TaxTMI 
TaxTMI 
2020 (7) TMI 5
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....016 ("I&B Code" for short) can be made applicable under Voluntary Liquidation initiated pursuant to the Companies Act, 1956 and the procedure to be followed and in such case, whether the appeal under Section 42 of the 'I&B Code' is maintainable before the Adjudicating Authority (National Company Law Tribunal). 2. The Appellant- Mr. Harrish Khurana, Liquidator of 'M/s. TEIL Projects Limited' has preferred the instant Appeal seeking setting aside of impugned order dated 29th November, 2019 passed by the Adjudicating Authority (National Company Law Tribunal), New Delhi, Court-III in IB-1451(ND) 2019 with further direction to 'M/s. Engineers India Limited' (Respondent No. 1) to approach the Hon'ble High Court of Del....
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....ocess contemplated under Chapter V of Part II of the 'I&B Code'. It is indisputable that Section 59 of the 'I&B Code' incorporated in Chapter V of Part II of the 'I&B Code' providing for 'Voluntary Liquidation of Corporate Persons' stands duly notified vide S.O. 1005 (E) dated 30thMarch, 2017 and has been enforced w.e.f. 1st April, 2017. The provision is reproduced hereunder: "59. Voluntary liquidation of corporate persons.- (1) A corporate person who intends to liquidate itself voluntarily and has not committed any default may initiate voluntary liquidation proceedings under the provisions of this Chapter. (2) The voluntary liquidation of a corporate person under sub-section (1) shall meet such conditi....
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....f any, fixed by its articles or on the occurrence of any event in respect of which the articles provide that the company shall be dissolved, as the case may be and appointing an insolvency professional to act as the liquidator: Provided that the company owes any debt to any person, creditors representing two thirds in value of the debt of the company shall approve the resolution passed under sub-clause (c) within seven days of such resolution. (4) The company shall notify the Registrar of Companies and the Board about the resolution under sub-section (3) to liquidate the company within seven days of such resolution or the subsequent approval by the creditors, as the case may be. (5) Subject to approval of the creditors under sub-secti....
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.... provision further envisages a declaration from majority of the Directors of the Company regarding formation of an opinion that either the Company has no debt or that it would be able to liquidate its liability from sale proceeds of its assets with further requirements that the company is not being liquidated to defraud any person. The declaration has to be followed by Special Resolution within four weeks of such declaration passed in a general meeting with a further rider that in the event of company owing any debt to any person, creditors representing two thirds in value of the debt of the Company shall approve such resolution within seven days of passing of such resolution. It is significant to take note of sub-section (6) of Section 59,....
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....ird proviso to Section 434(1) (c) of the Companies Act, 2013 by providing that the proceedings relating to cases of voluntary winding up of a company where notice of the resolution by advertisement has been given, but the company has not been dissolved before the 1st April, 2017 shall continue to be dealt with in accordance with provisions of the Companies Act, 1956 and the Companies (Court) Rules, 1959. The order in question operates in a different field and seeks to remove difficulties regarding transfer of voluntary winding up proceedings of a company pending consideration. The issue raised in this appeal is confined to legality of the impugned order by virtue whereof letter of rejection of claim of the Respondent No. 1 has been set asid....
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....the Adjudicating Authority and such provision being made applicable to voluntary liquidation proceedings explicitly in terms of the provisions embodied in Section 59(6) of the 'I&B Code', issue raised with regard to maintainability of the appeal and jurisdiction of the Adjudicating Authority are without substance and arguments raised on this score are repelled. 10. On careful consideration of the issue raised in this appeal, we are of the considered opinion that the jurisdiction exercised by the Adjudicating Authority is vested in it and cannot be termed improper. Despite being of the view that the claim initially left out by the Respondent No. 1 was payable, the Liquidator proceeded to reject the same without any justifiable reaso....