2024 (12) TMI 846 - AT - IBC

Tribunal Overturns Non-Prosecution Dismissal, Orders Reconsideration with Emphasis on Detailed Rationale and Fairness.

The tribunal set aside the impugned order dismissing the restoration application for non-prosecution, citing the absence of a speaking order. The tribunal ... Dismissal of application for non-prosecution - whether the Tribunal while passing the Order dated 11th January, 2024 has passed a speaking Order or not? - violation of principles of natural justice - HELD THAT:- In the present legal system where the party who has engaged his counsel remain supremely confident that his Counsel would appear on his behalf and submit his case, should not be penalized if the Counsel engaged by the Appellant, left for USA without informing the Appellant. There are no doubt that the parties who have been pursuing this application continuously for two years, i.e. from the date of filing till ultimately dismissed on 6th October, 2023 would not appear deliberately. The Review Application i.e. RA 200 of 2023 which was dismissed by the learned Tribunal is also on the issue that the Counsel for the Appellant did not appear but the Appellant has given the reason for the non-appearance and said reason has not been appreciated by the learned Tribunal while dismissing Restoration Application 2 of 2024. The Appellant has invested his hard earned money of Rs.65 lakhs and that the claim of the Appellant was once admitted by the IRP and the RP in the list dated 29th June, 2020, the amount claimed by the Appellant was shown as nil, this Appeal deserves to be allowed because the impugned Order is totally non-speaking - the matter is remanded back to the learned Tribunal to decide the said application in accordance with law by passing a speaking order. Issues: Restoration application dismissal, non-prosecution, speaking order requirement.Analysis:The judgment pertains to an appeal against the dismissal of a restoration application seeking to restore a previous application that was dismissed for non-prosecution. The appellant, a homebuyer, had filed multiple applications, including IA 1724 of 2021, which was dismissed due to the appellant's counsel leaving for the US without informing the appellant. Subsequently, the restoration application RA 200/2023 was dismissed for non-prosecution on 14th December, 2023. Another restoration application, RA 2 of 2024, was filed, but it was also dismissed on 11th January, 2024, without reasons provided in the order.The main issue in this case was whether the tribunal passed a speaking order while dismissing the restoration application on 11th January, 2024. The appellant argued that the non-appearance was due to the application being listed in the ordinary cases instead of the supplementary list, which caused a lack of notice. The appellant cited a Supreme Court decision emphasizing that a party should not be penalized for the fault of their advocate. The tribunal acknowledged the appellant's investment and previous admission of the claim but found the impugned order to be non-speaking and remanded the matter back to the tribunal for a decision with a speaking order, directing the parties to appear on a specified date.The judgment highlights the importance of a speaking order in legal proceedings and the obligation of the tribunal to provide reasons for its decisions. It also underscores the need for parties to be diligent in monitoring their cases and the actions of their legal representatives to avoid adverse outcomes. The tribunal's decision to set aside the impugned order and remand the matter for a speaking order demonstrates a commitment to procedural fairness and ensuring that all relevant factors are considered in the adjudication of the case.