TMI Blog2018 (2) TMI 885X X X X Extracts X X X X X X X X Extracts X X X X ..... s “…if the choices is between two interpretations, the narrower of which would fail to achieve the manifest purpose of the legislation, we should avoid a construction which would reduce the legislation to futility and should rather accept the holder construction based on the view that Parliament would legislate only for the purpose of bring about an effective result.” In view of the legal position stated above, the second objection raised by the Counsel for the Operational Creditor stands rejected. Therefore, this Authority is satisfied that the CIRP could not be completed during 180 days plus 30 days in this matter, so there is a requirement to grant extension of CIRP for a further period of sixty days. Hence, the CIRP period in relatio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ne that there is no valid reason provided in the Application which merits the extension of time period beyond 180 days of the CIRP and during the said time only two meetings of the Committee of Creditors (CoC) were convened, one by IRP and another by RP. The 2nd meeting of CoC was convened on 01.11.2017 i.e. more than two months after the date of the Ist meeting of the CoC, and in two months, there has been no activity for being reported by the RP during the 2nd meeting of the CoC. The RP had not even invited the prospective lenders, investors and any other person to put forward a Resolution Plan until 2nd meeting of the CoC. It has also been submitted that very recently i.e. on 31.12.2017, the RP has issued advertisement calling for expres ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Plan has been submitted by M/s. Acestar Properties Private Limited, that requires consideration by the RP, for being presented before the CoC for approval. However, the time period of 180 days had expired on 15.12.2017 and 30 days time was extended, vide Order dated 06.12.2017. In case, more time is not granted to the RP for working out the Plan of the Resolution Applicant as mentioned above, it will amount to scuttling the process of CIRP at a pre- mature stage. 6. Sub-Section (3) of Section 12 of I B Code, 2016 provides that an extension can be granted by the Adjudicating Authority on its satisfaction that CIRP could not be completed within 180 days and the duration to such process can be extended beyond the said period with further ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... b-section (3) of Section 12 of the I B Code, 2016, provides that the Adjudicating Authority can exercise the discretion for extension of the time period of CIRP not more than once, because, a 30 days extension of CIRP has already been granted on 06.12.2017. For the sake of convenience, the provision of Sub-section (3) of Section 12 of the I B Code, 2016, are reproduced as follows:- Time- limit for completion of insolvency resolution process 12. (1) (2) . (3) On receipt of an application under sub- section (2), if the Adjudicating Authority is satisfied that the subject-matter of the case is such that corporate insolvency resolution process cannot be completed within one hundred and eighty days. It may by order ex ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . 10. Thus, the interpretation of the proviso to section (3) of Section 12 leads to the conclusion that the Adjudicating Authority cannot grant extension of the CIRP more than 90 days after the completion of 180 days. In case, the interpretation that has been placed by the Counsel for the Operational Creditor is accepted, the same will lead to absurd result, because the provisions to Sub-section (3) of Section 12 of I B Code, 2016 will be rendered otiose. This view is supported with a well-established maxim of interpretation which says ut res magis valeat quam pereat. This Latin maxim of interpretation when translated into English means that it is better for a thing to have effect than to be void. But, the language used in Sub-section ( ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hould avoid a construction which would reduce the legislation to futility and should rather accept the holder construction based on the view that Parliament would legislate only for the purpose of bring about an effective result. 14. In view of the legal position stated above, the second objection raised by the Counsel for the Operational Creditor stands rejected. 15. Therefore, this Authority is satisfied that the CIRP could not be completed during 180 days plus 30 days in this matter, so there is a requirement to grant extension of CIRP for a further period of sixty days. Hence, the CIRP period in relation to the Corporate Debtor, viz., M/s. Forward Shoes (India), private Limited, is hereby extended for a further period of 60 days ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
