TaxTMI 
TaxTMI 
2022 (9) TMI 1296
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....issued invoices for payment. Operational Creditor issued demand notice on 23rd June, 2021 under Section 8 of the Code calling for Corporate Debtor to pay an amount of Rs. 46,64,249/- with interest. An Application under Section 9 was filed by the Operational Creditor (Appellant) on 08.09.2021 being I.B.- 527/ND/2021. Notices were issued in the Company Petition. Corporate Debtor and Operational Creditor entered into Settlement Agreement dated 04.01.2022. On the basis of Settlement between the parties, the Adjudicating Authority permitted the Operational Creditor (Appellant) to withdraw the Company Petition. The Company Petition was dismissed as withdrawn by Order dated 06.01.2022. The Corporate Debtor having not made payment as per the Settlement Agreement, the Appellant filed an I.A. No. 3100/2022 praying for revival of the IB-527/ND/2021, which Application came for hearing before the Adjudicating Authority, the Adjudicating Authority took the view that there is no any provision to revive the Application. The Tribunal observed that Petitioner (Appellant) can avail such remedy as available under law. The Appellant placed reliance on Judgment of this Tribunal to contend that ....
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....estoring the Company Petition. An Appeal was filed by the Corporate Debtor in the above case challenging the Order contending that the Adjudicating Authority has no power to revive the Company Petition, dismissing the Appeal, this Tribunal in paragraph 56 held as under: "56. It is to be mentioned that an 'inherent power' of the 'Tribunal' has its gross root in necessity and the said power can be exercised by a 'Tribunal' based on the rudimentary principle that an 'act of Court shall prejudice no person'. Further, to meet the ends of justice an 'inherent power' of a 'Tribunal' being 'Coextensive with need' can be exercised to render justice to the litigants. Also that, I A No. 02/KOB/2021 filed by the Respondent/Financial Creditor/Applicant to restore and Revive the Application IBA/13/KOB/2020 (filed under Section 7 of the Code) is not to be termed as one of 'Review Application' or to be confused with, in the considered opinion of this 'Tribunal'. Undoubtedly, the 'Adjudicating Authority' (National Company Law Tribunal, Kochi Bench, Kerala) had rightly allowed IA No.02/KOB/2021 in IBA/13/KOB/2021 on 28.01.2021 (filed under Rule 11 of National Company Law Tribunal Rules, 2016 by th....
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....t was maintainable under Section 9. 11. Section 4 of the Code provides as follows:- "Section 4: Application of this Part.- (1) This Part shall apply to matters relating to the insolvency and liquidation of corporate debtors where the minimum amount of the default is one lakh rupees: Provided that the Central Government may, by notification1, specify the minimum amount of default of higher value which shall not be more than one crore rupees. [Provided further that the Central Government may, by notification, specify such minimum amount of default of higher value, which shall not be more than one crore rupees, for matters relating to the prepackaged insolvency resolution process of corporate debtors under Chapter III-A.]" 12. Under Section 4 proviso, a notification was issued by Central Government dated 24th March, 2020 which is to the following effect: "MINISTRY OF CORPORATE AFFAIRS NOTIFICATION New Delhi, the 24th March, 2020 S.O. 1205(E).-In exercise of the powers conferred by the proviso to section 4 of the Insolvency and Bankruptcy Code, 2016 (31 of 2016), the Central Government hereby specifies one crore rupees as the minimum amount of default for the purposes of....
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....nected by an intrinsic unity and are to be regarded as one legal proceeding. (ii) The right of appeal is not a mere matter of procedure but is a substantive right. (iii) The institution of the suit carries with it the implication that all rights of appeal then in force are preserved, to the parties thereto till the rest of the career of the suit. (iv) The right of appeal is a vested right and such a right to enter the superior court accrues to the litigant and exists as on and from the date the lis commences and although it may be actually exercised when the adverse judgment is pronounced such right is to be governed by the law prevailing at the date of the institution of the suit or proceeding and not by the law that prevails at the date of its decision or at the date of the filing of the appeal. (v) This vested right of appeal can be taken away only by a subsequent enactment, if it so provides expressly or by necessary intendment and not otherwise." 16. In the above case, the Hon'ble Supreme Court was considering the question of right of Appeal which was held to be vested right which exists as from the date the lis commenced. We may also refer to the Judgement of th....
