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TMI Blog2021 (7) TMI 557X X X X Extracts X X X X X X X X Extracts X X X X ..... Applicants are as follows: i. The applicants submits that the original petition under section 7 of IBC, 2016 was admitted by the Hon'ble Tribunal vide order dated 02.01.2019 thereby, initiating CIRP of the corporate Debtor i.e., Albus India Limited. ii. The applicants states that COC was constituted having two Financial Creditors namely the applicant TUF Metallurgical Private Limited and the Central Bank of India. The applicants further submit that during the 1st COC Meeting held on 16.02.2019 Resolution Professional was authorizes to conduct the forensic audit into the accounts of the Corporate Debtor in order to unearth the financial irregularities in accordance with the IBBI regulations and statutory scheme of the IBC, 2016. That vide the same COC resolution C.A. Mr. C.P. Bhatia of M/s. C.P. Bhatia & Associates was appointed as the forensic auditor for the said purpose. iii. The applicants submits that the said forensic auditor in its report dated 05.03.2019 pointed out huge diversion of funds, fabrication of transactions and fraudulent activities. Further on the basis of aforesaid findings the erstwhile Resolution Professional (Respondent No. 1) had filed an applicat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ck Bench in CA (IB) No. 401/KB/2018, TA No. 18/CTB/2019 in CP (IB) No. 371/KB/2017 titled as 'State Bank of India & Ors. v/s. Adhunik Steels Limited & Ors. Stating that the Hon'ble tribunal in the aforesaid matter recognized the right of the Financial Creditor to have say in the disposal of application u/s. 66 r/w 43 of IBC, 2016. viii. The applicants further stated that the Monitoring Committee in its 2nd meeting held on 02.01.2020 has observed several facts and evidences in support of the allegations made in C.A. (IB) No. 785/ND/2019 and the Applicants therefore wish to intervene in the said Application in order to agitate the same and assist this hon'ble Tribunal at arriving at a just conclusion. 2. Consequent to the notice issued by this Tribunal, the Respondent No. 1 filed its reply in which the following contentions are made: i. The Respondent No. 1 in its reply submitted that the present application is not maintainable as according to section 60(5) the adjudicating authority can adjudicate an application by or against either a corporate person or a corporate debtor whereas, the applicant No. 2 i.e., Monitoring Committee is not a corporate personas per sectio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lso has no jurisdiction to entertain and decide avoidance applications, in respect of a Corporate Debtor which is now under a new management unless provision is made in the final Resolution Plan." "92. ... The Parties would have to be therefore left to their civil and other remedies in terms of the contract between them. The NCLT ought not to be permitted to now adjudicate the preferential nature of the Transaction under a contract which now stands terminated, after approval of the Resolution Plan. Thus, the Respondent No. 1 submits that the said application for avoidance of Transactions cannot be adjudicated beyond approval of the Plan hence, the present application seeking intervention in the avoidance application is also not legally tenable. iii. The Respondent No. 1 further referring to clause 2.4 of the Report of the Insolvency Law Committee (ILC) constituted by the Ministry of Corporate Affairs dated 20.02.2020 (ILC Report), the Hon'ble Delhi High Court in "Venus Recruiters Put. Ltd. vs. Union of India & Ors." Observed that the Resolution Applicant cannot be permitted to file avoidance applications, as the same was not factored in the bid. The Relevant extract of IL ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... any preferential transaction is meant to give some benefit to the creditors of the Corporate Debtor. The benefit is not meant for the Corporate Debtor in its new avatar, after the approval of the Resolution Plan. This is clear from a perusal of Section 44 of the IBC, which sets out the kind of orders which can be passed by the NCLT in case of preferential transactions. The benefit of these orders would be for the Corporate Debtor, prior to approval of the Resolution Plan. Any property transferred or sum acquired in an order passed in respect of a preferential transaction would have to form part of the final Resolution Plan. The Resolution Plan would have to take into consideration such amounts and benefits which can be given to the Corporate Debtor for the benefit of the CoC. The benefit of an avoidance application is not meant for the company, after the Resolution Plan is considered by the CoC and approved by the NCLT. 74. Moreover, an RP cannot continue to file applications in an indefinite manner even after the approval of a Resolution Plan under Section 31. The role of a RP is finite in nature. He or she cannot continue to act on behalf of the Corporate Debtor once the Plan i ..... X X X X Extracts X X X X X X X X Extracts X X X X
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