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2023 (1) TMI 57 - AT - Insolvency & Bankruptcy
Initition of CIRP - Ex-parte order - Corporate Debtor could not appear before the NCLT - Validity of impugned order - Burden to prove - It is the version of the Appellant that when a Statute specifies that a particular thing, is to be performed in a particular manner, it has to be done only in that fashion, and further that in the present case, the procedure enunciated, under Rule 37 of NCLT Rules, 2016, was not followed, by the Adjudicating Authority / Tribunal - HELD THAT:- The Burden of Proving, the Service of Summons, is on the Petitioner / 1st Respondent / Bank / Financial Creditor. In Law, if a registered Summons / Notice is sent to a Respondent / Defendant, at his / her correct address, the presumption of Service, arises, and an Ex-parte Decree, will not be set aside - In a given case, where Summons / Notice, correctly addressed sent by a Registered Post with Acknowledgement, not received back, the same is presumed to be Served.
An Adjudicating Authority, under the I & B Code, 2016, is to provide a reasonable opportunity, to a Corporate Debtor, and as per sub-section 4 (7) of the Code, is to ascertain the factum of Default, from the records of Information Utility or from the evidence furnished, by the Financial Creditor - Where the Record showed that an Application / Petition was preferred on the Proforma, prescribed under the Rule 4 (2) of the Insolvency and Bankruptcy (Application to Adjudicating Authority) Rules, 2016, and if an Adjudicating Authority, was satisfied, if the Default, had taken place, there is no illegality, in admitting the Application, filed by the Financial Creditor, under the I & B Code, 2016.
An Application / Petition, under Section 7 of the Code, is to be considered by an Adjudicating Authority, on its own merits, taking into consideration of the available materials on record - Where the post filing, the Notice, as required under Rule 4 (3) of the Insolvency and Bankruptcy (Application to Adjudicating Authority) Rules, 2016, was sent to the Corporate Debtor, and if the said Corporate Debtor, does not appear, before the Adjudicating Authority, the Petition, filed by a Financial Creditor, can be determined Ex-parte. There is no prohibition in Law, in this regard - An Application, under Section 7 of the I & B Code, 2016, is not to be rejected, merely on technical ground.
An Acknowledgement - HELD THAT:- Under the Limitation Act, 1963, an Acknowledgement, ought to be in writing and signed by a Person, making an Acknowledgement. In fact, the exact sum or nature of Claim, need not be Acknowledged - the requirement of Section 18 and 19 of the Limitation Act, 1963, are quite independent and they are not cumulative in character.
A mere denial, will not take the sheen off the document(s) and the Claim of the Creditor, remain alive, within the meaning of Section 18 of the Limitation Act, 1963.
A Judicial Discretion, is to be regulated, as per known Rules of Law, and not on mere impulse or whim of a Person, for whom, it is given on the hypothesis that he is circumspect - In the instant case, it cannot be forgotten that the Adjudicating Authority (Tribunal), on 21.10.2022 at 2.30 P.M. (through Video Conferencing Hearing in CP (IB) / 308 / 7 / HDB / 2022), had directed the 1st Respondent/Bank (Financial Creditor), to serve Notice to the 2nd Respondent / M/s. Gayatri Projects Ltd. (Corporate Debtor), by Speed Post, and Email, within 5 days from today, i.e., 21.10.2022 and the Proof of Service, was directed to be filed, before the next hearing date.
Any Person, who is in Law, entitled to Stake a Claim for payment, has no prohibition, under the I & B Code, 2016, to prefer the same, by means of an Application / Petition. The prevalent of Default, is a Sine Qua Non, for Admitting, an Application/ Petition, under the I & B Code, 2016, in respect of the Insolvency Proceedings.
This Tribunal, on going through the impugned order (Filed under Section 7 of the Insolvency and Bankruptcy Code, 2016, r/w Rule 4 of the I & B (Application to Adjudicating Authority) Rules, 2016, passed by the Adjudicating Authority, (National Company Law Tribunal, Hyderabad Bench – II, Hyderabad), comes to a consequent conclusion that in the instant case on hand, there is overwhelming evidence of Debt Due, payable in Fact and in Law, and Default, the Adjudicating Authority, had exercised its subjective discretion in a sound, judicious and right thinking manner, and accordingly Admitted the CP (IB) No.308 / 7 / HDB / 2022, filed by the 1st Respondent / Bank(Financial Creditor), which requires no interference, in the hands of this Tribunal, sitting in Appeal. Consequently, the Appeal fails.