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Insolvency and Bankruptcy - Case Laws
Showing 101 to 120 of 133 Records
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2021 (9) TMI 441 - NATIONAL COMPANY LAW TRIBUNAL , MUMBAI BENCH
Dissolution of the Corporate Person through voluntary liquidation - Section 59 of Insolvency and Bankruptcy Code, 2016 - HELD THAT:- On the Petition filed by the Liquidator under sub-section 7 of Section 59 of the Code for dissolution of this Corporate Person, it is noticed that the affairs of the Corporate Person have been completely wound up and its assets are liquidated.
This Corporate Person, through its Liquidator, voluntarily liquidated itself so as to get dissolved - this Corporate Person is dissolved directing the Liquidator to file this order with concerned Registrar of Companies and IBBI within 14 days thereof - petition allowed.
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2021 (9) TMI 437 - NATIONAL COMPANY LAW APPELLATE TRIBUNAL , NEW DELHI
Distribution of the dues in the Resolution Plan including dues of statutory authorities - Resolution plan already approved - dues of appellant approved by CoC in its commercial wisdom - case of appellant is that its quite surprising that the Appellant - Operational Creditor has been given a 99% haircut and the Learned Counsel is expressing doubts in the manner in which CIRP was conducted - HELD THAT:- Hon'ble Supreme Court in the matter of GHANASHYAM MISHRA AND SONS PRIVATE LIMITED THROUGH THE AUTHORIZED SIGNATORY VERSUS EDELWEISS ASSET RECONSTRUCTION COMPANY LIMITED THROUGH THE DIRECTOR & ORS. [2021 (4) TMI 613 - SUPREME COURT] has held that once a resolution plan is duly approved by the Adjudicating Authority under subsection (1) of Section 31, the claims as provided in the resolution plan shall stand frozen and will be binding on the Corporate Debtor and its employees, members, creditors, including the Central Government, any State Government or any local authority, guarantors and other stakeholders. On the date of approval of resolution plan by the Adjudicating Authority, all such claims, which are not a part of resolution plan, shall stand extinguished and no person will be entitled to initiate or continue any proceedings in respect to a claim, which is not part of the resolution plan.
As it is found that Committee of Creditors in the present matter has taken a discussion with regard to distribution of the dues in the Resolution Plan including dues of statutory authorities, it is found that this is a matter where interference in the impugned order accepting a Resolution Plan is called for. The dues of the Appellant are admittedly operational dues and the Resolution Plan has dealt with the dues.
The appeal cannot be entertained.
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2021 (9) TMI 435 - NATIONAL COMPANY LAW TRIBUNAL , AMARAVATI BENCH
Order for Replacement of the Liquidator - depreciated value of the Plant & Machinery as per the latest MSME classification - Section 34(4)(a) of IBC, 2016 - HELD THAT:- The proviso of Section 34(4)(a) of IBC, 2016, does not provide for any application to be made by any aggrieved person with regard to the invocation of Section 34(4)(a) of IBC, 2016 and the language with which the provision made is very clear and enables this Adjudicating Authority to set-aside the appointment of Mr. Sisirkumar Appikatla as the Liquidator of the Corporate Debtor.
This order shall not come in the way on interferes with the of appeal pending before the Hon'ble National Company Law Appellate Tribunal for the reason that this Adjudicating Authority not venturing into or transgressing his powers in any manner and this order is confined only to the extent of replacement of Mr. Sisirkumar Appikatla as the Liquidator of the Corporate Debtor.
The appointment of Mr. Sisirkumar Appikatla as the Liquidator of the Corporate Debtor Company is non-est/illegal and ab initio void - Application disposed off.
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2021 (9) TMI 434 - NATIONAL COMPANY LAW TRIBUNAL , BENGALURU BENCH
Seeking extension of period of liquidation of the Corporate Debtor by a period of one year beyond 11.04.2021 - Section 35(1)(N) of the I&B Code, 2016 R/w Regulation 44(2) of the IBBI (Liquidation Process) Regulations, 2016 - HELD THAT:- This Adjudicating Authority has also been taking a view that the hardship caused by the COVID-19 pandemic, the lockdown enforced by the Central and State Governments, and the resulting disruption to movement of men and material during the last few months constitute exceptional circumstances as contemplated in Section 60(5) of the Code wherein this Adjudicating Authority is empowered to pass orders as it deems fit.
