Financial creditor's transfer application rejected as no bias shown in Section 7 proceedings

The NCLAT Principal Bench dismissed an appeal challenging rejection of a transfer application. The case involved Section 7 proceedings by a financial creditor where CIRP admission and recall rejection orders were previously set aside by the Tribunal, reviving proceedings before the Adjudicating Authority. The appellant sought transfer claiming apprehension of bias. The NCLAT held that while mere apprehension of bias suffices for transfer, the facts and sequence of events showed neither actual bias nor reasonable apprehension of bias against the hearing bench. The President's rejection of the transfer application contained no error, warranting dismissal of the appeal.

---

---

Issues:
The appeal against the rejection of a transfer application by the Principal Bench is challenged on grounds of bias and procedural irregularities.

Summary:
The appellant contested the rejection of a transfer application against the order dated 01.03.2024, initiating proceedings under Section 7, which were revived after a previous appeal. The appellant sought dismissal of the petition as time-barred, leading to a series of hearings and objections. Allegations of bias were raised due to the handling of the case by the Adjudicating Authority, prompting the transfer application.

The respondent argued against bias claims, highlighting the history of the case and the fairness of proceedings before the Adjudicating Authority. The respondent emphasized that all parties were given opportunities to present their arguments, and no prejudice was caused by the handling of the case. The respondent refuted the bias allegations and defended the Adjudicating Authority's decisions.

After considering the arguments from both sides and reviewing the case records, the Tribunal acknowledged the previous order setting aside the Corporate Insolvency Resolution Process (CIRP) admission and the subsequent revival of Section 7 proceedings. The Tribunal addressed the appellant's grievances regarding the dismissal of the time-barred application and the subsequent hearings on merits and limitations.

The Tribunal found no evidence of bias or procedural irregularities in the case, dismissing the appeal against the rejection of the transfer application. The Tribunal cited legal precedents and concluded that no bias or apprehension of bias was evident in the proceedings, upholding the decision to decline the transfer application.

---