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Insolvency and Bankruptcy - Case Laws
Showing 81 to 100 of 133 Records
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2021 (9) TMI 744
Seeking exclusion of period starting on the date of commencement of CIRP till the availability of books of accounts and details from the personnel of the Corporate Debtor - HELD THAT:- Section 19 provides for the personnel of the Corporate Debtor to cooperate with the interim resolution professional and if they do not cooperate, an application may be preferred under sub-section (2) thereof. Although the application under section 19(2) has been filed in the present case, it has not been pressed for hearing so far. Filing an application does not absolve the RP of his duties but he also has to pursue the application diligently, which has not been done in the present case.
Although a provision for filing of application against the non-cooperating members has been provided for in the Code, the same shall not be resorted to unless the professional has discharged his duties proactively and diligently. The duty cast upon the IRP and the RP under sections 18 and 25 of the Code are not empty formalities that the professionals have to discharge just for the sake of doing it. Section 25(2) provides, inter alia, for the RP to take custody and control of all the assets of the Corporate Debtor, including the business records of the Corporate Debtor. In the present case, all that the RP has done is contact the member of the suspended board through email and speed post. The utter lack of seriousness on the part of the RP in discharging his duties under the Code is appalling.
Coming back to the point of exclusion, although a discretion has been provided to the Adjudicating Authority to enlarge the time for completion of CIRP, the discretion is to be used sparingly and judiciously in cases where the Applicant demonstrates that the Corporate Debtor is only a few days short of achieving a resolution by way of a resolution plan and that it would be in the interest of all stakeholders that the Corporate Debtor be put back on its feet instead of being sent into liquidation.
Application dismissed.
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2021 (9) TMI 733
Validity of permitting withdrawal of Corporate Insolvency Resolution Process - appellant D. Ramjee who is an exemployee of M/s Aruna Hotels Ltd. has filed an appeal as he was not receiving salary regularly, he sought to get relieved from the services with effect from 30.9.2006 and sought for settlement of his salary dues - HELD THAT:- The Adjudicating Authority is entitled to withdraw the application admitted under Section 7 or Section 9 or Section 10, on an application made by the applicant with the approval of 90% voting share of the CoC - It is not in dispute that the resolution of CoC approving withdrawal of CIRP proceedings was supported by the requisite voting majority.
One of the principal objects of the IBC is providing for revival of the Corporate Debtor and to make it a going concern. Every attempt has to be first made to revive the concern and make it a going concern, liquidation being the last resort - From the order of NCLT dated 4.6.2021, it could be seen that the Corporate Debtor has already settled the issue with the erstwhile financial creditors, who have resolved to withdraw the CIRP proceedings and by virtue of withdrawal of CIRP proceedings, the Corporate Debtor now is a going concern.
NCLT vide order dated 6.7.2021, passed in the application (I.A.No.540/CHE/2021) filed by D.Ramjee, has rightly held that from the date of the order dated 4.6.2021, after the withdrawal of CIRP proceedings, the powers and management of the Corporate Debtor were handed over to the Directors of the Corporate Debtor and from that date RP and CoC in relation to the Corporate Debtor had become functus officio. NCLT has rightly disposed of the application filed by D.Ramjee having rendered infructuous.
Appeal disposed off.
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2021 (9) TMI 693
Levy of penalty - Corporate Debtor alleged shortage of supply of Coal and the amounts were never paid - allegations of short supply were strongly denied by the ‘Operational Creditor’ and no payments made - HELD THAT:- On a query from the Bench, Learned Counsel for the Respondent has fairly conceded that the observations made, 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, relevant paras of the Impugned Order be expunged and the same is ordered. The merits of the matter with respect to any ‘Pre-Existing Dispute’ or otherwise is not discussed.
Appeal disposed off.
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2021 (9) TMI 685
Maintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - Operational Creditors - existence of debt and dispute or not - non-compliance with mandatory requirement u/s 9(3)(b) of IBC - HELD THAT:- This Petition has been filed by the Operational Creditor, M/s. Indiabulls Distribution Services Ltd. u/s. 9 for a total claim amount of ₹ 17,35,762/-. The claim is based on an agreement dated 09.03.2016 between the Operational Creditor and the Corporate Debtor wherein the Operational Creditor was appointed as a Consultant/Broker to market the Units in the project named 'Xrbia Eiffle City II' of the Corporate Debtor situated in district Raigad. This bench notes that the brokerage agreed between the parties was 8.5% of the total sale consideration only on the Units which has been booked by the Consultant (Operational Creditor).
