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IBC - Case Laws
Showing 301 to 320 of 779 Records
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2023 (8) TMI 482
Maintainability of application filed u/s 7 of IBC - barred by time limitation or not - Appellant, contends that the Adjudicating Authority/ Tribunal, had failed to appreciate that the Claim of the 1st Respondent / Petitioner / Financial Creditor, was hopelessly barred by Limitation - HELD THAT:- Dealing with the aspect of Reply Notice, dated 19.06.2019, issued on behalf of the Corporate Debtor (for the Legal Notice, dated 10.06.2019), issued by the 1st Respondent / Bank / Financial Creditor, the Paragraph 2 of the said Reply, makes a reference to the Financial Turmoil, faced by the Corporate Debtor, in the recent past, resulting to Non payment of Loan Amount, and the discussion both had with O.T.S. Proposal, for Fourteen Cr., which was under due consideration, etc. - an admission, is the best peace of evidence, which can be used against the Maker, and this can be taken advantage of, by a Party, which places reliance, so as to bind, the said Maker.
This Tribunal, to point out an admission, is not a self serving statement, but it is a self harming one. An Admission, is Confession or Voluntary Acknowledgement, made by a Party or Someone, identified with him, in legal interest, of the existence of certain facts, which are in issue or relevant to an issue, in the case, as per decision - It cannot be forgotten that the Corporate Debtor, had acknowledged the Debt, by offering One Time Settlement Proposal for Rs.14 Crore, through a Letter dated 03.03.2018. Also that the OTS Letters (sent by the ‘Corporate Debtor’), 13.07.2021, 03.08.2021, 31.12.2021, 04.01.2022 and 13.01.2022, were rejected by the 1st Respondent / Bank / Financial Creditor, as not Financially viable.
An Unconditional Acknowledgment, is held to imply, a promise, to pay as per decision of the Hon’ble Supreme Court of India, in Hiralal & Ors. Badkulal, [1953 (3) TMI 36 - SUPREME COURT]. An Acknowledgement, extends the Limitation Period. No wonder, an Acknowledgement, contained in the Balance Sheet of the Company, begins a fresh commencing point of Limitation - Undoubtedly, if any documents is executed, during the subsistence of Limitation, thereby the Dues, are / were acknowledged, the Limitation, will be revived, afresh, from the Date of Acknowledgement.
In the instant case, the Default, committed by the Corporate Debtor, in respect of the Financial Debt, is more than Threshold Limit of Rs. 1 Crore (vide Section 4 of the Code, after amendment) - In the present case, as on date, for the Loan Facilities, provided by the 1st Respondent / Bank, to the Corporate Debtor, a Sum of Rs.239,51,53,055.83/-, being the Due Default Amount, committed by the Corporate Debtor. If there is any Financial Debt and Default, in repayment of the same, by the Corporate Debtor, then, an Adjudicating Authority/ Tribunal, by exercising its Discretion, after subjectively satisfying, itself that a Default, was committed by the Corporate Debtor, then, the Section 7 Application, filed by the Financial Creditor, can be admitted, under the I & B Code, 2016.
In the instant case on hand, the Adjudicating Authority / Tribunal, on the available materials on record, came to an ultimate conclusion that the Corporate Debtor, had committed Default, in respect of the Debt, to be paid by it, to and in favour of the 1st Respondent / Bank. Indeed, the Section 7 Application, was admitted, by the Adjudicating Authority / Tribunal through its impugned order, dated 06.05.2022, and appointed, an Interim Resolution Professional and declared Moratorium, etc., which is free from any Legal Infirmities.
Appeal dismissed.
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2023 (8) TMI 481
CIRP - Legality of admitting Section 7 Application - Existence of Financial Debt - Time Value of Money - no Privity of Contract between the Corporate Debtor and the 1st Respondent / Financial Creditor / Petitioner. - Nature of loan / money borrowed from bank to pay / settle the dues of another bank. - Scope of Article of association - Delegation of power to Directors / Borrowing Powers of Directors.
Aggrieved person being Shareholder and Suspended Director - the Corporate Debtor, is a family business of the Appellant.
HELD THAT:- There is no embargo in Law, for a Director of a Company, to infuse the Funds, into the Company, with a view to rescue a Company from Financial Distress / Crisis, and the monies advanced clearly come within the umbrage of Section 5(8) of the Code. - It cannot be gainsaid that a ‘Financial Debt’, is to be understood to include ‘Interest Free Loans, given to a ‘Company’ / ‘Entity’, for its ‘Business purpose’ / ‘Operations’, as the case may be.
