2020 (8) TMI 499

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....Ramachandran, Sr. Advocate, Mr. Sumesh Dhawan, Mr. Vaijayant Paliwal and Ms.Charu Bansal, Advocates for Appellant Mr. Ramji Srinivasan, Sr. Advocate with Mr. Ramakant Rai, Ms. Mehak Suri, Advocate forR1 and R2. Mr Raunak Dhillon with Ms Ananya Dhar Choudhury & Mr Parikalp Gupta, Advocates for R3 and R4. JUDGMENT DR. ASHOK KUMAR MISHRA, TECHNICAL MEMBER 1. The present Appeal is filed by Resolution Professional of the Corporate Debtors - Dishnet Wireless Limited & Aircel Limited under Section 61 of the Insolvency and Bankruptcy Code, 2016 against the impugned order dated 01.05.2019 in MA 230/2019 in C.P No.302/IBC/NCLT/MB/MAH/2018 & MA No.219 in CP No.298/IBC/NCLT/MB/MAH/2018 passed by National Company Law Tribunal ('for short Adjudi....

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....ent set off has granted the Respondents a preferential payment over other Operational Creditors and it is also against the objective of I&B Code and Article 14 of the Constitution. 6. While the Respondent has submitted that they have released Rs. 341.80 Crores to Aircel entities and has applied the balance amount of Rs. 112 Crore approx. for set off against the dues owed by Aircel entities to Airtel entities only to the extent of undisputed principal amounts payable by Aircel entities to Airtel entities. After adjusting the amount they notified the same to the Resolution Professional vide their letter dated 10.01.2019 & 11.01.2019. The Resolution Professional has sent a letter on 12.01.2019 to Airtel entities denying their right to set off....

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....rinciples and protection accorded under any insolvency law. It will be anti-ethical to the objective of the IBC on the Resolution framework. The objectives of the which is to preserve & maximise the value of the Corporate Debtor. Further submitted that this is also in violation of Moratorium imposed under IBC. The present set off is being claimed is in respect of two separate and unrelated transactions. They have also submitted that it is prejudicial to the interest of secured creditor (which includes State Bank of India) who have a first charge over the spectrum assets and beneficial interest in the proceeds from any sale of the Spectrum Assets. 9. The Appellant and the Respondents have submitted multiple case laws to supplement their cas....

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....ies, we find that the Adjudicating Authority rightly held that Section 14 of the 'I&B Code' will override any other provisions contrary to the same. Any amount due to the 'Operational Creditor' prior to the date of 'Corporate Insolvency Resolution Process' (Admission) cannot be appropriated during the moratorium period." 12. The provisions of the I&B Code, 2016, particularly, Section 238 of the IBC, 2016 reads as follows: "Section 238 Provisions of this Code to override other laws - The provisions of this Code shall have effect, notwithstanding anything inconsistent therewith contained in any other law for the time being in force or any instrument having effect by virtue of any such law". 13. Section 14 - Moratorium - (4) The order of....