2024 (3) TMI 927 - AT - Insolvency and Bankruptcy

Auction Order Overturned for Non-Impleadment; Tribunal Calls for Fresh Consideration and Delays E-auction Proceedings.

The NCLAT, Chennai, set aside the impugned order dated 09.02.2024 due to the non-impleadment of the Successful Auction Purchaser/Appellant in the ... Seeking impleadment of Successful Auction Purchaser/Appellant as one of the Respondents - HELD THAT:- This ‘Tribunal’, makes a pertinent mention that all pleadings exchanged prior to and non-impleadment, to overcome direction issued by the ‘Adjudicating Authority/Tribunal’, in regard to impleadment shall not be anyway to be construed that the concerned party had an effective and adequate opportunity to putforth its views/grievances, in terms of the ‘principles of natural justice’. This ‘Tribunal’, is of the considered view that even though the ‘Adjudicating Authority/Tribunal’ had observed among other things “Liquidator is permitted to start e-auction process afresh allowing the ‘Applicant/Successful Bidder’ and other persons to participate in the process. It was also submitted that the mistake was bona fide and he is willing to allow the ‘Successful Bidder’, to participate with the amount already ‘furnished/deposited’ and ultimately, proceeded to pass an order, that there will be a ‘fresh auction’ and the ‘Applicant, Successful Bidder’ and other persons would be permitted to participate in the ‘fresh e-auction’ is liable to be set aside, to secure the ‘ends of justice’ because of the latent and patent fact that the ‘Appellant/Proposed Impleading Party, who was directed earlier by the ‘Adjudicating Authority/Tribunal’ through its order dated 30.01.2024 to be impleaded as the ‘Appellant/Successful Bidder’, as one of the ‘Respondents’, was not added as a party as one of the Respondents, this ‘Tribunal’ is of the considered view that the said omission is a vital one and goes to the root of the matter and affects the impugned order on the file of the ‘Adjudicating Authority/National Company Law Tribunal, Division Bench Court-I, Chennai. Appeal allowed. Issues involved: Non-impleadment of the Appellant/Successful Auction Purchaser in the proceedings before the Adjudicating Authority/National Company Law Tribunal, Division Bench Court-I, Chennai.Summary:The National Company Law Appellate Tribunal, Chennai, considered Comp. App. (AT)(CH)(Ins) No.79 of 2024, where the Adjudicating Authority had directed the Petitioner/1st Respondent to implead the Successful Auction Purchaser/Appellant as a Respondent. However, the Appellant was not included as a party, leading to a lack of opportunity to present views. The Tribunal noted that the omission was crucial and impacted the impugned order. Consequently, the Tribunal set aside the Impugned Order dated 09.02.2024, directing a fresh consideration by the Adjudicating Authority for impleading the Appellant. The 1st Respondent was instructed to file an interlocutory Application for impleading the Appellant within three working days. The Liquidator was directed to defer the E-auction pending further orders from the Adjudicating Authority. The Tribunal clarified that it did not delve into the merits of the case but focused on the non-impleadment issue. All connected pending applications were closed.