a validly conducted E-Auction Process in a fair and transparent manner is to be set at naught by this Appellate Tribunal, then there will be no sanctity to the Sale that was concluded to and in favour of the 3rd Respondent (of course in accordance with Law), who had admittedly paid the sale consideration and applied for Renewal of Licenses before the concerned Authorities and the whole process of E-auction cannot be revisited, comes to a consequent conclusion that the impugned order dated 18.03.2021, passed by the Adjudicating Authority in dismissing the IA No.74 of 2021 in CP/508/IB/2017 is free from legal infirmities Appeal dismissed.
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