It is brought to the fore on behalf of the ‘1st Respondent / Financial Creditor / Petitioner’, that a Sum of Rs.3,97,85,000/-, was advanced to the ‘Corporate Debtor’, by the ‘1st Respondent / Financial Creditor / Petitioner’, and the same was used by the ‘Corporate Debtor’, to ‘repay the Loans’, taken by the ‘Corporate Debtor / Company’, from the ‘State Bank of India’ (earlier State Bank of Hyderabad), under the ‘One Time Settlement Scheme’, provided by the ‘Bank’, to save the ‘Corporate Debtor’, from ‘distress’.
In reality, the ‘State Bank of India / Lender’, had issued a ‘No Due Certificate’, dated 30.01.2021. Suffice it for this ‘Tribunal’, to point out that a Sum of Rs.3,97,85,000/- advanced to the ‘Corporate Debtor’, by the ‘1st Respondent / Financial Creditor / Petitioner’, was through numerous Bank Transactions and all these, would unerringly prove the ‘Existence of a ‘Financial Debt’ of an ‘Amount of Rs.1 Crore’, ‘Due and Payable’, by the ‘Corporate Debtor’, to the ‘1st Respondent / Financial Creditor / Petitioner’.
If the Articles, have a provision which ‘prohibited the Directors’, from ‘delegating their power’, to ‘Borrow Monies’, does not prevent them from ‘empowering one of the Directors’, to execute a ‘Mortgage Deed’. - It is not necessary that while specifying the ‘Borrowing Powers’ of a ‘Company’, the ‘Articles’, should state the manner, in which, the ‘Borrowing’, is made.
Notice of Default - HELD THAT:- The question of whether, there is a ‘Debt and Default’, can be looked into, only, if the ‘Corporate Debtor’, disputes the ‘Debt’ or takes a stand that ‘there is no Default’, although, there is ‘Debt’. - An ‘Adjudicating Authority’, this ‘Tribunal’, pertinently points out is to see the ‘Records of Information Utility’ or ‘other evidence’, produced by a ‘Financial Creditor’, to satisfy itself, that a ‘Default’, has occurred. The other factors, such as, the ‘Existence of a Dispute’ or ‘Discrepancy’, are not ‘Germane’, as long as, it has not been ‘Disputed’, that the same ‘Debt’, is ‘Due’ and is ‘Payable’, to the ‘Financial Creditor’, and the ‘Corporate Debtor’, has ‘Defaulted’.
This Tribunal, taking note of the contentions, advanced on respective sides, considering the surrounding facts and circumstances of the instant case, in a holistic manner, comes to an irresistible and inescapable conclusion that the aspect of Debt and Default, committed by the Corporate Debtor, were established by the 1st Respondent / Financial Creditor / Petitioner, to the subjective satisfaction of this Tribunal.
Appeal dismissed.
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2023 (8) TMI 480
Approval of Resolution Plan (at second round) - it is alleged that the payments to the Operational Creditors have decreased in the revised payments proposal - HELD THAT:- The direction of this Tribunal in M/S. RANA SARIA POLY PACK PVT. LTD. VERSUS UNIWORLD SUGARS PVT. LTD., NCIRCLE EXIM LLP AND SIMBHAOLI SUGARS LIMITED VERSUS PRAMOD KUMAR SHARMA, RESOLUTION PROFESSIONAL OF UNIWORLD SUGARS PRIVATE LIMITED (USPL) , COMMITTEE OF CREDITORS OF UNIWORLD SUGARS PRIVATE LIMITED (USPL) , IDBI BANK LTD. THROUGH ITS AUTHORIZED REPRESENTATIVE, ORIENTAL BANK OF COMMERCE, THROUGH ITS AUTHORIZED REPRESENTATIVE, UNION BANK OF INDIA, M/S. NCIRCLE EXIM LLP [2022 (5) TMI 460 - NATIONAL COMPANY LAW APPELLATE TRIBUNAL NEW DELHI] indicate that the Resolution Plan was set aside only to the extent it relates to allocation of payment to stakeholders and creditors and directed that revision of payments and subsequent approval of the revised resolution plan was to be completed within a period of two months. Subsequent to order of this Tribunal, the revised proposal for distribution was placed before the Committee of Creditors which came to be approved on 11.05.2022. The revised plan which has been approved indicate that payments to workmen and employees has been increased as well as payment to Financial Creditors. There is little decrease in payment to Operational Creditors, earlier Rs.1.69 Crores were allocated which is now at Rs.1.57 Crores (which has been actually paid).
