TaxTMI 
TaxTMI 
2023 (7) TMI 1407
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....hearing the Appellant, Resolution Professional as well as Respondent No.2 (Financial Creditor who had filed application under Section 7) has rejected I.A. No. 203/JPR/2022, against which order this Appeal has been filed. Brief facts of the case necessary to be noticed for deciding this Appeal are: i. A Section 7 application was filed by the Respondent No.2, UTI Trustee Company Pvt. Ltd. against the Corporate Debtor - M/s Modern Syntex (India) Ltd. on 04.06.2018 on which CP (IB) No. 39(PB)2018 was registered. ii. The Corporate Debtor received finance from the Respondent No.2 in the nature of Secured Redeemable Non-Convertible Debentures in the year 1995. The Corporate Debtor who cannot repay the debt was referred to BIFR on 08.12.2000. Upon enactment of Insolvency and Bankruptcy Code, 2016, pending reference in BIFR stood abated on 16.12.2016. iii. Section 7 application was filed by Respondent No.2 on 04.06.2018, which could be admitted by the Adjudicating Authority by its order dated 28.03.2022. Respondent No.1 was appointed as IRP, who made public announcement on 29.03.2022. iv. On 11.04.2022, the Appellant herein submitted three financial claim....
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....ation: and e. Grant ex-parte ad interim stay against implementation of any resolution as passed by the CoC in absence of the Applicant during the pendency of the instant Applicant; and/or f. Pass any other Order that this Ld. Tribunal deems necessary in the interests of justice." vii. The Adjudicating Authority passed an order dated 10.05.2022, where it was observed that the application filed by the Applicant (Appellant) generates several doubts regarding claim of the Appellant. Direction was issued by the Adjudicating Authority on 10.05.2022 to the Applicant to provide various documents including the Bank Statement of ICICI Bank for last six years. Appellant was also directed to file original Assignment Deeds dated 03.04.2017, 29.01.2019 and 13.04.2017 and details of major business events of the Appellant. viii. Appellant aggrieved by the order dated 10.05.2022 filed an appeal before this Tribunal. ix. In the I.A. No. 203/JPR/2022, reply and submissions were made by the Resolution Professional. Respondent No.2 also filed an application for impleadment, which was allowed by the Adjudicating Authority. Respondent No.2 also filed its writt....
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....rsed amount of Rs.45 Crores to the Corporate Debtor between the 2004 to 2010, claim of Rs.715,86,30,000/- was filed. It is submitted that mere fact that in the Assignment Deed dated 03.04.2017, the consideration was Rs.5 Crore out of which Rs.5 Lakhs was paid, cannot be ground to doubt the Assignment Deed. Consideration paid in the Assignment is not relevant nor on that basis Assignment can be discarded. It is submitted that all relevant documents were submitted by the Appellant before the Resolution Professional and before the Adjudicating Authority. The Resolution Professional wrongly treated the Appellant as related party to the Corporate Debtor, whereas no finding has been recorded by the Adjudicating Authority that the Appellant is related party as Assignors were related party to the Corporate Debtor. The impugned order proceeds on mere suspicion and speculation. Disbursal of the amount by original lenders is an admitted fact. The Adjudicating Authority has erred in recording finding in Para 21 that Appellant has failed to submit documents as sought by order dated 10.05.2022. The Adjudicating Authority has been unduly swayed away by non-disbursement of consideration amount in ....
