|
Advanced Search Options
IBC - Case Laws
Showing 261 to 280 of 779 Records
-
2023 (8) TMI 1268
Approval of Resolution plan - Validity of order of NCLT issuing direction for consideration of PUFE Transaction Applications first and adjourning the Application for approval of Resolution Plan to be heard later
HELD THAT:- What appears to be reason which persuaded the Adjudicating Authority to decide the PUFE Transaction Application first is that if the preferential transaction are established against the Appellant, the fate of the project will be in jeopardy.
PUFE Applications are a different scheme of proceedings which has to be concluded to its logical act which shall have its consequences as contemplated in the statute. When the CoC approved the Resolution Plan and has also reiterated that Application for Resolution Plan be considered by tis 17th CoC Meeting dated 27.02.2023, there are no reason not to consider the said application merely on the ground that PUFE Applications are pending. The Adjudicating Authority is well within jurisdiction to consider both the Resolution Plan Approval Application as well as PUFE Application but the Adjudicating Authority erred in observing that the consideration of Plan Approval Application has to be deferred and can be taken only after PUFE Applications are decided.
Hon’ble Supreme Court in Arun Kumar Jagatramka [2021 (3) TMI 611 - SUPREME COURT] had occasion to notice the object and purpose of amendment by which Section 29A was sought to be introduced in IBC and held that Section 29A was added to the Code by the Amendment Act. Owing to this provision, persons, who by their misconduct contributed to the defaults of the corporate debtor or are otherwise undesirable, are prevented from gaining or regaining control of the corporate debtor. This provision protects creditors of the company by preventing unscrupulous persons from rewarding themselves at the expense of creditors and undermining the processes laid down in the Code.
The Adjudicating Authority shall proceed to consider the Resolution Plan Application and not to await the decision in PUFE Applications - Adjudicating Authority shall decide the Plan Approval Application and shall also consider the eligibility of the Resolution Applicant which is an issue raised by the Intervener (IIFL Finance Limited) - appeal disposed off.
-
2023 (8) TMI 1156
Withdrawal of application u/s 7 which was admitted - Acceptance of the One Time Settlement (OTS) - No intent to proceed further with CIRP - HELD THAT:- In view of the acceptance of OTS, no purpose shall be served in proceeding the CIRP any further - the CIRP proceedings are closed and the order impugned dated 23.11.2022 is set aside. Liberty is given to the Canara Bank for revival, if any, such circumstances arise.
In view of the fact that CoC has not been constituted in pursuance of the Interim Order passed by this Tribunal, the Applicants (SRS Private Investments Powai Ltd. and ICICI Bank) are at liberty to take appropriate steps in accordance with law. IRP fees and expenses shall be paid within two weeks by the Appellant.
Appeal disposed off.
-
2023 (8) TMI 1155
Rejection of application filed u/s 9 of IBC - failure of the Respondent to supply the material within three months of the advance payments - pre-existing dispute between the parties or not - HELD THAT:- The Appellant complied with various clauses of the Sales Contract especially regarding advance payment which the Appellant performed by making two tranches of payment of Rs. 10 Crores on 25.02.2019 and Rs. 5 Crores on 06.03.2019. Upon his making advance payment, the responsibility was on the Respondent as Seller of the material to arrange for the trucks, load the materials on to trucks and deliver the same at the site of the Appellant and then only the liability and risk would have transferred to the Appellant as Buyers of the goods.
From the various documents made available including the Sales Contract, there remains no doubt that while the Appellant had paid the advance of Rs. 15 Crores but the Respondent has not been able to supply the material.
As per the Sales Contract, the delivery was to be completed preferably within three months and maximum six months from the date of receipt of Rs. 15 Crores advance. It is the case of the Respondent that he asked the Appellant vide his letter dated 07.08.2019, inter-alia, about delivery schedule. We note that the Sales Contract was signed on 22.02.2019 between the Appellant and the Respondent and the Appellant had paid of Rs. 10 Crores on 25.02.2019 and balance of Rs. 5 Crores on 06.03.2019. The three months normal period for delivery of material by the Respondent would have been over by 05.06.2019, much before alleged letter of the Respondent dated 07.08.2019. All these events indicates that perhaps the Respondent was not in a position to supply material and no attempt was made by him in this regard.
There are no cogent reason for rejecting the application under Section 9 of the Code and - the Impugned Order passed by the Adjudicating Authority cannot be agreed - Impugned Order is set-aside and the case is remanded back to the Adjudicating Authority who shall pass suitable order in accordance with the law at an early date - appeal allowed.
