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TMI Blog2023 (1) TMI 191X X X X Extracts X X X X X X X X Extracts X X X X ..... 7 of the Insolvency and Bankruptcy Code, 2016 (in short 'Code') read with Rule 4 of the Insolvency and Bankruptcy (Application to Adjudicating Authority) Rules, 2016 (in short 'Rules') for resolution of unresolved financial debt of Rs. 2,924,730,442/- by Edelweiss Asset Reconstruction Company Ltd. (Respondent No. 1) as Financial Creditor, in its capacity as trustee of EARC Trust SC 384 (Assignee of the rights of the assignor ECL Finance Ltd.) vide assignment deed dated 28.06.2019, has been admitted. 2. The facts in brief, extracted from the memorandum of appeal, are that the Corporate Debtor i.e. Smaaash Entertainment Pvt. Ltd., engaged in providing gaming arcade services and sporting entertainment services, issued 14.75% secured redeemable non-convertible debentures in September, 2017 to ECL Finance Ltd. at par with face value of Rs. 10 lakhs per debenture for an aggregating amount of Rs. 280 Crores at a private placement basis in two tranches. The first tranche was up to Rs. 258 Crores and the second tranche was up to Rs. 22 Crores. 3. The debenture trust deed was executed between the Corporate Debtor and Catalyst Trusteeship Limited on 17.08.2017 (amended by first supplemental ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e nor the interest payable was overdue. Different dates of NPA shows that the Respondents were themselves not sure in respect of date of NPA. NPA is the main crux in issuing 13(2) notice which is found missing in the circumstances as on date of notice under section 13(2) of Act. On this count the Securitisation Application deserves to be allowed." 11. It is the grievance of the Appellant that when the matter was listed before the Adjudicating Authority on 15.03.2022, request of the Appellant (Corporate Debtor) to file additional document on account of subsequent development was not allowed rather the order was reserved. The order passed on that date is "C.P. 935 of 2020 & 1930 of 2020. Heard both sides and orders are reserved. Both parties are directed to file written submissions within two days". 12. This order was challenged by the Appellant by way of i.e. CA(AT) (Ins) No. 322 of 2022 which was dismissed on 28.03.2022 with the following order: "This Appeal has been filed against the following order dated 15.03.2022 passed by the Adjudicating Authority (National Company Law Tribunal), Mumbai Bench, Court III: "Counsel for both sides present. Parties directed to file WS wit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... urt in which the following order was passed on 19.09.2022 which is reproduced as under:- "1.Permission to file the Special Leave Petition is granted. 2 Delay condoned. 3 The ad-interim order of the learned Single Judge dated 19 April 2022 has been stayed by the Division of the High Court of Judicature at Bombay on 5 May 2022 while admitting the appeal. The Division Bench has specifically clarified that the pendency of the appeal shall not come in the way of the hearing of the interim application and that "learned Single Judge may dispose the interim application in accordance with law". The reasons contained in the impugned order of the Division Bench shall not be regarded as a final or conclusive expression of opinion since they are only confined to the admission of the appeal and an ad-interim stay. The appellants would be at liberty to move the Single Judge for early hearing. 4 The Special Leave Petition is accordingly disposed of. 5 Pending applications, if any, stand disposed of." 17. It is further pertinent to mention that the order dated 28.02.2022 passed by the DRT, Pune was stayed by the DRAT, Mumbai in appeal no. 31 of 2022 vide its order dated 03.06.2022 w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... has approached the Respondent for making an offer of some settlement. 5. Shri Ramji Srinivasan, Learned Senior Counsel for Respondent No.1 submits that although Appellant submits that Appellant is ready to make upfront payment of Rs.30 Crores but in the e-mail, they said that the said payment can be made only after approval of one-time settlement within one month from signing of the settlement. 6. Be that as it may. Issue notice. Shri Ramji Srinivasan, Learned Senior Counsel accepts notice on behalf of Respondent No.1. Shri Bhrugesh Amin, Learned Counsel accepts notice on behalf of Respondent No.2. No further notice need be issued. Let reply be filed within one week. Rejoinder, if any, may be filed by the next date. 7. List the Appeal on 02.06.2022. Subject to Appellant depositing Demand Draft of Rs.30 Crores in favour of "The Pay and Accounts Officer, Ministry of Corporate Affairs, New Delhi" within one week from today, the Interim Resolution Professional shall collate the claims but shall not constitute the Committee of Creditors. We further observe that in event the amount is not deposited within one week from today, this interim order shall stand automatically vacated. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ve been filed before the same court instead of making a part of the Appeal. It is further submitted that in the case of Dharampal Satyapal Limited Vs. Deputy Commissioner of Central Excise, Gauhati & Ors. (2015) 8 SCC 519, it has been held that if a hearing would not change the ultimate conclusion reached by the decision maker then it is not necessary to grant a hearing and therefore, until and unless prejudice is shown, every violation of a natural justice may not lead to the conclusion that the order passed is always null and void. Moreover, the Respondent has also filed an affidavit of Rahul Dev, Adv. to counter the assertion made by the Appellant through affidavit of Sujit Lohaty. 21. Thus, from the aforesaid facts and circumstances much less the order recorded by the Adjudicating Authority on 15.03.2022 of hearing the parties before reserving the order and in view of the decisions of Hon'ble Supreme Court in the case of State of Maharastra (Supra) and Dharampal Satyapal Limited (Supra), it cannot be said that the principle of natural justice has been violated for not granting an opportunity of hearing. However, in the interest of justice the subsequent events which the Appell ..... X X X X Extracts X X X X X X X X Extracts X X X X
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