|
Advanced Search Options
Insolvency and Bankruptcy - Case Laws
Showing 1 to 20 of 177 Records
-
2022 (9) TMI 1579
Time limitation of proceedings as financial creditor under Section 7 of the Insolvency and Bankruptcy Code, 2016 - calculation of time period - HELD THAT:- The company had paid a sum of Rs.49,50,000/- on 19.12.2016, amounting to acknowledgment of debt - the period of three years has to be calculated from the said date.
Reliance is placed on a Judgment of this Court in SESH NATH SINGH & ANR. VERSUS BAIDYABATI SHEORAPHULI CO-OPERATIVE BANK LTD AND ANR. [2021 (3) TMI 1183 - SUPREME COURT], wherein this Court has held We see no reason why Section 14 or 18 of the Limitation Act,1963 should not apply to proceeding under Section 7 or Section 9 of the IBC. Of course, Section 18 of the Limitation Act is not attracted in this case, since the impugned order of the NCLAT does not proceed on the basis of any acknowledgment.
The order passed by the National Company Law Appellate Tribunal is clearly erroneous in law. The same is set aside and the order of the National Company Law Tribunal dated 27.08.2019 is restored. The appeal is, accordingly, allowed.
-
2022 (9) TMI 1544
Preferential, fraudulent, and undervalued transactions under sections 43,45 and 66 of Insolvency and Bankruptcy Code 2016.
Preferential Transactions - HELD THAT:- The 4th respondent is not related party to the corporate debtor; this transaction had taken place in the financial year 2015-2016. The CIRP commenced against the corporate debtor on 26.04.2018. As per section 43(4)(b) any transaction made within a year prior to the date of commencement of insolvency termed as preferential transaction. In this case the disputed transaction happened in the financial year 2014-2015 three years prior to the date of commencement of insolvency date. Here the look back period exceeded one year as mentioned in section 43(4)(b) of IBC 2016, hence the transaction referred here is not a preferential transaction.
Fraudulent Transactions - HELD THAT:- The Section 66 (1) of Insolvency Bankruptcy Code, 2016 should read along with Section 35 (1) (n) of IBC, 2016. If the contention of the respondent is accepted then there will not be any avenue available to the Liquidator who found the fraudulent transactions of the corporate debtor during liquidation process, to proceed against them, this will not the intention of the statue, hence it is held that this petition filed by the liquidator alleging certain fraudulent transactions against the corporate debtor is maintainable.
Purchase of Rice husk from Related parties at a reasonably High Price - HELD THAT:- There is no material to show that the suspended directors of the corporate debtor reasonably knew that the commencement of insolvency proceeding against the corporate debtor was inevitable and the suspended directors failed to take due diligence to minimise the potential loss to the creditors. The purchase was made in the year 2015, the look back period exceeded three years from the date of commencement of CIRP. The Vendors who supplied rice husk are not arrayed as respondents. In the scenario it is answered that the fraudulent transaction alleged against the corporate debtor is not proved.
Interest free Advance to Ashirwad Trading Company, Kamal Associates and Parsa Kente Collieries Limited - HELD THAT:- As per section 66(1) of IBC 2016 if the Adjudicating Authority arrived to the conclusion that the transactions were carried out in fraudulent manner, it can order against persons who were knowingly parties to the such fraudulent business transactions to make such contribution to the corporate debtor. The applicant stated that the supra mentioned amounts are remains as an outstanding amount payable to the corporate debtor. The respondent 1 & 2 failed to take any steps to recover the same but the applicant has not whispered what steps he has taken to recover the amount. In this scenario the afore mentioned three companies are necessary parties to this application. In the absence, said companies no fruitful order can be passed. Further fails to recover the outstanding amounts will not amounts to fraud, at most it can be termed as negligence act. In these circumstances it is concluded that on the applicant side failed to establish these transactions are fraudulent transactions as alleged.