If unit is cancelled by the prospective purchaser, the Operational Creditor shall not be entitled to any brokerage. In addition, if the purchaser does not pay the minimum of 40%, in case of Self Funded Customer, or 20% in case of a Customer availing loan facility, then no amount will be payable as brokerage fee and any brokerage already paid shall be adjusted from the brokerage future due - the amount of debt does not match the invoices attached to the Petition which states as ₹ 17,35,762/-. Similarly, in the notice issued by the Petitioner to the Corporate Debtor on 20.12.2016 the amount due is shown as ₹ 8,59,655/-. This shows discrepancies/lack of clarity on the amount of debt being claimed by the Petitioner. Be that it may, this bench notes that there are pre-existing disputes between the Petitioner and the Corporate Debtor. This bench notes that in this Petition, several invoices have been annexed and to explain the same, excel sheet has been annexed by the respondent.
Thus, it is clear that most of the customers have booked the flats from different sources viz. with a reference of a friend, through newspaper, etc. and not through the petitioner. In view of this, this bench is of the view that no brokerage arises in the flat bookings relating to the customers who have booked flats from the sources other than brokerage.
It is evident to the bench that the Corporate Debtor had raised dispute before filing of the Petition. The Corporate Debtor had clearly intimated in its email dated 01.03.2017 about the dispute between the parties and also that no amount was payable to the Operational Creditor - petition dismissed.
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2021 (9) TMI 683
Seeking Liquidation of Corporate Debtor - Section 33(2) and 34(1) of the Insolvency and Bankruptcy Code, 2016 - HELD THAT:- Despite all possible steps as required under the Code taken during the CIRP, the CoC did not accept any of the resolution plans/proposal for revival of the Company. The CoC in its wisdom has resolved with 81% voting share in favour of the liquidation of the Company. This Authority has no reason before it to take a contrary view in terms of Section 33(1)(a) of the Code. Therefore, there are no option than to pass an order for liquidation of the Company in the manner laid down in Chapter-III of the Code.
On reading the Application and the documents enclosed therein, it is found the RP has complied with the procedure laid down under the Code; Regulations made thereunder - this is a fit case to pass liquidation order under sub-clauses (i), (ii) and (iii) of Clause (b) of Sub-Section (1) of Section 33 of the Code for liquidation in the absence of any resolution plan.
The Corporate Debtor i.e. M/s. Ind-Barath Power Gencom Limited shall be liquidated in the manner laid down in Chapter-III of the Code - Application allowed.
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2021 (9) TMI 682
Seeking issuance of necessary directions to the Suspended Directors and Statutory Auditors of the Corporate Debtor to provide assistance, co-operation and information required by the Resolution Professional in discharging his statutory duties - Section 19(2) & Section 60(5) read with rule 11 of the NCLT Rules, 2016 of the Insolvency and Bankruptcy Code, 2016 - HELD THAT:- In view of the facts of the case on hand and after considering the provisions contained thereof, this adjudicating Authority is of the view that the ex-management are collectively as well as independently, must furnish information and assist the RP in managing the affairs of the Corporate Debtor in order to enable the RP to complete the CIRP expeditiously and therefore, the persons who can cooperate with the RP and persuade the other managerial personnel to supply the documents, cannot escape their obligation.
This Adjudicating Authority in order to implement the intention of the Code directs the suspended Directors and managerial persons to extend full cooperation and simultaneously furnish all the information of their accounts as well as all the information as required by the Resolution Professional to complete the CIRP efficiently and in time bound manner and RP is further directed to take possession of the whole record. Further, when information are in knowledge and possession of the Directors, they shall be held responsible for non-submission - Of the information as well as for non-cooperation with the RP as prescribed under Section 19 of the Code, and shall therefore be liable for punishment under Section 70 of the Code, if information is not provided further.
Application allowed.
