Tribunal Upholds Order Dismissing Possession Application During CIRP The Tribunal allowed the condonation of a delay in representing appeal papers due to the appellant's illness. However, the Tribunal upheld the impugned ...
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Tribunal Upholds Order Dismissing Possession Application During CIRP
The Tribunal allowed the condonation of a delay in representing appeal papers due to the appellant's illness. However, the Tribunal upheld the impugned order dismissing the application for possession of four apartments during the CIRP, stating that granting possession would alter the corporate debtor's assets and favor the creditor, contravening the Insolvency and Bankruptcy Code. Justice M. Venugopal stressed the importance of adhering to legal requirements to preserve the integrity of insolvency proceedings.
Issues involved: 1. Delay in representing material papers of the appeal. 2. Validity of the impugned order regarding possession of four apartments during CIRP.
Issue 1: Delay in representing material papers of the appeal The appellant sought to condone a delay of 89 days in representing the appeal material papers due to the appellant's illness and logistical challenges. The Tribunal, satisfied with the reasons provided, allowed the condonation of delay without imposing any costs.
Issue 2: Validity of the impugned order regarding possession of four apartments during CIRP The impugned order by the Adjudicating Authority dismissed the application seeking possession of four apartments during the CIRP period. The appellant contended that the Tribunal did not consider relevant facts and laws, leading to an incorrect decision. The appellant argued that the possession of the apartments would not violate the moratorium or relevant sections of the Insolvency and Bankruptcy Code, as the appellant had paid for the construction of the apartments. However, the Tribunal, after considering the provisions of Section 43(2)(b) of the IBC, concluded that granting possession would alter the corporate debtor's assets and put the creditor in a beneficial position, contrary to Section 53 of the IBC. The Tribunal found the impugned order to be legally sound and dismissed the appeal, stating it lacked merit.
Separate Judgment by Justice M. Venugopal In a separate judgment, Justice M. Venugopal emphasized the importance of upholding the integrity of the insolvency process and ensuring compliance with the provisions of the Insolvency and Bankruptcy Code. The judge highlighted the need for strict adherence to legal requirements to maintain the sanctity of insolvency proceedings.
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