AI Drafter 
TaxTMI 
TaxTMI 
2021 (12) TMI 1375
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....uspended managing director, on 01st July 2018 as loan to be repaid to the Corporate Debtor with interest and cost thereof. iii. To direct the suspended directors and Sabkaa Payments Limited to settle the interest and cost of the balance outstanding with respect to the SMS Server Maintenance charges of Rs. 90,00,000/-, which is still pending to be received from this subsidiary company, subject to the Application filed with NCLT, Kochi Bench regarding the recoverability of Outstanding Debtors of the Corporate Debtor. (IA(IBC)/24/KOB/2021 in IA/01/2021 in MA/05/KOB/2020 in TIBA/1/KOB/2019). iv. To restore the position as it existed before such transaction as if the transaction had not been entered into and protecting the interests of persons who are victims of such transactions. 2. The applicant/liquidator stated there were three transactions, namely; Preferential transactions, undervalued transactions and fraudulent trading done by the Respondents. Preferential Transactions 3. While analysing the audited financial statements and various bank statements, it is seen that preferential transactions for an amount of Rs. 1,38,78,397 was made during the rele....
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....urther stated that Rs. 1,09,550 had been spent by the corporate debtor as the preliminary legal expenses for the incorporation of its subsidiary "Sabkaa Payments Limited" during the financial year 2016-2017. It was shown as a long term borrowing as unsecured loans from Corporate Debtor in the balance sheet of Sabkaa Payments Limited. During the Financial year 2017-2018, an amount of Rs. 13,34,818/- has been invested in the share capital of Sabkaa Payments Limited for 65.99% holding in the Company. This was disclosed in the balance sheet of Sabkaa payments Limited which is confirmed by Mr. Reji Sivankutty through e-mail dated 05.09.2020. The material disclosure is suspected to be intentional to defraud creditors as there was a considerable increase in the trade payables and other current liabilities and the SMS server Maintenance charges of Rs. 90,00,000/- from Sabkaa Payments Limited is yet to be collected. 7. The books of account and other documents were tampered by Mr. Ashutosh and Mr. Sujith. A formal complaint and FIR was lodged against them. 8. Further the applicant stated that there was a huge loss of Rs. 3,93,92,027.11/- reported during the FY 2017-18, in relation to t....
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....Corporate Debtor, permit for taking such advances from customers and using it for the operations of the Corporate Debtor is not explicitly found mentioned. Due to non-availability of books of accounts and other supporting evidences which was sought but was not submitted by the suspended directors the Liquidator further observed that, there were no KYC updated for such transaction conducted by the Corporate Debtor. No proper records as to the wallet transactions is maintained by the Corporate Debtor contributing to less accountability and transparency in accounting system followed by the Corporate Debtor. 12. It is further stated that the GST payment was presented as expenses in the profit and loss account. However, the previous auditor, through his verbal communication, explained that, the "other income" in the financial statements includes GST collected from the costumers. Based on the analysis of the Forensic cum Transaction Auditor of GST returns shared by the Previous Auditor of the Corporate Debtor, it was observed that there was almost the same amount of GST collected is reflected in the "other income". 13. The Forensic cum Transaction Auditor could not trace a loan rep....
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....ication was filed against the corporate debtor company (Achariya Techno Solutions India Pvt. Ltd) which is within the jurisdiction of this Tribunal was admitted but the Sabkaa Payments Ltd. which is a corporate entity incorporated under Companies Act 2013 in New Delhi was not made as a party in that case. Without a company being arrayed as a party no orders can be passed against the said company. The liquidator only impleaded the company directors in their personal capacity and not in their official capacity. 17. In the year 2016 Sabkaa Payments Lid was incorporated as a subsidiary company of the Corporate debtor Achariya Techno Solutions Pvt. Ltd. where Achariya holds 65.99% of shares, during the year 2016 the Corporate debtor Achariya Techno Solutions India Pvt. Ltd. was conducting business in a successful manner. The main objective of starting the subsidiary company in New Delhi is to expand the business of the corporate debtor company. During that period when Corporate Debtor went to insolvency, the operations of the subsidiary company practically stopped. From April 2020 onwards no business transactions were carried out by Sabkaa Payments Ltd. 18. Another employee of the....
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....to provide the service rather than processing refunds. 20. The Debtor Company was having a yearly transactions of 200 to 500 crore approximately but the profit margin was less than 15 lakhs per year due to bare minimum profit margins. The bulk sms, voice calls, online mobile recharge, flight booking etc. were having very less profit margins i.e. for a mobile recharge Rs. 100 company will be getting a percentage between 0.10 to 0.25% depends on the mobile operator and wherein for SMS, Voice Call service the corporate debtor company used to earn 1 to 2% of profit. In order to get more profits, the company had to take bulk recharge stock from the operators which resulting in high purchase rate but very less profit. The business transactions done by the company come around more than 500 crore approximate per year. It will be practically difficult to keep the books of accounts in physical format due to voluminous transactions, so the books of accounts were kept in electronic mode and was kept in company master server at the Trivandrum, Vazhthacaud office the same was accessible to the managing director, directors and accountants, the books of account were periodically given to the Ch....
