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2022 (10) TMI 523 - AT - Insolvency and BankruptcyFraudulent Trading/Wrongful Trading - crystalline stand of the Appellant is that the Adjudicating Authority (National Company Law Tribunal, Division Bench – II, Chennai) had not considered the Relevant Documents, notwithstanding the Forensic and Transactions Audit Report - HELD THAT:- A High Level Proof, is very much required in regard to a Fraudulent Intent. Even for an Isolated / Single Fraud, against an Individual, the action, in Civil Wrong (Tort) will lie. Furthermore, a Creditor, who was Defaulter has a viable, effective, an efficacious, alternate remedy in Civil Law. In this connection, this Tribunal, pertinently points out that it is not open to the Directors of a Company accused of Fraudulent Trading to allege that the Company’s Claim for recovery in Tort, are barred. The Yardstick / Tape i.e., to be pressed in to service to determine, the Liability, is whether a Director had exercised the General Knowledge, Skill and Experience, to be expected of a person, in carrying out the functions of his duties. The aspect of Fraud is the cementing platform for a Liability. An element of Dishonesty, is to be Proved and the Aspect of Dishonesty, cannot be inferred, when the Conduct of the concerned Individuals is Receptive of more than one explanation. It must be borne in mind, that for Fraudulent Trading / Wrongful Trading, Relevant Facts / Acceptable Materials, are to be pleaded by a Party, by providing requisite details / adequate facts, to fall within the parameters of Section 66 of the I & B Code, 2016. The stand taken by the respective parties, comes to a Resultant Conclusion that the Transfer of Assets among the Group Companies ex-facie is not a Fraudulent Trading, as per Section 66 (1) of the Insolvency & Bankruptcy Code, 2016. Moreover, because of the fact that all Transactions between the Companies as well as the Asset details were maintained in a Transparent Manner on an SAP System (including the Fixed Assets Register) and further the Transactions of the Corporate Debtor and the 1st Respondent were Audited, every year, the Plea of Fraudulent Trading as projected by the Appellant / Applicant is not proved, to the subjective satisfaction of this Tribunal, in a convincing manner. This Tribunal, comes to an inevitable and irresistible conclusion that the view arrived at by the Adjudicating Authority (`National Company Law Tribunal, Division Bench – II, Chennai), in dismissing application, does not suffer from any material irregularity or patent legality, in the eye of Law - Appeal dismissed.
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