Fraudulent write off of Debtor from the Books of the Corporate Debtor - HELD THAT:- There is major difference exist between a loan is waived off and write off. If the loan is waived off thereafter no action can be taken to recover the said loans but if the loan is write off, the loan can be recovered through legal process. In short, write off will not extinguish the rights of the lender to recover the amount, it is only for audit purposes write of is made - the write off of debt will not amounts to fraudulent Transactions.
Advance Payment Made to Fatehpur East Coal Pvt. Ltd. A potentially Related Party and Later on adjustment of the said payment by way of purchase of shares - HELD THAT:- There is a difference between wrongful trading and fraudulent trading, the element of negligence exists in wrongful trading but element of deceit will not there. On the applicant side not explained how the above transaction is termed as fraudulent transaction. In the circumstances it is concluded that since the incident taken much before the commencement of corporate insolvency resolution process date and in the absence of elements of deceit, the applicant failed to prove this transaction is a fraudulent transaction.
Excess Payment made to various suppliers but Receipt of payment, Goods or services not booked - HELD THAT:- In the case of fraudulent transactions, the person or persons who were benefited because of the fraudulent acts of the suspended directors of corporate debtor also to be added as party to arrive just and correct conclusion and also if the guilt is proved to get back the benefit acquired by them. In this case five vendors of Rice husk are not arrayed as parties to this application, this amounts to non-joinder of necessary parties - the transactions under the caption of fraudulent transactions are not proved.
Undervalued Transactions - HELD THAT:- As per section 46(1)(ii) of IBC 2016, the transactions made with related party within period of two years preceding the insolvency commencement date is the under-value transaction. In this case look back period exceeded two years from the date of commencement of CIRP against the corporate debtor hence, the transactions referred in the application does not fall under value transactions.
Thus, the transactions styled as preferential, fraudulent, and undervalued in the petition are not proved hence the petition is liable to be dismissed.
Application dismissed.
-
2022 (9) TMI 1537
Disposal of the uncleared cargo by way of auction - Right of Customs Department - it was held by NCLAT that No interference is called for against the impugned order dated 3rd July, 2018 passed by the Adjudicating Authority prohibiting the Customs Authority from selling the assets of the ‘Corporate Debtor’ - HELD THAT:- There are no ground to interfere with the impugned order passed by the National Company Law Appellate Tribunal. The civil appeal is, accordingly, dismissed.
-
2022 (9) TMI 1523
Dismissal of application invoking Section 70 of the Insolvency and Bankruptcy Code, 2016 - dismissed only on the ground that the Tribunal lacks jurisdiction to entertain such an application - HELD THAT:- Reliance placed in the matter of 'Vivek Prakash (Suspended Director & MD) vs. Dinesh Kr. Gupta, Liquidator of M/s. Jarvis Infratech Pvt. Ltd. & Anr.' [2022 (2) TMI 906 - NATIONAL COMPANY LAW APPELLATE TRIBUNAL , PRINCIPAL BENCH , NEW DELHI] in which it has been held that the RP is not empowered to initiate the prosecution but at the same time, it has been held that in order to initiate prosecution under Section 70 the complaint has to be filed by the Insolvency and Bankruptcy Board of India (IBBI) or Central Government or person authorized by the Central Government.
There are no error in the order of the Ld. Tribunal, therefore, the present Appeal is hereby dismissed.
-
2022 (9) TMI 1500
Maintainability of Section 9 application - application rejected on the ground that for breach of settlement agreement, application - dues arising out of settlement may not be an ‘operational debt’ - HELD THAT:- Present is a case where the Appellant was awarded the contract to carry on construction and structural work and the dues claimed by the Appellant are operational debt. The Memorandum of Understanding entered between the parties was only with regard to mode and manner of payment, that too after final bill certificate which was duly signed by both the parties - Adjudicating Authority did not consider the nature of transaction between the parties and has erroneously come to the conclusion that section 9 application was not maintainable. The judgement of Adjudicating Authority cannot be sustained.
The appeal is allowed by setting aside the order of Adjudicating Authority directing the Adjudicating Authority to pass an order of admission and other consequential order within a period of four weeks from the date of receipt of this order.
-
2022 (9) TMI 1477
Maintainability of review application - HELD THAT:- It is now well settled that an application for review against the order of the Tribunal can only be maintained if the remedy of review is provided in I&B Code.