-
2023 (8) TMI 1126
Maintainability of application under Section 10 of the IBC - defaults in payment of lease rent by GoAir - interplay between the provisions of IBC, particularly the moratorium envisaged under Section 14 of IBC - legal obligations and rights derived from the Aircraft Rules as well as the lease agreements - Approval of resumption plan - HELD THAT:- Given the time-consuming nature of the approval process, the Court finds it prudent not to pass any judgement on the contentious issues outlined, at this juncture.
The impugned interim directives primarily pertain to the inspection and maintenance of the aircrafts, which are designed to prevent cannibalisation and preserve their value and integrity - no severe prejudice would be inflicted upon GoAir in the event the matter is relegated to the learned Single Judge for final disposal of the writ petitions, especially in light of the fact that DGCA would require a minimum of fifteen days to decide on re-commencement of GoAir’s flights - it is deemed appropriate in the interest of justice to refrain from entertaining the appeals at this juncture. The learned Single Judge is however requested to endeavour to decide the writ petitions as expeditiously as possible, preferably on the next scheduled date of hearing.
The pleadings have not been completed in the writ petitions. Accordingly, a week’s time is granted to GoAir as well as the DGCA to file their respective counter affidavits in the writ petitions pending before the learned Single Judge - Appeal disposed off.
-
2023 (8) TMI 1100
Jurisdiction of High court - Article 226 of the Constitution - HELD THAT:- Proceedings under Article 226 of the Constitution are pending before a Single Judge of the High Court of Delhi. The petitions are being argued on a day to day basis. The jurisdictional issues which are sought to be raised in these proceedings can be addressed before the High Court.
SLP dismissed.
-
2023 (8) TMI 1099
Maintainability of application - initiation of CIRP - Operational Creditors - claim of the Appellant was that his EMD is not refunded - HELD THAT:- Present is a case where the Appellant was only a tenderer who has submitted EMD along with the tender which tender was admittedly rejected. The EMD payment by the Appellant was not towards any goods or services and the submission that in event the tender was accepted the Appellant would have provided services is far-fetched to accept the claim relating to goods and services.
The judgment which has been relied by the Counsel for the Appellant in Consolidated Construction Consortium Limited vs. Hitro Energy Solutions Private Limited [2022 (2) TMI 254 - SUPREME COURT] was in entirely different facts where amount of Rs.50 lakhs was paid towards the project which was directed to be paid and on account of non-payment of the said amount the proceedings were initiated. The facts of the present case are clearly distinguishable and the above judgment does not help the Appellant.
Thus, no error has been committed by the Adjudicating Authority in rejecting Section 9 Application - Appeal is dismissed.
-
2023 (8) TMI 1052
Seeking closing of CIRP process - HELD THAT:- From the facts which have been recorded in the Settlement Agreement, it is clear that the Corporate Debtor has defaulted in making payment to the Operational Creditor since 2015 and the Settlement Agreement dated 27.09.2021 was also breached since payment as per the Settlement Agreement was not discharged by the Corporate Debtor.
The Settlement Agreement, thus, clearly contemplates that in event of default, the Operational Creditor shall continue with the existing pending proceedings. The default having been committed by the Corporate Debtor, it is not open for the Corporate Debtor to insist that the Operational Creditor should not continue the proceedings. From the Settlement Agreement it is also clear that on account of breach the entitlement of Operational Creditor was Rs.92.70 Crores minus Rs.25 Lakhs with interest @12%.
At time when the CoC was not constituted, there can be no impediment in power of Adjudicating Authority to exercise jurisdiction under Rule 11 to close the CIRP even if no application as per the procedure under Section 12A r/w Regulation 30A has been filed. The Adjudicating Authority itself has recorded finding that application filed by the Applicant was maintainable, which finding is recorded in Para 10 of the order.
Thus, the mere fact that there are claims of other creditors against the Corporate Debtor are not impediment for closing the CIRP filed by an Applicant either under Section 7 or Section 9, if the Applicant enters into settlement with the Corporate Debtor and the debt is liquidated but present is a case where offer given by the Appellant in its application under I.A. No. 1571 of 2023 came after breach of the Settlement Agreement at the stage when Appeal against the admission order was dismissed by this Tribunal and the said order was upheld by the Hon’ble Supreme Court - CIRP against the Corporate Debtor need not be closed and be allowed to complete its due course in accordance with law.
Appeal dismissed.