It is now well settled that distribution to the creditors in accordance with provisions of Section 30(2) is in the discretion of the Committee of Creditors and with regard to distribution the scope of judicial review by the Adjudicating Authority and this Tribunal is very little. From the facts brought on the record it does appear that liquidation value of the Operational Creditors is nil. When payment of Rs.1.57 Crore has been proposed in the plan, it cannot be said that there is violation of any provisions of law especially Section 30(2) of the Code.
The present is a case where the Corporate Debtor is not being liquidated rather resolution plan has been approved as per the Insolvency and Bankruptcy Board of India. (Insolvency Resolution Process for Corporate Persons) Regulations, 2016 - there is no applicability of Regulation 29 while approving the resolution plan - such submission of the Appellant cannot be appreciated.
There is no infirmity in the impugned order of the Adjudicating Authority approving the Resolution Plan. There is no merit in the Appeal. Appeal is dismissed.
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2023 (8) TMI 413
Admitted as resolution professional in the third meeting of the Committee of Creditors and until the seventeenth meeting - National Company Law Appellate Tribunal rendered adverse findings in regard to the conduct of the appellant and imposed costs of Rs 1,00,000.
HELD THAT:- Issue notice, returnable in three weeks.
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2023 (8) TMI 412
Erroneous proceeding under the provisions of Section 138 of the Negotiable Instruments Act, 1881 - CIRP initiated and IRP appointed - HELD THAT:- The counsel would contend that the proceedings initiated against the present petitioners was not maintainable and should have been interdicted by the High Court in the impugned judgment.
Issue notice.
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2023 (8) TMI 411
Condonation of delay of 85 days in filing claim - Claim filed belatedly - liquidation process has been disposed of and third party rights have been created - HELD THAT:- During the intervening period, the subject matter involved in the liquidation process has been disposed of and third party rights have been created. Therefore, the NCLT observed that the appellant herein may pursue other remedies available in law. The said order has been affirmed by the National Company Law Appellate Tribunal (NCLAT).
The contention of learned counsel for the appellant that the delay could be condoned and his claim must be taken on record, cannot be accepted - Appeal disposed off.
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2023 (8) TMI 357
Validity of SCN issued - payment of Rs.1 crore has been made to respondent no. 1 – operational creditor - HELD THAT:- It will be open to the appellant to point out the aforesaid factum before the National Company Law Tribunal (NCLT)/National Company Law Appellate Tribunal (NCLAT) - A number of applications have been filed for intervention/impleadment by other operational/financial creditors of respondent no. 2 – Balaji Fiber Reinforce Pvt. Ltd.
It will be open to the appellant and the parties who have filed application(s) for intervention/impleadment to take steps under the Insolvency and Bankruptcy Code, 2016.
Appeal disposed off.
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2023 (8) TMI 356
Preferential Transactions - Validity of impugned order - error in accepting the conclusions in Forensic Report - Delegation of Powers of the Resolution Professional or not - HELD THAT:- It is brought to the fore, that the Corporate Debtor, had transferred Sums, from its Bank Account, to the Appellants / Respondents, with a view to Discharge its Antecedent Operational Debt, and by virtue of the Payments so made, the Appellants / Creditors, were placed in a higher Beneficial Pedestal, than that of the Financial Creditors, when Distribution of Assets, are made as per Section 53 of the Code.
In the instant case, the Transactions that took place between the period from 27.12.2019 and 12.04.2021, were rightly taken into account, and undoubtedly, the period specified in Section 43 (4) (a) of the Code, is fulfilled, considering the fact that the Insolvency beginning date, was 21.12.2021, and the Transactions, were held between the Related Parties / Appellants / Respondents, being the Former Directors of the Corporate Debtor. No wonder, the lookback period of two years, squarely applies to the facts of the instant case.
Although, on behalf of the Appellants / Respondents, a stand was taken (Before the Adjudicating Authority), that the Transactions, were made in the Ordinary Course of their Business, and the amounts, withdrawn from the Corporate Debtor’s Account, etc., and usurping the same in respect of the Antecedent Debt, cannot tantamount to carrying on business in an ordinary manner of the Corporate Debtor, or in the Financial Affairs of the Respondents. Looking at from any angle, the impugned transactions, are not exempted transactions, as per Section 43 (3) of the Code, in the considered opinion of this Tribunal - In the present case, the NPA, was made on 23.02.2021 and the transactions, pointed out by the Appellants / Respondents, were before the earlier Date of the NPA, is not omitted.
