Tribunal allows late Reply by Corporate Debtor in insolvency case, dismissing appeal.

The Tribunal dismissed the appeal against the Order allowing the modification to accept a late Reply from the Corporate Debtor in an insolvency matter. Despite the initial closure of the right to file a Reply, the Tribunal found that the Adjudicating Authority properly exercised its inherent power under Rule 11 of the NCLT Rules to accept the Reply. The presence of the Corporate Debtor's Reply on record was deemed beneficial for addressing the issues raised by the Financial Creditor representing the Home Buyer Association, leading to the dismissal of the Appeal.

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Issues:
Appeal against Order allowing modification of a previous Order to accept a late Reply from Corporate Debtor in an insolvency matter.

Analysis:
The appeal was filed against an Order allowing the modification of a previous Order to accept a late Reply from the Corporate Debtor in an insolvency matter. The Corporate Debtor had failed to file a Reply within the specified time frame, leading to the closure of the right to file a Reply as per the initial Order dated 10th December, 2020. Subsequent Orders reiterated the closure of the right to file a Reply. However, the Corporate Debtor filed an Application to modify the Order and have the Reply taken on record. The Appellant, representing the Home Buyer Association/Financial Creditor, argued that the Adjudicating Authority had no power to review its earlier Order and accept the late Reply. They contended that once the right to reply was closed, it could not be reinstated by the Impugned Order.

Upon considering the submissions, the Tribunal noted that the Corporate Debtor had indeed failed to file a Reply within the stipulated time frame, and the right to reply had been closed as per the initial Orders. However, the Corporate Debtor annexed the Reply with the Application for modification, requesting its acceptance. The Tribunal observed that the Adjudicating Authority had not reviewed any substantive issue but had exercised its inherent power under Rule 11 of the NCLT Rules to accept the Reply. The Tribunal found that substantial justice had been served by allowing the Reply on record, especially considering the nature of the parties involved. The presence of the Corporate Debtor's Reply on record would assist the Adjudicating Authority in addressing the issues raised by the Appellant, a Financial Creditor representing the Home Buyer Association. Consequently, the Tribunal concluded that the case did not warrant the exercise of its appellate power, and the Appeal was dismissed.

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