TaxTMI 
TaxTMI 
2018 (8) TMI 1866
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....s petition on behalf of the corporate debtor. 3. This petition is presented under section 10 of the IB Code with a request to trigger corporate insolvency resolution process in respect of Supraja Textiles P. Ltd., hereinafter called as "the corporate debtor". 4. The corporate debtor is having financial creditors, operational creditors besides statutory dues. 5. The corporate debtor has committed default in payment of Rs. 16,13,67,283. According to the corporate applicant, the date of default is December 28, 2016. 6. The corporate applicant filed the following documents to prove the existence of default and the amount in default : (a) Copy of Form 8 dated April 17, 2006 for creation of charge for Rs. 12.36 crores as filed with the Registrar of Companies, Andhra Pradesh. (b) Copy of Form 8 dated January 3, 2007 for creation of charge for Rs. 15.44 crores as filed with the Registrar of Companies, Andhra Pradesh. (c) Copy of the certificate of registration of charge for creation of charge dated January 3, 2007 for Rs. 15.44 crores issued by the Registrar of Companies, Andhra Pradesh. (d) Copy of Form 8 dated March 23, 2008 for creation of....
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....sion notice dated August 9, 2017 issue by the State Bank of India under rule 8(1) of the Security Interest (Enforcement) Rules, 2002. (s) Copy of sale notice dated August 19, 2017 issued by the State Bank of India under rule 8(6) of the Security Interest (Enforcement) Rules, 2002. (t) Copy of letter No. SAMBII/HYD/LRS/1197, dated October 31, 2017 of State Bank of India, SAM Branch, Hyderabad approving one-time settlement of Rs. 12,09,87,013 to the corporate debtor. (u) Copy of letter No. SAMB/HYD-II/LRS/18, dated April 2, 2018 of the State Bank of India, SAM Branch, Hyderabad intimating cancellation of one-time settlement to the corporate debtor. (v) Copy of letter dated April 16, 2018 issued by the State Bank of India, SAM Branch, Hyderabad intimating publication of e-auction sales notice dated April 13, 2018 and April 14, 2018 on fixing the date for sale of secured assets through e-auction on May 23, 2018. (w) Copies of e-auction notice published in New Indian Express, Vijayawada edition on April 14, 2018. (x) Copies of e-auction notice published in New Indian Express, Hyderabad edition on April 14, 2018. 7. The corporate d....
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....per the terms of OTS. Financial creditor cancelled the OTS sanctioned to the corporate debtor and the corporate debtor was liable to pay the total outstanding amount. 20. After the expiry of 30 days, from the date of notice issued prior to sale, SBI got issued an intimation of sale of properties through e-auction on April 14, 2018 to the corporate debtor. 21. It is stated by the SBI that the corporate debtor having full knowledge of all these proceedings, invoked the provisions of IB Code, only to stall the proceedings under SARFAESI Act. 22. It is stated by SBI that this petition is filed with a mala filed intention but not to have a resolution plan or for revival of the company. 23. Mr. Guntupalli Srinivasa Rao, who is holding 48 per cent. of the voting rights in the corporate debtor, filed reply, raising the following objections : (i) The management ought to have taken prior written consent of all the parties to the memorandum of understanding dated December 23, 2013 before filing this petition. (ii) On account of the financial irregularities and misappropriations, committed by the present management, Guntupalli Srinivasa Rao and others moved a peti....
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.... (AT) (Insolvency) No. 100 of 2017, contended that, this Adjudicating Authority has to see only the existence of debt occurrence of default and that the corporate applicant is not suffering for any disqualification under section 7 of the Code. 30. Learned counsel appearing for the petitioner contended that this Adjudicating Authority cannot go beyond the scope of the above said three aspects and see whether the application is complete or not. 31. A perusal of the petition, filed by the corporate debtor, discloses that it is complete in all respects except filing special resolution passed by the share- holders of the corporate debtor, as required by section 10(3)(c) of the Code, that came into force with effect from June 6, 2018, by virtue of the Insolvency and Bankruptcy Code (Amendment) Ordinance, 2018. 32. The material on record further discloses the existence of debt and occurrence of default. The corporate applicant also proposed the name of the insolvency professional to act as IRP and filed his written communication in Form 2. 33. The contention raised by the SBI is that this petition is a mala fide petition to prevent the proceedings under the SARFAESI Act. 34....
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....pplicant seeking stay and discretion is given to the court whether to grant stay of the execution of the award or not laying down certain conditions. The question that fell for consideration of the hon'ble Supreme Court and the hon'ble High Court of Bombay in the decisions stated supra is whether amended section 36 of the Arbitration Act is applicable to the applications filed under section 34 of the Arbitration Act prior to October 23, 2015. 43. It is held that the amended section 36 is not retrospective in operation but the hon'ble Supreme Court held that the amended section 36 is applicable even for arbitration proceedings that were initiated prior to October 23, 2015. 44. A distinction was made between the arbitration proceedings that were initiated prior to October 23, 2015 and the applications before court under section 34 that were filed prior to October 23, 2015. 45. It is held by the hon'ble Supreme Court that if an application is filed under section 34 prior to October 23, 2015 the amended section 36 is not applicable. If an application is filed under section 34 on or after October 23, 2015 amended section 36 is applicable even though arbitral pro....
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....ation under section 34 is filed even as per amended section 36(2) of the Arbitration Act. 55. In the case on hand, the petition is filed on May 9, 2018 much prior to coming into force of amended section 10(3)(c), which came into force on June 6, 2018. 56. Therefore, it is not just and proper to direct the corporate applicant to take the approval of the shareholders by applying the amended section 10(3)(c) of the Code. 57. Learned counsel appearing for the shareholders-cumsecured creditors relying upon the decision of the hon'ble Supreme Court in [2008] 304 ITR 308 (SC) ; [2008] 9 SCC 622 (CIT v. Gold Coin Health Food P. Ltd.), contended that when the amendment is clarificatory in nature, it must be given retrospective effect. 58. The said decision relates to section 271(1)(c)(iii) Explanation 4(a) of the Income-tax Act, as amended by the Finance Act, 2002 with effect from April 1, 2003. 59. In that case, the hon'ble Supreme Court held that the amendment is clarificatory in nature. 60. The hon'ble Supreme Court held that Explanation 4 of section 27(1)(c) of the Income-tax Act is clarificatory and not substantial and therefore it is given retrospective e....
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....t and scope of an amended Act and its retrospective operations are as follows (page 633 of [1994] 4 SCC) : "(i) A statute which affects substantive rights is presumed to be prospective in operation unless made retrospective, either expressly or by necessary intendment, whereas a statute which merely affects procedure, unless such a construction is textually impossible, is presumed to be retrospective in its application, should not be given an extended meaning and should be strictly confined to its clearly- defined limits. (ii) Law relating to forum and limitation is procedural in nature, whereas law relating to right of action and right of appeal even though remedial is substantive in nature. (iii) Every litigant has a vested right in substantive law but no such right exists in procedural law. (iv) A procedural statute should not generally speaking be applied retrospective where the result would be to create new disabilities or obligations or to impose new duties in respect of transactions already accomplished. (v) A statute which not only changes the procedure but also creates new rights and liabilities shall be constructed to be prospe....