2023 (2) TMI 950
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....Abhishek Manu Singhvi, Sr. Advocate Mr. Prakul Khurana, Mr. Ankit Sareen, Mr. Yash Tandon, Mr. Hemant Kothari, Mr. Gourav, Advocates For the Respondents: Mr. Abhijeet Sinha, Mr. Ashu Kansal, Ms. Heena Kochar, Advocates for R-1. Mr. Ramji Srinivasan, Sr. Advocate, Mr. Gaurav Singh, Ms. Varsha Banerjee, Ms. Shruti Pandey, Advocates for R-2. Mr. Abhirup Dasgupta, Mr. Ishaan Duggal, Mr. Pathik Choudhury, Advocates for R-3. For the Appellant : Dr. Abhishek Manu Singhvi, Sr. Advocate Mr. Prakul Khurana, Mr. Ankit Sareen, Mr. Yash Tandon, Mr. Hemant Kothari, Mr. Gourav, Advocates For the Respondent : Mr. Abhijeet Sinha, Mr. Ashu Kansal, Ms. Heena Kochar, Advocates for R-1. JUDGMENT ASHOK BHUSHAN , J. These three Appeal(s) have been filed by the State of Rajasthan through Officer-in-Charge Panchu Ram Sharma, Joint Director, Industries, challenging order dated 24.06.2022 passed by National Company Law Tribunal, Jaipur Bench in IA No.327/JPR/2019 in Company Appeal (AT) (Insolvency) No. 733 of 2022. Company Appeal (AT) (Insolvency) No. 734 of 2022 has been filed against the same order passed in IA No.328/JPR/2019. Company Appeal (AT) (Insolvency) No. 996 of 2022 has also been filed agai....
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....f Rajasthan for submitting a revival proposal for the Corporate Debtor, confirmed its opinion to wind up of the Corporate Debtor under Section 20(1) of the Sick Industrial Companies (Special Provisions) Act, 1985 ("SICA") and forwarded its opinion to the High Court of Rajasthan and Jaipur. An Appeal was filed by the Coordination Committee of the Workers Union against BIFR order dated 26.09.2022 before the Appellate Authority for Industrial and Financial Reconstruction ("AAIFR"), which was dismissed on 11.05.2005. (vi) On the opinion forwarded by BIFR, Company Petition No.19 of 2009 was registered before the Rajasthan High Court. In Company Petition No.19 of 2009 and other connected matters, various writ petitions were filed by the Labour Union. The High Court vide interim order dated 26.04.2018 stayed the implementation of the order passed by the Adjudicating Authority dated 13.04.2018. The High Court passed a final judgment on 01.06.2018 in which it refused to transfer the winding up proceedings pending before it and set-aside the order of the Adjudicating Authority dated 13.04.2018 stating that it was passed without jurisdiction. Against the order dated 01.06.2018 passed by the....
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....sthan Stamps Act directing the Alchemist to pay requisite stamps duty on the documents which were executed as Asset Credit Agreement and other ancillary documents as mentioned in the notice. Writ Petition No.7747/2021 and 7748/2021 was filed by the Alchemist in the Rajasthan High Court, challenging the notice in which initially an interim order was passed, but subsequently vide judgment dated 01.09.2021, the Writ Petitions were dismissed. In D.B. Special Appeal Writ No.1032 of 2021, the Division Bench of the High Court noted that Stamp Duty Authority had passed final orders in pursuance to show cause notice. The Division bench passed an interim order preventing the Respondent - State of Rajasthan and the Stamp Duty Authority from recovering the stamp duties in relation to the show cause notice dated 27.04.2021. (x) An IA No.328/JPR/2019 was filed by the State of Rajasthan, where following prayers were made: "Therefore in the light of the above stated factual and legal position, it is most respectfully prayed before this Hon'ble Tribunal that it may kindly be pleased to set aside the action of the RP admitting the claim filed by Alchemist Asset Reconstruction Company Limited and....
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....n be proved by different documents and Adjudicating Authority do not wish to impinge in the domain of the Collector or the High Court. The Adjudicating Authority has not analyzed any such documents, which proves evidence of debt. It is submitted that issue of under-stamped was not before the Hon'ble Supreme Court, when it delivered its judgment on 12.12.2018. 5. Dr. Singhvi further submits that the claims filed by Alchemist and ARCIL were barred by time. It is submitted that date of NPA of Corporate Debtor was 30.09.1997 and Corporate Debtor was notified as a relief undertaking from 03.10.1998 to 07.12.2016. The Corporate Debtor was de-notified as relief undertaking from 07.12.2016. It is submitted that reliance of Alchemist and ARCIL on provisions of Section 4(1) (b) of the 1961 Act is misplaced. It is submitted that the term "because" and "for such suit or proceeding" has been used in relation to only those remedies which are contemporaneous at that point of time. The remedy of filing Section 7 Application under the IBC came into existence only on 01.12.2016, hence, the exclusion, if any available could not have been applied to the remedies under the IBC, which came into existen....
