2022 (11) TMI 1044 - AT - Insolvency and Bankruptcy

Tribunal upholds Adjudicating Authority's decision on Insolvency and Bankruptcy Code application

Haridas Gautamkumar Dave Versus Indian Transformers Co. Ltd., Union Bank of India

Haridas Gautamkumar Dave Versus Indian Transformers Co. Ltd., Union Bank of India - TMI Issues:Challenge to Impugned Order dated 17.09.2021 admitting Section 7 Application under Insolvency and Bankruptcy Code, 2016 by Financial Creditor against Corporate Debtor. Main contention of fraud, limitation, debt, default, and nature of proceeding.Analysis:1. Limitation Issue:- Adjudicating Authority admitted Section 7 Application addressing the issue of limitation.- Financial Creditor proved debt within limitation period through documents.- Corporate Debtor's objection on limitation plea rejected based on Supreme Court judgments.- Financial Creditor's actions deemed legally sustainable within limitation.2. Fraud Allegation:- Appellant claimed Impugned Order obtained through fraud by Financial Creditor.- Allegations include incorrect NPA date, non-compliance with restructuring terms, and lack of default under the Code.- Additional Affidavit filed by Financial Creditor challenged for being out of time.- Appellant's arguments on fraud and limitation not accepted by the Tribunal.3. Debt and Default Assessment:- Financial Creditor argued debt and default existence based on loan history and restructuring.- Appellant contended the proceeding as a recovery process, not a resolution.- Financial Creditor's compliance with SARFAESI Act and subsequent legal actions highlighted.- Tribunal found sufficient evidence of debt, default, and compliance with legal requirements.4. Legal Precedents and Judgments:- Both parties relied on various Supreme Court judgments to support their arguments on limitation, debt acknowledgment, and default.- Tribunal considered the application of legal principles in the context of the present case.5. Tribunal's Decision:- Tribunal dismissed the Appeal based on findings related to limitation, debt acknowledgment, and default.- Acknowledged the Financial Creditor's actions as legally valid within the limitation period.- Noted the Corporate Debtor's current liquidation status but upheld the Adjudicating Authority's decision.In conclusion, the Tribunal dismissed the Appeal, emphasizing the legal validity of the Financial Creditor's actions within the limitation period and the existence of debt and default. The judgment analyzed the fraud allegations, debt restructuring, and compliance with legal requirements, ultimately upholding the Adjudicating Authority's decision to admit the Section 7 Application.