TMI Blog2019 (12) TMI 1536X X X X Extracts X X X X X X X X Extracts X X X X ..... /23/KOB/2019 IN TIBA/15/KOB/2019 - - - Dated:- 2-12-2019 - Shri Ashok Kumar Borah And Shri Veera Brahma Rao Arekapudi, JJ. Counsel for the Operational Creditor : Shri J. Krishnakumar, Advocate Counsel for the Corporate Debtor : M/s. Menon Pai Counsel for the Financial Creditor :Shri Vinod P.V., India Law LLP ORDER 1. The Corporate Insolvency Resolution Process was initiated against M/s. Solar Off Set Printers Pvt Ltd vide Order of this Tribunal dated 23.10.2019 in TIBA/15/KOB/2019 (IBA/630/2019 of NCLT Chennai Bench) filed by the Operational Creditor M /s. Siddhi Vinayaka Enterprises. Shri Easwara Pillai Kesavan Nair was appointed as Interim Resolution Professional. The IRP took over the management control of the Corporate Debtor on 28.10.2019 in terms of Section 17(1) (a) to (d) of IBC, 2016. The public notice was published in daily newspapers and claim petition from Financial Creditors and Operational Creditors were received. 2. These MAs (M.A. 20/KPB/2019, MA/21/KOB/2019 and MA/23/KOB/2019 in TIBA/15/2019) have arisen consequent to the order passed by this Tribunal on 15th Nov 2019 in MA/17/KOB/2019 in TIBA/15/KOB/2019 filed by the IRP with regard ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t the applicant has sanctioned various credit facilities amounting to ₹ 15,31 crores to the Corporate Debtor vide sanction letters dated 3.12.2015 and 3.3.2016. The Corporate Debtor has committed default in the payment of the principal and the interest thereon and the accounts of the Corporate Debtor became irregular and classified as NPA on 30.3.2018 under the norms of Reserve Bank of India. As on the insolvency commencement date, the total claim of the petitioner against the Corporate Debtor is ₹ 15,60,65,148.34 plus the 0.44 Crore towards Bank Guarantee outstanding to be crystalized as and when invoked. 9. The applicant submits that after the initiation of the Corporate Insolvency Resolution Process, it has come to their knowledge that IRP is filing an application for withdrawal as the matter is settled with the operational creditor. It is submitted that any such preferential settlement and withdrawal shall be detrimental to the interest of other creditors and no such withdrawal may be granted without the consent of 90% voting share of the Committee of Creditors. It is a fact the Corporate Debtors has committed default and unable to pay its debt of ₹ 15.61 c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... efore the applicant avers that it is highly necessary that the IRP to constitute the committee and place the Form FA filed by the Applicant before the Committee for its consideration and if the Committee with 90% voting share considers that the withdrawal to be permitted, the IRP may file an application before this Tribunal for withdrawal. Accordingly, the Financial Creditor prayed before this Tribunal to issue direction to the IRP to constitute the committee and place the application for withdrawal for the decision of the committee. 14. The Corporate Debtor (2nd respondent in this IA/20/KOB/202019) vehemently opposed the contentions of the Financial Creditor stating that the entire debts amounting to ₹ 14,09,554/- payable to the Operational Creditor M/s. Siddhi Vinayak Enterprises have been settled and the required Form FA was also submitted to the IRP along with the covering letter dated 4.11.2019. 15. The Corporate Debtor has also submitted that on 7.11.2019 the IRP requested for an additional amount of ₹ 2,00,000/- (Rupees two lakhs only) for filing the withdrawal application along with Form FA before this Tribunal. 16. According to the Corporate Debtor, as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r withdrawal under Section 12A of the IBC, 2016 read with Regulation 30A of IBBI(Insolvency Resolution Process of Corporate Debtors) Regulations, 2016 was made by IRP. This being so, an official of the State Bnk of India (Financial Creditor) entered appearance along with the counsel and averred that they have made a claim before the IRP. Taking note of the aforesaid submission, this Tribunal directed SBI to file their submission through an affidavit. Consequent to the aforeasaid development, the Operational Creditor forthwith sent an email to the IRP requesting that the withdrawal application shall be filed immediately instead of the report that had been filed on 13.11.2019. 21. The Corporate Debtor further submitted that the IRP has issued notice dated 19.11.2019 to convene the first meeting of the Committee of Creditors on 22.11.2019. According to the Corporate Debtor, this is obviously not in consonance with Section 12A of the IBC 2016, and Regulation 30A of the CIRP Regulations prescribed. 