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TMI Blog2023 (8) TMI 859X X X X Extracts X X X X X X X X Extracts X X X X ..... by the Adjudicating Authority (National Company Law Tribunal, Kolkata Bench I, Kolkata) in CP(IB) No. 367/KB/2021 and IA (IBC) No. 1184/KB/2022. By the impugned order, the Adjudicating Authority has admitted the petition under Section 7 of the IBC and allowed the initiation of Corporate Insolvency Resolution Process ("CIRP" in short) of the Corporate Debtor - M/s Dadheech Infrastructures Private Limited. Aggrieved by this impugned order, the present appeal has been preferred by the suspended Director of the Corporate Debtor. 2. Putting briefly the facts of the case, the Corporate Debtor had a business relationship with the Financial Creditor, SREI Equipment Finance Ltd. - Respondent No.1 since 2007. The Financial Creditor was a non-banking financial company which was admitted under CIRP on 08.10.2021 following which an Administrator was appointed. During the course of their business relationship, several loan agreements were signed following which funds were transferred by the Financial Creditor to the Corporate Debtor. Claiming that an amount of Rs.131,35,08,475/- was due from the Corporate Debtor and remained unpaid as on 12.08.2021, a Section 7 application was filed by Mr. Pro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of Attorney ("PoA" in short). It was stated that the main petition was signed and verified by Mr. Projoy Chatterjee on the basis of a PoA dated 31.03.2021 executed by the Financial Creditor. However, since the Financial Creditor had been admitted to CIRP and was taken over by the Administrator, the PoA signed by the erstwhile management had become non-maintainable. It was further pointed out that acknowledging the fact that the main petition was not maintainable, Respondent No.1 have themselves instituted IA(IB) No.430/2022 to re-sign and re-verify the main petition. While admitting that the Adjudicating Authority while deciding this matter passed an order on 01.07.2022 and allowed formal amendments to be made by the Financial Creditor, it was emphatically asserted that the same order also allowed the Appellant to take all available defences, and pursuant thereto, IA No. 1184/2022 was filed by the Appellant before the Adjudicating Authority to decide on the maintainability of the main petition. 5. It is the contention of the Appellant that despite the amendments, the cause-title of the main application continued to remain defective. The main petition which was affirmed by Mr. Pro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... firmed by the Administrator on 25.10.2021 which preceded the filing of the main petition on 22.11.2021. When Mr. Projoy Chatterjee resigned, the Administrator executed another PoA on 01.04.2022 in favour of Mr. Sohan Kumar Jha. After execution of the second PoA, the Adjudicating Authority on 04.04.2022 had directed the Financial Creditor to obtain proper instructions from the Administrator to make necessary amendments to the pleadings in the company petition. Accordingly, IA No.430/2022 was filed by the Financial Creditor which was allowed by the Adjudicating Authority on 01.07.2022 and thereafter the main petition was re-signed and re-verified. It has been strongly contended that the institution of the main company petition and continuance of the proceedings on behalf of the Financial Creditor has been done by duly authorized persons at all points of time. It was also added that in order to avoid an order of CIRP from being passed, the Corporate Debtor had filed IA No. 1184/2022 raising frivolous grounds. 9. Refuting the contention of the Appellant that principles of natural justice had been violated, it was asserted the Corporate Debtor was given due opportunity to file pleading ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Debtor was absent on 08.08.2022 but time to file reply affidavit was enlarged by another two week's as a last opportunity. On the next date of hearing on 12.09.2022, the counsel of Corporate Debtor was present but had not filed reply affidavit. The Corporate Debtor's right to file reply affidavit was closed and matter fixed for arguments on 13.10.2022 and accorded priority listing. Again on 13.10.2022, though counsel of Corporate Debtor was present, he was not ready for argument and sought time to prepare arguments on the maintainability of the main petition. The matter was adjourned to 19.10.2022 with costs. It is significant to note that the Adjudicating Authority had accorded priority listing to this matter. On the next date of hearing on 19.10.2022 it is pertinent to note that both parties were present and the Adjudicating Authority in IA 1200/2022 allowed recall of its order dated 12.09.2022 and gave an opportunity to the counsel of Corporate Debtor to file reply affidavit. Thus, at this stage, three distinctive developments are noteworthy, first, that the Corporate Debtor's right to file reply affidavit to the main petition was restored; secondly, Corporate Debtor's