TMI Blog2021 (3) TMI 1224X X X X Extracts X X X X X X X X Extracts X X X X ..... negotiation, CIRP period has crossed 537 days. In the absence of the clarify from the FC, CD and IRP relating to their stand on the application filed under Section 7 of the IBC, 2016, CIRP after the Judgment of the Hon'ble NCLAT, Writs filed before the Hon ble High Court and the Hon ble Supreme Court this Bench is not able to proceed further/ dispose of the matter as the application is filed under IBC and the disposal of the matter needs to be done within the stipulated time. This Tribunal allows the instant Appeal setting aside the impugned order and matter is remanded back to the Adjudicating Authority to pass an order afresh, after providing an opportunity to the opposite party in the light of the directions in the body of the judgment - Appeal allowed by way of remand. - IA No.07 to 09 of 2021 With IA No.39 to 41 of 2020 IN C.P. (1B) No.22 to 24/GB/2019 - - - Dated:- 23-3-2021 - Shri H. V. Subba Rao And Shri Prasanta Kumar Mohanty, JJ. For The Respondents: Mr. Kniska Khetan, Mr. S. Makkar, Mr. Muksh Sharma, Mr. K. K. Nandi, Mr. Anil Agarwal ORDER 1. The matter is taken up for hearing through Video Conferencing. This Bench had passed an order on 10 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he CD with a prayer to stay the pronouncement of the Order on the application is rejected . and the Application was admitted. 2. Part of the Hon'ble NCLAT's Interim Order dated 27.09.2019, on appeal filed by the CD against the admission order of the NCLT dated 23.08.2019, is reproduced below: Heard. Counsel for the Appellant states that in all these Appeals, different companies are involved but the Directors of suspended Boards are common. In all these matters, similar orders have been passed on 23rd August, 2019 admitting the Section 7 Applications under Insolvency and Bankruptcy Code, 2016. The Counsel states that the Appellants were ready to settle the claims of the banks with regard to these companies and had even given OTS proposals which were under consideration of the Bank but at the last moment, the bank refused to accept the same during pendency of the Applications before the Adjudicating Authority. The Counsel states that the Appellants are still ready to settle the matters with the bank. Issue Notice. Requisite along with process fee, if not filed, be filed by 30th September, 2019. If the Appellant provides the e-mail address of Respondents, let ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... th. But it is a matter of concern that after lapse of more than 6 months, you have deposited ₹ 6.79 Crores against due amount of ₹ 16.50 Crores till July 2019. ... 26. On perusal of the record, it is apparent that after acceptance of OTS for settling the dues of all the three companies for Rs. Sixty Crores, Bank has received a substantial amount from the Corporate Debtor. It is also clear that after making default in payment as per terms of OTS, the Corporate Debtor further paid rupees One Crore to the Bank for renewing the OTS. Bank even after accepting after rupees One Crore revoked the offer to renew the OTS. Considering the present/prevailing economic scenario of the country and downfall/slump in every business activity, we deem it fit and proper to provide one more opportunity to the parties for considering the OTS (One Time Proposal) in a fair, just, objective and dispassionate manner. 27. On perusal of the record that it is also evident that there is no proper compliance under Section 7(5)(a) of the Insolvency and Bankruptcy Code, but this defect in the Application is a curable defect which can be rectified. It is also on record that the admission ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the order is reproduced below: 5. In spite of the clear order of this Bench to the Petitioner (FC) and the Respondent (CD), they have not produced copy of any order of the Hon'ble Supreme Court passed on the Writ filed by the Petitioner (FC) against the order of the Hon'ble NCLAT dated 18.06.2020. 6. Section 7(4) of IBC reads as under (4) The Adjudicating Authority shall, within fourteen days of the receipt of the application under sub-section (2), ascertain the existence of a default from the records of an information utility or on the basis of other evidence furnished by the financial creditor under sub-section (3). 7. Section 12(1) of lBC reads as under: 12. (1) Subject to sub-section (2), the corporate insolvency resolution process shall be completed within a period of one hundred and eighty days from the date of admission of the application to initiate such process. (2) The resolution professional shall file an application to the Adjudicating Authority to extend the period of the corporate insolvency resolution process beyond one hundred and eighty days, if instructed to do so by a resolution passed at a meeting of the committee of creditors ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed to file an Affidavit giving details of the assignment as IRP for the CD, undertaken right from the day i.e. 23.08.2019 till 09.02.2021, under whose direction, he has reportedly handed over the Management back to the CD, the details of expenses of ₹ 17,81,160/- (Rupees Seventeen lakh eighty one thousand one hundred sixty) as CIRP cost to be reimbursed, enclosing the copy of the agreements between him and the Petitioner FC and the Respondent CD, if any, towards his fees and revised Form H Compliance Report before the Registry. This Affidavit/clarification is to be submitted by 03.03.2021 . 