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2021 (9) TMI 680
Seeking liquidation of the Corporate Debtor - Section 33(2) of the Insolvency and Bankruptcy Code, 2016 - HELD THAT:- The Application is in accordance with law. The same needs to be approved as provided under Section 33 of the Code.
The Corporate Debtor, Orient Tourism Private Limited, shall be liquidated in the manner as laid down in Chapter-III of the Code with the directions issued - application allowed.
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2021 (9) TMI 679
Seeking dissolution of the Corporate Debtor - Sections 54 of the Insolvency & Bankruptcy Code, 2016 read with Regulation 14(a) of Insolvency and Bankruptcy Board of India (Liquidation Process) Regulations, 2016 and also read with Rule 11 National Company Law Tribunal, Rules 2016 - HELD THAT:- On examining the submissions made by the Counsel appearing for the Applicant and the documents annexed to the Application, it appears that the affairs of the Corporate Debtor have been standstill since last 15 years and there are no assets to liquidate. Also, the name of the company was struck off from the list of the companies by the Registrar of the Companies vide public notice dated 03.10.2018.
We are satisfied from the documents on record that the dissolution is not with intent to defraud any person. The liquidation process has been duly completed as per the provisions of the Code without success.
From the facts narrated and the law on the subject it would be just and equitable to dissolve the Corporate Debtor. No party is going to be adversely affected or prejudiced thereby - the above the Corporate Debtor deserves to be dissolved - Application allowed.
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2021 (9) TMI 672
Withdrawal of Resolution Plan - resolution plan was approved by Committee of Creditors - principles of res-judicata - seeking refund of Earnest Money Deposit - whether the Third Withdrawal Application by Ebix was barred by res judicata? - HELD THAT:- While res judicata may have been codified in Section 11, that does not bar its application to other judicial proceedings, such as the one in the present case.
In Daryao v. State of U.P., [1961 (3) TMI 91 - SUPREME COURT], a Constitution Bench of this Court held that orders dismissing writ petitions in limine will not constitute res judicata. It was noted that while a summary dismissal may be considered as a dismissal on merits, it would be difficult to determine what weighed with the Court without a speaking order - Another two judge Bench of this Court, in its judgment in ERACH BOMAN KHAVAR VERSUS TUKARAM SHRIDHAR BHAT AND ANOTHER [2013 (12) TMI 1673 - SUPREME COURT], has held that the doctrine of res judicata can only apply when there has been a conscious adjudication of the issue on merits.
Res judicata cannot apply solely because the issue has previously come up before the court. The doctrine will apply where the issue has been “heard and finally decided” on merits through a conscious adjudication by the court. In the present case, the NLCT’s order dismissing the First Withdrawal Application makes it clear that it had only considered only that part of prayer (iv) which related to re-evaluation of the Resolution Plan, possibly because Ebix had hoped to re-evaluate the Resolution Plan on the basis of the information received as a consequence of prayers (i) and (ii) and those prayers were rejected since such information was not available.
Res judicata cannot apply solely because the issue has previously come up before the court. The doctrine will apply where the issue has been “heard and finally decided” on merits through a conscious adjudication by the court. In the present case, the NLCT’s order dismissing the First Withdrawal Application makes it clear that it had only considered only that part of prayer (iv) which related to re-evaluation of the Resolution Plan, possibly because Ebix had hoped to re-evaluate the Resolution Plan on the basis of the information received as a consequence of prayers (i) and (ii) and those prayers were rejected since such information was not available.
Ebix was responsible for conducting their own due diligence of Educomp and could not use that as a reason to revise/modify their approved Resolution Plan. In any event, Section 32A of the IBC grants immunity to the Corporate Debtor for offences committed prior to the commencement of CRIP and it cannot be prosecuted for such offences from the date the Resolution Plan has been approved by the Adjudicating Authority under Section 31, if the Resolution Plan results in a change of management or control of the Corporate Debtor subject to certain conditions - in any case even if it is found that there was any misconduct in the affairs of Educomp prior the commencement of the CIRP, Ebix will be immune from any prosecution or punishment in relation to the same. The submission that Ebix has been placed in a prejudicial position due to the initiation of investigation into the affairs of Educomp by the CBI and SFIO is nothing but a red herring since such investigations have no bearing on Ebix.