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....ellant to control the CoC. It is submitted that in the balance sheet of the Appellant, none of the amount which are now claimed as financial debt have been shown as payable by the Corporate Debtor, which itself proves that there was, in fact, no Assignment in the relevant time nor any dues payable by the Corporate Debtor. Assignment from Pallavi Synthetics Private Limited was without any basis since admittedly the amount paid to the Mashreq Bank in terms of the settlement was by M/s K3N and Adarsh Pratishthan. There is no right in Pallavi Synthetics Private Limited to make any Assignment. With regard to Midas Powertech Pvt. Ltd. Assignment, it is submitted that amount of Rs.45 Crores which is claimed to be disbursed by Midas Powertech Pvt. Ltd. was actually Equity Share Application Money brought in by the Promoter of the Corporate Debtor and Associates pursuant to restructuring/settlement scheme of liabilities, which is all clearly proved from the balance sheet of the Corporate Debtor for the year ending 31.03.2005 and balance sheet for year ending 31.03.2017. There was no debt of Midas Powertech Pvt. Ltd. and whole claim is false and frivolous. 5. The Resolution Professional al....
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....tails of the Statutory Auditors of the Corporate Debtor, List of Directors and Representation of the various shareholdings/directors. The Applicant has failed to file its Bank Statement for the past 6 years; Original Assignment Deeds as executed between the Applicant and the Assignor Companies; Copy of minutes books, Board Meetings, Notice & Agenda of Board Meetings; Minutes and Attendance register in the books of the Corporate Debtor, Applicant and Assignor Companies at the time of Assignment; etc. 22. In absence of the bank statements, we are unable to ascertain how the consideration as mentioned in the Assignment deeds was disbursed to the Assignee Companies. It is seen that only w.r.t. the Assignor Company No. 1 an amount of Rs. 5,00,000/- (Rupees Five Lacs Only) was disbursed at the time of execution as mentioned in the Assignment deed itself. The remaining payment to the Assignor Companies cannot be traced in the absence of any proof. Also, there is no reason which can explain the absence of any transaction between the Applicant and the Assignor Companies for the subsequent assignment of the alleged loans." 8. The Adjudicating Authority has also given cogent reaso....
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....Resolution Professional has referred to the balance sheet of the Appellant as per MCA online data from March, 2017 to March, 2021, where claims on the basis of all the three assignments against the Corporate are not mentioned. None of the balance sheet of the Appellant reflect any claim due on the strength of all the three assignments. Affidavit which has been filed by Respondent No.2 before this Tribunal brought on record letter dated 27.08.2018 sent by the Corporate Debtor to the Respondent No.2 alongwith which letter Corporate Debtor on 27.08.2018 has forwarded the Unaudited Accounts for the year 2018 for perusal of Respondent No.2. In the Unaudited Accounts which was sent, under the Long Term Borrowing, Foreign Currency Loan from Bank was mentioned as Rs.8,148 Lakhs as on 31.03.2018. Note 5.4 (a), (b) and (c) has been referred to which refers to company defaulting in payment of foreign currency loan since 1997-98. Balance Sheet of the Corporate Debtor for the year 2018-19 for the first time in finance notes referred to assignment to the Appellant. 10. Prior to balance sheet of 2018-19, there is no mention of assignment. Date on which balance sheet of 2018-19 was submitted is....
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....ch was submitted by the Appellant is well reflected by the facts and figures given by the Appellant themselves. With regard to Assignor No.1, the M/s Modern Terry Towel who was Guarantor of the financial assistance taken by the Corporate Debtor, entered into settlement on 29.07.2014. The settlement amount claimed by the Appellant was Rs.19,44,96,000/- as per settlement agreement dated 29.07.2014, which is part of the record. Settlement was for an amount of 24,00,000/- Euros i.e. Rs.19,44,96,000/-, according to the case of Appellant himself. When the Guarantor paid the settlement amount to settle the dues of Principal Borrower to the extent of Rs.19,44,96,000/- then how can Appellant in his claim form mentions Principal Amount as Rs.169,48,76,131/-. Form C which was filed by the Appellant indicate that on the above Principal Amount interest is being charged from 01.04.1997 to 28.03.2022. The Guarantor who has paid the settlement amount towards extinguishment of the debt of the Principal Borrower by virtue of provisions of Section 145 of the Contract Act, surety is entitled to recover from the Corporate Debtor whatever sum he has rightfully paid under the guarantee. Surety cannot cla....