In view of the circumstances narrated in the Petition, the extension of time period prayed for deserves to be acceded to - the period is extended for four months from 11.04.2021 in the Liquidation - petition disposed off.
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2021 (9) TMI 433 - NATIONAL COMPANY LAW TRIBUNAL , NEW DELHI BENCH
Maintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - Financial Creditors - existing dispute or not - quantum of default - pendency of arbitration proceeding - HELD THAT:- An application under Section 7 of the Code is acceptable so long as the debt is proved to be due and there has been occurrence of existence of default. What is material is that the default is at least ₹ 100 lakhs. In view of Section 4 of the Code, the moment default is of Rupees one hundred lakhs or more, the application to trigger Corporate Insolvency Resolution Process under the Code is maintainable.
In the present matter the applicant has produced loan agreement executed between the parties, according to which the respondent has failed to repay the loan within stipulated time. The respondent has not denied the same. The objections raised by respondent regarding sufficient security is not sustainable as proceeding under this Code is not money recovery proceeding. The other objection raised about removal of loan amount from Balance Sheet will also not help respondent - Fact still remains that the respondent has enjoyed the loan amount and failed to clear the dues on time. It is clear that the family member of applicant put forth their money in the company against the loan of the respondent company, however no assignment is made and admittedly the applicant is still a financial creditor of the respondent. The same fact has not been denied by the respondent itself.
If a debt become due and payable and not paid by-Corporate Debtor, it will be said that the Corporate Debtor has committed default. When we apply the aforesaid judgment in the present matter it is seen that the debt become due and payable on 31.03.2019 as per the loan agreement and the respondent itself has admitted that the payment has not been made to the applicant. Therefore, existence of debt and default cannot be ruled out in the present matter.
The respondent also placed reliance of Arbitration Clause, i.e., Clause 25 of the loan agreement. However, it is a settled preposition that the pendency of arbitration proceeding is not a defense in case of Section 7 application. In fact, no evidence is placed to show that any arbitration proceeding is pending in the present matter. The respondent has not raised any dispute over quantum of default or existence of loan amount. Therefore, this objection is also not sustainable.
The present application is complete in all respects and the applicant is entitled to claim outstanding financial debts from the respondent and that there has been default in payment of the financial debt - Application admitted - moratorium declared.
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2021 (9) TMI 432 - NATIONAL COMPANY LAW APPELLATE TRIBUNAL , PRINCIPAL BENCH, NEW DELHI
Maintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - Operational Creditors - HELD THAT:- Learned Counsel for the Respondent has fairly conceded that the observations in Paras 29 and 34 of the Impugned Order do touch upon the merits of the case and that he has no objection to the same being expunged.
Keeping in view the facts and circumstances of the case and the observation made in these two Paras, we are of the considered view that the aforenoted Paras 29 and 34 of the Impugned Order be expunged and the same is ordered. We observe that we have not gone into merits of the matter with respect to any ‘Pre-Existing Dispute’ or otherwise. This Appeal is disposed of expunging Paras 29 and 34 from the Impugned Order dated 04.01.2021.
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2021 (9) TMI 418 - NATIONAL COMPANY LAW APPELLATE TRIBUNAL , CHENNAI
Admissibility of application - application was for initiation of CIRP - grievance of the ‘Appellant’ is that till date the matter was never listed for pronouncement of an order - principles of natural justice - HELD THAT:- This ‘Tribunal’ pertinently points out that when the main C.P.(IB) No.116/BB/2020 was listed before the ‘Adjudicating Authority’ under the caption ‘For Hearing/Clarification’ on 11.12.2020 and when the matter was reserved ‘For Orders’ on that date, however, the same being not uploaded in the NCLT Online Website Portal, certainly, the order in the main CP(IB)/116/BB/2020 could not have been pronounced on 07.12.2020 (vide Annexure ‘E’ of the ‘Appeal Paper Book’ Diary No.137 dated 08.03.2011). Apart from that, there was no communication that was received by the ‘Appellant’ in regard to the pronouncement of the order which was received by the ‘Adjudicating Authority’ in the aforesaid Company Petition.