Thus, no review application is maintainable before this Tribunal as there is no provision for review in the Code. However, the Appellant, if so advised, may take recourse to its other remedy in accordance with law in case it is still aggrieved against the order dated 27.01.2022 or a part of it.
-
2022 (9) TMI 1474
Review petition - it was mentioned and submitted that this Court had overlooked the judgment of this Court in ES KRISHNAMURTHY & ORS. VERSUS M/S BHARATH HI TECH BUILDERS PVT. LTD. [2021 (12) TMI 683 - SUPREME COURT], to which the attention of this Court had not been drawn - Revenue submits that certain observations made by us in the judgment and order under review could be interpreted in a manner that might be contrary to the aims and objects of the IBC and render the law infructuous.
HELD THAT:- It is well settled that judgments and observations in judgments are not to be read as provisions of statute. Judicial utterances and/or pronouncements are in the setting of the facts of a particular case.
To interpret words and provisions of a statute, it may become necessary for the Judges to embark upon lengthy discussions. The words of Judges interpreting statutes a re not to be interpreted as statutes.
There are no grounds for review of the judgment and order. The Review Petition is, accordingly, disposed of.
-
2022 (9) TMI 1465
Vacation of interim order - Appellant contends that the assets of the Corporate Debtor were the only property and in view of the vacation of the Interim Order, prejudice will be caused to the Appellant - HELD THAT:- The Interim Order dated 01st April, 2022 was passed on an I.A. filed by the Yes Bank being I.A. No. 779/2022 which having been dismissed by the Impugned Order, Appellant can not be said to be aggrieved by the dismissal of the Application since it was not the Applicant’s application which got dismissed. Appellant in no manner was party to the said application hence we see no reason to entertain the Appeal at the instance of the Appellant.
Appeal dismissed.
-
2022 (9) TMI 1400
Validity of approved Resolution Plan - it is alleged that the Resolution Plan fails to consider the payment of provident fund dues as computed by the Assistant Provident Fund Commissioner
NCLAT decided partly in favor of appellant stating that, "Since no provisions of the above said Act is in conflict with any of the provisions of the I& B Code, the applicability of even Section 238 of the I& B Code does not arise. PF dues are not the assets of the CD as amply made clear by the provisions of Section 36(4)(a)(iii) of the I& B Code, 2016"
SC dismissed the appeal.
However, the appellant is permitted to make a request before the appropriate forum, to provide sometime for the deposit of the difference of the provident fund.
-
2022 (9) TMI 1390
Maintainability of petition - initiation of CIRP - Corporate debtor have failed to make repayment of its dues - financial creditors - existence of debt and dispute or not - whether documentary evidence furnished with application shows that the aforesaid debt is due and payable and has not yet been paid? - HELD THAT:- The sine qua non for triggering the CIRP against the corporate debtor by the operational creditor is existence of debt and default .In so far as the case on hand is concerned there is no dispute raised with regard to the existence of debt between the operational creditor and corporate debtor and in fact the corporate debtor had even made part payments towards amount claimed under the invoices - The record reveals that despite of receiving the demand notice corporate debtor has not chosen to send any reply that apart no record has been filed by the corporate debtor showing that it has raised the dispute as regards to the quality of services rendered by the operational creditor before receipt of demand notice.
The documentary evidence placed clearly shows that the debt is due and payable by the Corporate Debtor. However, the same has not been paid.
The application is complete and deserves to be admitted - petition admitted - moratorium delcared.
-
2022 (9) TMI 1349
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:- In the present case notice of demand was issued on 30.12.2019, hence, we proceed to examine the materials on the record before 30.12.2019 to find out was to whether there was any dispute raised by the Corporate Debtor regarding bills of the Appellant and further whether the dispute raised earlier was not existing on the date when Demand Notice was issued and has subsided as contended by leaned counsel for the Appellant - The Operational Creditor was put to notice that there is short supply of the Supervisor and Security Personnel under the contract which shall result in recovery from the payment and payments for the months mentioned therein has been released to mitigate the hardship of the employees which were released conditionally and all recoveries will be visited on conclusion of the contract.
