TaxTMI 
TaxTMI 
2017 (12) TMI 649
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....tcy Code, 2016 read along with section 423 of the Companies Act, 2013; (b) That this Hon'ble Tribunal be pleased to declare that the instant Company Petition filed by the Petitioner/Financial Creditor an abuse of process of the Tribunal pursuant to Rule 11 of the National Company Law Tribunal Rules, 2016; (c) That this Hon'ble Tribunal be pleased to pass appropriate orders under section 65 of the Insolvency and Bankruptcy Code, 2016 that the Petitioner/Financial Creditor has fraudulently or with a malicious intention instituted the instant Company Petition; (d) That this Hon'ble Tribunal be pleased to pass an order of mandatory injunction against the Petitioner/Financial Creditor to commence insolvency proceedings against Respondents No. 2 to Respondent No. 11 i.e. various entities in the Bhatia Group (comprising Bhatia Coke and Energy Limited, Bhatia Coal Washeries Limited, Bhatia Industries and Infrastructure Limited, Bhatia Sons (India) Limited, BCC Cargo Limited, BCC Enterprises (India) Limited, BCC Estates (P.) Limited, Reliance Services and Consultants Ltd., Associated Transport Company and Ishaar Overseas Pvt. Ltd.) and initiate legal proceedings a....
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....against Respondents No. 22 to 34 (comprising the State Bank of India, State Bank of Indore, UCO Bank, Union Bank of India, Oriental Bank of Commerce, The Hong Kong and Shanghai Banking Corporation Ltd, State Bank of Mysore, Indusind Bank Limited, HDFC Bank Limited, Standard Chartered Bank, Bank of Baroda, Bank of India, SBICAP Trustee Company Ltd.) to place on record all documents relating to the cross default available to them to move against any entity in the Bhatia Group including but not limited to Bhatia Coke and Energy Limited, Bhatia Coal Washeries Limited, Bhatia Industries and Infrastructure Limited, Bhatia Sons (India) Limited, BCC Cargo Limited, BCC Enterprises (India) Limited, BCC Estates (P.) Limited, Reliance Services and Consultants Ltd., Associated Transport Company and Ishaar Overseas Pvt. Ltd and all documents relating to the personal guarantees issued to the Bhatia Family including but not limited to Mr. Surinder Singh Bhatia, Mr. Gurvinder Singh Bhatia, Mr. Amandeep Singh Bhatia, Mrs. Veena Bhatia, Mrs. Gurvinder Kaur Bhatia, Mr. Manjeet Singh Bhatia, Mrs. Indrajit Kaur Bhatia, Ms. Ishipal Kaur Bhatia, Mr. Kulwant Singh Bhatia, GS Bhatia (HUF) for the debts of t....
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....tion Process. The said Application was admitted by this Adjudicating Authority by order dated 23rd May, 2017. This Adjudicating Authority appointed Shri Nitin Hasmukhlal Parikh, Company Secretary as 'Interim Resolution Professional'. This Adjudicating Authority also granted moratorium under Section 13 of the Code for the purposes referred to in Section 14 of the Code. 3. It is stated in this Application that the Applicant on 17th January, 2011 obtained a London Arbitral Award against Asian Natural Resources (India) Limited for a sum of USD 68.43 Million in addition to cost of GBP 758,580 along with interest. The claim of the Operational Creditor against the Corporate Debtor is Rs. 529,18,40,254.65 in addition to interest @ 2% over LIBOR till realization. 4. Applicant/Operational Creditor filed Execution Application No. 240 of 2011 before Hon'ble Bombay High Court to enforce and execute the London Arbitral Award dated 17th January, 2011 against the property of the Corporate Debtor within the jurisdiction of the Hon'ble Bombay High Court which inter alia included the office premises situated at 101, Orbit Plaza at New Prabhadevi Road, Mumbai. The Corporate Debtor resisted the e....
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....rporate Debtor; "a. Certain officers in the Indore Branch of the IDBI Bank would turn a blind eye to the Corporate Debtor entering into purported business transfer agreements to transfer its trading, coke and washeries business undertakings as a going concern on a slump sale with BGTL, BCEL and BCWL at grossly insufficient consideration and/or a consideration with was an absolute eye wash; b. Certain officers in the Indore Branch of the IDBI Bank would turn a blind eye to the Corporate Debtor transferring the totality of its overseas assets of more than USD 83 Million held by one of its wholly owned overseas subsidiaries in Dubai - Ishaar Overseas Limited ("IOF") to another overseas subsidy Bhatia International Pte. Limited of Singapore ("BIPL") and diluted its stake in both companies Funds from BIPL would thereafter be fraudulently funnelled into BCEL. c. Certain officers in the Indore Branch of the IDBI Bank would turn a blind eye to the Corporate Debtor novating various purchase and sale contract for coal that it had with various suppliers and end users of coal to entities in the Bhatia Group such as BIIL. d. Certain officers in the Indore Bra....