It cannot be gainsaid that if an order/judgment of a ‘Tribunal’ is not pronounced at all, the same is a nullity in the ‘eye of law’, considering the fact that the ‘pronouncement’ is primarily a judicial act, which is the ‘Sanctum Sanctorum of any judicial proceedings’ in our ‘justice delivery system’, as opined by this ‘Tribunal’ - If an order/judgment is delivered by a ‘Tribunal’ ignoramus of rules, then, it will result in untold hardship, misery and unerringly leading to a miscarriage of justice. Moreover, ‘expediency in pronouncement’ of an ‘Order’/‘Judgment’ by a ‘Tribunal’ is not desirable/palatable, in the earnest opinion of this ‘Tribunal’.
This ‘Tribunal’ taking note of the totality of the attendant facts and circumstances of the instant case, comes to a resultant conclusion that when the main CP(IB) No.116/NCLT/BB/2020 was heard on 11.12.2020 by the ‘Adjudicating Authority’ and considering the prime fact that when the matter was listed on 07.12.2020 an ‘interim order’ was passed adjourning the main case to 11.12.2020, by no stretch of imagination the ‘Impugned Order’ of the ‘Adjudicating Authority’ in main CP(IB)No.116/NCLT/ BB/2020 would have been pronounced on earlier date on 07.12.2020.
This ‘Tribunal’ without delving deep into the matter and not expressing any opinion on the merits of the matter, any further, at this stage, simpliciter sets aside the said ‘Impugned Order’ of the ‘Adjudicating Authority’ to prevent an aberration of justice and to promote substantial cause of justice.
Appeal allowed.
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2021 (9) TMI 415 - NATIONAL COMPANY LAW APPELLATE TRIBUNAL , CHENNAI
Maintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - Operational Creditors - pre-existing dispute or not - service of demand notice - HELD THAT:- The Adjudicating Authority ought not to have directed the Respondent to settle the claim of the Petitioner within a period of 3 months from the date of receipt of the copy of the Order. Further, the Learned Adjudicating Authority observed that the Application filed by the Appellant/Applicant is with an intention to recover an alleged balance amount, which is against the object of Code, and the settled position of the law. This Tribunal is of the view that the said finding is patently illegal and unreasonable. Further, the Learned Adjudicating Authority in the Impugned Order observed that the Respondent has paid part payments with an assurance to clear the balance in short time. The said observation is also illegal without application of mind. It is a settled Law that when a debt and default is proved, the Adjudicating Authority has to admit the Application and initiate ‘Corporate Insolvency Resolution Process’ against the Corporate Debtor otherwise it is complete.
The Learned Adjudicating Authority having noticed that there is a debt and default, passed the Impugned Order which is non-application of mind and accordingly this ‘Tribunal’ is of the view that it is patently illegal and cannot with-stand to the scrutiny of law - Respondent failed to establish the existence of dispute prior to issuance of ‘Demand Notice’.
This ‘Tribunal’ comes to a conclusion that it is a fit case to be admitted by the Adjudicating Authority - Application admitted - moratorium declared.
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2021 (9) TMI 412 - NATIONAL COMPANY LAW APPELLATE TRIBUNAL , PRINCIPAL BENCH , NEW DELHI
Direction to give a chance to submit Resolution Plan - time limitation - major part of the CIRP Proceedings and the approval of the present Resolution Plan had taken place during Covid Pandemic Period - Corporate Debtor is an MSME Unit a Corporate Guarantor to the Principal Borrower - HELD THAT:- This is the case of the CD which is an MSME Unit, a corporate guarantor to the principal borrower – National Board Limited. The CD was established on 11.12.1973 - Section 29-A R/w Section 240-A of the Code refers to the Resolution Applicant in respect of CIRP of any MSME and these two sections provide for certain reliefs to the promoter of the MSME as a prospective Resolution Applicant and is entitled to have opportunity to place Resolution Plan.
