Former liquidator's review petition dismissed for lack of standing and statutory authority

The NCLAT Chennai dismissed a review petition filed by a former liquidator seeking to recall an order passed without hearing him as an aggrieved party. The Tribunal held that review power is statutory, not inherent, and cannot be exercised absent specific statutory provision. The petitioner lacked standing as neither a necessary nor proper party to the proceedings. The Tribunal emphasized that review cannot be granted under the guise of clarification, and a review court cannot sit in appeal over its own order. The petition was deemed a fishing expedition without legal foundation, as the petitioner had no vested right to file the review application in his personal capacity.

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Issues Involved:
1. Whether the Impugned Order dated 05.01.2024 was passed without hearing the Petitioner.
2. Whether the Petitioner is a "Necessary Party" and if the Order is "Void Ab Initio".
3. Allegations of fraud, cheating, and obstruction of liquidation process by the New Liquidator.
4. Compliance with previous Tribunal orders and the necessity of including Rayagada Land in the Asset Memorandum.
5. Continuous nature of the Liquidation Process and the role of the Erstwhile Liquidator.
6. The Petitioner's right to defend against allegations made in IA No. 815 / 2020.
7. The Petitioner's claim regarding actual compensation and the Tribunal's reliance on IDBI Bank's pleadings.
8. The Petitioner's right to be heard as an Affected Party.
9. The Petitioner's contention about the New Liquidator's lack of jurisdiction and experience.
10. The Petitioner's stance on the corporate debtor's right to claim compensation for Ceiling Surplus Land.
11. The Petitioner's argument about the procedural errors in the Tribunal's judgment.

Summary:

Issue 1: Whether the Impugned Order dated 05.01.2024 was passed without hearing the Petitioner.
The Petitioner contended that the Impugned Order dated 05.01.2024 was passed by the Tribunal without hearing him, making the Order "Void Ab Initio" and "Non-Est".

Issue 2: Whether the Petitioner is a "Necessary Party" and if the Order is "Void Ab Initio".
The Petitioner argued that he was a "Necessary Party" whose presence was essential for an effective order. The Tribunal referred to previous judgments to establish the necessity of a party's presence for adjudication.

Issue 3: Allegations of fraud, cheating, and obstruction of liquidation process by the New Liquidator.
The Petitioner alleged that the New Liquidator obtained the Order by suppressing issues of fraud, cheating, and obstruction of the liquidation process, causing significant loss to IDBI Bank and attracting Section 2(c) of the Contempt of Courts Act, 1971.

Issue 4: Compliance with previous Tribunal orders and the necessity of including Rayagada Land in the Asset Memorandum.
The Petitioner claimed that the New Liquidator disregarded the Tribunal's previous order to include Rayagada Land in the Asset Memorandum before proceeding with the Section 230 Scheme.

Issue 5: Continuous nature of the Liquidation Process and the role of the Erstwhile Liquidator.
The Petitioner emphasized that the Liquidation Process is continuous and that the acts performed by the Erstwhile Liquidator should be respected as he held quasi-judicial powers.

Issue 6: The Petitioner's right to defend against allegations made in IA No. 815 / 2020.
The Petitioner asserted that he needed to defend his integrity, character, and efficiency against severe allegations made in IA No. 815 / 2020.

Issue 7: The Petitioner's claim regarding actual compensation and the Tribunal's reliance on IDBI Bank's pleadings.
The Petitioner argued that the actual compensation receivable was Rs.12.33 Lakhs, not Rs.500 Crores as presumed by the Tribunal based on IDBI Bank's false pleadings.

Issue 8: The Petitioner's right to be heard as an Affected Party.
The Petitioner contended that he was not given an opportunity to defend his case, despite being an Affected Party with mala fides attributed to him.

Issue 9: The Petitioner's contention about the New Liquidator's lack of jurisdiction and experience.
The Petitioner argued that the New Liquidator had no jurisdiction to function and lacked experience, being selected from the IBBI list of highly experienced professionals.

Issue 10: The Petitioner's stance on the corporate debtor's right to claim compensation for Ceiling Surplus Land.
The Petitioner pointed out that the Corporate Debtor has a right to claim compensation for Ceiling Surplus Land at Rayagada Property, as per the Order of the Hon'ble High Court of Orissa.

Issue 11: The Petitioner's argument about the procedural errors in the Tribunal's judgment.
The Petitioner cited various judgments to argue that procedural errors, such as not hearing a necessary party or ignoring fraud, justified recalling the Order.

Conclusion:
The Tribunal concluded that the Petitioner, being no longer the Liquidator, had no vested right to seek a review or recall of the Order. The New Liquidator, empowered by law, had the authority to withdraw the appeal, and the Petitioner's application was deemed not maintainable. The Review Application No. 3 / 2024 was dismissed without costs.

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