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.... has a positive net worth (total assets - total liabilities) of approximately Rs. 17.36 Crores, a copy of which is annexed to the Application as Annexure H; e. BCC Cargo Limited whose 2016 Balance Sheet reveals that the company has a positive net worth (total assets - total liabilities) of approximately Rs. 5.14 Crores, a copy of which is annexed as Annexure I to the Application; f. BCC Enterprises (India) Limited reveals that the company has a negative net worth (total assets - total liabilities) of approximately Rs. 14.88 Crores, a copy of which is annexed as Annexure J to the Application; g. BCC Estates (P.) Limited whose 2016 Balance Sheet reveals that the company has a positive net worth (total assets - total liabilities) of approximately Rs. 30.54 Crores, a copy of which is annexed as Annexure K to the Application; h. Reliance Services and Consultants Ltd., reveals that the company has a negative net worth (total assets - total liabilities) of approximately Rs. 26 Lakhs, a copy of which is annexed as Annexure L to the Application; i. Ishaar Overseas Pvt. Ltd, whose 2016 Balance Sheet reveals that the company has a positive net wort....
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....plication and therefore the present Application under Section 60(5)(c) is not maintainable. It is further stated that Section 65 of the Code only provides for a penalty to impose by the Adjudicating Authority in case of fraudulent or malicious petitions. 12. This Adjudicating Authority by order dated 23rd May, 2017 appointed Interim Resolution Professional with a direction to him to commence Corporate Insolvency Resolution Process in respect of Asian Natural Resources (India) Limited, and consequentially granted moratorium under Section 13 of the Code prohibiting the purposes referred to in Section 14. 13. There is no dispute about the fact that Applicant is one of the Operational Creditors of Asian Natural Resources (India) Limited. Therefore the Applicant is entitled to file a claim before the Interim Resolution Professional in respect of Asian Natural Resources (India) Limited. 14. The first and foremost question that needs to be answered in this Application is whether this Application is maintainable under Section 60(5)(c) of the Code. 14.1 Section 60 of the Code deals with the jurisdictional aspect of the Adjudicating Authority, more so by sub-section (5) of Sectio....
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.... in case of preferential transactions. Section 45 deals with avoidance of undervalued transactions. Section 46 deals with relevant period for avoidable transactions. Section 47 deals with Application by creditor in cases of undervalued transactions. Section 48 deals with Order in cases of undervalued transactions. No doubt, Sections 43 to 48 are in Chapter III which deal with liquidation process but not resolution process. Therefore, it may be argued that invoking of the above said Sections comes into picture only in case of commencement of liquidation process but not during resolution process. But Section 43 refers to Resolution Professional also. The question of forming an opinion by the Resolution Professional will arise only during the stage of Resolution Process. Therefore, Section 43 can be invoked. Even during Resolution Process or liquidation proceedings, if there is any grievance that pertains to preferential transactions, the Resolution Professional is entitled to move the Adjudicating Authority under Section 44, and the Adjudicating Authority is empowered to pass orders. Section 45 says about declaration of undervalued transactions by a Liquidator or Resolution Professio....
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....view of the matter, a formal order of impleading the Applicant as a party to the insolvency proceedings is not necessary in the facts and circumstances of the case and as per the provisions of law. 15(1) Regarding the prayer (d), it cannot be granted for the simple reason that the Adjudicating Authority cannot give directions to the Financial Creditor(s) to commence insolvency proceeding against the associated companies or sister companies of the Corporate Debtor or against the guarantors of the Corporate Debtor. Moreover, it is stated by the Financial Creditor/IDBI that it has initiated insolvency proceedings against some of the guarantors which are in progress. 15(2) Coming to the relief (e), it is not within the jurisdiction of this Adjudicating Authority to pass any orders touching the other companies which are said to be the entities of Bhatia Group. 15(3) Coming to the relief (f), in view of the moratorium order passed by this Tribunal under Section 13 of the Code in respect of all the pending proceedings, the said relief cannot be granted during moratorium period. 15(4) Coming to the relief (g), the answering of this relief would arise only in case concerned Fina....