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Insolvency and Bankruptcy - Case Laws
Showing 21 to 40 of 133 Records
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2021 (9) TMI 1352
Service of copy of memo of appeal - HELD THAT:- Learned Counsel for the Appellants are directed to taken steps for issuance of Notice on Respondent Nos. 3 to 5 by both modes. File requisites along with process fee be filed latest by Monday i.e. 20.09.2021. Learned Counsel for the Respondent Nos. 1 to 5 are directed to file Hard Copy of the Reply Affidavit, within two weeks from today.
List this matter for appearance of Respondent Nos. 3 to 5 on 24th November, 2021 under the heading ‘For Admission (After Notice)’.
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2021 (9) TMI 1344
Maintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - Operational Creditors - existence of debt and dispute or not - HELD THAT:- The Operational Creditor has only listed out the details of 1110 Nos. of invoices along with the Application, however has failed to enclose the copy of those invoices per se and in the absence of those invoices which sets out the date, the seal of the Operational Creditor and other details, the Application which are filed by the Operational Creditor are required to be treated as incomplete. It is also required to be noted that the Applicant even though in his Application has averred in Part - IV of the Application that as per his Books of accounts that a sum o ₹ 14,41,728/- is balance outstanding, however has miserably failed to placed on record the copy of the said Ledger Account in the typed set filed along with the Application. AIl these documents are least required for this Adjudicating Authority to properly adjudicate the Application on hand and the present Application filed by the Operational Creditor is bereft of all these details and hence on the said count itself, the present Application is required to be dismissed.
Further, the nature of transaction which transpired between the parties would show that at first the Operational Creditor will supply the materials to the Corporate Debtor and the Corporate Debtor would convert the said materials into finished products and in turn supply the same to the Operational Creditor. Thus, in the present case, it is seen that both the Operational Creditor and the Corporate Debtor have been supplying materials mutually exclusive with one and another and in the said circumstances, the Applicant alone cannot be treated as an ‘Operational Creditor’ in respect of the Corporate Debtor.
For a person to qualify as an Operational Creditor he must have supplied the goods or rendered service to the Corporate Debtor, which is not the proposition In the present case and on the other it is the Corporate Debtor who has supplied the service to the Operational Creditor of which it is claimed to be deficient. Thus, it is quite clear that only a supplier of goods or provider of services who has provided such goods or services can claim to be an “Operational Creditor” and not in the reverse (i.e.) a person who availed the services or received the goods from the Corporate Debtor and in relation to the said transaction a ‘claim’ had arisen.
The Application is bereft of particulars and also the Applicant is not an Operational Creditor in relation to the Corporate Debtor and as such this Application filed by the Operational Creditor is liable to be dismissed - Application dismissed.
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2021 (9) TMI 1332
Acceptance of EOI - seeking to declare Applicant as a prospective resolution applicant in terms of Regulation 36A of CIRP Regulations - seeking to issue a fresh Form G inviting EOI - seeking restraint on CoC from proceeding ahead on the current rushed up process, thereby obtaining and approving any other resolution plan without considering the Resolution Plan of the Applicant - HELD THAT:- It is seen from the record that the RP and CoC allowed other group Companies of M/s. Jindal Power Ltd., to submit the Resolution Plan changing Form-G, although that group Company was not a Resolution Applicant at all. Even the Resolution Plan submitted by the group company of M/s. Jindal Power Ltd. is still under consideration by CoC. The Applicant approached the CoC and requested them to allow to submit the Resolution Plan, in view of the changed circumstances, but, CoC did not consider the prayer.
It is to be noted that the Applicant has already submitted the EOI vide emails dated 28.06.2021 and 04.07.20201 along with its Net worth certificate showing its desire to submit the Resolution Plan. The RP has not controverted the eligibility of the Applicant on the basis of any criteria as laid down under RFRP.
It appears that CIRP period is already over but since one plan is pending and since there is likelihood of Resolution of Insolvency of Corporate Debtor, we did not pass order of Liquidation - the RP and CoC are directed to allow the Applicant to submit the Plan on the basis of amendment of Form - G on which the Group Companies of M/s. Jindal power Ltd. were allowed to submit the plan.
Application disposed off.