-
2023 (8) TMI 998
Approval of Resolution plan - CIRP - NCLT rejected the plan - Plan contains the provision for extinguishment of personal guarantee of the personal guarantors - HELD THAT:- The Hon’ble Supreme Court again in LALIT KUMAR JAIN VERSUS UNION OF INDIA AND ORS. [2021 (5) TMI 743 - SUPREME COURT] had occasion to consider the provisions of the Code as well as the law pertaining to personal guarantor and the consequence of approval of the Resolution Plan on the rights of the personal guarantors. In the said judgment, the Hon’ble Supreme Court held that sanction of a resolution plan does not per se operate as a discharge of the guarantor’s liability. It was held that approval of a resolution plan does not ipso facto discharge a personal guarantor.
The use of expressions ‘per se’ and ‘ipso facto’ clearly indicate that by approval of the Resolution Plan, personal guarantors are not per se and ipso facto discharge from its obligation which may arise of the guarantee given to the Financial Creditor. The use of above expressions conversely indicates that there may be situations and circumstances, for example, relevant clauses in the Resolution Plan by which personal guarantors may be discharged. The judgment of the Hon’ble Supreme Court in Lalit Kumar’s case cannot be read to mean as laying down law that personal guarantee never can be discharged in a Resolution Plan.
There can be no dispute that Moratorium under Section 14 is not applicable on the personal guarantors. Non-applicability of the Moratorium on personal guarantor is with different object and purpose. Personal guarantors are liable along with the principal borrower and can be proceeded with for recovery of dues by the Financial Creditor but the question as to whether personal guarantee given to the Financial Creditor can be extinguished in a Resolution Plan is a question which is a separate question and was not under consideration by the Hon’ble Supreme Court in “State Bank of India vs. V. Ramakrishnan and Anr” [2005 (10) TMI 542 - SUPREME COURT].
The present is a case where CoC consciously considered the clauses in the plan for relinquishing the personal guarantees of the Financial Creditors and as noticed above for a consideration offered by the Successful Resolution Applicant for release of the personal guarantee passed the Resolution Plan accepting the clause in the plan for release of the personal guarantee - The present is not a case where issue pertaining to the release of the personal guarantee was not before the CoC and was not deliberated.
There is no error in the consideration of the CoC of the Resolution Plan and the commercial wisdom of the CoC by approving the Resolution Plan has to be given due weightage.
The Adjudicating Authority committed error in rejecting the Application for approval of the Resolution Plan on the ground that plan could not have contained a provision for extinguishment of personal guarantee of the personal guarantors. Plan allocates a plan value for extinguishment of personal guarantee which has been accepted by the Financial Creditors by a vote share of 78.04% - the order of the Adjudicating Authority dated 06.01.2023 is unsustainable - Appeal allowed.
-
2023 (8) TMI 944
Transfer of proceeding and jurisdiction for such transfer - Proceedings after commencement of IBC - company court can Suo Motu transfer a proceeding relating to winding up to NCLT or can such transfer only be made pursuant to an application by one of the parties? - Section 434(1)(c) last proviso of the Companies Act, 2013 read with Rules 5 and 6 of companies (Transfer of Pending Proceedings) Rules, 2016.
HELD THAT:- As would appear from the substituted Section 434(1)(c), the original sub-section has undergone several changes between 7th December, 2016 and 17th August, 2018. The first proviso to Section 434 (1)(c) after the substitution in 2016 clarified transfer of pending proceeding by the phrase “only such proceeding relating to winding up the companies” as may be prescribed by the Central Government. The stage at which such pending proceeding relating to the winding up of companies needs to be transferred has been prescribed and laid down by the Companies (Transfer of Pending Proceeding) Rules, 2016.
The said rule was notified on 29th June, 2017. The fifth proviso to Section 434(1)(c) introduced by Act 26 of 2018 with effect from 6th June, 2018 was primarily to tide over the difficulties and the conflict that are likely to arise by reason of commencement of the Insolvency and Bankruptcy Code (Amendment) Ordinance, 2018. By reason of IBC there could be a possibility of initiation of proceeding under Sections 7 and 8 of IBC in relation to a company against whom a winding up petition is pending. The reading of the provisions of IBC with the Companies Act, 2013 undoubtedly would show that the provision of IBC would have primacy in case of conflict over the Companies Act, 2013 as the ultimate object of IBC is to resuscitate the corporate debtors who are in the red. This approach is also in some cases necessary to transfer the winding up proceeding to NCLT to prevent parallel proceeding.
In Action Ispat and Power Pvt. Ltd. [2020 (12) TMI 535 - SUPREME COURT] a winding up application was filed under Section 433(e) and (f), 434 and 439 of the Companies Act against the Company seeking winding up in which it was also alleged that for the goods supply Action Ispat had failed to pay a sum of Rs.4.55 crores. The Company Judge in Delhi High Court passed an order on 27th August, 2018 admitting the winding up petition and appointed the official liquidator attached to the Supreme Court as the liquidator of the Company with further direction to take over all the assets, books of accounts and records of the Company forthwith. An application was then filed before the Company Judge by SBI being a secured creditor of Action Ispat seeking transfer of the winding up petition to the NCLT in view of the fact that the SBI had filed an application under Section 7 of the IBC Code 2016 which was pending before NCLT. The issue before the Supreme Court was whether the discretion exercised by the Company Court in transferring the winding up proceeding to NCLT was liable to be set aside.