As far as the present case is concerned, on account of the Preferential Transactions, the Individual and the Companies, were gained at the cost of Creditors and in Law, the Appellant Nos. 1, 3 and 5 / Respondent No. 1, 3 and 5 and Paptrade India Pvt. Ltd. / Company (6th Respondent in IA (IBC) / 206 / KOB / 2022, are in Preferential Transaction.
The impugned order passed by the Adjudicating Authority / Tribunal, in directing the 1st Appellant / 1st Respondent, to pay an amount of Rs.3,96,04,622/-, the 2nd Appellant / 3rd Respondent, to pay an amount of Rs.30,39,400/- and the 3rd Appellant / 5th Respondent, to pay a Sum of Rs.37,86,943/-, and the Paptrade India Pvt. Ltd. (6th Respondent in IA (IBC) / 206 / KOB / 2022), to pay a Sum of Rs.47,13,869/-, within a month from the date of Order, failing which, the amounts will carry 12% Simple Interest, till the date of Realisation, is free from any Legal Infirmities. Accordingly, the Appeal, sans merits and it fails.
Appeal dismissed.
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2023 (8) TMI 321
Application filed under Section 9 of the IBC, 2016 rejected - rejection on the ground that it does not fulfil the threshold as prescribed under Section 4 proviso where minimum default amount has been increased to Rs. 1 Crores by Notification of MCA dated 24.03.2020 - it was held by NCLAT [2022 (12) TMI 1427 - NATIONAL COMPANY LAW APPELLATE TRIBUNAL PRINCIPAL BENCH, NEW DELHI] that no error has been committed in rejecting Section 9 application filed by the Appellant which did not fulfil the threshold of Rupees One Crore.
HELD THAT:- There are no reason to interfere in the order impugned passed by the National Company Law Appellate Tribunal - appeal dismissed.
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2023 (8) TMI 320
Application hit by Section 10A of IBC - Barter Transactions - dues claimed are prior to 25/03/2020 and ‘interest’ has been calculated from that date and the date of default written in Section 9 Application is 22/02/2020 and the calculation of interest is from 01/04/2020 - existence of pre-existing dispute or not - HELD THAT:- From the Invoice, it is clear that it is agreed between the Parties that interest would be charged at 24 % p.a., if payment is not received within 30 days from the Invoice date. Likewise, a bare reading of the aforenoted Invoice shows the interest component to be 24 % p.a. with a ‘default clause’ that if the amount is not paid within 30 days from the Invoice date, interest will be attracted. Therefore, the contention of the Learned Senior Counsel that the calculation ought to be based on 11 days to 42 days, is untenable.
The total amount for maintainability of Claim will include both ‘Principal Debt amount’ as well as the ‘Interest’ on the delayed payment which is stipulated in the Invoice dues. In the instant case, the Principal amount is said to be Rs. 1,65,60,017/- and the interest portion at 24 % as per the second Clause in Invoice No. 2 is Rs. 56,31,027/-. Therefore, this Tribunal is of the considered view that the amount has crossed the threshold of Rs. 1,00,00,000/- and also that the amounts due and payable are for a period prior to 25/03/2020. The date of default mentioned in the Section 9 Application is 22/02/2020. Therefore, it is clear that for any amounts due and payable prior to 25/03/2020, Section 10A cannot be made applicable.
Pre existing dispute between the Parties as there was a Barter Transaction and when the Respondent / Operational Creditor had initiated Arbitration Proceedings under the MSME Council - HELD THAT:- It is seen from the record that the MSME Council has rejected the Application and there is no Claims / Suit pending in any Court of Law before any Tribunal and there is no Arbitration Proceeding pending prior to the initiation of the Section 8 Notice. Additionally, the Appellant had stated in Para 8 of their Counter, that a payment of Rs. 40,000/- was made on 10/08/2021, 09/09/2021, 12/10/2021 & 22/03/2022 which further establishes that some amounts were paid even subsequent to the filing of the Application before the MSME Council - Additionally, the Appellant had stated in Para 8 of their Counter, that a payment of Rs. 40,000/- was made on 10/08/2021, 09/09/2021, 12/10/2021 & 22/03/2022 which further establishes that some amounts were paid even subsequent to the filing of the Application before the MSME Council.