Ebix cannot dispute that E-RP had provided it the relevant information required under Section 29 to formulate its Resolution Plan. The issues in relation to financial investigations into the conduct of Educomp arose when the two articles were published by The Wire, both of which were after the Approval Application had been filed by the E-RP. Further, Ebix was aware of all the proceedings before the NCLT since the various applications were often listed along with the Approval Application, in which it continued to appear. Finally, Ebix has brought nothing on record to prove that E-RP knew of the SFIO and CBI investigations before a regulatory disclosure was made by Educomp. Hence, it cannot be stated that the E-RP had faltered in its duty to provide relevant information to Ebix.
Ruling - In the present framework, even if an impermissible understanding of equity is imported through the route of residual powers or the terms of the Resolution Plan are interpreted in a manner that enables the appellants’ desired course of action, it is wholly unclear on whether a withdrawal of a CoC-approved Resolution Plan at a later stage of the process would result in the Adjudicating Authority directing mandatory liquidation of the Corporate Debtor. Pertinently, this direction has been otherwise provided in Section 33(1)(b) of the IBC when an Adjudicating Authority rejects a Resolution Plan under Section 31.
In this context, we hold that the existing insolvency framework in India provides no scope for effecting further modifications or withdrawals of CoC-approved Resolution Plans, at the behest of the successful Resolution Applicant, once the plan has been submitted to the Adjudicating Authority. A Resolution Applicant, after obtaining the financial information of the Corporate Debtor through the informational utilities and perusing the IM, is assumed to have analyzed the risks in the business of the Corporate Debtor and submitted a considered proposal. A submitted Resolution Plan is binding and irrevocable as between the CoC and the successful Resolution Applicant in terms of the provisions of the IBC and the CIRP Regulations.
Impact of Delay in approving the Plan - It would also be sobering for us to recognize that whilst this Court has declared the position in law to not enable a withdrawal or modification to a successful Resolution Applicant after its submission to the Adjudicating Authority, long delays in approving the Resolution Plan by the Adjudicating Authority affect the subsequent implementation of the plan. These delays, if systemic and frequent, will have an undeniable impact on the commercial assessment that the parties undertake during the course of the negotiation.
The NCLT and NCLAT are urged to be sensitive to the effect of such delays on the insolvency resolution process and be cognizant that adjournments hamper the efficacy of the judicial process. The NCLT and the NCLAT should endeavor, on a best effort basis, to strictly adhere to the timelines stipulated under the IBC and clear pending resolution plans forthwith. Judicial delay was one of the major reasons for the failure of the insolvency regime that was in effect prior to the IBC. We cannot let the present insolvency regime meet the same fate.
Appeal dismissed.
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2021 (9) TMI 633
Maintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - Operational Creditors - existence of debt and dispute or not - service of demand notice - HELD THAT:- The Petitioner raised invoices aggregative of ₹ 9,11,190/- to Corporate Debtor and the Corporate Debtor made a payment of ₹ 2,97,676/- and hence the outstanding amount of ₹ 6,91,514/- remain payable by the Corporate Debtor. The said invoice were to be paid on immediate basis and contain interest clause wherein the Petitioner could claim interest @ 24% in case delayed payment. Hence an amount of ₹ 3,52,953.91/- towards interest was claimed. The total amount outstanding of ₹ 10,45,467.90/-. The debt became due on 09.01.2018.
The Petitioner has issued demand notice under section 8 claiming entire amount due and the Corporate Debtor replied to said demand notice stating that they were unable to pay the monies and were facing financial distress. The Corporate Debtor filed reply and sought time of 12 to 15 months to pay the outstanding balance. Therefore, in view of the facts of the present case which clearly demonstrate the debt which was due for payment under the invoices raised by the Petitioner and the admission of liability by the Corporate Debtor and express declaration of inability of non-payment due to financial crisis, this petition is admitted.
The application filed by the Petitioner is on proper Form 5, as prescribed under the Adjudicating Authority Rules and is complete - Application admitted - moratorium declared.
