TaxTMI 
TaxTMI 
2021 (7) TMI 238
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..../orders as Your Lordship may deem fit and proper in the interest of justice. 2. The matter was taken up on 07.11.2020, 13.11.2020, 08.12.2020, 18.01.2021, 24.02.2021 and 23.03.2021. 3. Heard both the sides and perused the documents, Affidavits, and orders made available by both the parties. Now, it has become essential to reproduce below the relevant portion of the order passed by this Bench on 23.03.2021 before passing the appropriate order in this IA. Part of the order of this Bench dated 23.03.2021 is reproduced below: 4. On 21.05.2018, the Respondent Punjab National Bank filed applications under Section 7 of IBC before this Bench against the following three Companies: (i) Shree Sai Prakash Alloys Pvt. Ltd. [CPIB No.24/GB/2019] (ii) Shree Sai Rolling Mills (India) Pvt. Ltd. [CPIB No.22/GB/2019] (iii) Shree Sai Smelters (India) Pvt. Ltd. [CPIB No.23/GB/2019] with a claim of Rs. 84,46,17,450.68 (Rupees Eighty Four Crores Forty Six lacs Seventeen thousand Four hundred Fifty and paise Sixty Eight) only against Shree Sai Prakash Alloys Pvt. Ltd. [CPIB No.24/GB/2019], Rs. 35,38,27,057.67 (Rupees Thirty Five Crores Thirty Eight lacs Tw....
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....esolution Professional' to ensure compliance of this order." 5. Part of the Final Order dated 18.06.2020 of Hon'ble NCLAT is reproduced below: "18. In the Impugned Order, the adjudicating authority has mentioned that the Corporate Debtor gained so much time on the pretext of settlement and also by filing Writ Petition before the Hon'ble High Court of Meghalaya at Shillong and it is high time to put an end to this matter. 19. It is undisputed that by the order of the Hon'ble High Court dated 19th August 2019, parties were directed to maintain status quo till 26th August 2019. However, the Adjudicating Authority, without taking the status quo order of the Hon'ble High Court passed the Order of Admission on 23rd August 2019. ... 27. On perusal of the record that it is also evident that there is no proper compliance under Section 7(5) (a) of the Insolvency and Bankruptcy Code, but this defect in the Application is a curable defect which can be rectified. It is also on record that the admission order was passed even after the status quo order of the Hon'ble High Court. 28. In the circumstances, as stated above this Tribunal allows th....
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....C reads as under "(4) The Adjudicating Authority shall, within fourteen days of the receipt of the application under sub-section (2), ascertain the existence of a default from the records of an information utility or on the basis of other evidence furnished by the financial creditor under sub-section (3)." 7. Section 12 (1) of IBC reads as under: "12. (1) Subject to sub-section (2), the corporate insolvency resolution process shall be completed within a period of one hundred and eighty days from the date of admission of the application to initiate such process. (2) The resolution professional shall file an application to the Adjudicating Authority to extend the period of the corporate insolvency resolution process beyond one hundred and eighty days, if instructed to do so by a resolution passed at a meeting of the committee of creditors by a vote of seventy-five per cent of the voting shares." 8. Hon'ble Supreme Court has held in the matter of COC of Essar Steel India Ltd. Vs Satish Kumar Gupta [Civil Appeal No.8766 - 67/2019] that the CIRP must "ordinarily" be completed within the time limit of 330 days from the Insolvency Commencement Date unle....
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....7.08.2019 sent intimation letter to the Respondent no.1 and 2 conveying about the order of the initiation of the CIRP process. The Applicant had also sought the details from the management of the Corporate Debtor regularly and government agencies so that intimation can also be sent to them. 8. That the suspended Director of the Corporate Debtor had filed an Appeal before the Hon'ble NCLAT challenging the order dated 23.08.2019. The Hon'ble NCLAT had issued notice in an Appeal and also directed the Applicant not to constitute the Committee of Creditors. The Applicant in the meantime had received the claims from 1 financial creditor and 3 Operational Creditors and 1 claim from workmen in Form E. 9. That even after the stay by the Hon'ble NCLAT, the Applicant had continued performing the duties but in compliance of the orders, had not constituted the committee of creditors. The Applicant on 11.10.2019 emailed to the erstwhile management of the Corporate Debtor requesting them to provide the relevant documents and details as required to understand the business affairs of the Corporate Debtor. 13. That since the matter was pending before the Hon'ble NCLAT the ....