In Action Ispat and Power Pvt. Ltd. the Hon’ble Supreme Court observed that the primary focus of the legislation is to ensure revival and continuation of the corporate debtor by protecting the corporate debtor from its own management and from a corporate death by liquidation. The IBC Code was held to be a beneficial legislation which puts the corporate debtor back on its feet, not being a mere recovery legislation for creditors - The Hon’ble Supreme Court noticed that after the introduction of the transfer rules 2016 only those proceedings which are at the stage of pre service of notice of the winding up petition stand compulsorily transferred to NCLT. The Hon’ble Supreme Court noticed that by reason of Rules 5 and 6 of the transfer rules which would result in parallel proceedings to continue before the Company Court and pre admission proceeding would be compulsorily transferred to NCLT.
It was thus clarified that so long as no actual sale of the immovable or movable properties have taken place, nothing irreversible is done which would warrant a Company Court staying its hands on a transfer application made to it by a creditor or any party to the proceedings. It is only where the winding up proceedings have reached a stage where it would be irreversible, making it impossible to set the clock back that the Company Court must proceed with the winding up, instead of transferring the proceedings to the NCLT to now be decided in accordance with the provisions of the Code.
The aforesaid judgment thus, clearly spell out that unless the court is convinced that the company is to suffer an inevitable corporate death the first choice would to be to make an all out attempt to revive the company and this procedure has been elaborately laid down in IBC. The Companies Act, 2013 is not suited for such situation. This is clearly reflected from the amended and substituted Section 434 of the Companies Act, 2013 read with Sections 7 and 8 of the IBC and the objects and reasons of both the statutes. There is no conflict between the two provisions.
The Court has discretion to transfer the proceeding depending upon the stage of the proceeding. If it appears to the Company Court that the die is cast and the corporate death of the company is inevitable there is no requirement to transfer such proceeding. The said discretion is not always dependent upon any formal application being made but it is always desirable that the views of the petitioning creditor, secured creditors and the official liquidator are ascertained.
Re: M/s. Total Plastic Solutions Pvt. Ltd. (In Liquidation) - HELD THAT:- Applying the aforesaid principles we find that the direction of the Company Court to transfer CA No. 8 of 2022, CP No. 419 of 2013 (M/s. Total Plastic Solutions Pvt. Ltd.(In Liquidation) was not proper as the report of the official liquidator in paragraph 9 has clearly stated that the corporate death of the company is inevitable.
In view thereof the order dated 12th December, 2022 is set aside. The winding up of the company is required to be completed by the Company Court - Application allowed.
Re: M/s. Abhijeet Projects Limited (In Liquidation) - HELD THAT:- The views of the secured creditors have not been accurately stated. One of the secured creditors, IDBI has clearly expressed its intention to continue with the proceeding in this Court as would be evident from the email dated August 1, 2023. In the said email the secured creditor has stated that the company petition shall not be sent to NCLT.
The secured creditors unlike Action Ispat and Power Pvt. Ltd. did not file any application under Section 7 and 8 of IBC. In the event such applications were filed the company court could have been justified in transferring the proceeding to the Tribunal following Action Ispat and Power Pvt. Ltd. on a satisfaction being recorded that the corporate death of the company is not inevitable and NCLT would be the preferred choice - On such facts discretion could not have been exercised in favour of transferring the proceeding to NCLT. The creditors were not heard. Under such circumstances the order impugned is set aside. The Company Court shall proceed with the winding up of the company. APO 12 of 2023 with I.A. No. ACO 1 of 203 are allowed.
Re: M/s. Corporate Ispat Alloys Limited (In Liquidation) - HELD THAT:- In the report the Official Liquidator in paragraph 8 has clearly stated that five financial institutions are of the view that the transfer of proceeding to NCLT as directed by the Hon’ble Judge taking company matters may be implemented. In other words they consented to the proceeding being transferred to NCLT. Although the Act contemplates filing of an application for transfer of proceedings pending immediately before the commencement of the Insolvency and Bankruptcy Amendment Ordinance, 2018 in the present case having regard to the views expressed by the secured creditors insistent of any application for transfer would be a mere formality - Under such circumstances the order passed by the learned Single Judge in M/s. Corporate Ispat Alloys Limited is upheld.