There are issues regarding releasing the final payment after observing the terms and conditions of contracts. The letter dated 20.12.2019 clearly communicated that issues regarding observing the terms and conditions of the contracts are yet not settled or decided and that was in process. The email further stated that Appellant is informed that ‘very shortly the aforesaid issues would be settled’. The above email does clearly belie the submission of the Appellant that before issuance of demand notice dated 30.12.2019 all the issues between the parties were settled.
There are no substance in the submission of learned counsel for the Appellant that dispute, if any, existing earlier came to an end by the time Demand Notice was issued by the Appellant on 30.12.2019. The materials brought on the record before the Adjudicating Authority and also before us clearly indicate that there was pre-existing dispute with regard to payment of amount claimed by the Appellant and Appellant was duly communicated of the said dispute even prior to issuance of Demand Notice - No reliance on Minutes of Meeting dated 07.06.2019 be placed to accept the submission of Appellant that all the issues between the parties subsided and were settled and the reconciliation was complete.
The Adjudicating Authority did not commit any error in rejecting the Section 9 Application filed by the Appellant on the ground of pre-existing dispute - Appeal dismissed.
-
2022 (9) TMI 1348
Seeking permission to resolution applicant to withdraw the resolution plan - HELD THAT:- After noticing the adverse effect on all businesses the Hon’ble Supreme Court in Ebix Singapore [2021 (9) TMI 672 - SUPREME COURT] had laid down that vesting any such power in the Successful Resolution Applicant to withdraw shall be impermissible.
In event the submission of the Appellant is accepted that due to financial difficulty he is unable to implement the plan and he be permitting to go back from the commitments made in the Resolution Plan, it shall have disastrous effect on the entire process undertaken. The IBC is process consists of different steps with a ultimate object of reviving the Corporate Debtor. Permitting Successful Resolution Applicant to withdraw after the Plan has been approved will have serious disastrous effect on whole purpose and object of IBC - On the submission made by Counsel for the Appellant that since he had no financial capacity to implement the plan he should have been allowed to withdraw, the Adjudicating Authority has rightly rejected his application.
There is no merit in Appeal - The Appeal is dismissed.
-
2022 (9) TMI 1347
Seeking liquidation of the Corporate Debtor - Section 33(1) of the Insolvency and Bankruptcy Code, 2016 - HELD THAT:- The CoC having rejected the Resolution Plan submitted by the Resolution Applicant after due deliberation and discussion, the decision taken by the CoC is a decision taken in the commercial wisdom of the CoC which cannot be interfered with in exercise of jurisdiction by the Adjudicating Authority or by this Tribunal.
The submission of Learned Counsel for the Appellant that no reasons have been given by the CoC for rejecting the plan has also no legs to stand when a decision is taken after due deliberation. The decision of the CoC is reflected in the result of the voting which cannot be questioned. In so far as reliance on 14th CoC meeting dated 22.07.2021 is concerned, the Resolution Professional has brought into notice of CoC about the e-mail send by Resolution Applicant revisiting his offer, which fact although was noticed but no decision was taken by CoC to consider the e-mail by reversing its earlier decision of rejection of plan. Thus, the minutes of 14th CoC in no manner helps the Appellants.
Thus, no error has been committed by Adjudicating Authority in directing for liquidation of the Corporate Debtor. No grounds have been made out to interfere with the Impugned Order dated 26th October, 2021 passed by the Adjudicating Authority - appeal dismissed.
-
2022 (9) TMI 1346
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 duly done, but outstanding amount not paid by Operational creditor, nor any reply to demand notice was done - HELD THAT:- It is noted that the Operational Creditor supplied the electricity to the Corporate Debtor in the month of April to June and raised 8 invoices for an amount of Rs.1,59,25,360/- .The Corporate Debtor served the demand notice dated 21.10.2019 issued on 22.10.2019 and the same was delivered on 28.10.2019 to the Corporate Debtor. But the Corporate Debtor neither replied to the Demand Notice nor paid the outstanding amount to the Operational Creditor.
