TMI Blog2018 (2) TMI 1736X X X X Extracts X X X X X X X X Extracts X X X X ..... mited - ( Corporate Debtor ) on the ground that the said Respondent defaulted for making repayment of ₹ 24,06,52,849.50/- along with interest. 2. The Adjudicating Authority (National Company Law Tribunal), Mumbai Bench, rejected the application on the ground of pendency of a winding-up proceedings against the Corporate Debtor and left the question open for consideration whether the application was barred by limitation or under Section 11(a) of the I B Code or due to pendency of the arbitration proceedings. 3. The question arises for consideration in this appeal is whether an application under Section 7 of the I B Code can be rejected on the ground of pendency of a winding-up? 4. The Adjudicating Authority having noticed the provisions of Section 434 of the Companies Act, 2013 and Section 255 of the I B Code, as follows: 7. So, by reading section 255 of the Code and schedule thereto, it is evident that the source for amendment for section 434 of Companies Act 2013 is from section 255 of this Code, therefore when it is evident that Section 434 is amended in such a way that High Courts, as prescribed by Central Government, can proceed with pending winding-up ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vernment amended the aforesaid Rule 5 and in place of the principal Rule 5, following Rule 5 was substituted with effect from the 16th June, 2017 namely: - 5. Transfer of Pending proceedings of Winding up on the ground of inability to pay debts.─ (1) All petitions relating to winding up of a company under clause (e) of Section 433 of the Act on the ground of inability to pay its debts pending before a High Court, and where the petition has not been served on the respondent under rule 26 of the Companies (Court) Rules, 1959 shall be transferred to the Bench of the Tribunal established under sub-section (4) of Section 419 of the Companies Act, 2013 exercising territorial jurisdiction to be dealt with in accordance with Part II of the Code: Provided that the petitioner shall submit all information, other than information forming part of the records transferred in accordance with rule 7, required for admission of the petition under Sections 7, 8 or 9 of the Code, as the case may be, including details of the proposed insolvency professional to the Tribunal upto 15th day of July, 2017, failing which the petition shall stand abated: Provided further that any party or parti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that Section 238 of the I B Code will not override the effect on the winding-up proceedings saved by the I B Code . We agree that if in a particular case order of winding up has already been passed by the Hon ble High Court and is pending before the Hon ble High Court, such winding up proceedings being saved by the I B Code , Section 238 of the I B Code will not override the effect on such winding up proceedings. 10. For appreciation of the present case, it is desirable to refer the relevant facts relating to pendency of winding-up proceedings . 11. A Company Petition No. 468 of 2013 was preferred by the Appellant- Innoventive Industries Limited for winding up of Kumar Motors Private Limited before the Hon ble High Court of Judicature at Bombay. The Hon ble Bombay High Court having noticed the stand taken by the parties passed detailed order on 4th August, 2015, relevant portion of which is quoted below:- 14. In that view of the matter, there is absolutely no merit in any of the defences raised by the Respondent. There being no bona fide dispute concerning the Petitioner s debt and the statutory notice having not being complied with, there is a clear deemed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the right of the Petitioners in a winding up proceedings before the Hon ble High Court, then also the provisions of the I B Code shall have an overriding effect as expressly provided under Section 238 of the I B Code , which clearly provides that the provisions of the I B Code will prevail over all other laws in force. Therefore, in case of any inconsistency whatsoever, the provisions of the Code shall prevail over the provisions of the Companies Act, 1956 including Section 433 (e) of the Companies Act, 1956. The said position of law with respect to overriding provisions on account of a non-obstante clause has been settled by the Hon ble Supreme Court of India in Allahabad Bank v. Canara Bank, (2000) 4 SCC 406 . In fact, the Hon ble Supreme Court in the matter of Innoventive Industries Limited v. ICICI Bank Ors., Civil Appeal No. 8337-8338 of 1027 has categorically held that the provisions of the I B Code have an overriding effect and the non-obstante clause is to ensure that any right of the Corporate Debtor under any other law cannot come in the way of the I B Code . 15. Therefore, according to learned counsel for the Appellant, in the present case, the provis ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d to National Company Law Tribunal, pursuant to Companies (Transfer of Pending Proceedings) Rules, 2016 , framed by the Central Government. 30. Clause (d) of Section 11 refers to liquidation order , against a Corporate Debtor. The word winding up has not been mentioned therein. For the said reason by Section 255 read with Schedule 11 of the I B Code, in Section 2 of the Companies Act, 2013 for clause (23), the following clause has been substituted: 1. In section 2,- (a) for clause (23), the following clause shall be substituted, namely:- xxx xxx xxx (23) Company Liquidator means a person appointed by the Tribunal as the Company Liquidator in accordance with the provisions of section 275 for the winding up of a company under this Act ; (b) after clause (94) , the following clause shall be inserted, namely:- (94A) winding up means winding up under this Act or liquidation under the Insolvency and Bankruptcy Code, 2016, as applicable. 31. By aforesaid amendment, the legislatures have made it clear that the word winding up mentioned in the Companies Act, 2013 is synonymous to the word liquidation as mentioned in the I B Code. 32. In view of the provisions afore ..... 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