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2021 (9) TMI 632
Seeking liquidation of the Corporate Debtor - no resolution Plan was received - Section 33(2) of I&B Code - HELD THAT:- Section 33(2) of the Code enjoins the Adjudicating Authority to pass an order for liquidation of the Corporate Debtor where the resolution professional, at any time during the CIRP but before confirmation of the resolution plan, intimates the Adjudicating Authority of the decision of the CoC approved by not less than sixty-six percent of the voting share, to liquidate the Corporate Debtor. In the present case, the CoC has resolved by 100% voting share to liquidate the Corporate Debtor.
The Corporate Debtor is ordered to be liquidated in terms of section 33(2) of the Code read with sub-section (1) thereof - Application allowed.
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2021 (9) TMI 584
Maintainability of application - initiation of CIRP - Personal Guarantor to the Corporate Debtor failed to make repayment of its dues - Financial Creditors - existence of debt and dispute or not - HELD THAT:- It is pertinent to mention that as per part-III of Form-C, the total debt from the personal Guarantor, by way of personal Guarantee given to M/s. Hitech Grain Processing Pvt. Ltd., including the rate of interest as on 31.08.2020, amounts to ₹ 209,61,09,614/- - this Tribunal heard the arguments advanced by the Ld. counsel for the Applicant and perused the averments made in the application as well as the documents enclosed with the application. Further, the Respondent has not filed any submissions and on the date of hearing there was no representation from the side of the Respondent i.e., the Personal Guarantor.
Based on the documents produced and placed on record before this Tribunal and on the submissions made by the Applicant, it can be concluded that there is a 'default' on the part of the Personal Guarantor, by not fulfilling the debt owed to the Corporate Debtor, i.e., M/s. Hitech Grain Processing Pvt. Ltd. as per the Deed of Guarantee entered between the parties through the Deed of Guarantee dated 06.06.2017.
The Tribunal "Allows" the Present Application filed by Mr. S.V. Saravanan, Authorized Person on behalf of State Bank of India, the Financial Creditor, under Section 95 of the Insolvency & Bankruptcy Code, 2016 read with Rule 7 of the IBC Rules 2019, against Mrs. Asha Mittal, the Personal Guarantor of the Corporate Debtor, (M/s. Hitech Grain processing Pvt. Ltd.). The Interim Moratorium as per Section 96(1) of the Code has commenced from the date of filing of Application by the Financial Creditor, i.e., 14.07.2021.
Application admitted - moratorium declared - List the matter for further proceedings in the case on 09.09.2021.
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2021 (9) TMI 583
Maintainability of application - initiation of CIRP - Corporate Debtor failed to repay the dues despite receiving Demand Notice, nor replied to the notice, nor repay the outstanding amount - Operational Creditors - existence of debt and dispute or not - time limitation - HELD THAT:- The Corporate Debtor Mr. Vinod Sharma has admitted the existence of debt and default and in view of the above correspondence the debt and default in this case is establish and the above company petition is liable to be admitted. The petitioner also suggested the name Mr. Manish Motilal Jaju as Interim Resolution Professional and enclosed the consent letter given by the proposed IRP in Form-2. The above company petition is complete in all respects.
Time Limitation - HELD THAT:- The present petition is filed on 15.06.2021, and the amount is less than ₹ 1 crore. But the default occurred on 01.12.2019, hence Section 10A will not affect the present petition from getting admitted.
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 581
Maintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - Operational Creditors - Operational Debt in terms of Section 5(21) of IBC, 2016 - any dispute exists between the parties that exist before the issuance of the Demand Notice by the Operational Creditor - foreign Award has become legal enforceable in India or not.
Whether the debt of the Petitioner qualify to be an "operational debt" in terms of Section 5(21) of IBC, 2016 and as such the Petitioner would qualify to be an Operational Creditor in respect of the Corporate Debtor under the provisions of the IBC, 2016? - HELD THAT:- As to the facts of the present case, the right to claim money from the Corporate Debtor emanates from a SPA dated 19.09.2012, pursuant to which the Corporate Debtor had acquired the shares from the Operational Creditor. The transaction as transpired between the parties could have been treated as an 'operational debt' had it occurred in the 'ordinary course of business' of trading in shares by one seller and another purchaser, in which context the expression 'shares' would partake the characteristics of 'goods' as envisaged under the Sale of Goods Act, 1930. However, it is not so in the present case and the parties to the present proceedings are governed by a 'Share Purchase Agreement', and non - adherence/violation of the said terms and conditions envisaged thereunder, cannot be, under any circumstances, be treated as a claim in respect of the 'provision of goods' as defined under Section 5(21) of IBC, 2016 - the alleged 'debt' as claimed by the Operational Creditor in the present Application does not fall within the definition of the expression 'operational debt' as defined under Section 5(21) of the IBC, 2016.