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2021 (9) TMI 1330
Inaction of the 2nd respondent in not withdrawing the request for listing of the property - Vires of prohibitory list under Section 22(A) of the Registration Act, 1908 - violation of Articles 14 and 21 of the Constitution of India - HELD THAT:- Having regard to the decision of the Supreme Court in Ghanashyam Mishra and Sons Private Limited [2021 (4) TMI 613 - SUPREME COURT], since in the instant case as the dues of the 2nd respondent are not part of the resolution plan (as can be seen from para F(i) of the Resolution Plan dated 26.06.2019) which was approved by NCLT, the dues of the 2nd respondent automatically stood extinguished - Consequently, there is no authority for the 2nd respondent to continue to insist that the properties of the petitioner cannot be alienated, and the request made by the 2nd respondent on 10.11.2014 and 18.03.2015 requesting the 3rd and 4th respondents not to permit registrations cannot operate and would be non est in law.
As regards the sole defence of the Revenue department that the subject land is an "agricultural land" and the person to register the property is the concerned Tahsildar of Farooqnagar and not any of the respondents, the said plea is without any merit. Along with the reply affidavit, the petitioner has filed several documents showing that the petitioner company was manufacturing iron and steel; that there was a factory located in the said property and Exs. P12 to P16 show the existence of the same. Thus the land ceased to be agricultural land long before the introduction of A.P. Agricultural Land (Conversion for Non-Agricultural Purposes) Act, 2006 - The Revenue department cannot be blind to the existence of the factory in the subject property and if it had failed to amend its revenue records suitably, it cannot put blame on the petitioner for the same.
The request of the 2nd respondent for listing of the property of the petitioner situated in Sy. No. 394 of Raikul Village and Sy. Nos. 49/E and 50/E of Annaram Village of Farooqnagar Mandal, Mahaboobnagar in the prohibited list under Section 22(A) of the Registration Act, 1908 is declared as illegal and violative of Articles 14 and 21 of the Constitution of India and also the provisions of the IBC, 2016 and the consequential proceedings dated 10.11.2014 and 18.03.2015 issued by the 2nd respondent are also declared as null and void and of no effect - Petition allowed.
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2021 (9) TMI 1326
Withdrawal of CIRP application - section 12A of IBC - HELD THAT:- The matter was settled and this application was filed. This application was not adjudicated upon and withdrawal did not happen, in the meantime the CoC is formed and there are two Financial Creditors, out of which one Financial Creditor has dissented to allow withdrawal, having 17% of voting share.
At this stage, this application cannot be considered unless the consent from CoC, as required under the statute, is obtained - List further consideration on 24 November, 2021.
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2021 (9) TMI 1325
Seeking extension of CIRP period - seeking extension beyond 330 days - more than 730 days have passed since the commencement of the CIRP in the Corporate Debtor company - Section 12(3) of IBC, 2016 - HELD THAT:- In terms of Section 12(3) of IBC, 2016, the CIRP of the Corporate Debtor has to be mandatorily completed within maximum of 330 days from the Insolvency commencement date including all extensions and also time taking in legal proceedings in relation to the resolution therefore, the Bench notes that as per the law the Bench cannot extend the CIRP period beyond 330 days. In the extant case also admittedly more than 330 days even after all exclusions and extensions under Code is over.
The Bench notes that Hon’ble Supreme Court in the case of Essar Steel Vs. Satish Gupta [2019 (11) TMI 731 - SUPREME COURT] has mentioned that the CIRP must be completed in 330 days, however, if it can be demonstrated to the Tribunal that only a short period is left for completion of the CIRP beyond 330 days then only the Adjudicating Authority may decide to extend time limit for a short period beyond 330 days. The Bench further notes that in the instant case, even after more than 730 days, there is no sight of completion of CIRP and the RP and COC want to merely explore the possibility of Resolution. From this the Bench concludes that no Resolution of the Corporate Debtor Company is insight.
The application filed by the RP for extension of the CIRP Period beyond more than 730 days for further exploring possibility of resolution of the Corporate Debtor Company is dismissed.
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2021 (9) TMI 1324
Maintainability of application - applicability of time limitation - seeking condonation of Delay is maintainable in an Application filed under Sec7 of IBC? - section 5 of the Limitation Act - sufficient cause for condonation of delay present or not - HELD THAT:- In the present case, the total financial debt owed by the Corporate Debtor is ₹ 681.87 crores to the Applicant who is a custodian of public money and public interest is at stake, CBI proceedings were instituted pursuant to FIR bearing No. RC068206E0014 and also with an element of fraud and involvement of certain officers of Applicant/Petitioner. The petitioner had taken steps and filed recovery proceedings before DRT and thus there is no negligence no lack of bonafides on the part of the Applicant in exercise of its legal rights.