As per the statement given by the PGVCL for the credited units, all the units are credited after the deduction of transmission loss and wheeling loss units. A total of 26,60,401 units have been credited by the PGVCL and the Operational Creditor raised eight invoices of Rs. 1,59,25,360/-. The Corporate Debtor claimed that an amount of Rs. 1,31,82,987/- has been paid. As per the ledger account from 01.04..2015 to 14.10.2019 more than Rs. 23,00,000/- is still due and payable by the Corporate Debtor to the Operational Creditor. It is not a disputed fact that the Corporate Debtor has not raised any disputes with respect to the invoices raised by the Operational Creditors. Moreover, Corporate Debtor vide letter dated 26.09.2017 itself admitted that Rs. 67,65,986/- has been withheld on account of gross subsidy charges, additional surcharge and electricity supplied.
The present application is defect free as per section 9 (5) of the IB Code, and the outstanding amount meets the threshold limits as section 4 of the IB Code - Application admitted - moratorium declared.
-
2022 (9) TMI 1345
Maintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - Operational Creditors - existence of debt and dispute or not - Time limitation - service of demand notice - whether the demand notice in Form 3 dated 13.11.2019 was properly served? - HELD THAT:- The petitioner has placed a copy of the notice which was delivered to the corporate debtor.
Whether the operational debt was disputed by the corporate debtor? - HELD THAT:- It is to be noted that none appeared on behalf of the corporate debtor despite repeated service and has been set ex parte vide order dated 30.06.2022. It is deposed by way of affidavit by Operational Creditor that reply dated 30.11.2019 was received to its Demand Notice where Corporate Debtor has raised baseless,frivolous, sham and bogus dispute. Also, it is stated that no notice was given by the Corporate Debtor relating to a dispute of the unpaid operational debt. It shows that there is no pre-existing dispute.
Whether this application is filed within limitation? - HELD THAT:- This application was filed on 24.02.2020 vide Diary No.1482. Whereas the date of default is 18.05.2019 i.e. 30 days from the date of first outstanding invoice dated 18.04.2019, therefore, this Adjudicating Authority finds that this application has been filed within limitation.
It is seen that the petition preferred by the petitioner is complete in all respects. The material on record clearly goes to show that the respondent committed default in payment of the claimed operational debt even after demand made by the petitioner. In view of the satisfaction of the conditions provided for in Section 9(5)(i) of the Code, the petition is admitted - moratorium declared.
-
2022 (9) TMI 1344
Maintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - Financial Creditors - existence of debt and dispute or not - HELD THAT:- The sale was confirmed and the Financial Creditor has released a sum of Rs. 6.32 crores by selling one of the mortgaged properties of the Corporate Debtor. Hence, the amount due and payable would come to a sum of Rs.1.02 Crore (Approx) after deducting the sale proceed amount from the default amount as mention in this application.
It emerges that the Financial Creditor has filed its application only for the recovery of the interests and also that the Corporate Debtor is a going concern and in view of the recent judgment of Hon’ble Supreme Court in VIDARBHA INDUSTRIES POWER LIMITED VERSUS AXIS BANK LIMITED [2022 (7) TMI 581 - SUPREME COURT], it is not satisfying that the present petition has been filed only for resolving the insolvency, as the Corporate Debtor had even tendered the balance amount, which the Financial Creditor did not accept.
Petition dismissed.