Whether there is any dispute exists between the parties that exist before the issuance of the Demand Notice by the Operational Creditor - HELD THAT:- There exists a 'dispute' between the parties before the issuance of the Demand Notice itself and the defence raised by the Corporate Debtor on the grounds of existence of a dispute cannot be considered as spurious, hypothetical, illusory or misconceived. Further this Tribunal in exercise of summary jurisdiction cannot adjudicate upon the dispute between the parties.
Whether the Award passed by the Arbitral Tribunal, which is a foreign Award has become legal enforceable in India and if so what would be the consequences? - HELD THAT:- The Supreme Court in the matter of GOVERNMENT OF INDIA VERSUS VEDANTA LIMITED AND ORS. [2020 (9) TMI 1178 - SUPREME COURT] has held that a petition for enforcement and execution of a foreign award by way of a petition is required to be filed under Section 47 and a foreign award does not become a decree until and unless it passes the muster of Section 47 to 49, only after which it acquires the status of a decree. Only after the Court adjudicates on the enforceability of the foreign award under Section 47 to 49, the foreign award would deem to be a decree of the Court - However, in relation to the enforcement of 'Domestic' award that is not the case; in respect of the 'Foreign' Award, a further declaration is required to be made in respect of its enforcement and admittedly the award in the present case is yet to be enforceable under Section 47 to 49 of the Act, 1996. While this being the fact, and also by taking into consideration the divergent views expressed in this regard by NCLT Hyderabad Bench and Bombay Bench, this Tribunal does not wish to render its finding in relation to the said Issue.
Issue decided in favour of the Corporate Debtor and against the Operational Creditor and that there exists dispute between the parties and also the 'debt' as claimed in the Application does not partake to the character of an operational debt - application dismissed.
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2021 (9) TMI 580
Acceptance of after expiry of EMD Deposit Date - postponing the relevant dates of Auction, by way of the impugned corrigendum - violative of procedures/fairness/sanctity attached with Auction Process or not - HELD THAT:- The IBBI - the Respondent no. 3 is not the necessary party and therefore, directed the Applicant to delete the name of the IBBI from the Memo of Parties to the application. Further, the Applicant has submitted that Respondent no. 3 may be directed to nominate the Liquidator. Since it is already observed through our Order dated 15th February 2021 that the IBBI is not a necessary party in the proceedings, therefore, we are not inclined to give any directions to the IBBI as prayed at Sl. No. vii & x of the prayers. Hence, the prayers of the Applicant are not liable to be accepted.
The application is Dismissed being infructuous.
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2021 (9) TMI 523
Maintainability of appeal - appeals are filed by Directors of this company - continuation of proceedings of suits against the company when insolvency resolution is in process - HELD THAT:- The movement an order is passed referring the assessee for resolution u/s seven of the IBC 2016, the administration of the company rest with the insurance resolution professional. In this case, these appeals are filed by the directors of the company therefore, they are not maintainable. Therefore, these appeals should have been preferred by the insolvency resolution professional under the instruction of committee of the creditors and the directors do not have any locus standi.
The adjournment application of the assessee is rejected - appeals are dismissed as not maintainable with a liberty to the IRP that if he wants to prefer these appeals, he may file the fresh appeals or makes an application for restoration of these appeals with the approval of committee of creditors.
The third appeal is filed by the learned assessing officer, according to the provisions of Section 14 of IBC 2016, no proceedings of suits against the company can continue until the insolvency resolution process is complete. Therefore, the appeal filed by the learned AO is also deserves to be dismissed with a liberty to the AO that he may file an application for recall of this order after the moratorium period is over.
Appeal dismissed.
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2021 (9) TMI 492
Maintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - Financial Creditors - existence of its debt and dispute or not - HELD THAT:- On perusal of the material papers on record and in terms of extant provisions of Section 7 of IBC, the debt due to the Financial Creditor is proved.