The Hon’ble Apex Court in the matter of ‘Mobilox Innovations Pvt. Ltd. Vs. Kirusa Software Pvt. Ltd’ reported in [2017 (9) TMI 1270 - SUPREME COURT] has addressed to the question of ‘pre existing dispute’ and observed So long as dispute truly exists in fact and is not spurious, hypothetical, or illusory, the Adjudicating Authority has to reject the application.
This Tribunal is of the considered view that the ratio of the aforenoted Judgment is squarely applicable to the facts of this case as this Tribunal is of the considered view that the ‘Dispute’ raised is a spurious one and is an illusory one. Additionally, it is significant to mention that before the very same ‘MSME Council’, the Appellant / Corporate Debtor in his Reply, in Paras 4 and 5 (Reply to MSME Annexure A4) has clearly admitted that the ‘reason for delay of settlement of outstanding amounts is not wanton and that Company is making all sorts of efforts to settle the outstanding dues as soon as possible’.
Appeal dismissed.
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2023 (8) TMI 259
Fraudulent transaction - Sale Deed executed by the Corporate Debtor in favour of the Respondent, with regard to the immovable property - evidence existed to establish that the sale deed was Fraudulent Transaction or not - HELD THAT:- Having regard to the facts and circumstances of the case and the Recitals in the Sale Deed dated 11/08/2008, this Tribunal is of the considered view that merely because the Sale Agreement is dated 15/05/1989 and the Sale Deed is executed on 11/08/2008, it cannot be a ground for establishing that the said transaction is a Fraudulent one. Now, we address to the contention of the Learned Counsel for the Appellant that there is no documentary proof to establish that Rs. 50,00,000/- was indeed transferred to the Corporate Debtor by the Respondent. Apart from the fact that the Financials of the Respondent Company record that the said Consideration was paid on its behalf by ‘M/s Shivalika Leasing and Finance Limited’, this ‘Tribunal’ is conscious of the fact that the amount has been paid by Cheque.
This Tribunal finds it a fit case to place reliance on the Judgment of the Principal Bench of NCLAT in the matter of JAGDISH KUMAR PARULKAR, LIQUIDATOR FOR KAPIL STEELS LTD. VERSUS M/S INDORE STEEL & ALLOYS PRIVATE LIMITED, SUBHASH KUMAR JAISWAL, MANISH MALVIYA, M/S RUPENDRA JAISWAL KUMAR, MADHYA PRADESH INDUSTRIAL DEVELOPMENT CORPORATION LIMITED [2023 (3) TMI 1388 - NATIONAL COMPANY LAW APPELLATE TRIBUNAL PRINCIPAL BENCH, NEW DELHI] in which this ‘Tribunal’ had addressed in detail, regarding the role of Liquidator and observed The negligence on the part of the Corporate Debtor not to have executed the lease deed cannot be overlooked and cannot be allowed to become a ruse for fraudulent transaction. Mere possibility of a potential collusion without material on record is not sufficient to persuade, this Bench to record any finding on preferential or fraudulent transaction.
It is settled position of law that there is a presumption that a ‘Registered Document’ is validly executed. The burden of proof, thus would be on the person who leads the evidence to rebut the presumption. In the instant case, this ‘Tribunal’ does not find any documentary evidence on record to establish that the said ‘Transaction’ is a ‘Fraudulent’ one.
Appeal dismissed.
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2023 (8) TMI 258
Challenge to approval of Resolution Plan - approval of the plan challenged on the ground that claim admitted of the Appellant was Rs.27,91,64,187/- whereas in the plan only an amount of Rs. 58,58,444/- has been allocated - HELD THAT:- Similar issues were answered by this Tribunal in DEPARTMENT OF STATE TAX, THROUGH THE DY. COMMISSIONER OF STATE TAX VERSUS ZICOM SAAS PVT. LTD. & ANR. [2023 (2) TMI 1170 - NATIONAL COMPANY LAW APPELLATE TRIBUNAL, NEW DELHI] where it was held that The Appellant having been treated as Operational Creditor allocation of amount in the Resolution Plan cannot be said to be in violation of Section 30 (2)(b). We thus are of the view that no ground has been made to interfere with the Impugned Order.
The issues raised in the present Appeal are fully covered by the judgment of this Tribunal in Department of State Tax, Through the Dy. Commissioner of State Tax vs. Zicom Saas Pvt. Ltd. & Anr. - appeal dismissed.
