TaxTMI 
TaxTMI 
2019 (5) TMI 819
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.... ORDER This appeal has been preferred by the Appellant against the order dated 8th June, 2018 passed by the Adjudicating Authority (National Company Law Tribunal), New Delhi, Court-III, whereby and whereunder, the application under Section 9 of the Insolvency and Bankruptcy Code, 2016 ("I&B Code" for short) preferred by 'M/s. M.N. Auxichem' ('1st Respondent' herein) for initiation of 'Corporate Insolvency Resolution Process' against 'M/s. BTM Industries Limited' ('Corporate Debtor') has been admitted. 2. The appeal has been filed after some delay which has been explained by the Appellant- Mr. Anmol Tekriwal, Shareholder of 'M/s. BTM Industries Limited' ('Corporate Debtor'). 3. On 20th September, 2018, we noticed the submissi....
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....ong with copy of the Demand Draft and Certificate dated 12th February, 2018 has been enclosed with the supplementary affidavit. 5. It has not been disputed that the Appellant came to know of the impugned order when the 'Operational Creditor' forwarded the impugned order. The certified copy has not been forwarded. The appeal was thereafter filed on 13th September, 2018 and thereby delay of about 6 days in preferring the appeal. Taking into consideration the stand taken by the parties and being satisfied with the grounds, we condone the delay of 6 days in preferring the appeal. 6. The Appellant has pleaded and brought to our notice that the notice under Section 8(1) was properly served on the 'Corporate Debtor' in the address shown in t....
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....iod of the date of knowledge as pleaded by the Appellant, and condone the delay. 10. There is nothing on the record to suggest that the Adjudicating Authority has issued notice to the 'Corporate Debtor' and it was served on them. 11. Learned counsel for the 'Resolution Professional' submits that the notice for admission was issued by the Adjudicating Authority on 28th November, 2017. However, none of the Respondents have enclosed the copy of the order dated 28th November, 2017 nor anything on the record to suggest that it was served on the 'Corporate Debtor'. 12. Similar issue fell for consideration before this Appellate Tribunal in 'M/s. Starlog Enterprises Limited vs. ICICI Bank Limited - 2017 SCC Online NCLAT 13', wherein this A....
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....to the other provisions of the Act of 2013 or the Insolvency and Bankruptcy Code of 2016 and any Rules made thereunder. The Code of 2016 read with the Rules 2016 is silent on the procedure to be adopted at the hearing of an application under section 7 presented before the NCLT, that is to say, it is silent whether a party respondent has a right of hearing before the adjudicating authority or not. Section 424 of the Companies Act, 2013 requires the NCLT and NCLAT to adhere to the principles of the natural justice above anything else. It also allows the NCLT and NCLAT the power to regulate their own procedure. Fetters of the Code of Civil Procedure, 1908 does not bind it. However, it is required to apply its principles. Principles of....
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....s within its wake the extension of a reasonable opportunity to the corporate debtor to substantiate by document or otherwise, that there does not exist a default as claimed against it. The proceedings before the NCLT are adversarial in nature. Both the sides are, therefore, entitled to a reasonable opportunity of hearing. The requirement of NCLT and NCLAT to adhere to the principles of natural justice and the fact that, the principles of natural justice are not ousted by the Code of 2016 can be found from Section 7(4) of the Code of 2016 and Rule 4 of the Insolvency and Bankruptcy (Application to Adjudicating Authority) Rules, 2016. Rule 4 deals with an application made by a financial creditor under Section 7 of the Code of 2016. S....
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....he principles of natural justice. The respondent was not heard by the NCLT before passing the order. It would be open to the parties to agitate their respective grievances with regard to any order of NCLT or NCLAT as the case may be in accordance with law. It is also open to the parties to point out that the NCLT and the NCLAT are bound to follow the principles of natural justice while disposing of proceedings before them. In such circumstances, the challenge to the vires to Section 7 of the Code of 201 6 fails." 6. Therefore, it is clear that before admitting an application under Section 9 of the MB Code it is mandatory duty of the 'adjudicating authority' to issue notice." 13. In the present case, as ....