Keeping in mind the intention of the legislature, there is no harm in giving an opportunity to the MSME in accordance with the provisions of the Code for keeping the promotion of entrepreneurship alive. The Adjudicating Authority has only provided an opportunity to the MSME and has given the liberty to the CoC to negotiate with existing Resolution Applicant and MSME unit also and accept the one which is commercially viable and technically feasible.
There are no infirmity in the order - appeal dismissed.
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2021 (9) TMI 389 - NATIONAL COMPANY LAW APPELLATE TRIBUNAL , CHENNAI
Preferential Transactions or not - sale deed executed by the Corporate Debtor - transaction between the Appellant and the Corporate Debtor - Section 43(1) of the I & B Code 2016 - HELD THAT:- In due compliance of the Provisions of Law, if the ‘Adjudicating Authority’ is of the opinion that the said transaction is ‘preferential’ in nature and is within the period of one year preceding the Insolvency commencement date, the said transaction can be declared as void and reverse the effect of such transaction in accordance with Section 45 sub-section (1) of the I & B Code and in accordance with the Chapter III of the I & B Code, 2016.
In the present case, from the documents it is crystal clear that the Appellant is not a related party and the transaction is preceding one year from the date of admission of the application by the Adjudicating Authority on 04.02.2019. The sale deed dated 04.07.2018 and the Application was admitted on 04.02.2019, is well within one year preceding the admission of Application.
The criteria as enunciated under the Code and the Law laid down by the Hon’ble Supreme Court in Anuj Jain, Interim Resolution Professional [2020 (2) TMI 1259 - SUPREME COURT], squarely applicable to the facts of the present case. Further, the Resolution Professional need to see whether the property belongs to the Corporate Debtor or not? In the present case, admittedly the property belongs to the Corporate Debtor as evident from the sale deed and there is no dispute with regard to the same. Therefore, the criteria as prescribed by the Hon’ble Supreme Court in the Judgment is fulfilled and the ‘Adjudicating Authority’ rightly allowed the Application of the Resolution Professional.
This Tribunal is of the view that the said transaction is a preferential transaction and not in the ordinary course of business. Further, this Tribunal is of the considered opinion that the said transaction entered between the Appellant and the Corporate Debtor by executing sale deed dated 04.07.2018 certainly prejudice the interest of other Creditors who have precedence in relation to the claim being settled ahead of the Appellant or even in relation to other ‘Operational Creditors’ who are similarly placed like the ‘Appellant’.
Appeal dismissed.
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2021 (9) TMI 388 - NATIONAL COMPANY LAW APPELLATE TRIBUNAL , PRINCIPAL BENCH , NEW DELHI
Rejection of claim of the Appellant to be a Financial Creditor rejected by Resolution Professional - whether or not the Appellant could be treated as the Financial Creditor looking to the Agreements which are more of Development Agreements? - HELD THAT:- It is stated that the Corporate Debtor had about 70 projects in hand and thus there were applicants who wanted to give offers of Resolution Plans project-wise, which CoC did not find practicable - When the application of Appellant was pending before the Adjudicating Authority, the Adjudicating Authority had only orally asked the CoC to delay taking decision on the question of liquidation. Now, the Adjudicating Authority has applied its mind and taken a conscious decision not accepting the Appellant as the Financial Creditor and observed in Para 16 of the impugned order that CIRP is at an advance stage and reason why it had earlier given oral direction. If for an individual person claiming to be Financial Creditor the progress of CIRP is to be stayed, it would be counter-productive according to us considering the objects of the IBC. Now, when we already have decision not in the favour of the Appellant, it is all the more reason for us to not to grant any interim orders to stay the proceedings which are taking place before the CoC.
It is stated that although extension has been granted by the Adjudicating Authority vide order dated 16th August, 2021, that order also has not been uploaded. Such order has been passed is not disputed by the Resolution Professional. Fact remains that there is time available in the CIRP till 30th September, 2021. The present Appeal will not come in the way of the CoC for either rejecting or accepting any Resolution Plan or from taking any other decisions including decision with regard to liquidation, as per law, when period prescribed under Section 12 of IBC is coming to an end, if Resolution Plan is not there.
List the Appeal ‘For Admission (After Notice)’ Hearing on 25th October, 2021.
