Appellate Tribunal overturns Order, emphasizes fair process and natural justice

The National Company Law Appellate Tribunal, Chennai, set aside the Impugned Order due to the failure to provide an opportunity for the Appellant to explain the necessity of the Resolution Professional and the lack of adherence to the Principles of Natural Justice. The matter was remitted back to the Adjudicating Authority to pass a reasoned order, allowing both parties to present their arguments. The Tribunal emphasized the importance of a fair and just process in accordance with the law.

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Issues Involved:
The judgment involves issues related to the failure of the Adjudicating Authority to provide an opportunity for the Appellant to explain why the Resolution Professional was a necessary party, the non-payment of Corporate Insolvency Resolution Process costs, the adherence to the Principles of Natural Justice, and the need for a reasoned order.

Issue 1: Failure to Provide Opportunity to Explain the Necessity of the Resolution Professional:
The Appellant challenged the Impugned Order, contending that the Adjudicating Authority did not allow an opportunity to explain why the Resolution Professional was a necessary party. The Appellant's Counsel emphasized the importance of summoning the Resolution Professional for not paying the Corporate Insolvency Resolution Process costs, leading to liquidation. In contrast, the Respondent's Counsel argued against including the Resolution Professional, stating that it would be futile as all documents were handed over to the Liquidator.

Issue 2: Adherence to Principles of Natural Justice:
The Tribunal highlighted the importance of adhering to the Principles of Natural Justice, specifically the Audi Alteram Partem principle. The Tribunal noted that the Impugned Order failed to reflect this principle, leading to the decision to set it aside without delving into the merits of the case. The Tribunal emphasized the need for a reasoned order to ensure justice and fairness in proceedings.

Issue 3: Requirement for a Reasoned Order:
The Tribunal underscored the significance of a reasoned order, stating that it is essential for justice to prevail. It mentioned that even an unreasoned order may be valid for the party receiving a favorable outcome but could appear unjust to the affected party. The Tribunal referenced legal principles guiding the Adjudicating Authority and the Appellate Tribunal to follow the Principles of Natural Justice in their proceedings.

Conclusion:
The National Company Law Appellate Tribunal, Chennai, set aside the Impugned Order due to the failure to provide an opportunity for the Appellant to explain the necessity of the Resolution Professional and the lack of adherence to the Principles of Natural Justice. The matter was remitted back to the Adjudicating Authority to pass a reasoned order, allowing both parties to present their arguments. The Tribunal emphasized the importance of a fair and just process in accordance with the law.

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