TMI Blog2020 (5) TMI 682X X X X Extracts X X X X X X X X Extracts X X X X ..... not disputed that it failed to pay any amount due including interest subsequent to October, 2017 despite issue of notice of acceleration and recall dated 31.01.2019 - Respondent accordingly was in default in payment of a financial debt. The Code has overriding effect over any other law or any instrument having the effect of law. The agreement between the parties as to the jurisdiction of Courts at Hyderabad cannot override express provision of the Code which provides for a specialised mechanism for Corporate Insolvency Resolution. The parties cannot decide jurisdiction of the resolution of their dispute in violation of the express provision of any statute. The contention as to lack of jurisdiction of this Authority raised by the Respond ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 6 and other security instruments with the Respondent. The debentures were to be partially redeemed on different dates as per the redemption schedule set out in the Debenture Trust Deed (Annexure 2 thereof). The Respondent defaulted in partially redeeming the debentures on 31.10.2017 and paid ₹ 1,66,38,784/- only on 12.12.2017 as against the due amount of ₹ 2,16,38,685/-. It also failed to pay any amount due for the months subsequent to October, 2017. Thus, the Respondent committed default in payment of a financial debt. An amount of ₹ 186,62,33,737/- remained due as on 12.09.2019 which included the principal, interest thereon, maturity premium default interest, costs and TDS on 26.07.2018 the Petitioner issued a notice of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... be maintainable. The Petitioner having not come to the Tribunal with clean hands, the petition deserves to be dismissed. 4. Basing on the rival pleadings the following issues emerge for determination. I. Whether the Petition is maintainable? II. Whether the Respondent committed default in payment of a financial debt? ; III]. To what relief, the Petitioner is entitled? Issue No. II: 5. The execution of the Debenture Trust Deed and allotment of the debenture to the debentures holders is not in dispute. It is also not in dispute that the Respondent defaulted in honouring the redemption on the schedule dates as per Annexure 2 of the Debenture Trust Deed. It partially redeemed debentures on 12.12.2017, which were due on 3 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ee and pledge agreement which indicate that the parties agreed to the Courts at Hyderabad alone and no other Courts shall have jurisdiction to entertain and try any dispute arising from and out of the provisions of the deed(s). It must be remembered that a proceeding under section 7 of the Code is not recovery proceeding. Therefore, whether or not the Petitioner was authorised to resort to recovery of the debt by other means, it could not be precluded from approaching this Authority. Besides section 238 of the Code envisages that the provisions of the Code shall have effect, notwithstanding anything inconsistent therewith contained in any other law for the time being in force or any instrument having effect by virtue of any such law. The co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ntrepreneurship and to ensure that the company continue to function as on going concern, it is desirable to close such proceeding without delay and going into technical rigour of one or other provisions, which are all otherwise futile for all purpose. (in re: Prowess International Pvt. Ltd. Vs. Parker Hannifin India Pvt. Ltd. (Company Appeal (AT) (Insol.) No. 89 of 2017 Decided on 18.08.2017) 8. As already indicated the Code has overriding effect over any other law or any instrument having the effect of law. The agreement between the parties as to the jurisdiction of Courts at Hyderabad cannot override express provision of the Code which provides for a specialised mechanism for Corporate Insolvency Resolution. The parties cannot decide j ..... X X X X Extracts X X X X X X X X Extracts X X X X
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