-
2022 (9) TMI 1343
Seeking to declare that the Lease Property is not an asset of the Corporate Debtor and shall not form part of the resolution plan - transfer of the Lease Property or continuation of the lease arrangement in relation to the Lease Property shall be subject to strict compliance with the Agreement and the express approval of the Applicant herein, or not - seeking direction to Respondent No. 1 and Respondent No. 2 to refrain from taking any action in relation to the Lease Property - HELD THAT:- The registered Lease Deed is not a mere Lease Deed and is a registered Lease-Cum-Sale-Agreement under which the Corporate Debtor has already acquired possessory legal rights under the registered document. It is also very clear from the above terms that the Lessee has a right to ask for extension of the lease or for purchasing the above property with absolute rights at the price determined by the Corporation. In fact, the Corporate Debtor has already requested the Applicant/KIADB to fix the price of the land that was allotted to them by means of letter dated 18.10.2016 so as to obtain Sale Deed by them for which the Applicant/KIADB vide their letter dated 28.11.2016 informed the Corporate Debtor that the board of the Applicant/KIADB has not yet fixed the final price to the said industrial area and hence the Sale Deed cannot be considered at this stage. Of course, the Applicant/KIADB also issued notice under Section 34 B of KIAD Act of 1966 to the Resolution Professional to remedy the alleged breaches said to have been committed by the Corporate Debtor in their notice.
It is clear from the terms and conditions of the Lease Deed as well as the various correspondence relied by them that the Corporate Debtor is in physical possession and enjoyment of the land allotted to them under the above registered Lease Deed and both parties are alleging breach of terms and conditions of the registered Lease-Cum-Sale-Agreement against each other and the Applicant/KIADB could not evict the Corporate Debtor due to kicking of moratorium.
Thus, it is held that whatever legal rights the Corporate Debtor had already acquired under the above registered Lease-Cum-Sale-Agreement shall continue to vest with the Resolution Applicant and the Resolution Applicant is entitled to continue in possession of the property till the Resolution Applicant is evicted under due process of law - application dismissed.
-
2022 (9) TMI 1342
Seeking Liquidation of Corporate Debtor - Section 33 (1) of the Insolvency and Bankruptcy Code, 2016 - HELD THAT:- Upon perusing the material available on record, it is observed from the minutes of the 12th CoC meeting that the COC unanimously decided to liquidate the Corporate Debtor. Even though the COC in its 12th meeting unanimously decided to liquidate the Corporate Debtor, no voting was conducted in this regard for the reason best known to the COC. It is important to observe here that more than 397 days has been elapsed without any Resolution application and therefore this Tribunal by virtue of powers conferred under section 33(1)(b)(i), orders Liquidation.
Application allowed.
-
2022 (9) TMI 1341
Seeking Liquidation of Corporate Debtor - Section 33 of the Insolvency and Bankruptcy Code, 2016 read with Rule of the NCLT Rules, 2016 - HELD THAT:- It can be seen from the submissions that the CIRP of the Corporate Debtor ended on 24.08.2021 and the Committee of Creditors in the 9th COC meeting held on 03.03.2022 has resolved to liquidate the Corporate Debtor. In such circumstances, this Adjudicating Authority concludes that this present application deserves to be allowed.
As the CIRP of the Corporate Debtor has come to an end on 24.08.2021 and the COC vide meeting dated 02.03.2022 has unanimously resolved to liquidate the Corporate Debtor. It is noted that a period of 863 days have passed since commencement of CIRP till the date of this Application. As such this Adjudicating Authority is left with no other choice but to liquidate the Corporate Debtor
The liquidation of Corporate Debtor is ordered - application allowed.
-
2022 (9) TMI 1297
Condonation of delay of 45 days in filing appeal - Appellant failed to apply for certified copy within 30 days period - it is alleged that the Appeal is barred by time as filed beyond extended time of limitation prescribed under Section 61(2) of the Code - Section 12(2) of Limitation Act, 1963 - HELD THAT:- In the facts of the present case, when order was passed on 06.05.2022, the period of 30 days expired on 06.06.2022. 15 days period upto which delay is condonable under Section 61(2) also expired upto 20.06.2022. The appeal by the Appellant having been filed on 06.07.2022 is clearly beyond the 45 days - In the present case, certified copy is claimed to be applied by the Appellant on 15.06.2022 i.e. after expiry of limitation. Thus, the present appeal has been filed beyond 45 days from date of the order dated 06.05.2022 and delay of more than 15 days beyond the period of 30 days cannot be condoned by this Tribunal in exercise of its jurisdiction under Section 61(2) of the I&B Code.
There are no good ground to allow section 5 application filed by the Appellant. Delay condonation application is dismissed.
........
|
