TaxTMI 
TaxTMI 
2021 (11) TMI 615
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....ia. Mr. Y.M. Nakhawa, APP for State. JUDGMENT : SANDEEP K. SHINDE, J. 1. Rule. Rule, made returnable forthwith. By consent of the parties, taken up for hearing forthwith. 2. Writ Petition No. 3157 of 2021 under Article 227 of the Constitution of India read with Section 482 of the Criminal Procedure Code, seeks to challenge order dated 20th August, 2021, by which the learned Special Judge, CBI, Greater Bombay in exercise of jurisdiction under Section 32A of the Insolvency and Bankruptcy Code, 2016 ("IBC" for short), declined to discharge Dewan Housing Finance Corporation Limited-Corporate Debtor, from the CBI Special Case No. 830 of 2021 and permitted prosecution of the, Corporate Debtor through its erstwhile Directors (accused nos. 2 and 3) in CBI Special Case No. 830 of 2021. 3. Petitioner, in Writ Petition No. 3221 of 2021, is the successful resolution applicant, whose Resolution Plan dated 22nd December, 2020 has been approved by the Committee of Creditors of Dewan Housing Finance Corporation Limited (DHFL)-(Corporate Debtor) with an overwhelming majority of 93.65% voting and thereafter by the National Company Law Appellate Tribunal (NCLAT), Mumbai, vide its or....
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.... Piramal Capital and Housing Finance Limited ([Petitioner in Cri. Writ Petition No.3221 of 2021) was approved by majority of 93.65% of votes in the Committee of Creditors (CoC). (ix) Pursuant, to approval of Resolution Plan by CoC and no-objection being granted to the same by RBI, on February 24, 2021 the Administrator filed an application under Section 31 of IBC, before the NCLAT (Adjudicating Authority), seeking approval to Resolution Plan of Piramal Capital. (x) On 7th June 2021, NCLAT approved Piramal Capitals' Resolution Plan for DHFL with effect from 7th June, 2021 and appointed Interim Monitoring Committee. (xi) On 6th July 2021, Piramal Capital obtained all requisite regulatory and statutory approvals in relation to the scheme of arrangement between Piramal Capital and Corporate Debtor i.e. Reverse Merger of the Piramal Capital and Housing Finance Limited, into and with DHFL, the Corporate Debtor. (xii) The Resolution Plan order dated 7th June, 2021 was challenged by one, 63, Moons Technologies Limited, before the NCLAT by filing Company Appeals. (xiii). On 6th July, 2021 and 23rd July, 2021, NCLAT, rejected 63 Moon's prayer ....
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....d BSE and NSE of the change in management of DHFL, by way of appointment of six additional Directors, namely Mr. Ajay Gopikisan Piramal, Ms. Swati Ajay Piramal, Mr. Anand Ajay Piramal, Mr. Gautam Bhailal Doshi, Mr. Khushroo B. Jijina and Mr. Sohail Amin Nathani. 8. Heard Mr. Ravi Kadam, learned Senior Counsel for the petitioner in Writ Petition No. 3157/2021, Mr. Aabad Ponda, learned Senior Advocate with Writ Petition No. 3221/2021 and Mr. Pranav Badheka for Intervenor and Mr. Venegaonkar, Learned Prosecutor for the CBI. Issue : 9. Broad question raised in these petitions is : "Whether Section 32(1)(a) of IBC lays down a direction that, Corporate Debtor, would be absolved of all criminal offences committed prior to commencement of CRIP, from the date of approval of Resolution Plan, although, appeals against Section 31 order of the IBC were pending before the NCLAT ?" Submissions : 10. Mr. Ravi Kadam, Learned Senior Counsel submitted that, Corporate Debtor would not be liable for any offence committed prior to commencement of CRIP and prosecution would not continue against once Resolution Plan is approved by the Adjudicating Authority. Mr. Kadam, learned Seni....