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2023 (8) TMI 197
Termination of Lease agreements - Petitioners have been constrained to move this Application on account of the fact that the Respondent No. 9/RP of Go Airlines has commenced flying the Aircrafts of the Petitioners despite the fact that the Lease Agreements with respect to such Aircrafts have been terminated by the Petitioners - HELD THAT:- The provisions of the Aircraft Act, 1934 and the Aircraft Rules, 1937 provide that no person shall use and operate an Aircraft unless it is in accordance with the Aircraft Rules, 1937. Rule 30(6)(iv) of the Aircraft Rules, 1937 provides that the registration of an Aircraft registered in India may be cancelled where the lease in respect of the Aircraft has expired or been terminated - Non-payment of lease rentals by the Respondent No. 9/RP of Go Airlines constituted an event of default under the Lease Agreement(s) executed between the Petitioners and Respondent No. 9/RP of Go Airlines. Hence, the Lease Agreement(s) were terminated by the Petitioners.
It is not disputed by the parties that Lease Agreements qua the Aircrafts in paragraph 7.1 above have been terminated and the process of deregistration of the Aircrafts has commenced. Once an event of default has occurred and the Petitioners have terminated the Lease Agreement(s) and commenced the process of deregistration of the Aircraft, flying such Aircraft will be contrary to the provisions of the Aircraft Act, 1934 and the Rules framed thereunder.
The document termed as the ‘Airbus Manual’ (which appears to only be an extract of the complete Airbus Manual) has been relied upon to submit that during the parking period such flights require to be undertaken at intervals of 3 months. This document also does not help the case of the Respondent No. 9/RP, as Paragraph 3 of this document itself contains multiple options qua storage and maintenance. Paragraph 3(A)(4) also states that a maintenance/handling flight is requisite every two years, during a storage period, so that the Aircraft is preserved. It cannot be disputed by the either party that these Aircrafts have not been grounded for two years. Therefore, reliance placed on the Airbus Manual extract, as has been done by the Respondent No. 9 /RP of Go Airlines, cannot be accepted either - thus, the contention of the Respondent No. 9/RP of Go Airlines, that the reason, 2 of the 10 Aircrafts have been flown by Go Airlines is that these were handling flights forming part of the scheduled maintenance activity for the Aircraft, is misconceived.
Let status quo be maintained in respect of handling/non-revenue flights of the Petitioners Aircrafts till the next date of hearing - List this Application for further hearing/disposal on 03.08.2023 at 3:00 PM.
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2023 (8) TMI 196
Seeking refund of security deposit - adjustment was done while the moratorium was in operation or not - HELD THAT:- It is found that firstly the Appellant did not file any claim and secondly, it did not choose to appear to contest the application. After the liquidation order was passed on 21.01.2020, all tangible or intangible, movable or immovable properties as evidenced in balance sheet of the Corporate Debtor, being a part of the liquidation estate in terms of Section 36(3) of the Code, could not have been utilised by the Appellant by invoking general terms of supply of electricity. The electricity bills incurred by CD during the moratorium period were paid and the Appellant after the commencement of liquidation unilaterally adjusted the outstanding bills.
There are no merit in the present appeal and the same is hereby dismissed.
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2023 (8) TMI 195
Validity of impugned order - CIRP expenses required to be approved and the Appellant/Petitioner had already made claim - Impugned Order granting liberty to agitate the same issue before the Appropriate Forum - HELD THAT:- Taking note of the fact that the claim of the Appellant/Petitioner was admitted and it is for the Committee of Creditors to take a final call in the subject matter in issue, at this stage, simpliciter is not inclined to entertain the Appeal. In reality, this Tribunal is in complete agreement with the view arrived at by the Adjudicating Authority in the Impugned Order that the said application was closed with liberty to agitate before the appropriate Forum.
Appeal dismissed.
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2023 (8) TMI 194
Rejection of the Claim by the Liquidator - challenge to the rejection dismissed on the grounds that the Appellant did not file any Order passed under the EPF &MP Act, 1952 and that no supporting documents have been enclosed in that regard - HELD THAT:- It is seen from the record that the Corporate Debtor has declared the Contribution amount in the monthly returns, but while remitting the amounts admittedly he has permitted amounts short of the already declared contribution and the same is reflected in the Establishment Ledger.
The Employees Provident Fund Scheme, 1952 requires the Employer / Corporate Debtor to prepare a Contribution Card which would deal all the payments made by the Corporate Debtor against the monthly PF dues payable by the Corporate Debtor and the shortcomings in the remittance of the said dues would be automatically reflected in the Establishment Ledger. The contention of the Learned Counsel appearing for the Liquidator that an Assessment Order is an essential prerequisite for realising the amounts, is untenable in the light of the aforenoted discussion.