The Adjudicating Authority admits the Petition under Section 7 of the Code, declaring the moratorium for the purposes referred to in Section 14 of the Code - Petition admitted - moratorium declared.
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2021 (9) TMI 491
Maintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - Financial Creditors - parties to development agreement - existence of debt and dispute or not - HELD THAT:- One thing is clear that amount of ₹ 5,00,000/- had been paid by the Financial Creditor to the Corporate Debtor but the Financial Creditor has not produced anything on record that the amount had been paid to the Corporate Debtor as booking amount for a particular flat. The Development Agreement relied upon by the Financial Creditor is between the Landowners and the Corporate Debtor, and not between the Financial Creditor and the Corporate Debtor.
Once it is proved that the amount advanced did not relate to booking of any flat, particularly in the absence of any agreement between the Financial Creditor and the Corporate Debtor to that effect, the Financial Creditor cannot make out a case for initiating CIRP against the Corporate Debtor. The amount given by the Financial Creditor to the Corporate Debtor may have been given for any purpose. No terms of any agreement, specific period, or continued investment, have been proved by any documents placed on record. Even the date of default, if at all, is not clear nor has any letter recalling the alleged loan/advance has been served on the Corporate Debtor or placed on record.
The Financial Creditor may however, be free to seek its remedies elsewhere for recovery of the amount of ₹ 5,00,000/- with or without interest as the case may be, as per the documents in its possession. But certainly, it is not a case for initiation of CIRP under section 7 of the IBC, 2016.
This is not a fit case for admission - petition dismissed.
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2021 (9) TMI 486
Maintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues or not - Operational Creditors - advance paid for supply of goods can be considered as an Operational debt or not - existence of debt and dispute or not - HELD THAT:- Hon'ble NCLAT in the case of SMT. ANDAL BONUMALLA W/O. VENUGOPAL SWAMI BONUMALLA VERSUS VERSUS TOMATO TRADING LLP., SMART LOGIN SOLUTIONS PVT. LTD. [2020 (8) TMI 791 - NATIONAL COMPANY LAW APPELLATE TRIBUNAL, NEW DELHI] has held that an advance amount paid for supply of goods cannot fall within the category of 'Operational Debt'.
Thus, the claim of the Operational Creditor in the instant Application which is totally based on the advanced amount of ₹ 7,05,00,000/- paid towards supply of 5000MT Maize and as such, the instant claim cannot be treated as Operational Debt as per Section 5(21) of the IB Code, 2016 nor the Applicant herein be called as Operational Creditor as per Section 5(20) of the IB Code, 2016. Such being the case, the instant Application cannot be admitted U/s. 9 of the Code.
Petition dismissed.
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2021 (9) TMI 467
Maintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - Financial Creditors - Financial Debt - Non-performing asset - existence of debt and dispute or not - time limitation - HELD THAT:- A plea of limitation is a mixed question of law and fact. It cannot be decided as an abstract principle of law devoid from facts as in every case, the starting point of limitation is entirely a question of fact.
Time Limitation - HELD THAT:- In the instant case, the term loan was serviced till June 2017. The Application was filed on 21.12.2019. Further, an OTS Agreement was entered into by the parties and the promise to pay the amount within the time frame can safely be construed as the existence of a jural relationship between the parties constituting an ‘acknowledgement of debt’. Hence, Section 7 Application was not barred by Limitation as the facts substantiate that the period of limitation of three years as provided under Article 137 of the Limitation Act, 1963 is satisfied.
In the interest of justice and taking into consideration the fact that in this pandemic, the travel dependent sector, which is the core business of the ‘Corporate Debtor’, has more than suffered the negative impact of the crisis, this opportunity is being given to settle which could help mitigate the blow - the ‘Corporate Debtor’ has settled the matter with Dhanlaxmi Bank, the Applicant of Section 7 Application which was disposed of as withdrawn based on the settlement terms on 06.01.2020, during which period of pendency, this Section 7 Application was filed on 27.12.2019 against the same ‘Corporate Debtor’.
The Admission of Section 7 Application is set aside - this Appeal is disposed off with a direction that if the ‘Corporate Debtor’ fails to settle in 6 months time from the date of this Order, the Respondent Bank is at liberty to take appropriate steps.
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