Special Court jurisdiction and prima facie non-cooperation under the Insolvency Code led to cognizance and summons.

The Special Court's jurisdiction to try offences under the Insolvency and Bankruptcy Code, 2016 was affirmed because such offences are triable by Special Courts constituted under Chapter XXVIII of the Companies Act, 2013, and the notified court had been vested with authority to hear the prosecution. On the merits, the Court found prima facie material that the accused persons, being in charge of the corporate debtor, failed to cooperate with the resolution professional, withheld books and financial records, and did not comply with directions issued in the insolvency proceedings. As the complaint was filed by a public servant in official capacity, pre-summoning evidence was dispensed with, cognizance was taken, and summons were issued to all five accused.

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Issues: (i) Whether the Special Court had jurisdiction to try offences under the Insolvency and Bankruptcy Code, 2016; (ii) Whether a prima facie case was made out for taking cognizance and issuing summons to the accused persons for alleged non-cooperation with the resolution professional and related defaults.

Issue (i): Whether the Special Court had jurisdiction to try offences under the Insolvency and Bankruptcy Code, 2016.

Analysis: The complaint was instituted by an authorised officer of the Insolvency and Bankruptcy Board of India. The Court noted that offences punishable under the Insolvency and Bankruptcy Code, 2016 are triable by Special Courts constituted under Chapter XXVIII of the Companies Act, 2013, and that the notified Special Court had been vested with jurisdiction to entertain such prosecutions.

Conclusion: The Court held that it had jurisdiction to try the complaint.

Issue (ii): Whether a prima facie case was made out for taking cognizance and issuing summons to the accused persons for alleged non-cooperation with the resolution professional and related defaults.

Analysis: On the material placed on record, the Court found prima facie allegations that the accused persons, being persons in charge of the corporate debtor, failed to cooperate with the resolution professional, withheld books and financial records, and did not comply with directions issued in the insolvency proceedings. As the complaint was filed by a public servant in official capacity, pre-summoning evidence was dispensed with under the Code of Criminal Procedure, 1973.

Conclusion: Cognizance was taken and all five accused persons were directed to be summoned for the alleged violations.

Final Conclusion: The complaint was accepted for prosecution, and the accused persons were required to face trial for the alleged offences under the Insolvency and Bankruptcy Code, 2016.

Ratio Decidendi: Where the complaint is supported by sufficient prima facie material showing statutory non-cooperation and withholding of required insolvency records, the Special Court may take cognizance, dispense with pre-summoning evidence where permissible, and issue summons to the accused.

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