TaxTMI 
TaxTMI 
2022 (3) TMI 997
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.... Mr. Shaurya Shyam, Mr. Sujal Gupta, Advocates for R1. Mr. Rajiv Gupta, Advocate for R3 and 4 ORDER (Through Virtual Mode) Heard Learned Counsel for the Appellant and Learned Counsel for the Resolution Professional. 2. This Appeal has been filed against the judgment and order of the Adjudicating Authority (National Company Law Tribunal), New Delhi (Court No.IV) dated 24.03.2021 in I.A No. 2277 of 2020 in CP(IB) No. 241/(ND)2019. An Application was filed by the Resolution Professional praying for following reliefs:- "a. Declare the transaction of Plant and Machinery of the Corporate Debtor to Respondent No.3 as fraudulent; b. Issue necessary directions for cancellation of the transaction of sale of Plant and Mac....
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....and bill no. 408 dated 08.05.2019 for an amount of Rs. 14,40,600/- (Inclusive of GST). The Final Audit Report states that during the period under audit there have been no transaction as laid down in Section 49 and with respect to Section 66 of the code, the observations made only rely on the fact that the Corporate Debtor has trans-ferred its fixed assets just before the initiation of CIRP by the way of books entries. However, on scrutinizing the details of all the documents placed on record, we are of the view that the Directors of the Corporate Debtor were well aware of the fact that an application has been filed on 25.01.2019 and the same is pending for initiation CIR process against the Corporate Debtor, therefore the Directors of the C....
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....his Appeal. 5. Shri Sangram Patnaik, Learned Counsel for the Appellant challenging the order contends that Appellant was a bonafide purchaser for value and transaction ought not to have been declared undervalued transaction or cancelled. It is submitted that the bid was invited by the Corporate Debtor and three bids were received and the Appellant being highest bidder its bid was accepted. It also paid an amount of Rs. 7,55,200/- and Rs. 14,40,600/- which transaction cannot be said to be neither undervalued nor could have been cancelled. It is submitted that under Section 46(2) of the IB Code, 2016, the Adjudicating Authority was required to appoint an independent expert to assess evidence relating to the value of the transactions mentio....
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....ounsel for the Appellant that transaction was not undervalued, suffice it to notice that book value of the machinery is Rs. 1.56 Crore as has been noted by the Adjudicating Authority, the sale of the plant and machinery for only Rs. 21 lacs is clearly an undervalued transaction and the submissions of the Appellant that transaction was not undervalued is wholly incorrect and cannot be accepted. The submission made by the Learned Counsel for the Appellant is on the basis of Section 46 of the Code, which reads as follows:- "46. Relevant period for avoidable transactions. - (1) In an application for avoiding a transaction at undervalue, the liquidator or the resolution professional, as the case may be, shall demonstrate that -....
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....the corporate debtor has entered into an undervalued transaction as referred to in sub-section (2) of section 45 and the Adjudicating Authority is satisfied that such transaction was deliberately entered into by such corporate debtor - (a) for keeping assets of the corporate debtor beyond the reach of any person who is entitled to make a claim against the corporate debtor; or (b) in order to adversely affect the interests of such a person in relation to the claim, the Adjudicating Authority shall make an order- (i) restoring the position as it existed before such transaction as if the transaction had not been entered into; and (ii) protecting the interests of persons who are victims of such transactions:"....