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....heme. When it was decided to change the threshold for initiating Insolvency Resolution Process against a Corporate Debtor, no Applicant can be heard in saying that even if he does not fulfill the threshold of Rs. 1 Crore, he should be permitted to initiate the CIRP. Threshold of Rs. 1 Crore is statutorily fixed for all Application to initiate CIRP after 24th March, 2020 irrespective of any exceptions. Accepting the submission of Learned Counsel for the Appellant that an Application can be filed by Operational Creditor after 24th March, 2020 for which default was committed prior to 24.03.2020 on threshold of Rs. 1 Lakh only, shall be reading an exception which is not provided in the statute. 20. This Tribunal in large number of cases have held that even if default was committed prior to 24.03.2020 and Application is filed under Section 9 after 24th March, 2020, it has to fulfill the threshold of Rs. 1 Crore. We may refer to following judgements of this Tribunal where the above view has been taken. A. This Tribunal has occasion to consider this question in "Company Appeal (AT) (Ins.) No. 910 of 2022, V-Con Integrated Solutions Pvt. Ltd. vs. Argos Technology Resources Pvt. Ltd.". Th....
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.... in issue) it will create absurd results of wider implications / complications. 57. In view of the upshot and also this Tribunal, on a careful consideration of respective contentions advanced on either side and considering the facts and circumstances of the instant case in a conspectus fashion holds unhesitatingly that the notification dated 24.03.2020 of the Ministry of Corporate Affairs, Government of India, is prospective in nature and it is not retrospective or retroactive in nature. Further, the said notification will not apply to the pending applications filed before the concerned 'Adjudicating Authority' (Authorities), under IBC (waiting for admission), prior to the issuance of the aforesaid notification, as opined by this Tribunal. Viewed in the above prospectives, the conclusion arrived at by the 'Adjudicating Authority' in the impugned order to the effect that the notification dated 24.03.2020 of the Ministry of Corporate Affairs, Government of India, shall be considered as prospective and not retrospective and the finding that there was no payment on the side of 'Corporate Debtor' after receipt of Demand Notice, no pre-existing dispute also alleged or proved and ultim....
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....ty is to avail the change in I & B Code, 2016, notwithstanding the fact his/its actionable right of 'cause of action' had arisen earlier to an amendment that has been brought about, increasing the threshold limit to Rs. 1 Crore [vide Notification dated 24.03.2000 issued by the 'Ministry of Corporate Affairs' in S.O. 1205(E)] for considering the Application filed under Section 7 or 9 of I&B Code on after 24.03.2020, even if the 'Debt' is of a date prior to 24.03.2020. In law, a Party has no vested right in respect of a 'Fora', albeit he has a 'Actionable Right'. After all, the impediment in Section 10(A) of the I & B Code is to be viewed from the point of view of the purpose and object sought to be achieved in enacting the same by the Parliament in its wisdom." It is to be noticed that against the above judgment of this Tribunal dated 13.12.2021, Civil Appeal No. 1914 of 2022 was filed by the Corporate Debtor 'Al Sadiq Sweets' which also was dismissed by the Hon'ble Supreme Court on 25.03.2022 by the following order:- "ORDER We have heard the learned senior counsel for the appellant and perused the record. We do not see any cogent reason to entertain the appeal. The judgment ....
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....y or by necessary intendment. Every litigant has a vested right in substantive matters but no such right exists in procedural law. The law relating to right of action and right of appeal, even though remedial, is substantive in nature. A procedural Statute should not, generally speaking, be applied retrospectively, where the result would be to create new disabilities or obligations or to impose new duties in respect of accomplished transactions. ...... 380. A right of appeal is a vested right, as noticed. However, it becomes vested not because the right is created under the Statute alone. It becomes vested, as noticed by this Court in Garikapati Veeraya (supra), from the date of institution of the suit. What about a right to sue? In the case of a right to file a civil suit, equally there is a vested right to file a suit but the question would be as to when does it arise. From the line of argument pursued on behalf of the Union that in the case of the right to take advantage of an existing Statute, there is no accrued right, which means also that there is no vested right, should we proceed on the basis that the concept of a vested right qua a civil suit, can be recognized only....
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....be vested right. Thus right of action by Operational Creditor can also be treated as vested right as per law laid down by the Apex Court subject to "conditions otherwise exist". Thus vested right which can be enforced by the Operational Creditor under Section 9 is subject to existence of conditions otherwise. Fulfillment of condition of threshold of Rs. 1 Crore with effect from 24.03.2020 is a condition precedent which need to be fulfilled before proceedings under Section 9 can be initiated by an Operational Creditor. Existence of default is undoubtedly a condition to be fulfilled for initiating Section 9 Application but the default alone is not the condition which entitles the Operational Creditor to initiate Section 9 proceeding after 24.03.2020 on default of Rs. 1 Lac. The Application is further conditioned with compliance of threshold of Rs. 1 Crore as laid down in Section 4. Admittedly Application under Section 9 was filed in the present case on 08.09.2021 hence the Application under Section 9 had to fulfill the threshold of Rs. 1 Crore. The Adjudicating Authority thus rightly took the view that Application filed by the Appellant on 08.09.2021 under Section 9 for claim of an a....