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2021 (9) TMI 384 - NATIONAL COMPANY LAW TRIBUNAL , MUMBAI BENCH
Maintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - Financial Creditors - existence of debt and dispute or not - time limitation - HELD THAT:- The Corporate Debtor made cash payments through NEFT into almost all the accounts in July 2017. The Company Petition being filed on 18.12.2019 is less than the 3 years from the date last payment and is within limitation. The counsel appearing for the Financial Debtor submitted that the debt and default are clearly established, and debt is also within limitation in the Company Petition.
The learned counsel appearing for the Corporate Debtor was present at the time of final arguments on 06.08.2021, he did not raise any legal issues opposing the company petition except making statement that the Corporate Debtor has submitted One Time Settlement to the Financial Creditor. Thus, the present Company Petition satisfies all the necessary requirement for admission and the claim of Financial Creditor remained unchallenged.
This tribunal is of the considered opinion that the company petition is liable to be admitted - petition admitted - moratorium declared.
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2021 (9) TMI 364 - NATIONAL COMPANY LAW APPELLATE TRIBUNAL ,PRINCIPAL BENCH, NEW DELHI
Seeking necessary instructions to the RP to consider the claim without having any regard to the delay - admission of claim of the Applicant before RP - adoption of Resolution Plan (not been approved till today and the approval of which would render the present application infructuous), without the admission of the instant claim of the applicant - the claim was duly presented before the RP at an appropriate stage which warranted admission as per the settled law - HELD THAT:- The fact is categorically established that the Appellant was having full knowledge of the CIRP and deliberately not submitted his claim within time and after expiry of 90 days filed the claim which was rightly rejected by the Resolution Professional.
There is no illegality committed by the Ld. Adjudicating Authority - Appeal dismissed.
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2021 (9) TMI 362 - NATIONAL COMPANY LAW APPELLATE TRIBUNAL , CHENNAI
Jurisdiction - power of Adjudicating Authority to adjudicate the matter under the I & B Code - Respondent/Applicant is neither a Financial Creditor nor an Operational Creditor - debt and default existing in terms of the I & B Code or not - case of Appellant is that there is no provision for return of money together with interest under the Share Purchase Agreement between the parties and therefore, the Respondent is not a Financial Creditor viz-a-viz the Appellant - HELD THAT:- The essence of any debt to be described as financial debt is the time value of money as Borrowing is a name for money transaction. The word debt is applicable to a sum of money which has been promised at a future day as against a sum nor due and payable. In fact, a sum of money which is certainly and in all events payable is a debt, in regard to the fact whether it is payable now or at a future date - Under the I&B Code, 2016 the shift is from inability to pay to an existence of default. No doubt, the Adjudicating Authority is not required to decide the amount of default. Even if a debt is disputed, if the same is more than ₹ 1,00,000/- then the application filed under Section 7 of the Code is maintainable in Law.
The actuality of debt was proven by virtue of the concerned terms which formed part of the order of the Adjudicating Authority dated 24.09.2020. When a Settlement was arrived at between the parties, it is the pre-module duty of the Corporate Debtor to effect payments proposed by virtue of the Settlement after committing default, the Appellant cannot take altogether different stand, especially when the tenor and spirit of Share Purchase Agreement was not adhered to - when the Appellant had promised to repay the advanced sum paid by the Respondent/Applicant to it, then there is not only a violation of the Share Purchase Agreement dated 21.11.2012 but also the non-payment of amounts comes squarely under definition of Section 5(8) of the I&B Code pertaining to Financial Debt.
In the instant case, it is quite clear that the order admitting the application under Section 7 of the Code, filed by the Respondent/Applicant has not been assailed by the Appellant. In fact, in the Impugned Order dated 30.03.2021 passed by the Adjudicating Authority in IBA/13/KOB/2020 whereby and whereunder the application filed by the Respondent/Applicant was admitted, the said Adjudicating Authority came to the conclusion that the Respondent/Applicant had proved the existence of a debt as well as existence of default and had discussed in detail about the same in the order dated 25.08.2020, which speaks for itself.