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....f directions given. The relevant excerpts of the order passed by the Hon'ble NCLAT are reproduced below for the reference of this Hon'ble Tribunal. 28. In the circumstances as stated above this Tribunal allows the instant Appeal setting aside the impugned order and matter is remanded back to the Adjudicating Authority to pass an order afresh, after providing an opportunity to the opposite party in the light of the directions in the body of the judgment. However, if is also clear that the Adjudicating Authority should provide one more opportunity for the parties to consider the renewal of OTS and in the event of renewal of OTS, the said opportunity may be utilised by the e parties in right earnest, of course in true letter and spirit. The parties are directed to appear before the Adjudicating Authority (NCLT, Guwahati Bench) on dated 29th June 2020. No order as to costs." 23. That the Applicant is only concerned about the operative part which annul the order dated 23.08.2019 passed by this Hon'ble Tribunal vide which the CIRP was commenced and the Applicant was appointed as Interim Resolution Professional. As per the best understanding of the Applicant and normal r....
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.... the passing of any appropriate order. 28. That the Applicant in the Application under prayer clause (ii) had sought the relief for the dismissal of the Corporate Insolvency Resolution Process and not for the dismissal of the Company Petition (IB) filed by the Financial creditor under section 7 of the Code, 2016. The prayer sought was solely on the basis of the order passed by the Hon'ble NCLAT and have no other motive to seek such prayer. The Applicant had bona fide controlled the affairs of the Corporate debtors. Since the Applicant is an officer appointed by the Court is also bound to follow orders passed by the Appellate Tribunal. Therefore, the Applicant while performing the duties as per the Code, 2016 had stopped controlling the business affairs of the corporate Debtor and had filed the present Application for the reimbursement of the CIRP cost which includes the fees of the Applicant for controlling the affairs of all three group companies. 9. In compliance of the order of this Tribunal, the FC has filed Affidavit-inreply on 10.03.2021 enclosing the copy of the order of the Hon'ble Supreme Court. Part of the Affidavit-in-reply is reproduced below: ....
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....0.03.2021 is reproduced below: "Upon hearing the counsel the court made the following O R D E R List on 26.03.2021." 11. It is observed during the course of proceedings that the IRP had handed over the Management of the Company to the erstwhile Management on receipt of the order of the Hon'ble NCLAT dated 18.06.2020 from the Respondent No.2 and he has stopped controlling the affairs of the all three Corporate Debtors from 20.06.2020. He has also submitted that he has not entered into any agreement with the Applicant/FC with regard to his fees as IRP. 12. He has also submitted that since the order of admission of the Application was set aside, he deemed it fit to release the Corporate Debtors and to handover the control of the Corporate Debtors to the main management. He has also submitted during the proceedings that he was not aware of any appeal filed by the FC before the Hon'ble Supreme Court and moreover, the Hon'ble Supreme Court has not stayed the order dated 18.06.2020 of the Hon'ble NCLAT. 13. The Learned Counsel of the FC has further submitted that the IRP should continue to work as IRP till the final disposal of its appeal filed before t....
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....by the Court on sufficient cause". 330 days is for CIRP. More than 1000 days have already passed even before the commencement of the actual CIRP in the process of OTS, acceptance/nonacceptance of OTS, Negotiations/further Negotiations. Commitments and failure of commitments, filing of IAs after IAs, Cases/Appeals before the Hon'ble NCLAT, Hon'ble High Court and Hon'ble Supreme Court. 17. Objectives of the IBC are very clear i.e. Insolvency Resolution of Corporate Persons /Stressed Assets in a time bound manner for maximisation of value of Assets of such persons, promotion of entrepreneurship, availability of credit and balance of interest of all stake holders. Delay in resolution of these stressed Assets costs heavily to all stake holders especially CD itself, employees of the CD, Creditors and others. No FC/OC may come forward to extend credit once an application under Section 7 of the IBC is filed. On the other hand, the funds of the existing FC is blocked and cannot be further deployed. On the other hand, CDs cannot keep the IBC matters postponed in the name of OTS offer, implementation of offers and filing of IAs etc. 18. It is also a fact that there ....