This Tribunal is of the considered view that the ratio of the NCLAT, Principal Bench in the matter of ‘JET AIRCRAFT MAINTENANCE ENGINEERS WELFARE ASSOCIATION VERSUS ASHISH CHHAWCHHARIA RESOLUTION PROFESSIONAL OF JET AIRWAYS (INDIA) LTD. & ORS; ASSOCIATION OF AGGRIEVED WORKMEN OF JET AIRWAYS (INDIA) LTD. VERSUS JET AIRWAYS (INDIA) LTD. & ORS. [2022 (11) TMI 332 - NATIONAL COMPANY LAW APPELLATE TRIBUNAL, PRINCIPAL BENCH, NEW DELHI] upheld by the Hon’ble Apex Court in JALAN FRITSCH CONSORTIUM VERSUS REGIONAL PROVIDENT FUND COMMISSIONER & ANR. [2023 (3) TMI 223 - SUPREME COURT], with respect to the full payment of the Provident Fund dues, is squarely applicable to the facts of this case.
The Order of the Adjudicating Authority is set aside and the Liquidator is permitted to admit the ‘Claims’ based on the Establishment Ledger - appeal allowed.
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2023 (8) TMI 193
Approval of the Resolution Plan challenged - challenged on the ground that as per the Resolution Plan, only 0.13% has been earmarked towards Government dues, and the Financial Creditor is getting 44.5% of the Claim amounts and the other Operational Creditors are getting 0.51% of their Claim amounts, which is stated to be unfair.
HELD THAT:- The Hon’ble Supreme Court in a Catena of Judgments in the matter of KALPRAJ DHARAMSHI & ANR. VERSUS KOTAK INVESTMENT ADVISORS LTD. & ANR. [2021 (3) TMI 496 - SUPREME COURT] has observed that the Commercial Wisdom of the CoC is non-justiciable, unless it is not in accordance with Section 30(2) of the Code.
In the instant case, this Tribunal do not find any such irregularity in the Provisions of the Resolution Plan, as specified under Section 30 (2) of the Code. Additionally, this ‘Tribunal’ is quite alive and conscious of the fact that the Resolution Plan was fully implemented and the Successful Resolution Applicant had made payments amounting to Rs. 35,25,00,000/- to all the Creditors and almost 2 years has passed since the approval of the Resolution Plan and this ‘Tribunal’ does not find any tangible and substantial reasons to set the clock back at this point of time.
Appeal dismissed.
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2023 (8) TMI 192
Refund of the EMD Amount - respondent was considered to be ‘disqualified’ under Section 29A of the Code for Submission of the Plan - HELD THAT:- It is an admitted fact that the First Respondent had deposited an amount of Rs. 2,00,00,000/- on 23/01/2020 towards EMD/ Binding Submission Bank Guarantee (BSBG), and was subsequently informed by the Appellant vide email dated 27/02/2020 that he was disqualified under Section 29A of the Code and hence was not eligible to submit a Resolution Plan. While so, the ‘Adjudicating Authority’ vide Order dated 29/05/2020 had ordered for Liquidation of the Corporate Debtor Company.
As regarding the forfeiture of BSBG, it is clearly stated in the terms that only when the Resolution Applicant is found to have made ‘false or misleading representation’, it can be forfeited. In the instant case, there is absolutely no material evidence on record to substantiate the contention of the Appellant that the 1st Respondent had deliberately or maliciously sought to derail the CIRP Process or given any misleading representation. It is not the case of the Appellant that the 1st Respondent had challenged his ineligibility under Section 29A of the I & B Code, 2016 by way of an Appeal.
It is pertinent to mention that under Regulation 36B of the IBBI (CIRP) Regulations, 2016, there is no requirement to obtain a non-refundable deposit for submission of the Resolution Plan. The Record shows that the Company had gone into Liquidation on 29/05/2020 and the IA/829/2020 filed by the 1st Respondent was allowed, vide the Impugned Order on 04/10/2021 and the EMD amount of Rs. 2,00,00,000/- has still not been refunded. The ‘Adjudicating Authority’ in the Impugned Order has observed that the Resolution Plan given by the 1st Respondent was not even placed before the CoC for its consideration and therefore the question of delay in procedure does not arise and that the Liquidator was not right in holding back the EMD amount.
There are no illegality or infirmity in the reasoning given by the ‘Adjudicating Authority’ in the Order impugned - appeal dismissed.
