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of <h1>Dismissal of Application to Recall Judgment under IBC due to Lack of Tribunal Authority</h1> <h3>APYA CAPITAL SERVICES PRIVATE LIMITED Versus GUARDIAN HOMES PRIVAT LIMITED</h3> The application seeking the recall of a judgment and order passed by the Appellate Tribunal was dismissed as not maintainable. The Respondent challenged ... Prayer to recall of the judgment and order passed by this Appellate Tribunal - section 424(1) of the Companies Act, 2013, as amended, read with Rule 11 of the National Company Law Appellate Tribunal Rules, 2016 - HELD THAT:- Neither Section 242 (1) of the Companies Act, 2013 nor Rule 11 of the NCLAT Rules, 2016 gives power to this Appellate Tribunal to recall the judgment passed by this Appellate Tribunal, after the judgment dated 08.12.2020 was questioned before the Hon’ble supreme Court in Appeal and the Appeal was dismissed by the Hon’ble Supreme Court. The power to recall the judgment is not permitted in IBC - application dismissed. Issues:1. Application filed under section 424(1) of the Companies Act, 2013 for recall of judgment and order dated 08.12.2020 passed by the Appellate Tribunal.2. Dispute regarding the classification of the Appellant as a Financial Creditor under the IBC.3. Alleged errors in the judgment related to the quantum of debt and admission of the application.4. Prayers sought in the instant application filed by the Respondent/Applicant.5. Challenge of the judgment before the Hon'ble Supreme Court and its impact on the jurisdiction of the Appellate Tribunal.6. Analysis of the powers of the Appellate Tribunal under Section 424(1) of the Companies Act, 2013 and Rule 11 of the NCLAT Rules, 2016 regarding the recall of judgments.Analysis:1. The application was filed under section 424(1) of the Companies Act, 2013, seeking the recall of the judgment and order dated 08.12.2020 passed by the Appellate Tribunal. The Respondent/Applicant challenged the classification of the Appellant as a Financial Creditor under the IBC, contending that the Appellant should have been considered an Operational Creditor who filed the application under Section 9 of the IBC. The Respondent argued that the judgment erred in treating the Appellant as a Financial Creditor and disregarding the pre-existing dispute regarding the quantum of debt.2. The Respondent/Applicant raised concerns about the errors in the judgment, particularly regarding the immateriality of the quantum of debt at the admission stage of the application under Section 9 of the IBC. The Respondent emphasized the provisions of Sections 8, 9, and 5(6)(a) of the IBC, asserting that the observations made in the judgment were contrary to the statutory provisions and the factual record of the case. The Respondent sought the recall of the judgment based on these alleged errors.3. The prayers in the instant application included recalling the order dated 18.12.2020, directing the NCLT, Mumbai to reconsider the Section 9 IBC Application, granting a stay on the execution of the order dated 08.12.2020, and any other orders deemed fit in the interest of justice. The application highlighted the need for addressing the errors in the judgment and ensuring a fair consideration of the dispute between the parties.4. The judgment of the Appellate Tribunal was challenged before the Hon'ble Supreme Court, which dismissed the appeal on 01.07.2021. The Appellate Tribunal noted that the judgment passed by it merged with the Supreme Court's order upon dismissal of the appeal. This aspect influenced the jurisdiction of the Appellate Tribunal in considering the recall of its earlier judgment, as the matter had been adjudicated by the higher court.5. The analysis of the powers vested in the Appellate Tribunal under Section 424(1) of the Companies Act, 2013, and Rule 11 of the NCLAT Rules, 2016 revealed limitations on the Tribunal's authority to recall judgments once they had been challenged and adjudicated by a higher court. The Tribunal concluded that the power to recall the judgment was not permitted under the IBC, leading to the dismissal of the instant application as not maintainable. The decision was based on the legal framework governing the Tribunal's jurisdiction in such matters.
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