TaxTMI 
TaxTMI 
2019 (1) TMI 1744
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....een admitted by the impugned order dated 14th November, 2018, has been challenged by Mr. Dingo Ku, shareholder of 'M/s. CINDA Engineering & construction Private Limited' ('Corporate Debtor'). 2. Learned Senior Counsel appearing on behalf of the appellant submitted that the impugned order has been passed by the Adjudicating Authority (National Company Law Tribunal), New Delhi (Court No. IV) on the application under Section 9 filed by the 'Operational Creditor' without any notice to the 'Corporate Debtor'. It is further submitted that the notice has been issued and served on the 'Corporate Debtor', it could have been brought to the notice of the Adjudicating Authority that there is a pre-existing dispute. Learned counsel appearing on behalf of the 1st Respondent ('Operational Creditor') submitted that the petition under Section 9 was listed before the Adjudicating Authority on 6th July, 2018 where 1st Respondent has stated that the parties are exploring the possibility of settlement and the meeting has been scheduled on 9th July, 2018. The matter was adjourned to 25th July, 2018. 3. On 25th July, 2018, the 1st Respondent informed the Adjudicating Authority that the settlement talks....
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.... connection we may state that the vires of Section 7 of I&B Code was considered by Hon'ble Calcutta High Court in " Sree Metaliks Limited & Ann" in writ petition 7144 (W) of 2017, wherein Hon'ble High Court by its judgment dated 7th April, 2017 held as follows:- "......However, it is to apply the principles of natural justice in the proceedings before it. It can regulate it own procedure, however, subject 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 natural justice require an authority ....
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....f the corporate debtor. Rule 10 of the Rules of 2016 states that, till such time the Rules of procedure for conduct of proceedings under the Code of 2016 are notified, an application made under Sub-section (1) of Section 7 of the Code of 2017 is required to be filed before the adjudicating authority in accordance with Rules 20, 21, 22, 23, 24 and 26 or Part-HI of the National Company Law Tribunal Rules, 2016. Adherence to the principles of natural justice by NCLT or NCLAT would not mean that in every situation, NCLT or NCLAT is required to afford a reasonable opportunity of hearing to the respondent before passing its order. In a given case, a situation may arise which may require NCLT to pass an ex-parte ad interim order against a respondent. Therefore, in such situation NCLT, it may proceed to pass an ex-parte ad interim order, however, after recording the reasons for grant of such an order and why it has chosen not to adhere to the principles of natural justice at that stage. It must, thereafter proceed to afford the party respondent an opportunity of hearing before confirming such ex-parte ad interim order. In the facts of the present case, the learned senior advocate for....
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.... we find that the Appellant is unable to demonstrate that before Section 8 Notice was issued any dispute existed, we find no propriety in sending back this matter to the NCLT." 9. In the present case the appellant has brought to our notice different communications made between the parties, which were suppressed by the 1st Respondent, which are as under:- - By letter dated 26th January, 2018, the appellant ('Corporate Debtor') claimed Rs. 51,80,211/- on the respondent towards the delay in delivery of the project and the loss sustained by the 'Corporate Debtor' in rectifying the workmanship of the defects in the works also made. - The letter aforesaid has been sent through e-mail dated 26th January, 2018 and enclosed as 'Annexure-A5 (Colly), relevant portion of which is as follows: By e-mail dated 20th February, 2018 the 'Corporate Debtor' sent a letter to the 1st Respondent offering to waive off its claim for liquidated damages and reducing its claim but it was refused by the 1st Respondent by an e-mail dated 21st February, 2018. The aforesaid two e-mails were also suppressed by the 1st Respondent. 10. From the e-mail dated 26th January, 2018 as extracted above, we find that....