This bench is bound to conclude that an application under Sec.7 is to be filed within three years as construed under Article 137 save and except in those cases where, in the facts of the case, sec.5 of Limitation Act may be applied to condone the delay in filing such application only on the ground that sufficient cause has been shown to condone such delay. It is well settled expression “sufficient Cause” is to receive liberal construction and that the judicial discretion is to be exercised with vigilance and circumspection. It is not the case of the Respondent/ Corporate Debtor that grave injustice would be occasioned if the delay is condoned, this Bench is adopting a liberal approach considering that the applicant is a public sector undertaking of Government of India involving public interest/public money. This proceedings under Section 7 is not a recovery proceedings but to initiate Corporate Insolvency Resolution Process of the Corporate Debtor and as such this Adjudicating Authority is exercising its judicial discretion in condoning the delay in filing the petition under Sec.7 as an exceptional case.
On perusal of the documents filed by the Financial Creditor, is of the view that the Premier Limited and the Corporate Debtor defaulted in repaying the loan availed. The existence of debt and default is reasonably established by the Petitioner as a major constituent for admission of a Petition under Section 7 of the Code. Therefore, the Petition under sub-section (2) of Section 7 is taken as complete, accordingly this Bench hereby admits this Petition - Petition dismissed - moratorium declared.
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2021 (9) TMI 1323
Maintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - personal guarantor - existence of debt and default or not - HELD THAT:- The Bench has no doubt in its mind that there is a ‘default’ on the part of the Personal Guarantor by not fulfilling the debt owed to the Corporate Debtor, i.e., Anoushka Medicare & Diagnostics Private Limited as per the Deed of Personal Guarantee entered between the parties through the Deed of Personal Guarantee dated 01.08.2017.
This Bench “Allows” the Application filed by Sudha Bhushan, Insolvency Resolution Professional on behalf of Finquest Financial Solutions Private Limited, the Financial Creditor, under Section 95 of the Insolvency & Bankruptcy Code, 2016 read with Rule 7 of the IBC Rules 2019 against Mrs. Kanchan Nanubhai Desai, the Personal Guarantor of the Corporate Debtor, Anoushka Medicare & Diagnostics Private Limited in CP No. 457/2020.
The Bench makes it clear that from the date of filing this Application i.e. 31.01.2020 by the Petitioner, Interim Moratorium commences as stipulated under Section 96(1) of the Code in relation to all the debts of the Personal Guarantor - List the matter for further hearing along with IA 2495 of 2020 on 02.11.2021.
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2021 (9) TMI 1320
Maintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - Financial Creditors - alleged default of ‘financial debt’ which was admitted by the NCLT - HELD THAT:- There is no reason to interfere with the order dated 03.08.2021, which is interlocutory in nature. However, it is directed that the NCLAT to decide the appeal, i.e. Company Appeal (AT) (Insolvency) No.128 of 2021 finally on 05.10.2021 when the matter is listed for hearing.
Appeal disposed off.
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2021 (9) TMI 1308
Seeking direction to Respondent No. 1 to pay the Invoices dated July 24, 2021 alongwith the contractual rate of interest till realization - seeking direction to Respondent No. 1 to ensure that the invoices which will be raised by the Applicant on behalf of RCRIPL for the services provided by RCRIPL to KMPCL are paid in full and in priority - HELD THAT:-The Law is very clear that the supplier of goods or provider of service of the Corporate Debtor cannot stop such supply or stop to provide services, provided the RP has to make the payment of expenses for such procurement of services or supply of goods to keep the Corporate Debtor as a going concern. We do not wish to add anything more than what has been stated in the Law.
The Respondent are directed to pay the Applicant the amount raised in the said the Invoice, in accordance with a binding contract which is in force, within a week so as to enable the Applicant to provide the rail services subject to due payment without interruption to keep both the Respondent as well as the Applicant as going concerns. It is also made clear that this Adjudicating Authority is not dwelling into the dispute regarding alleged exorbitant pricing as the same is arising out of the Agreement entered into between both the parties prior to CIRP.
Application disposed off.