7. In compliance with the order of this Bench, the IRP has filed the Affidavit dated 03.03.2021. Relevant part of the same is reproduced below: 5. That the Applicant was appointed as Interim Resolution Professional vide Order dated 23.08.2019 and the Applicant had received the copy of the order dated 23.08.2019 on 26.08.2019. Thereafter, on 27.08.2019 sent intimation letter to the Respondent No. 1 and 2 conveying about the order of the initiation of the CIRP process. The Applicant had also sought the details from the managxement of the Corporate Debtor regularly and government agen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pplicant was about to constitute the committee of creditors but due to the order of stay passed by the Hon'ble NCLAT it cannot be done. Therefore, the Applicant is bound by the order of Hon'ble NCLAT 21. That the order dated 18.06.2020 was brought in the notice of the Applicant by the Respondent No. 2 on 20.06.2020 vide email and letter requesting to the Applicant for carrying out the necessary formalities towards handing over the control of all three group companies. A copy of the email dated 20.06.2020 sent by the erstwhile management to the Applicant is annexed herewith and marked as Annexure A9. 22. That after coming to the notice of the Hon'ble NCLAT dated 18.06.2020 the Applicant had stopped controlling the affairs of the Corporate Debtors. The Hon'ble NCLAT had remanded back the matter to this Hon'ble Tribunal for adjudicating section 7 Application afresh and for passing of appropriate orders in terms of directions given. The relevant excerpts of the order passed by the Hon'ble NCLAT are reproduced below for the reference of this Hon'ble Tribunal. 28. In the circumstances as stated above this Tribunal allows the instant Appeal setting ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... icant through the submissions of the Financial Creditor and the corporate Debtor came into the knowledge of the Applicant that both the parties have filed the Appeal before the Hon'ble Supreme Court against the order of the Hon'ble NCLAT dated 18.06.2020 but no copy of the Appeal has been served to the Applicant. The Applicant is not aware about the proceedings/development in the Appeal filed before the Hon'ble Supreme Court also till the date of filing of the present Affidavit no copy of any order was handed over to the Applicant by the contesting parties. Even the Applicant was not impleaded as a necessary party neither by the Respondent No. 1 in the Appeal filed before the Hon'ble Supreme Court nor by the Respondent No. 3. To the best knowledge of the Applicant the Hon'ble Supreme Court had not stayed the order dated 18.06.2020 passed by the Hon'ble NCLAT. Therefore, the order of Hon'ble NCLAT is binding on the Applicant till the passing of any appropriate order. 28. That the Applicant in the Application under prayer clause (ii) had sought the relief for the dismissal of the Corporate Insolvency Resolution Process and not for the dismissal of the C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . (Civil Appeal No. 4044 of 2020 is annexed herewith and marked as ANNEXURE A-11. 31. That the Applicant in compliance of order dated 24.02.2021 had also served the copy of the present Application to the respondents through email as well as through speed post. The copies of proof of service of the Application to the Respondents is annexed herewith and marked as ANNEXURE A-12. 8. In compliance of the order of this Tribunal, the FC has filed Affidavit-in-reply on 10.03.2021 enclosing the copy of the order of the Hon'ble Supreme Court. Part of the Affidavit-in-reply is reproduced below: 1. That this Hon'ble Tribunal vide Order dated 23.08.2019 admitted the application of the financial creditor under section 7 of the Insolvency and Bankruptcy Code, 2016. 2. That the corporate debtor preferred an appeal before the Hon'ble National Company Law Appellate Tribunal being Company Appeal (AT) Insolvency No. 1004 of 2019 and the Hon'ble National Company Law Appellate Tribunal vide Order dated 18.06.2020 was pleased to set aside the Order passed by this Hon'ble Tribunal and remanded back the matter to this Hon'ble Tribunal to pass a fresh order after p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... itted that he has not entered into any agreement with the Applicant/FC with regard to his fees as IRP. 11. He has also submitted that since the order of admission of the Application was set aside, he deemed it fit to release the Corporate Debtors and to handover the control of the Corporate Debtors to the main management. He has also submitted during the proceedings that he was not aware of any appeal filed by the FC before the Hon'ble Supreme Court and moreover, the Hon'ble Supreme Court has not stayed the order dated 18.06.2020 of the Hon'ble NCLAT. 12. The Learned Counsel appearing for the FC has submitted that it has not entered into agreement with the IRP for his fees as IRP but submits that the RP has undertaken other assignment from the FC. Hence, both the FC and IRP can sit together to decide the fees. 13. The Learned Counsel of the FC has further submitted that the IRP should continue to work as IRP till the final disposal of its appeal filed before the Hon'ble Supreme Court. On the other hand, the Learned Counsel appearing for the Respondents has submitted that once the CIRP process is set aside by the Hon'ble NCLAT, the role of IRP is not the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... NCLT Rules and craves leave of this Hon'ble Tribunal to file additional reply/addendum if so required before this Hon'ble Tribunal. Since the FC has preferred three appeals before the Hon'ble Apex Court against the order of the Hon'ble NCLAT, the three IAs i.e. IA Nos. 39, 40 and 41 of 2020 are not taken up. 18. The Original Applications under Section 7 of IBC were filed on 21.05.2018 and in the meantime 1036 days have since passed from the date of filing of the Petitions. As per Section 7(A) of the IBC, an Application is required to be admitted or rejected within fourteen days of the receipt of the application. Hon'ble Supreme Court has held in the matter of COC of Essar Steel India Ltd. vs. Satish Kumar Gupta [Civil Appeal No. 8766 - 67/2019] that the CIRP must ordinarily be completed within the time limit of 330 days from the Insolvency Commencement Date unless extended by the Court on sufficient cause . 330 days is for CIRP. More than 1000 days have already passed even before the commencement of the actual CIRP in the process of OTS, acceptance/non-acceptance of OTS, Negotiations/further Negotiations. Commitments and failure of commitments, filing ..... X X X X Extracts X X X X X X X X Extracts X X X X
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