The department is directed to transfer the record of CP/419/2013 to the National Company Law Tribunal, Calcutta, forthwith.
-
2023 (8) TMI 906
Application for approval of the resolution plan heard on as many as 35 days - Final orders have not been passed - HELD THAT:- On 7 August 2023, the proceedings were heard for several hours after which they were posted to 29 August 2023 but in the meantime one of the members of the Bench has been transferred to the Bench of the NCLT at Chandigarh.
In view of the time lines specified in the Insolvency and Bankruptcy Code, the NCLT should dispose of the application for approval of the resolution plan as expeditiously as possible and in any event within a period of two months from the date of this order and report compliance to this Court - Application disposed off.
-
2023 (8) TMI 905
Jurisdiction of the ‘Adjudicating Authority’/ ‘Tribunal’ to ‘waive’, the ‘Electricity Dues’, recoverable from the premises - HELD THAT:- A mere running of the eye over the Judgment, dated 13/12/2022 in Company Appeal (AT) (Ins) No. 1078/2020 (Principal Bench) [2023 (1) TMI 290 - NATIONAL COMPANY LAW APPELLATE TRIBUNAL, NEW DELHI], this ‘Tribunal’, comes to an ‘inevitable’, ‘irresistible’ and ‘inescapable’ conclusion, that this ‘Appellate Tribunal’ has observed [2022 (5) TMI 1365 - NATIONAL COMPANY LAW APPELLATE TRIBUNAL , PRINCIPAL BENCH , NEW DELHI].
Following the said ‘Judgment’ of this ‘Appellate Tribunal’, which is squarely applicable to the facts of the instant Company Appeal (AT) (CH) (Ins) No. 62/2022, before the ‘Tribunal, this ‘Tribunal’, dismisses the instant Company Appeal (AT) (CH) (Ins) No. 62/2022, but without Costs.
-
2023 (8) TMI 861
Extension of CIRP period - approval of the Resolution Plan - Appellant challenging the orders contends that there is no justification for allowing the exclusion ex-post facto and 24.04.2022 was last date for period of CIRP - HELD THAT:- Coming to order dated 29.03.2023 by which the Adjudicating Authority has extended the period of CIRP from 24.04.2022 to 26.05.2022 i.e. 32 days, it is suffice to mention that on 24.04.2022 in the 17th CoC meeting of CoC plans were already discussed and were to be voted upon and application has to be filed before the Adjudicating Authority for approval. 26.05.2022 is that date when the application was filed by the Resolution Professional for approval of the Resolution Plan. 24.04.2022 being last date for CIRP, on which date plans were already discussed, exclusion of 32 days lapsed between 17th CoC meeting and filing of application by Resolution Professional has rightly been allowed by the Adjudicating Authority.
The Adjudicating Authority has rightly noticed that the CIRP in the present case commenced during the COVID period and Adjudicating Authority also noticed that the application for approval of the plan is pending consideration before the Adjudicating Authority which may result in resolution of the Corporate Debtor, case has been made out for exclusion of the period from 24.04.2022 to 26.05.2022 - there are no error in the order passed by the Adjudicating Authority granting exclusion of period from 24.04.2022 to 26.05.2022. There is no infirmity in the order dated 29.03.2022 which may warrant interference by this Appellate Tribunal.
Approval of the Resolution Plan - principal submission advanced by the Appellant is that the Resolution Applicant is not eligible to submit the Resolution Plan - HELD THAT:- The Committee of Creditors in its commercial wisdom has approved the Resolution Plan submitted by KGK Realty (India) Private Limited with vote share of 76.35% - there are no reason to interfere with the decision of Adjudicating Authority approving the Resolution Plan.
No grounds have been made out to interfere with the impugned order. Both the Appeals are dismissed.
-
2023 (8) TMI 860
Rejection of application of the Liquidator - recoveries of customs duties - invocation of the Bank Guarantee(BG) allowed, during the moratorium period in force under section 14 of IBC.
Whether the BGs and FDRs (Fixed Deposit Receipts) that were deposited by the corporate debtor in view of various materials received at the port and released by the customs from Nhava Sheva Port and the Customs Private Bonded Warehouse at Wardha, should be returned to the corporate debtor/liquidator?