This Tribunal comes to an inevitable and inescapable cocksure conclusion that the aforesaid promise comes squarely within the ambit of definition of ‘Financial Debt’ and that the Respondent/Applicant is without any haziness is a Financial Creditor in the eye of Law - Suffice it for this Tribunal to pertinently point out that the Appellant/Corporate Debtor had not adhered to its ‘commitment’ in respect of Share Purchase Agreement dated 21.11.2012 and had not paid the amount admittedly, especially in the teeth of the fact that the ‘debt’ due arises out of the said Share Purchase Agreement.
The Impugned Order passed by the Adjudicating Authority (National Company Law Tribunal, Kochi Bench, Kerala) in admitting the Application IBA/13/KOB/2020 does not suffer from any material irregularity or patent illegality in the eye of law - Appeal dismissed.
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2021 (9) TMI 337 - NATIONAL COMPANY LAW APPELLATE TRIBUNAL , PRINCIPAL BENCH , NEW DELHI
Correctness of admitting the application - for same debt two proceedings could not be maintained or not - Co-borrowers and Guarantor - interpretation of scope Borrower and Pledgor - Loan cum Pledge Agreements - HELD THAT:- M/s Premier Ltd. and M/s Doshi Holdings were Co-borrowers and promised to pay back the loan with interest. Their liability to pay is joint and several liability. The Promisee may recover the amounts jointly or severally. Here we are not concerned with rights and liabilities inter-se between the Co-borrowers when debt is enforced against one or the other or both of them - A Co-borrower is as much a Borrower like the other entity and is fully liable to repay the loan taken and it is immaterial as to in which account Co-borrowers received the money, when receipt is an admitted position.
The Appellant is arguing that for same debt two proceedings could not be maintained. Piramal’s [2019 (2) TMI 316 - NATIONAL COMPANY LAW APPELLATE TRIBUNAL, NEW DELHI] Judgment was matter relating to filing of proceeding against Principal Borrower as well as Corporate Guarantor and in that context this Tribunal had held that for same debt there could not be two separate proceedings and that in one proceeding filed under Section 7 of IBC action against two Corporate Debtors was not contemplated.
We need not enter into the question if in Pledgor-Pledgee relationship would it be Financial Debt. Doshi Holdings, in addition to stepping into the shoes of Co-borrower, which is financial debt, additionally pledged shares. The liability invoked by Financial Creditor is on the basis of Corporate Debtor being Co-borrower and not merely Pledgor. It is surprising to find that the Appellant is denying liability on account of Doshi Holdings when the Appellant has signed joint documents after documents in favour of Respondent No.1 as Authorised Signatory for both the Companies - Corporate Debtor cannot be permitted to back out from the documents and promises made.
When the Adjudicating Authority admitted the Application under Section 7 of IBC although there was error in observations where reference is made interchangeably to Co-borrower and Guarantor. The Adjudicating Authority at the same time dealt with the case as a matter of Co-borrower. It is a case of Co-borrower, we decline to interfere with the impugned order admitting the Application.
Appeal dismissed.
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2021 (9) TMI 334 - NATIONAL COMPANY LAW TRIBUNAL , GUWAHATI BENCH
Maintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - Financial creditors failed to make repayment of its dues - Rate at which green tea supplied, was not mentioned - amount payable and the date of default established or not - existence of debt and dispute or not - HELD THAT:- It is evident from the Agreement that the Rate per kg. of green tea leaves is not fixed on the date of agreement. It would be fixed in future. On the other hand, the Respondent is expected to supply 12.50 lacs kgs. of quality green tea leaves to the Applicant without knowing the rate. It is clearly established that the amount payable and its due date are not known neither to the Petitioner nor to the Respondent. Hence, the amount payable and the date of default is not established - It is further found from the documents and submissions made during the arguments that the Applicant has not provided the details to the Respondent relating to the quantum of green tea leaves received, rate at which it is sold, the amount of sales proceeds credited and the said bank account maintained. Derivative arrangement or provision is also not there.
The Auditor has not shown this amount as Overdue/NPA in its report. Tea Industry is a going concern. The Applicant has reportedly given further advance of ₹ 98,50,000.00 on its own. Auditor has reported that the copy of the Original Agreement was not furnished to them while the balance sheet was being prepared by them. No further balance sheet has been prepared after 31.03.2018.