challeng ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... having filed the affidavit in opposition on 13.10.2022 as at page 768 of Appeal Paper Book ("APB" in short) putting forth its objections. These submissions have been duly considered by the Adjudicating Authority while recording its findings. Thus, we have no doubt in our minds that both parties were fully aware that the Adjudicating Authority had clubbed together for hearing the main petition and IA 1184/2022 for conjoint disposal which got deferred from 21.11.2022 to 05.12.2022. That the Adjudicating Authority having allowed the counsel of Corporate Debtor to file reply affidavit, there can be no room for complaining that pleadings could not be made. The submission made by the Learned Senior Counsel of the Appellant that they were under the impression that only IA 1184/2022 was being heard on 05.12.2022 does not appeal to us. Prima-facie, there is no valid ground to find any fault in the conduct of proceedings by the Adjudicating Authority on grounds of denial of any opportunity of hearing to either party. We are also inclined to believe that both the matters being integral to each other were heard together. 14. It is however the case of the Appellant that their contention that t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e maintainability aspect of the main petition at para 11.2 of the impugned order and come to a definitive conclusion at para 11.3 that the main petition is maintainable which is as reproduced below: "11.3 Therefore, we have no hesitation in holding that the Administrator had lawful authority to execute the Power of Attorney in favour of Mr. Sohan Kumar Jha and further that Mr. Sohan Kumar Jha was duly authorized to continue/contest the present petition on behalf of the Financial Creditor before this Adjudicating Authority and to file further document perform other acts and deeds required for pursuing/contesting the instant petition. The amendments carried out in cause title are in pursuance of the Power of Attorney in favor of Mr. Sohan Kumar Jha and therefore the Corporate Debtor's plea regarding the defective cause title is incorrect and untenable. Based on facts and documents as indicated above, the filing of this petition and its continuation subsequently do not suffer any defects as alleged. As such contentions of respondent are found to be in-correct and untenable." 17. The above findings recorded by the Adjudicating Authority are in order when we test it on the factual ma ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t that the Adjudicating Authority had failed to consider the fact that the Corporate Debtor had repaid the total sum lent to him and that the claim of the Financial Creditor is based on several agreements which have been barred by limitation on the date of filing of the main petition. Further the Adjudicating Authority had mistakenly and erroneously held that the Corporate Debtor had acknowledged an outstanding liability by relying on an email dated 05.08.2022 which could not have been held to be an admission of debt or liability. Further, the Adjudicating Authority has also failed to appreciate that the Corporate Debtor is a going concern presently executing various government contracts. Hence, the admission of the Corporate Debtor into CIRP runs contrary to the decision of the Hon'ble Supreme Court in Vidarbha Industries Power Ltd. vs. Axis Bank Ltd. (2022) 8 SCC 352. It was also submitted that the Financial Creditor having been admitted to CIRP at the behest of RBI in CP(IB) No.294/2021 and RBI being a Corporate Debtor itself is barred from initiating CIRP against the Corporate Debtor. 19. It is the case of the Respondent No. 1 that once existence of debt and default is establ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of limitation. The debt due and in default is more than One crore Rupees. As such, the instant petition deserves to be admitted and is hereby admitted."
(Emphasis supplied)
21. We are satisfied with the above findings recorded by the Adjudicating Authority in that debt and default above the threshold limit having been established, there is sufficient reason for admission of the main petition and admitting the Corporate Debtor into the rigours of CIRP. We however add that procrastinated pronouncement of order has given fodder to the Appellant in making the absurd claims of having not been heard. At this point, we cannot restrain ourselves from observing that such unreasonable and unexplained delays in delivering verdicts are not desirable. Be that as it may, the hyper-technical and opportunistic pleas raised by the Appellant to stymie the admission of CIRP of the Corporate Debtor cannot be countenanced either.
22. For the foregoing reasons, we are of the considered view that there are no sufficient and plausible grounds made which warrant any interference with the impugned order. There is no merit in the appeal. The appeal is dismissed. No costs. X X X X Extracts X X X X X X X X Extracts X X X X
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