HELD THAT:- In the present case, invocation of BG is not about recovery of any claim by the customs authorities, but is about revocation of surety provided by the corporate debtor to the customs authorities in the form of FDRs and BG. In this connection, the judgment of the Hon’ble Supreme court in the matter of STATE BANK OF INDIA VERSUS V. RAMAKRISHNAN AND ANR. [2018 (8) TMI 837 - SUPREME COURT] is noted, wherein Hon’ble Supreme Court has noticed the observations in the report dated 26.03.2018 of the Insolvency Law Committee appointed by the Ministry of Corporate Affairs, holding that to clear the confusion regarding treatment of assets of guarantors of the corporate debtor vis-a-vis the moratorium on the assets of the corporate debtor, it has been recommended to clarify by way of an explanation that all assets of such guarantors to the corporate debtor shall be outside scope of moratorium imposed under the Code
Appellant placed reliance upon the judgment of Hon’ble Supreme Court in the matter of SUNDARESH BHATT, LIQUIDATOR OF ABG SHIPYARD VERSUS CENTRAL BOARD OF INDIRECT TAXES AND CUSTOMS [2022 (8) TMI 1161 - SUPREME COURT]. A perusal of this judgment shows that the customs authorities can assess/reassess customs/import duty, but are not allowed to recover such amounts, which should be claimed as part of the resolution process under IBC by the debtor. This judgment is distinguished on the basis that in the present case, the customs authorities are not recovering any amount on the basis of assessed customs/import duty, but the issue in the appeal is about invocation of the BG and FDRs.
Therefore, in the light of the judgment of Hon’ble Supreme Court in the matter of State Bank of India vs. V. Ramakrishnan & Anr. and of this Tribunal in the matter of BHARAT ALUMINIUM CO. LTD VERSUS M/S J.P. ENGINEERS PVT LTD., ANDHRA BANK (NOW MERGED WITH UNION BANK) [2021 (2) TMI 1151 - NATIONAL COMPANY LAW APPELLATE TRIBUNAL , PRINCIPAL BENCH , NEW DELHI], it is clear that section 14(3)(b) allows for invocation of BGs.
The appeal is devoid of merit and does not deserve to be admitted at the initial stage itself.
-
2023 (8) TMI 859
CIRP - NCLT admitted the application - Violation of principles of natural justice - whether there was any denial of justice and fair opportunity of hearing suffered by either of the parties before the Adjudicating Authority and whether the impugned order suffers from any infirmity on the count of natural justice or on merits?
HELD THAT:- The debt and default above the threshold limit having been established, there is sufficient reason for admission of the main petition and admitting the Corporate Debtor into the rigours of CIRP - it is added that procrastinated pronouncement of order has given fodder to the Appellant in making the absurd claims of having not been heard. At this point, we cannot restrain ourselves from observing that such unreasonable and unexplained delays in delivering verdicts are not desirable. Be that as it may, the hyper-technical and opportunistic pleas raised by the Appellant to stymie the admission of CIRP of the Corporate Debtor cannot be countenanced either.
There are no sufficient and plausible grounds made which warrant any interference with the impugned order. There is no merit in the appeal. The appeal is dismissed.
-
2023 (8) TMI 799
Maintainability of petition - initiation of CIRP - amount exceeding Rs.1 crore was due for payment to the Operational Creditor - undisputed debt which had become due and payable - operational debt was barred by Section 10A of IBC or not - HELD THAT:- From a plain reading of the communications, there arises no doubt that the Corporate Debtor had acknowledged the outstanding amount which was due and payable to the Operational Creditor. Not only was the outstanding amount acknowledged but an assurance had also been given by Corporate Debtor to clear the said amount and make extra payment towards old outstanding dues.
Pre-existing disputes - HELD THAT:- The rider “subject to the claims lodged” is a very generic statement without any specific reference to past disputes and thus devoid of plausibility. Objections in terms of “claims lodged”, if relatable to existing disputes, should have been brought to the pointed notice of the Operational Creditor which has clearly not happened in the present case - when the Corporate Debtor had admitted the outstanding debt and agreed to pay the same, it amounts to clear acknowledgment of debt being due and payable and belies the existence of any dispute.
Whether the debt arising out of the invoices fell during the period which attracts the bar of Section 10A of IBC? - HELD THAT:- There are no hesitation in observing that in the present case, all requisite conditions necessary to trigger CIRP under Section 9 stands fulfilled with operational debt having been acknowledged and default committed thereto and there being no real pre-existing disputes discernible from given facts.
The Adjudicating Authority has rightly admitted the application of the Operational Creditor filed under Section 9 of IBC - at the impugned order does not warrant any interference. There is no merit in the Appeal. The Appeal is dismissed.
-
2023 (8) TMI 798
Approval of the Resolution Plan - dissenting Financial Creditor - discrimination with the payment to unsecured financial creditors or not - HELD THAT:- The Form-H clearly indicate that there are two different categories one who did not vote in favour of the resolution plan and other those who voted in favour of the resolution plan. Form-H also clearly indicate that there can be different payment to the two categories. Thus, the submission of the Appellant that there cannot be any discrimination with the payment to unsecured financial creditors who did not vote in favour of the plan and those who voted in favour of the plan cannot be accepted.