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....llant. The impugned order clearly records the factum of disbursal of the debt and the debt being due and payable. The submission of the Appellant as regards inadmissibility of the documents annexed with the claim are liable to be rejected. It is submitted that all the documents forming part of the Alchemist claim has been duly considered at the time of passing of the admission order and said order having been upheld by the Hon'ble Supreme Court, the documents, which have been admitted in the proceeding, cannot be questioned on account of being insufficiently stamped. Reliance has been placed on Section 40 of Rajasthan Stamp Act. It is submitted that RP exercise limited jurisdiction at the time of admission of claim and the duty of RP is to collate and verify the claims only. Under Regulation 8 of the CIRP Regulations, Financial Creditor can prove its financial debt on the basis of other relevant documents. The documents issued by the State Government including the Information Memorandum issued by the Government of Rajasthan CERSAI Certificate, which was filed along with the claim Form, fully proved the debt of Financial Creditor. The Corporate Debtor, in its reply to Section 7 Appl....
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....RP. The Appellant in its Information Memorandum dated 14.07.2018 clearly stated that IDBI as its Financial Creditor, which also contains an admission that debt has been assigned to Alchemist, which amounts to clear admission of debt by the State also. 7. The learned Counsel appearing for ARCIL has adopted the arguments made by the learned Senior Counsel Shri Ramji Srinivasan. It is further submitted that against Respondent No.3, although a notice was issued, pointing out deficiencies in the documents, but no proceedings were undertaken under the Rajasthan Stamp Act against the ARCIL. 8. The learned Counsel for the RP also supported the impugned order and submits that claims of Alchemist and ARCIL were duly verified and accepted by the RP in accordance with law. There were various materials on record including the admission of the Corporate Debtor, which proved the existence of 'debt' and 'default'. Section 7 Application having been admitted and which admission order having been affirmed by the Hon'ble Supreme Court, the Appellant cannot be allowed to negate the 'debt' and 'default' in the same proceedings before the Adjudicating Authority. 9. We have considered the submissions o....
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.... credit facilities amounting to Rs.200 lakh. * Copy of the Joint Mortgage deed dated 07.04.1995 executed by Shri Gopal Singh, Director, and the Corporate Debtor (JMEL) in respect of deposit of title deeds of immovable and hypothecation of movables with reference to credit facilities availed from various Financial Creditors. * Copy of the Loan agreement dated 21.03.1996 executed between the corporate Debtor and IDBI for availing the credit facility for an amount of Rs.150 lakh for purchase of equipments. * Copy of the Deed of Hypothecation dated 21.03.1996 executed between the Corporate Debtor and IDBI for availing the credit facilities amounting to Rs.150 lakh. * Copy of the Joint mortgage deed dated 29.04.1996 executed by Shri Gori Shankar Pathak, Director and the Corporate Debtor in respect of deposit of titles deeds of immovable and hypothecation of movables with reference to credit facilities availed from various financial Creditors. * Copy of Memorandum of entry dated 11.04.1996 wherein Mr. Gori Shanker Pathak, Director, of the Corporate Debtor submitted the title of documents at the office of IFCI (acting for itself and other financial creditors). * Copy of assign....
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....tor for the financial year ending on 31.03.2013 was also relied. In this respect, paragraph 22 of the order dated 13.04.2018 is as follows: "22. The audited financial statement of the respondent company for the financial year ending 31 March 2013 clearly reveals that a total amount of Rs.391,72,98,134/- is due and payable to all the financial creditors including IDBI and SBBJ. The audited financial statement for the year ending 31.03.2013 also reveals that the outstanding dues of IDBI Bank and SBBJ have been assigned to the applicant AARCL. There is thus clear admission that consequent to the assignment of the outstanding dues of IDBI Bank and SBBJ, the applicant AARCL comes within the purview of 'financial creditor' in order to maintain the present application preferred under section 7 of the Code. Besides the material on record clearly goes to show that the respondent corporate debtor has committed default in payment of the outstanding loan amount." 14. The Adjudicating Authority considering the relevant documents pertaining to loans extended by the Banks as well as noticing the assignment in favour of Alchemist and ARCIL has admitted Section 7 Application. The order of admiss....
