TMI Blog2019 (11) TMI 1015X X X X Extracts X X X X X X X X Extracts X X X X ..... 2019 (1) TMI 1442 - Supreme Court ] clearly observes that the objective would be to ensure that there are no parallel proceedings before the High Court and before the NCLT. Though, there is no doubt that the jurisdiction of this Court is not to be exercised under Article 227 if there is an alternate remedy available, in order to avoid conflicting orders from operating in respect of the company, to the detriment of the creditors and other stakeholders, this Court is of the opinion that, while relegating the Petitioner to the NCLAT, the impugned order of the NCLT deserves to be kept in abeyance - In view of the remedy of appeal being available to the Petitioner, to approach the NCLAT, the Petitioner is permitted to approach the NCLAT within four weeks. The NCLAT shall consider the entire matter including the orders passed by the Company Court. All parties who are intervening before the Court today and any other affected parties are permitted to appear before the NCLAT - This Court has not given any opinion on the merits of the revival scheme pending before the Company Court or the order of the NCLT which is under challenge in the present case. Application disposed off. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... urt Mediation and Conciliation Centre, with investors who represent more than 80% of VDPL s creditors. Accordingly, the settlement was taken on record and the Court proceeded to the second stage. Subsequently, further submissions have been heard in the matter. Arguments were thereafter heard and judgment was reserved on 13th May, 2019. 5. Parallelly, one Mr. Lavkash Verma, claiming to be a Financial Creditor of VDPL, approached the NCLT under Section 7 of the IBC with a prayer for appointment of an IRP and for commencing the insolvency process against VDPL. By the impugned order, the said petition has been admitted by the NCLT, an IRP has been appointed and a moratorium has been declared. 6. The grievance of the Petitioner, who is the ex-Director/Promoter of VDPL was that the Company Court was fully seized of the matter and had, in fact, taken on record the scheme for revival of VDPL. It is submitted that the entire purpose behind the IBC being revival, the matter being fully seized before the Company Court and judgment having been reserved, the NCLT ought not to have brought the revival to a complete standstill by appointing an IRP and declaring a moratorium. It ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... submitted by the ld. counsel that the entire purpose of the IBC is to revive the company, which is actually what the High Court is considering and supervising at this point, and the intervention by the NCLT would lead to absolute chaos. 13. Mr. Bharat Gupta, ld. counsel appearing for Investors Sangharsh Samiti supports the case of the company that there is a revival scheme which is currently underway before the Delhi High Court and pending for orders. 14. The Court has considered the various submissions of the parties and has perused the orders of the NCLT and of the Company Court. A perusal of the order dated 12th October, 2018 shows that the Company Court had heard all the relevant associations who are represented before the Court even today. After hearing all the parties and considering the mediation report and the settlement scheme which was agreed to by more than 80% of the creditors, the Court had accepted the first motion and had directed that publication etc. would be made in accordance with the scheme of the IBC. The order dated 12th October, 2018 is set out below: CA No.509/2018 in CP No.885/2015 1. This app ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ents before the Delhi High Court Mediation and Conciliation Centre. 5. Learned counsel appearing for the Vigneshwara Victims Welfare Association has further pleaded that the as per the terms of the settlement agreement, the ex-Directors are to bring in funds for the purposes of payment to the farmers from whom the land has been purchased and payment of other necessary and statutory dues. He submits that in the absence of the funds being available, the future of the proposed scheme is itself in jeopardy. 6. Learned counsel for the applicant in CA No.739/2017 has also stated that he is an un-secured creditor of the respondent company and does not find a place in the scheme at all. 7. Keeping in view the above position, in my opinion as 1180 unit buyers have supported the scheme, out of 1437, the requisite majority as provided under Section 391 of the Companies Act would be available. Under the Section 391 of the Companies Act, if a majority in number representing 3/4th in value of the creditors, or class of creditors, or class of members as the case may be present and voting have to agree any compromise or arrangement for the court to sanction the sch ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s a whole is also found to be just, fair and reasonable from the point of view of prudent men of business taking a commercial decision beneficial to the class represented by them for whom the scheme is meant. 9. Once the aforesaid broad parameters about the requirements of a scheme for getting sanction of the Court are found to have been met, the Court will have no further jurisdiction to sit in appeal over the commercial wisdom of the majority of the class of persons who with their open eyes have given their approval to the scheme even if in the view of the Court there would be a better scheme for the company and its members or creditors for whom the scheme is framed. The Court cannot refuse to sanction such a scheme on that ground as it would otherwise amount to the Court exercising appellate jurisdiction over the scheme rather than its supervisory jurisdiction. The aforesaid parameters of the scope and ambit of the jurisdiction of the Company Court which is called upon to sanction a scheme of compromise and arrangement are not exhaustive but only broadly illustrative of the contours of the Court's jurisdiction. 9. It is manifest from the ple ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nternet, further hearing was conducted by the Company Court on 13th May, 2019, and judgment has been reserved. 16. The question as to whether the scheme would be finally accepted by the Court and if so, what steps are to be taken, is yet to be pronounced by the Company Court. However, the order of the NCLT, at this stage, has become an interdiction into the proceedings which were pending before the Company Court. The NCLT has considered the judgment of the Supreme Court in Forech India Ltd. v. Edelweiss Assets Reconstruction Co. Ltd [Civil Appeal No. 818/2018, decided on 22nd January, 2019] and has held that the pendency of the winding up petition does not take away the jurisdiction of the NCLT and, in fact, the NCLT would have the exclusive jurisdiction to adjudicate upon such disputes. 17. What the NCLT has failed to appreciate is that even the judgment in Forech (supra) clearly observes that the objective would be to ensure that there are no parallel proceedings before the High Court and before the NCLT. The relevant paragraph of Forech (supra) reads as under: 17. The resultant position in law is that, as a first step, when the Code was enact ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to the Petitioner, to approach the NCLAT, the Petitioner is permitted to approach the NCLAT within four weeks. In view of the peculiar facts and circumstances of the present case, it is directed that the order dated 10th October, 2019, passed by the NCLT, shall remain stayed until the pronouncement of the judgment by the Delhi High Court in Company Petition No. 885/2015 and connected petitions, or until the matter is finally decided by the NCLAT, whichever is earlier. The NCLAT shall consider the entire matter including the orders passed by the Company Court. All parties who are intervening before the Court today and any other affected parties are permitted to appear before the NCLAT. The NCLAT shall consider the Petitioner s plea in accordance with law. This Court has not given any opinion on the merits of the revival scheme pending before the Company Court or the order of the NCLT which is under challenge in the present case. 20. Ld. counsel for the Petitioner assures the Court that the Petitioner would approach the NCLAT on or before 30th November, 2019. Parties may place the present order before the Company Court where judgment is reserved. 21. With these obse ..... X X X X Extracts X X X X X X X X Extracts X X X X
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