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2021 (9) TMI 1302
Seeking to exclude the period commencing from 25.03.3020 to 30.06.2020 i.e. 98 days on the ground of Lockdown imposed by the Central Government as well as State Government while calculating the total period of Corporate Insolvency Resolution Process - HELD THAT:- Where Ld. Adjudicating Authority excluded only 98 days, we hereby exclude 221 days (the period from 25.03.2020 to 31.10.2020) from the CIRP period as prayed by the Appellant on the ground of Lockdown imposed by the Central Government as well as State Government. Thus, the impugned order is hereby set aside. The time spent in pursuing the instant Appeal i.e. Company Appeal (AT) (Insolvency) No. 444 of 2021 filed by Resolution Professional (Appellant herein) on 18.06.2021 to till the date of Judgment is also excluded from the CIRP period.
Appeal allowed - Registry to upload the Judgment forthwith on the website of this Appellate Tribunal.
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2021 (9) TMI 1295
Non-grant of interim order by the Tribunal - HELD THAT:- Ld. Counsel for R-1 submits that he could not file the reply affidavit of the appeal as well as reply of the stay application. Therefore, he further seeks and is granted one week’s time to file the same.
Let the matter be fixed for ‘Orders’ on stay application I.A. no. 1649/2021 on 24th September, 2021.
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2021 (9) TMI 1272
Liquidation of the Corporate Debtor - no Resolution Plan was approved by the Committee of Creditors within the CIRP period - Section 33(1)(a) of the I&B Code - HELD THAT:- In the present case, it cannot be brushed aside that the ‘Committee of Creditors’ had rejected the Resolution Plan in the meeting that took place on 15.11.2019. Moreover, the ‘Corporate Insolvency Resolution Process’ came to an end on 15.11.2019, which date 651 days rolled by from the commencement date of insolvency on 02.02.2018 - As a matter of fact, the Resolution Applicant, on 19.11.2019 had acknowledged the rejection of its Resolution Plan by the Committee of Creditors and had prayed for the refund of ‘Earnest Money Deposit’ and subsequently had requested for a deliberation / discussion with the State Bank of India for mutual Resolution of the concerns of the Bank. Apart from that, the Resolution Professional filed CA 1077/2019 on 19.11.2019 and sought for an additional 75 days to complete the CIRP process.
In the present case, it is to be borne in mind that the Resolution Applicant had acknowledged the decision of the CoC in regard to the rejection of the Resolution Plan through an email dated 19.11.2019 and claimed the refund of the ‘Earnest Money Deposit’. Further, it cannot be lost sight of that the Resolution Applicant had not furnished the revised Resolution Plan including the suggested changes and instead proposed, more modifications to the commercials and term of the Resolution Plan and later withdrew its interest in any Resolution Plan. Suffice it for this Tribunal to point out that on 19.3.2020 the Resolution Applicant withdrew its interest for pursuing the Resolution Plan, perceiving that the Committee of Creditors had not approved the Resolution Plan till date of withdrawal - In the present case, indisputably, the CIRP period came to an end on 15.11.2019 and because of the direction dated 30.10.2019 issued by the ‘Adjudicating Authority’ the ‘Resolution Professional’ had no option but to file an IA. No. 412/2020 praying for a ‘Liquidation Order’ be passed as per Section 33(1)(a) of the Code. Moreover, liberty was prayed for to withdraw an application seeking extension of CIRP period as grounds were claiming extension and holding further CoC meeting for consideration of Resolution Plan had disappeared and the CIRP period got lapsed on 15.11.2019.
This Tribunal considering the facts and circumstances of the entire conspectus of the instant case in an encircling manner, bearing in mind a primordial fact that the ‘Committee of Creditors’ had not approved the ‘Resolution Plan’ till 15.11.2019(viz. the final day of CIRP), the CIRP period was not extended by the Adjudicating Authority on 19.03.2020 when the Resolution Applicant / Maritime Trade Corporation had withdrew its interest for pursuing the Resolution Plan, the CoC becoming ‘Functuous Officio’ and the Resolution Applicant despite the State Bank of India conveying the acceptance of Plan by its authorities subject to the inclusion of changes proposed by its legal team on 07.02.2020 and the ‘Resolution Applicant’ / Maritime Trade Corporation had not submitted the modified ‘Resolution Plan’ etc.; comes to a consequent conclusion that in the present case, there is no approved plan of the ‘Committee of Creditors’.
Appeal dismissed.