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....(two orders), by which demand of an amount of Rs.629 crores have been raised. As noticed above, the said order is under scrutiny by the High Court. More so, the RP has taken into consideration various other documents, which were filed along with Form-C, also in addition to the assignments Deeds. The proceedings under the Rajasthan Stamp Act are separate and independent proceedings to the proceedings under the IBC initiated by the Financial Creditors under Section 7 of the IBC. The admission of claim by the RP, took place much before the proceedings initiated under the Stamp Act and which were based on other relevant materials as noted above cannot be faulted on the ground that Stamp Authorities have declared deficiencies in several documents relied by Financial Creditors. We, thus, are not persuaded to agree with the submission of learned Counsel for the Appellant that on the ground of orders passed by Stamp Duty Authorities, the admission of claims by RP of the Financial Creditors need to be rejected. The Adjudicating Authority has elaborately considered the submission of Applicant/ Appellant and has rightly rejected the IA No.327/JPR/2019. 17. Now, we come to the second ground o....
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.... (Development and Regulation) Act, 1951 (Central Act 65 of 1951), or before any loan, guarantee, or other financial assistance was provided to it, by the State Government, shall be suspended in operation, or shall, if so directed by the State Government, be applied with such modifications as may be specified in the notification; and (b) no suit or other legal proceeding shall be instituted or commenced or if pending, shall be proceeded with, against any industrial undertaking during the period in which it remains a relief undertaking. Explanation.-"Legal proceeding" means any proceeding under any law before any court, tribunal, officer, authority or arbitrator, started on a plaint, petition of appeal, application, reference, or otherwise. 2 Provided that a notification issued under this Act shall have no effect in respect of any law, legal proceedings, agreement, settlement, award, standing order or the like relating to the payment of wages to the workmen of the industrial undertaking specified in the said notification: Provided further that with the issuance and publication of notification under section 3 or section 4 of the Act, the State Government shall, in no case, be ....
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....annot be ignored. The submission of learned Counsel for the Appellant that since the IBC come into force on 01.12.2016, Section 4(2) has to be read only with the remedies which are contemporaneous, cannot be accepted. As noted above, period of limitation for filing an Application commenced on 30.09.1997, which is much before the enforcement of IBC. It is well settled that IBC does not give any fresh period of limitation for filing any Application and no fresh lease of life can be given to the State or dead claim by the enforcement of IBC. But when the Applicant has still balance period of limitation for filing an Application under Section 7 on the principle of computation of limitation as per provisions of 1961 Act, the said benefit cannot be denied. As noted above, the period of limitation commenced on 30.09.1997 and Corporate Debtor was declared a relief undertaking on 03.10.1998 and continued till 07.12.2016. The period, which could be counted for filing Section 7 Application from 30.09.1997 was one year and 2 days. The period of limitation, which cannot be computed and was arrested by virtue of Section 4, sub-section (2), which again recommenced with effect from 08.12.2016, whe....
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....solution Professional sat tight over the matter and did not convene the meeting. In the peculiar circumstances applications were filed by the Financial Creditor praying for removal of the Resolution Professional. In Para 12 of the judgment following has been observed: "12. Besides hearing the learned counsel for the parties we have examined the material available on record particularly the impugned order. It is reflected from the impugned order that the CIRP was initiated long back in 2019, however, for more than one and half years, no step was taken by the Appellant/RP for revival of the CD or even for generating funds. There is no order of any 'Stay' regarding the convening of the said 'Meeting' placed before us. The CoC Meeting was delayed for such a long time. This conduct is sufficient to draw an adverse inference against the appellant as it has been noticed that though the applicant/respondent No.1 had intimated the RP for convening Meeting for removal of the RP, the appellant did not respond to the request of the applicant nor did he convene any 'Meeting', compelling the applicant to approach the Adjudicating Authority for passing order for replacing of the RP. It is true ....
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....the appointee." 23. The judgment of this Tribunal in Srigopal Choudary's case was in peculiar facts and circumstances where the Resolution Professional did not convene the meeting for consideration of agenda for removal of Resolution Professional, hence, application had to be filed before the Adjudicating Authority for removal of Resolution Professional. In the above case, the Adjudicating Authority exercised its inherent power under Rule 11 for passing order. The facts and circumstances under which the order of this Tribunal was passed in Srigopal Choudary's case is entirely different from the facts and circumstances of the present case. Present is a case where the Appellant has only 4% vote share in the Committee of Creditors and no member of the CoC apart from the Appellant has made any request for convening any meeting for consideration of agenda for removal of the Resolution Professional. We, thus, are of the view that reliance placed on the judgment of "Srigopal Choudary, Resolution Professional of Shree Ram Urban Infrastructure Ltd. Vs. SREI Equipment Finance Ltd." by the Appellant is misplaced. 24. In the Written Submission filed on behalf of the Appellant various allegat....