22. Accordingly the Corporate Debtor vide MA 23/KOB/20-19 sought a direction to declare that the CIR proceedings in the matter has concluded with the filing of Form FA by the IRP before ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... FA was submitted along with the proof of payment of ₹ 2,00,000/- as directed by this Tribunal to be paid to the IRP. On 7.11.2019, the IRP requested for an additional amount of ₹ 2,00,000/- for filing the withdrawal application along with Form FA before this Tribunal, which was also complied by the Operational Creditor. Hence, reiterated that the Corporate Debtor cannot be put to irreparable injury due to the improper/defective filing of Form FA by the IRP. 27. The learned counsel for the financial creditor has vehemently objected the submissions of senior counsel for the Corporate Debtor and quoted the Hon ble Supreme Court Judgement in Writ Petition (Civil) No.99 of 2018 in the case of Swiss Ribbons Pvt Ltd Vs. Union of India others, wherein it was held as follows: 49. Section 12A was inserted by the Insolvency and Bankruptcy (Second Amendment) Act, 2018 with retrospective effect from 06.06.2018. It reads as follows: 12-A. Withdrawal of application admitted under Section 7, 9 or 10.-The Adjudicating Authority may allow the withdrawal of application admitted under Section 7 or Section 9 or Section 10, on an application made by the applicant with the appr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... if the CoC approves of such action by a voting share of ninety per cent. It was specifically discussed that rule 11 of the National Company Law Tribunal Rules, 2016 may not be adopted for this aspect of CIRP at this stage (as observed by the Hon ble Supreme Court in the case of Uttara Foods and Feeds Private Limited v. Mona Pharmacem, Civil Appeal No. 18520/2017) and even otherwise, as the issue can be specifically addressed by amending rule 8 of the CIRP Rules. 51. Before this Section was inserted, this Court, under Article 142, was passing orders allowing withdrawal of applications after creditors applications had been admitted by the NCLT or the NCLAT. Regulation 30A of the CIRP Regulations states as under: ―30A. Withdrawal of application.-(1) An application for withdrawal under Section 12-A shall be submitted to the interim resolution professional or the resolution professional, as the case may be, in Form FA of the Schedule before issue of invitation for expression of interest under Regulation 36A. (2) The application in sub-regulation (1) shall be accompanied by a bank guarantee towards estimated cost incurred for purposes of clauses (c) and (d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... has held as follows: 5. Learned counsel for the Appellant wanted time to settle the claim with Respondent. However, Mr. Nikhil Verma, appearing on behalf of the Interim Resolution Professional submitted that claim has been received and the Committee of Creditors has not been constituted. There is a Financial Creditor whose claim is ₹ 9 crore. 6. In fact and circumstances, we are not inclined to interfere with the impugned order passed by Adjudicating Authority. However, we allow the Appellant to settle the claim with all the claimants in terms of Section 12A of the I B Code, if the Appellant so chooses. 7. The Appellant and other Promoters are directed to handover all the assets and records of the Corporate Debtor to the Interim Resolution Professional, immediately. Failing which, the Adjudicating Authority will take appropriate action against the Appellant / Promoters of the Corporate Debtor and this Appellate Tribunal may initiate contempt Proceeding for non-compliance of directions 29. The Counsel for the financial Creditor accordingly pleaded before this Bench not to accept the Form FA filed by the Operational Creditor and continue with the CIR Proc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ure of ninety per cent, in the absence of anything further to show that it is arbitrary, must pertain to the domain of legislative policy, which has been explained by the Report (supra). Also, it is clear, that under Section 60 of the Code, the committee of creditors do not have the last word on the subject. If the committee of creditors arbitrarily rejects a just settlement and/or withdrawal claim, the NCLT, and thereafter, the NCLAT can always set aside such decision under Section 60 of the Code. For all these reasons, we are of the view that Section 12A also passes constitutional muster. 33. Further the recent Order of National Company Law Appellate Tribunal in CA(AT)(Insolvency) No.1150 of 2019 in the Case of Harpreet Singh Ahluwalia Vs. Eatigo India Pvt Ltd another also clearly establishes that this Tribunal cannot ignore the claims of the Financial Creditor M/s. State Bank of India, which is amounting to ₹ 15,60,65,148.34 plus the 0.44 crore towards Bank Guarantee in the instant case while considering the withdrawal of the Form FA filed by the Interim Resolution Professional. 34. Accordingly, in the facts and circumstances of this case, we are not inclined to ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