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2021 (9) TMI 1268
Seeking approval of Resolution Plan - section 33(1) r/w Section 60(5) of the I&B Code, 2016 - HELD THAT:- Taking note of the fact that the instant Company Appeal is pending on the file of this Tribunal, keeping in mind that the Liquidation Order is dated 31.12.2019, and also considering the primordial fact that the Eighth Respondent had taken steps based on the ‘Liquidation’ Order dated 31.12.2019 comes to a resultant conclusion that (i) the ‘Prima Facie’ (ii) the ‘Balance’ of convenience are not in favour of the grant of interim relief of stay of all further proceedings carried on by either the NCLT or by the Liquidator(including stay of E-Auction to be held on 29.9.2021 between 11.00 a.m. and 3.00 P.M. by the Liquidator in terms of Public Notices as per Public Notices (as prayed for in IA 436/2021 in TA No. 91/2021 in Comp. App.(AT)(Ins.) No. 314 of 2020) and viewed in that perspective dismisses the I.A. No. 436/2021 filed by the Applicant/Appellant, to secure the ends of justice.
Application dismissed.
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2021 (9) TMI 1246
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 - violation of Principles of Natural Justice - HELD THAT:- Appellant is harping upon the fact that the reply was to the MA and not to the petition. This deserves to be rejected. If one peruses Annexure A-5, it shows that in para 1 of the Reply although the Corporate Debtor referred to Miscellaneous Application (which was already withdrawn), the Corporate Debtor in para 3 stated that the Appellant was filing this affidavit for the purpose of opposing the Company Petition. In said reply the contentions of the company petition are met for the purpose of opposing the company petition. The reply goes on to answer averments of the petition. The receipt of the loan is admitted.
The debt outstanding is not disputed and the re-payments made till March, 2016 are pointed out. The fact that the Financial Creditor has obtained Recovery Certificate under Section 101 of the Maharashtra Co-operative Societies Act on 21.01.2015 is also not disputed - we discard the claim being made by the Corporate Debtor that he did not get opportunity to file reply to the petition.
Violation of principles of natural justice - HELD THAT:- Once the party has appeared in the proceeding in the original forum where the further dates are given in the proceedings, and pendency of the proceeding is known to a party, it is the responsibility of the party also to keep track of the proceedings and to participate in future developments in the matter.
The Corporate Debtor sought time to amicably settle the matter. It was recorded that failing settlement the matter will be heard on merits on next date of hearing and the matter came to be adjourned to 07.04.2020. The matter could not be heard on 07.04.2020 and was taken up on 24.11.2020 and the order dated 24.11.2020 shows that the Adjudicating Authority referred to hearings that took place on earlier dates and that the Corporate Debtor had filed reply. The Adjudicating Authority by way of abundant caution directed the Registry to send a court notice to the Corporate Debtor as although the Counsel for Petitioner was present nobody was present for the Corporate Debtor.
Time Limitation - HELD THAT:- The Adjudicating Authority came to a right conclusion that there was a debt which was in default and the debt outstanding was within limitation - Hon’ble Supreme Court referred to the judgment of “Sesh Nath Singh & Anr. vs. Bidyabati Sheoraphuli Co-operative Bank Ltd. & Anr.”, [2021 (3) TMI 1183 - SUPREME COURT] to observe that IBC does not exclude the application of Section 14 or 18 or any other provision of the Limitation Act.
It is quite clear that Certificate of Recovery issued would also give fresh right to recover the amounts for which the Recovery Certificate has been issued - In the present matter the Recovery Certificate was issued on 21.01.2015. Then there are undisputedly part-payments made. Thus Section 19 of Limitation Act is also helpful to Financial Creditors. The Application filed under Section 7 on 22.11.2019 cannot be said to be time barred.
Appeal dismissed.
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2021 (9) TMI 1245
Seeking dissolution of M/s. BSM India Private Limited - voluntary liquidation - section 59 of the Insolvency and Bankruptcy Code, 2016 (Code) read with Insolvency and Bankruptcy Board of India (Voluntary Liquidation Process) Regulations, 2017 - HELD THAT:- The Special Resolution was passed by members on 17.02.2020 after a gap of 101 days from Declaration by Directors (08.11.2019) as against requirement of 28 days as per Section 59(3)(c) of the Code. After special resolution, petition with NCLT was filed after 17 months as against requirement of 12 months. It was orally submitted by the Counsel that the reasons for delay in conducting the liquidation process and the statutory compliance U/s. 59(3)(c) was neither intentional nor deliberate. Accordingly, the delay is condoned in completing the process of liquidation.