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....ection 32A of IBC was, challenged in Manish Kumar (supra), wherein the Apex Court held; : "(i) That no case whatsoever is made out to seek invalidation of Section 32A. (ii) Having regard to the object of the Code, the experience of the working of the code, the interests of all stakeholders including most importantly the imperative need to attract resolution applicants who would not shy away from offering reasonable and fair value as part of the resolution plan if the legislature thought that immunity be granted to the corporate debtor as also its property, it hardly furnishes a ground for this Court to interfere. (iii) The extinguishment of the criminal liability of the corporate debtor is apparently important to the new management to make a clean break with the past and start on a clean slate. (iv) That the impugned provision is part of an economic measure. (v) Having regard to the object of the statute we hardly see any manifest arbitrariness in the provision. (vi) That the immunity is premised on various conditions being fulfilled. There must be a resolution plan. It must be approved. There must be a change in the control of ....
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....bmitted that, outcome of the appeal would be crucial consideration in discharge of DHFL from all criminal liabilities and in the event, the appeal is adjudged in favour of intervenor, it would become burdensome for prosecution agencies to once again initiate proceedings against DHFL, which may not be possible once DHFL is discharged from all criminal liabilities. Besides, Mr. Badheka, argued that, in any event, the management or control of DHFL has not yet changed and vested in resolution applicant, which is essential condition, before Corporate Debtor seeks discharge. Mr. Badheka has taken me through the Affidavit of Mr. Kapil Wadhwan (Intervenor) sworn on 22nd September, 2021 in support of this contention. Mr. Badheka, submitted that if DHFL is discharged at this stage and if Appeal is adjudged in favour of the Intervenor, again a cognizance cannot be taken against a Corporate Debtor since cognizance of an offence, can only be taken once. In support of the submission, he has relied on the judgment of the Apex Court in the case of Balveer Singh V/s. State of Rajasthan (2016) 6 SCC 680. His next contention is, once an Appeal is filed before the NCLAT, the order Section 31 cannot be....
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....ted that let the subsequent events, be first assessed by the trial Court and therefore Mr. Badheka, urged that parties be relegated to the trial Court for reconsideration. 18. It may be stated that, the subsequent events were placed on record vide purshis dated 12th October, 2021 and thereafter intervenor had filed a reply Affidavit, dated 20th October, 2021 and dealt with subsequent events extensively. As such, I do not think it appropriate to keep the subsequent events out of consideration and relegate the parties to the trial Court for reconsideration. 19. Herein, subsequent events indisputably caused change in management and control of Corporate Debtor. The immunities sought by the Corporate Debtor though conditional; yet all these conditions have been fulfilled and satisfied; viz (i) Resolution Plan in regard to Corporate Debtor has been approved by the Adjudicating Authority under Section 31 IBC. (ii) Resolution Plan approved caused and resulted inchange in management of Corporate Debtor. (iii) change in management is in favour of persons who were not related to party of Corporate Debtor. Thus, in my view, immunities under 32A of IBC, canno....
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...., in the following terms : "Suffice it to say that having gone through the rival contentions of the Learned Counsel for both sides, we do not find that these are Appeals wherein interim order should be passed for grounds being raised by the Appellant. The objections raised to the Resolution Plan which has been challenged in Company Appeal (AT) (Insolvency) No. 455 of 2021 are also based on similar footing. The rival claims, which are more questions of law would require deliberation and decision at appropriate stage. If the averments made by the Appellant are juxtaposed with averments made by Respondents, we do not find it a fit case to pass interim orders as sought. We do not think that any interim order as sought with regard to Resolution plan approved needs to be passed." 23. Be that as it may, although Section 32 provides for appeal against an order approving the Resolution Plan, yet, mere filing of appeal would by itself not operate as a stay, until a specific prayer in this regard is made and orders thereon are passed, as held in the case of Madan Kumar Singh V/s. District Magistrate, (2009) 9 SCC 79. Infact, herein appeals were filed with a specific prayer to gran....