The assenting financial creditors entitled for payment as proposed in the plan and dissenting financial creditor is entitled as per the minimum entitlement as per Section 30(2)(b). There is no dispute that liquidation value of the Appellant in the present case is nil. The submission of the Appellant that there is a discrimination between the payment of assenting unsecured financial creditor and dissenting unsecured financial creditor cannot be accepted and on the ground, as urged by the Appellant in this Appeal, the Resolution Plan approved by the Adjudicating Authority cannot be held to be discriminatory.
There is no error in the order of the Adjudicating Authority approving the Resolution Plan - there is no merit in the Appeal - appeal dismissed.
-
2023 (8) TMI 748
Initiation of CIRP - Period of limitation - Term Loan I challenged on the ground that the application filed under Section 7 of the Code could not ever have been filed - date of NPA to be taken as date of default or not - HELD THAT:- No doubt that as per schedule of payment, provided in the sanction letter, the repayment was to be made in respect of term loan 1 on half yearly basis, as per schedule provided in the sanction letter on the basis of which, as per chart prepared by the Appellant, 4th instalment was to be paid on 30.06.2020 of an amount of Rs. 14.59 Cr. but the same was not paid. Similarly, 5th instalment was to be paid on 31.12.2020 again of an amount of Rs. 14.59 Cr. which was also not paid and lastly 6th instalment was to be paid on 30.06.2021 of Rs. 26.27 Cr. which too was not paid.
The question that has been raised by the Appellant is that the amount of debt became due and payable by the Respondent on 30.06.2020, therefore, it should have been the date of default whereas according to the Respondent, there is no concept of first date of default because the word first is not deliberately used by the legislature in Section 7 of the Code as a prefix with the word default and if the limitation of three years is counted from 30.06.2020 even then the application has been filed within the period of limitation.
Next argument of Counsel for the Appellant is that since the notice of demand was issued on 01.10.2020, therefore, the date of default has to be treated as such, which could not have been 30.06.2021 as has been projected by the Respondent in order to wriggle out of the vigours of Section 10A of the Code - HELD THAT:- The submissions made by Counsel for the Appellant cannot be accepted because term loan I has been provided to the Corporate Debtor in which there is no bank guarantee which is there in term loan II and the notice dated 01.10.2020 has been issued both to the Corporate Debtor and the Guarantor making specific reference to term loan II, highlighting the amount, which was disbursed in that account.
The last argument raised by the Appellant is about the date of NPA - HELD THAT:- There is no dispute that if the date of NPA is taken as the date of default then it would definitely come within the aforesaid period during which no petition under Section 7 could have ever been filed - it is also submitted that even in this appeal, the Appellant has not filed any application, seeking permission from this Tribunal, to bring on record the additional documents much less the record of DRT alongwith certificate of NPA. Therefore, these documents cannot be looked into being not a part of the record - thus the contention raised by the Appellant, to take the date of NPA as the date of default, cannot be accepted.
Thus, all the points raised by the Appellant, in order to bring the date of default within the ambit of Section 10A of the Code fails and as a result thereof, all the contentions of the Appellant are hereby rejected - Appeal dismissed.
-
2023 (8) TMI 747
Direction to the Suspended Management to handover all the requisite documents/records of the Corporate Debtor to the IRP within one-week - HELD THAT:- As per the Rule 49 of NCLT Rules, in case, the Appellant being the Respondent in the application who was proceeded against ex parte, could have filed an application before the same court for setting aside the impugned order by recalling the same but no such effort was made at that time rather the present appeal has been filed.
It would be just and expedient if an application is filed by the Appellant in terms of Rule 49 of the Rules before the Adjudicating Authority who has passed the impugned order for the purpose of recalling the same on the ground that the Appellant was never served with the notice of the court and the email was only computer generated, therefore, it does not fall within the ambit of due notice as required by the Rules.
The present appeal is hereby disposed of, without commenting on the merits of the case and liberty is extended to the Appellant to file an appropriate application, in terms of Rule 49 of the Rules, for recalling the impugned order.