There is no legal impediment in allowing the prayer of the applicant - the Liquidator is allowed to dissolve the Company U/s. 59 of the Code and the said company is hereby dissolved with effect from the date of the present order.
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2021 (9) TMI 1242
Maintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - Financial Creditors/personal Guarantor - existence of debt and dispute or not - HELD THAT:- The Guarantee of the Personal Guarantor was invoked by the bank by way of notice dated 24.08.2020 and a Demand Notice in Form B under rule 7(1) of the Insolvency and Bankruptcy (Application to Adjudicating Authority for Insolvency Resolution Process of Personal Guarantors to Corporate Debtor) Rules, 2019 was issued by the Financial Creditor, i.e., State Bank of India on 24.08.2020 to the Personal Guarantor in respect of the unpaid debt due from M/s. C & C Constructions Limited. (Corporate Debtor) under rule 7(1) of the IBC, 2016. Counsel for the Applicant mentioned that there has been no response from the Respondent side to the demand notice - applicant in Part- III of Form-C has submitted that the Record of Default by Information Utility, M/s. National e-Governance Services Limited, recording of debt committed by the Corporate Debtor M/s. C & C Constructions Limited. has also been annexed with the application.
The application is complete and is admitted - moratorium declared.
List the matter for further proceedings in the case on 22.09.2021.
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2021 (9) TMI 1209
Seeking direction against admission of claim as per the FORM C - onus to prove claim - seeking to update the Committee of Creditors voting share ratio after admitting the claim of the Applicant - Section 60 (5) of Insolvency and Bankruptcy Code, 2016 - HELD THAT:- It is observed that the Applicant is conveniently trying to escape from the onus of proving its claim rather than expecting the Respondent / RP to the same without any application of mind, which is a clear mis-interpretation of the provisions of Section 18 of the Code. The RP is duty bound to apply his mind while collating and verifying the information to justify the claim and where the said claim is not supported with documentary evidences, the RP ought to refrain from admitting such claims. The Applicant fails to appreciate that an IRP/RP is not a mere rubber stamp to keep admitting claims without any verifications.
Form the facts of the case it is clear that RP has conscientiously reached at conclusion not admitting partial claim of the Respondent which was not supported by documents - Application rejected.
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2021 (9) TMI 1208
Seeking liquidation of Corporate Debtor - Section 33(4) of the Insolvency & Bankruptcy Code, 2016 - HELD THAT:- In the Present case contention of Applicant is that Total outstanding to the tune of ₹ 87,39,196/- were not admitted, instead only ₹ 70,00,000/- were admitted. Applicant also plead that they were not aware about this fact that there claim were not admitted in totality - When the resolution Plan is approved with ₹ 70,00,000/- out of ₹ 87,39,196/- of Applicants claim, now at this juncture it can’t be reverse by virtue of Section 32A of the IBC, there could be no question as to the successful Resolution Applicant, being saddled with the outstanding dues. Section 32A is retrospective in operation.
The accepting and modifying terms and conditions laid down in the Resolution Plan fall within the domain of commercial wisdom of the CoC and this Adjudicating Authority is not expected to substitute its view in such Resolution plan approved by the CoC. Hence such prayer cannot be allowed and is rejected.
Application rejected.
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2021 (9) TMI 1207
Preferential transaction or not - transfer of amount by Corporate Debtor - Section 43 (1) and 44 of Insolvency and Bankruptcy Code, 2016 - HELD THAT:- The Applicant has failed to provide substantial proof to term the transaction as the preferential transaction. Moreover, the amount paid to Respondent No. 1 was a mere refund of amount that was advanced to M/s Mind Estates Private Limited for booking of office premises for the Corporate Debtor Company even before the initiation of CIRP proceedings.
Respondent No. 1 had ordinarily been providing loans and getting repaid which proves that the Corporate Debtor Company and the Respondent No. 1 were into business transactions on regular basis - the Resolution Professional has himself not made out his case and the transaction in question fails to be that of a Preferential Transaction, having been made in Ordinary course of business. There was no intent to deceive the company through this transaction nor the Corporate debtor Company had any other ulterior motive other than merely re-paying the Respondent her advanced amount for booking of office premise with M/s Mind Estates Private Limited - Moreover, the Applicant has failed to conduct Forensic Audit which he was supposed to do, to bring out the relevant facts for moving this Application forward.
Application allowed.
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