Existence of debt and dispute or not - HELD THAT:- One of the prime conditions for admission of Application filed under Section 7 of IBC is that there should exist a debt which has become due and payable by the CD, the CD has committed default in payment of the same on due date and the date of default must be established. In this case, the documents have not been produced by the Petitioner to show the quantum of green tea leaves received from CD, the rate at which green tea leaves purchased/sold and the amount payable to/receivable from the CD and thereby it is clear that the amount of default and the date of default are not established. Then the pleadings of the Applicant that the Respondent has defaulted in making payment of the amount due do not carry any substance - the Application filed under Section 7 of IBC needs to be rejected on this ground also.
The appropriate Authority may take cognizance of prevailing of this type of Agreement and take suitable measures so these type of Agreements with such terms and conditions are not in operations and the needy Tea Estates Companies availing advance from others for supply of Green Tea Leaves are prohibited from the Debt Trap, Exploitation, Imminent Closure, Hostile Takeover and Liquidation, When Advances/loans are available from the established Financial Institutions/Banks with transparent, fair terms & conditions, insurance coverage and reasonable/lower rate of interest to the Tea Estates/Tea Plantation/Agriculture Advance/MSME Tea Industries.
This Application filed under Section 7 of IBC is rejected.
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2021 (9) TMI 275 - NATIONAL COMPANY LAW TRIBUNAL , NEW DELHI BENCH
Refund of amount illegally retained - amounts were given during moratorium period for supply of goods/components - siphoning off proceeds of Corporate Debtor in contravention of Moratorium - contravention of Section 14, 31 and Section 74 of IBC - section 60(5) of the Insolvency & Bankruptcy Code, 2016 - Maintainability of application under Rule 11 of the NCLT Rules, 2016 or under Section 60(5) of IBC, 2016 - HELD THAT:- The provisions of Section 60(5) (a) & (b) of IBC, 2016 are not applicable.
Section 60(5)(c) of IBC, 2016 states that any question of priorities or any question of law or facts, arising out of or in relation to the insolvency resolution or liquidation proceedings of the corporate debtor or corporate person under this Code shall be considered by the Adjudicating Authority - Admittedly, in the present matter, the Resolution Plan has already been approved.
This period of 180 days may be extended under Section 12 of IBC, 2016 and in terms of the amended provision of Section 12 of IBC, 2016, the total period of insolvency resolution process is 330 days, which means that the period so referred to in Section 5(14) of IBC, 2016 is subject to the extension made under Section 12 of IBC, 2016 or when the Resolution Plan is approved by the Adjudicating Authority - in the case in hand, the Resolution Plan has already been approved by the Adjudicating Authority on 02.04.2019. Therefore, no insolvency proceeding is pending before the Adjudicating Authority.
Maintainability of application under Rule 11 of NCLT Rules, 2016 - HELD THAT:- During the pendency of any matter before the Tribunal, when there is no specific provision under the Act/Code is given only then the Tribunal may pass order by exercise of its power under Rule 11 of the National Company Law Tribunal Rules to deal with such situation. But herein the case in hand, no such matter is pending after the approval of Resolution Plan by the Adjudicating Authority, therefore, a separate application to deal with a new issue cannot be entertained under Rule 11 of the NCLT Rules, 2016.
As per Section 25(1) of IBC, it is the first and foremost duty of the IRP/RP to preserve and protect the assets of the corporate debtor, including the continued business operations of the corporate debtor. And in order to protect and preserve the assets of the corporate debtor, a separate provision has been made under Section 14(2) of IBC and Sub Section 2A of Section 14 is added w.e.f. 28.12.2019, as per which the supply of essential goods or services of the Corporate Debtor shall not be terminated, suspended or interrupted during the period of moratorium. Even before the insertion of Sub Section 14(2A) there was a provision under Section 14(2) of IBC, which authorised the RP to permit anyone to continue the supply of essential goods or services which is necessary to keep the Corporate Debtor as a going concern.