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2023 (8) TMI 191
Initiation of CIRP - NCLT rejected the application - Pre-existing dispute - Maintainability of application u/s 9 of IBC - application was dismissed on the ground that the Application was filed solely with an intention to recover the outstanding amount - HELD THAT:- From the letter addressed by the Corporate Debtor to the Appellant / Operational Creditor, it is clear that the accounts were confirmed showing an amount of US $ 50,200. The contention of the Learned Counsel for the Respondent that this amount is not shown as due and payable in their financials, pales into insignificance, taking into consideration that this letter has been signed by the Authorised Signatory of the Corporate Debtor and it is clearly stated that the said amounts have been ‘examined by their Statutory Auditors’ and to ‘confirm’ the said amount. Further, this Tribunal is of the considered view that having admitted that this amount is due and payable and having agreed to pay the said amount in two tranches, a sum of $20,000 by the end of May 2021 and the entire balance by the end of July 2021, the Corporate Debtor cannot now turn around and say that there was a dispute and that the amounts are not due and payable.
Keeping in view the facts of the attendant case on hand, this Tribunal is of the considered view that the Judgment of ASSET RECONSTRUCTION COMPANY (INDIA) LIMITED VERSUS UNIWORTH TEXTILES LIMITED [2023 (7) TMI 484 - NATIONAL COMPANY LAW APPELLATE TRIBUNAL , PRINCIPAL BENCH , NEW DELHI] is not applicable to the facts of this case. Specifically, since there was a clear acknowledgement of payment of the amounts in two tranches within specific time periods.
It is settled law that what has to be seen is whether a dispute raised is spurious or genuine. Keeping in view the documentary evidence on record, this Tribunal is satisfied that the dispute raised is a spurious one specifically having regard to the admission of liability on 31/05/2019. The ‘Adjudicating Authority’ has erred in observing that ‘Corporate Insolvency Resolution Process’ cannot be initiated against the solvent company in a pandemic situation and that it is a recovery proceeding. To reiterate, the debt was ‘due and payable’ since May 2018 and therefore Section 10A is not applicable to the facts of this case.
The matter is remanded to the ‘Adjudicating Authority’ for initiation of ‘Company Insolvency Resolution Process’ against the Corporate Debtor Company in accordance with law - appeal allowed.
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2023 (8) TMI 190
Jurisdiction of Tribunal to entertain/initiate, the Insolvency Proceedings of the Personal Guarantors, even when no Corporate Insolvency Resolution Process proceedings, is pending, against the Corporate Debtor.
HELD THAT:- In the present case, it is brought to the notice of this ‘Tribunal’, on ‘Record’ that the ‘Corporate Insolvency Resolution Process’ proceedings, against the ‘Corporate Debtor’, were pending, on the ‘Date’, when the ‘Petition’, was filed before the ‘Adjudicating Authority’ / ‘Tribunal’, by the ‘1st Respondent / Financial Creditor’, and on the ‘Date’, when the ‘impugned order’, came to be passed, as on date, they continued to be pending - It is well settled by now, that the ‘Insolvency Proceedings’, can be initiated against the ‘Personal Guarantor’, even when ‘no proceedings’, are pending against the ‘Corporate Debtor’.
Going by the ingredients of Section 60 (1) of the I & B Code, 2016, it is quite clear, that for ‘Insolvency Resolution’ and ‘Liquidation’, for ‘Corporate Persons’, including ‘Corporate Debtors’ and ‘Personal Guarantors’, the ‘National Company Law Tribunal’ (‘Adjudicating Authority’), having ‘territorial jurisdiction’, over the place, where the ‘Registered Office’ of the ‘Corporate Person’, is located, and in the instant case, in the ‘State of Telangana’, the ‘Corporate Debtor’s Registered Office’, is situated, which comes within the ‘ambit of territorial jurisdiction’ of the ‘Adjudicating Authority’ (‘National Company Law Tribunal’, Bench – I, Hyderabad).
This ‘Tribunal’, keeping in mind the respective contentions advanced on either side, and considering the facts and circumstances of the instant case, in a conspectus manner, comes to a resultant conclusion that the ‘Adjudicating Authority’ / ‘Tribunal’, has ‘jurisdiction’, to ‘entertain’/’initiate’, the ‘Insolvency Proceedings’ of the ‘Personal Guarantors’, even when ‘no Corporate Insolvency Resolution Process’ proceedings, is ‘pending’, against the ‘Corporate Debtor’, and in any event, the ‘Corporate Insolvency Resolution Process’ proceedings, is pending, and continued to be pending, against the ‘Corporate Debtor’.
Appeal dismissed.
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