TMI Blog2018 (6) TMI 537X X X X Extracts X X X X X X X X Extracts X X X X ..... r’. - Company Appeal (AT) (Insolvency) Nos. 292 & 293 of 2017 And Company Appeal (AT) (Insolvency) No. 324 of 2017 - - - Dated:- 26-4-2018 - Mr. S.J. Mukhopadhaya And Mr. Bansi Lal Bhat, JJ. For The Appellant : Mr. Ajay Gaggar, Mr. Robin Singh Sirohi and Ms. Vineeta Rathore Advocates For The Respondent : Mr. Abhijeet Sinha, Mr. Arijit Mazumdar, Mr. R. N. Ghosh, Mr. Akshay Chandna, Mr. Saikat Sarkar and Mr. Aditya Shukhla, Advocates, Ms. Jayantika Ganguly and Mr. Rishav Banerjee, Advocates And Mr. Amitesh Gaurav and Mr. Bhavesh Verma, Advocates JUDGEMENT SUDHANSU JYOTI MUKHOPADHAYA, J. Srei Infrastructure (P) Limited ( Financial Creditor ) filed an application under Section 7 of the Insolvency and Bankrup ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... late Tribunal by its judgment dated 1st December, 2017 held: 25. Similarly, if any action has been taken by a Financial Creditor under Section 13(4) of the SARFAESI Act, 2002 against the Corporate Debtor or a suit is pending against Corporate Debtor under Section 19 of DRT Act, 1993 before a Debt Recovery Tribunal or appeal pending before the Debt Recovery Appellate Tribunal cannot be a ground to reject an application under Section 10, if the application is complete. 26. Any proceeding under Section 13(4) of the SARFAESI Act, 2002 or suit under Section 19 of the DRT Act, 1993 pending before Debt Recovery Tribunal or appeal pending before Debt Recovery Appellate Tribunal cannot proceed in view of the order of moratorium as may ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lication shall dispatch forthwith , a copy of the application filed with the Adjudicating Authority . Thereby meaning a post-filing notice and not 'before filing , the obvious purpose for the same being to put the corporate debtor to adequate and informed notice. The 'adjudicating authority' ought to have realised these deviations from the prescribed procedure and either rejected the application or directed the Respondent to follow the provisions of sub-Rule (3) of Rule 4 of Insolvency Bankruptcy (Application to Adjudicating Authority) Rules, 2016 and Rule 21 of the National Company Law Tribunal Rules. 20.4 Lastly, the 'adjudicating authority' has reached a conclusion at paragraph 9 of the impugned order that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... es Limited (Supra) set aside the order on different grounds as mentioned in Paragraph No. 23, which reads as follows: 23. Admittedly the impugned order is ex-facie illegal and ought to be set aside by the Appellate Tribunal. For the reasons aforesaid, we set aside the ex-parte impugned order dated 17th February 2017 passed by 'adjudicating authority', Mumbai Bench in C.P. No. 12/1 BP/NCLT/MAH/2017 and allow the appeal. 8. It is not the case of the Appellant- Mr. Aditya Kumar Jajodia that the Financial Creditor mislead the Adjudicating Authority and impugned order was passed ex parte in view of such misleading statement. 9. In Innoventive Industries Ltd. v. ICICI Bank─ 2017 SCC OnLine SC 1025 , the H ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion 5(21) means a claim in respect of provision of goods or services. 28. When it comes to a financial creditor triggering the process, Section 7 becomes relevant. Under the explanation to Section 7(1), a default is in respect of a financial debt owed to any financial creditor of the corporate debtor- it need not be a debt owed to the applicant financial creditor. Under Section 7(2), an application is to be made under sub-section (1) in such form and manner as is prescribed, which takes us to the Insolvency and Bankruptcy (Application to Adjudicating Authority) Rules, 2016. Under Rule 4, the application is made by a financial creditor in Form 1 accompanied by documents and records required therein. Form 1 is a detailed form in 5 parts ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d corporate debtor within 7 days of admission or rejection of such application, as the case may be. 10. It is not the case of the Appellant- Mr. Aditya Kumar Jajodia that they do not owe any debt to the Financial Creditor or there is no default. The Adjudicating Authority being satisfied that a default has occurred admitted the application which was complete. 11. Another ground taken by the Appellant is that the Form 7 was not signed by the authorised person. However, we are not inclined to set aside the impugned order on such ground as the application under Section 7 (in Form-1) was filed by the authorised employees of the Financial Creditor . In Company Appeal (AT) (Insolvency) No. 324 of 2017 12. The Appellant- All ..... X X X X Extracts X X X X X X X X Extracts X X X X
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