-
2023 (8) TMI 709
Seeking relief from Income Tax Dues - Benefit of Board for Industrial and Financial Reconstruction (BIFR) scheme denied - scheme came to an end - SICA was repealed - it is submitted that an appeal would now lie with the NCLAT in terms of the Insolvency and Bankruptcy Code (Removal of Difficulties) Order, 20172, issued by the Central Government in exercise of its powers under Section 242(1) of the Insolvency and Bankruptcy Code, 2016 - HELD THAT:- The contention that an appeal would lie against the order of BIFR to NCLAT after the repeal of SICA, is unmerited as the said provisos have been held to be ultra vires the Insolvency and Bankruptcy Code, 2016, by the NCLAT in PR. DIRECTOR GENERAL OF INCOME TAX (ADMN. AND TPS) AND GMB CERAMICS LTD. VERSUS M/S. SPARTEK CERAMICS INDIA LTD. & ANR. [2018 (6) TMI 350 - NATIONAL COMPANY LAW APPELLATE TRIBUNAL, NEW DELHI].
Thus, the contention that an appeal would lie against the order of the BIFR before the NCLAT is rejected.
It also cannot be accepted that the DGIT is remediless against an order passed by the BIFR solely for the reason that SICA, which provided for an appeal against a rehabilitation scheme or any orders passed by the BIFR, stands repealed - It is settled law that there is no inherent or fundamental right of an appeal, the right to appeal is available only if the statute provides for the remedy of an appeal. However, the fact that there is no statutory appellate remedy does not preclude this Court from exercising powers under Articles 226 and 227 of the Constitution of India. The recourse of this Court under Articles 226 and 227 of the Constitution of India is not precluded or proscribed where the relevant statues do not provide a remedy of appeal. Although this Court while exercising its powers under Articles 226 and 227 of the Constitution of India does not undertake a full merits review – which may be available in cases where an appeal is provided by the statute – a party is not precluded from challenging the orders passed by the statutory authorities on the ground that they fall foul of the constitutional guarantees or are otherwise contrary to law.
The present petition is not maintainable.
Whether the impugned order is contrary to law? - HELD THAT:- Clearly, no modification of the Scheme could be sanctioned requiring the Income Tax Department to give further concessions without the department consenting to grant such an extension - Admittedly, the Company’s application seeking modification of the scheme by extending the term remained pending with the BIFR. In terms of Section 18(5) of SICA, it was open for the BIFR to modify the Scheme and extend its term if it considered it apposite. However, no such modification could be sanctioned without the consent from the said concerned government, banks, institutions or authorities if the modification of the Scheme entailed any concession or financial assistance from such persons.
There is merit in the contention that the Scheme sanctioned by the BIFR had expired. The Scheme contemplated measures for exceeding the net worth within the period specified in the Scheme and in the manner as stipulated therein viz by settlement with banks and workmen, repayment of statutory dues in instalments over a specified period of time, and infusion of funds by the promoters and sale of certain assets, and other measures - the measures mentioned in the Scheme were timebound measures and were required to be implemented within the given time frame stipulated, therein.
Whether the BIFR’s order dated 26.02.2013, whereby the Scheme was modified, necessarily required the Income Tax Department to grant further additional concessions? - HELD THAT:- Plainly, the answer to this question is in the negative. This is for two reasons. First, that the obligation to extend further concessions could not be imposed on the Central Government (Income Tax Department) without its consent. The Income Tax Department had not consented for extending any further concession. And therefore, the order dated 26.02.2013 requiring the department to consider the grant of the further concessions, cannot be interpreted as making it obligatory on the department to grant such concessions. Second, it was the Company’s stand before the BIFR that the modifications of the Scheme as proposed did not prejudice the Income Tax Department as it retained the discretion whether to grant such concessions.
Also, the Scheme did not envisage the promoters’ contributing shares or other assets to make good the shortfall in the projections. The promoters were required to make the shortfall in liquid funds. Thus, the promoters had not complied with the Scheme which they now submit is binding on all other parties. It also appears that the entire exercise of gifting the shares to the Company and the Company selling the same was with the object of ensuring that the capital gains arise in the hands of the Company so as to enable the Company to claim further exemption.
The impugned order cannot be sustained. The same is set aside. The Income Tax Department is not required to grant any further concessions contrary to the IT Act, to the Company.
-
2023 (8) TMI 708
Stay on CIRP process - Immediate restoration of Authorised Signatories in the accounts maintained by the Applicant in various banks, including the only operational account of Applicant with Yes Bank Limited as it existed prior to the Admission Order - removal of the name of the Interim Resolution Professional from the list of Authorised Signatories in the bank accounts of the Applicant - HELD THAT:- Staying of the CIRP does not entitle the Corporate Debtor to put back in position which has already been held by this Appellate Tribunal in Ashok Kumar Tyagi’s case [2022 (11) TMI 984 - NATIONAL COMPANY LAW APPELLATE TRIBUNAL , PRINCIPAL BENCH , NEW DELHI]. Application filed by the Corporate Debtor cannot be allowed.
Application is rejected accordingly.
............
|
9911796707
