Latest - TMI e-Newsletter
New User/ Regiser
2022 (9) TMI 686 - Insolvency & Bankruptcy
Validity of ad-interim stay granted to the process of fresh e-auction - e-auction of immovable property - HELD THAT:- No relaxation in respect of time-line would be provided to the successful bidder in the second round of e-auction. Since this order had achieved finality as it had not been appealed against or modified, Pavan Enterprises could not have been given extension of time-line to what was provided in the e-auction document. Moreover, Pavan Enterprises who was the successful bidder in the second e-auction, had committed itself to making full payment by 21.4.2021 and therefore to engage in litigation through IA no. 868/2022 and IA no. 485.2021 was highly improper on the part of Respondent, and obtaining the order of ad-interim stay dated 28.2.2022 when it was precluded from doing so was clearly abuse of the judicial process - the Respondent experienced difficulty in depositing the balance of sale consideration after the first round of e-auction and could not deposit the requisite amount after committing itself to doing so.
In view of the order dated 16.3.2021 passed by the Adjudicating Authority which had achieved finality and also the Terms and Conditions of the second round of e-auction process, it is opined that the Respondent caused a serious obstruction in the sale of ‘the property’ by preferring an application to obtain stay order to the third round of e-auction through order dated 28.2.2022 which was granted - In view of the facts of the case and the conduct of the Respondent in obstructing the process of liquidation, particularly the e–auction of ‘the property’ despite it being fully aware of the order dated 16.3.2021 in IA No.468 of 2021, it is opined that the Respondent has clearly abused the process of law to gain undue advantage and thereby caused a delay in the culmination of the liquidation process.
In view of the situation and the conduct of the Respondent as discussed in detail above, we are of the view that a fine of Rs. One Lakh should be imposed on the Respondent for abusing the process of law thereby causing delay in the liquidation process, and seeking to subvert the basic objective of IBC. This fine shall be deposited in Prime Minister’s Relief Fund within 30 days of this order - appeal disposed off.