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....ocess. The hard disk was inaccessible during that time due to the fraudulent activities and data theft done by Mr. Sujith an employee of the Corporate Debtor Company. 25. The corporate debtor company was having business transactions with its subsidiary company Sabkaa Payments Limited. Hence whatever money transferred from Achariya towards Sabkaa was shown under the head Trade Receivables. During the Financial Year 2017-18 while finalising the accounts Sabkaa Payments Ltd. have transferred Rs. 13,31,848/- from their advance account to Share Capital account which was done after finalisation of Achariya accounts. The Auditor had signed the accounts of Achariya on 01-08-2018, whereas Sabkaa Accounts were prepared thereafter (06-09-2018). Since advance amount was not transferred to issue capital at the time of Finalisation of Achariya's account (signed on 01-08-2018) the same was treated as trade receivables and not being disclosed as related parties in the corporate debtor Financial Statement. 26. The liquidator had not mentioned which transactions were undervalued so without knowing specific transactions the liquidator is trying to get a blanket order on all transactions whi....
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....rocess initiated in this matter. This Tribunal vide order dated 13.09.2019 in TIBA/1/KOB/2019 filed by the Operational Creditor M/s. V-Con Integrated Solutions Pvt. Ltd. against the Corporate Debtor M/s. Achariya Techno Solutions (India) Pvt. Ltd. ordered the Corporate Insolvency Resolution Process under Section 9 of the IBC, 2016 and appointed Mr. Aravindakshan Nair as Interim Resolution Professional. Thereafter, in the first CoC, it was resolved to appoint the applicant herein as the Resolution Professional. Resolution Professional issued public notice inviting claims from the stakeholders. As the Corporate Debtor was under severe financial stress since the last 2 years and the Company had virtually no employees and no infrastructure to revive its operations, no positive response was received with regard to resolution plan of the Corporate Debtor. Hence, on an application (MA/05/KOB/2020), this Tribunal on 19.02.2020 passed an order of liquidation. After the commencement of the liquidation process, public announcement was made on 21.02.2020 and letters were sent to the suspended Directors requesting explanations of the amount found materially inconsistent in the financial stateme....
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.... as referred to in sub-Section (4), he is required to apply to the adjudicating authority for avoidance of preferential transactions and for one or more of the orders referred to in Section 44. If twin conditions specified in Section 43(2) are satisfied, the transaction would be deemed to be of preference. As per Section 43(2)(a), the transaction, of transfer of property or an interest thereof of the corporate debtor, ought to be for the benefit of a creditor or a surety or a guarantor for or on account of an antecedent financial debt or operational debt or other liabilities owed by the corporate debtor; and as per clause (b) thereof, such transfer ought to be of the effect of putting such creditor or surety or guarantor in beneficial position than it would have been in the event of distribution of assets under Section 53. However, merely giving the preference and putting the beneficiary in a better position is not enough. For a preference to become an offending one for the purpose of Section 43 of the Code, another essential and rather prime requirement is to be satisfied that such event, of giving preference, ought to have happened within and during the specified time, referred a....
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.... August 2018, which is still pending to be received from this subsidiary company. Invoice No. Date Description Taxable Amount IGST Total Amount SM1718/100 07.08.2018 SMS SERVER MAINTENANCE 3,17,797 57203 3,75,000 SM1718/101 13.08.2018 SMS SERVER MAINTENANCE 3,17,797 57203 3,75,000 SM1718/102 21.08.2018 SMS SERVER MAINTENANCE 3,17,797 57203 3,75,000 SM1718/103 30.08.2018 SMS SERVER MAINTENANCE 3,17,797 57203 3,75,000 SM1718/104 06.09.2018 SMS SERVER MAINTENANCE 3,17,797 57203 3,75,000 SM1718/105 12.09.2018 SMS SERVER MAINTENANCE 3,17,797 57203 3,75,000 SM1718/106 20.09.2018 SMS SERVER MAINTENANCE 3,17,797 57203 3,75,000 SM1718/107 30.09.2018 SMS SERVER MAINTENANCE 3,17,797 57203 3,75,000 SM1718/108 10.10.2018 SMS SERVER MAINTENANCE 3,17,797 57203 3,75,000 SM1718/109 11.10.2018 SMS SERVER MAINTENANCE 3,17,797 57203 3,75,000 SM1718/110 19.10.2018 SMS SERVER MAINTENANCE 3,17,797 57203 3,75,000 SM1718/111 31.10.2018 SMS SERVER MAINTENANCE 3,17,797 57203 3,7....
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....e corporate Debtor during the relevant period. Based on our analysis of the bank statements and information provided by the management, a car, with a written down vale of Rs. 1317434/- had been sold for a value of Rs. 24,00,000. Management also provided a list of other assets they sold during the relevant period which amounted to Rs. 77,500/-, However, supporting documents for these sale or receipts were not provided for verification by the management. Fixed asset register and evidence for the physical verification of assets were also not made available to us for verification." 41. Further it appears from the records that the transaction auditor also identified transaction that are defrauding creditors. The report of the transaction auditor is as under:- "We observed that, Rs. 1,09,550 had been spent by the corporate debtor for the preliminary and legal expenses for the incorporation of its subsidiary "Sabkaa Payments Limited" during the financial year 2016-17. However, this investment has not been reflected in the financial statements of corporate debtor, whereas the same has been shown as a liability in the balance sheet of Sabkaa Payments Limited as long-term borrowi....