Tribunal Dismisses Applications; Respondents' Actions Compliant with IBC

The Tribunal dismissed both IA/3927/2020 and IA/1356/2021, finding no merit in the applicants' contentions. The respondents' actions were in compliance with the relevant provisions of IBC, and there was no requirement to refund the amount of Rs. 12,30,457/- to the Corporate Debtor.

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Issues Involved:
1. Refund of Rs. 12,30,457/- with interest.
2. Alleged contravention of Sections 14, 31, and 74 of the Insolvency and Bankruptcy Code (IBC), 2016.
3. Maintainability of the application under Rule 11 of NCLT Rules, 2016 and Section 60(5) of IBC, 2016.

Issue-wise Detailed Analysis:

1. Refund of Rs. 12,30,457/- with interest:
The applicants sought a direction for the respondents to refund Rs. 12,30,457/- with interest at 18% per annum, claiming the amount was illegally retained during the moratorium period for the supply of goods/components. The respondents countered that they had an ongoing business relationship with the Corporate Debtor since 2012 and had supplied goods based on mutual understanding. They maintained that the amount was part of a running account and that the Corporate Debtor owed them Rs. 34,07,390/-. The Tribunal observed that the goods/components were supplied by the respondents on the request of the Resolution Professional (RP) during the moratorium period, and the RP acted as per the provisions of Section 14(2) of IBC, 2016. Therefore, there was no requirement for the respondents to refund the amount.

2. Alleged contravention of Sections 14, 31, and 74 of IBC, 2016:
The applicants contended that the respondents contravened Sections 14, 31, and 74 of IBC by siphoning off proceeds during the moratorium period. The respondents argued that they continued to supply essential goods to keep the Corporate Debtor as a going concern, as requested by the RP. The Tribunal referred to Sections 14(2), 14(2A), and 25 of IBC, which mandate the RP to preserve and protect the assets of the Corporate Debtor, including continued business operations. The Tribunal found that the RP's actions were in compliance with these provisions, and there was no contravention of Sections 14, 31, and 74 of IBC.

3. Maintainability of the application under Rule 11 of NCLT Rules, 2016 and Section 60(5) of IBC, 2016:
The Tribunal examined whether the application was maintainable under Rule 11 of NCLT Rules, 2016 or Section 60(5) of IBC, 2016. The Tribunal noted that Section 60(5) confers jurisdiction to entertain applications related to insolvency resolution or liquidation proceedings. However, in this case, the Resolution Plan had already been approved, and no insolvency proceeding was pending. Therefore, the application under Section 60(5) of IBC, 2016 was not maintainable. Similarly, Rule 11 of NCLT Rules, 2016 could not be invoked as no specific provision under the Act/Code was applicable, and no matter was pending before the Tribunal. Consequently, the application was not maintainable under Rule 11 of NCLT Rules, 2016.

Conclusion:
The Tribunal dismissed both IA/3927/2020 and IA/1356/2021, finding no merit in the applicants' contentions. The respondents' actions were in compliance with the relevant provisions of IBC, and there was no requirement to refund the amount of Rs. 12,30,457/- to the Corporate Debtor.

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