The goods/components were supplied by the respondents on the request of the RP during the moratorium period and the RP has acted as per the provision contained under Section 14(2) of the IBC 2016 - there is no contravention of provisions contained under Section 14 of IBC.
Application dismissed.
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2021 (9) TMI 256 - NATIONAL COMPANY LAW APPELLATE TRIBUNAL , PRINCIPAL BENCH , NEW DELHI
Acceptance or rejection of the Application - default in repayment of the loan for which the personal guarantee has been given - receipt of Report under Section 99 of the IBC when the matter is taken up under Section 100 of the IBC - HELD THAT:- There is no dispute that CIRP was initiated against the Corporate Debtor and that the said matter is at the stage of liquidation. The Learned Counsel for the Respondents as well as the Learned Counsel for the Appellant have referred to judgment of this Tribunal in RAVI AJIT KULKARNI, PERSONAL GUARANTOR OF PRATIBHA INDUSTRIES LIMITED AND ORS. VERSUS STATE BANK OF INDIA [2021 (9) TMI 60 - NATIONAL COMPANY LAW APPELLATE TRIBUNAL, NEW DELHI] and the Learned Counsel for both sides agree that the Personal Guarantor of Corporate Debtor may be given the opportunity before the Resolution Professional and orders on similar lines as in the matter of “Mr. Ravi Ajit Kulkarni vs. State Bank of India” could be passed.
Thus, at the stage at which the matter stood such finding in advance should not have been recorded as the said stage would be after receipt of Report under Section 99 of the IBC when the matter is taken up under Section 100 of the IBC.
In the present matter, now the Personal Guarantor is already available and did appear before the Adjudicating Authority to submit that the impugned order should be recalled. As such, the requirement of serving formal notice would not be necessary but the matter needs to be sent back to the Adjudicating Authority so that the procedure is duly followed as indicated by us in the matter of “Mr. Ravi Ajit Kulkarni vs. State Bank of India” - appeal allowed in part.
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2021 (9) TMI 197 - NATIONAL COMPANY LAW APPELLATE TRIBUNAL , PRINCIPAL BENCH , NEW DELHI
Liability for Fraudulent Conduct of Business - fraudulent transactions - existence of claim of the Appellant against the Corporate Debtor - movement of funds of the Corporate Debtor in the cooperative bank which was opened for the limited period from 19.07.2019 to 15.10.2019 - Section 61 of the Insolvency and Bankruptcy Code, 2016 - HELD THAT:- The Operational Creditor (Appellant) is a public incorporated Company since 09.04.1986 - It is not in dispute that they have not supplied the material and the amount were not due for collection.
What wrong has been done by the Operational Creditor is violation of Section 14 of the Code.
We are in agreement with the order passed by the Adjudicating Authority to the extent of refund of money and the same is in order - there is no need to interfere with the order of the Adjudicating Authority.
The appeal is dismissed.
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2021 (9) TMI 196 - NATIONAL COMPANY LAW APPELLATE TRIBUNAL , PRINCIPAL BENCH , NEW DELHI
Withdrawal of application - application was earlier dismissed on the technical ground that the form FA is not signed by the Operational Creditor - Section 12A of the IBC - HELD THAT:- Ld. Adjudicating Authority has rejected the Application on the ground that the Application Section 12A of the IBC is not filed by the Applicant (Operational Creditor) on whose instance CIRP initiated against the Corporate Debtor. No doubt, as per Section 12A of the IBC, the Application must be filed by the Applicant and Regulation 30A of the Regulations provides the procedure and format of the Application i.e. FA.
When the admitted claim of the Operational Creditor and other creditors are satisfied by the Corporate Debtor and CoC approved the resolution for withdrawal of the Application by 100% voting share and the Corporate Debtor has provided a bank guarantee as per sub-Regulation 2 of Regulation 30-A even though the Operational Creditor (Applicant) misusing his position, refused to sign the form FA and does not file Application under Section 12A of the IBC.
No cause of action survives in favour of the Operational Creditor to proceed with CIRP - the matter is remitted back to the Ld. Adjudicating Authority to decide the fees and costs of CIRP payable to IRP which shall be borne by the Corporate Debtor.
Appeal allowed by way of remand.
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