TaxTMI 
TaxTMI 
2021 (10) TMI 1474
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....ng directions against State Bank of India (Respondent No. 2 herein) and Director General of Foreign Trade (Respondent No. 4 herein) for release of Fixed Deposits Receipts of Anush Finlease and Construction Pvt. Ltd. (Corporate Debtor) wherein the Ld. Adjudicating Authority passed the following order: "39. For this reason alone, it has been said in Section 30(2)(e) that, the Resolution Plan shall not contravene any of the provisions of the laws for time being in force, the same is again reiterated in Section 238 of the Code saying that this Code will have overriding effect over other laws which are inconsistent with the provisions of this Code. Harmonisation of statutes is the hall mark of justice, not invalidating the rights conferred under one enactment by another enactment save and except to the extent mentioned. 40. Since it has been mentioned that Security Interst shall not include the Performance Guarantee, the incidental actions to the performance guarantee cannot be called as falling within the ambit of the Code. On the day the Bank is discharged, the applicant can get back this money from the Bank. 41. Accordingly, this application is he....
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....udicating Authority was pleased to allow the said application and the Resolution Plan stood approved vide order dated 01.04.2020 (Annexure A-4 at page 173 to 174 of the Appel Paper Book). vii) Further case is that 'Anush Finlease & Construction Private Limited' (for short AFCPL) somewhere in the year 2012/13 prior to the insolvency resolution, in furtherance of its business operations had obtained authorisation for 40 export promotion capital goods (hereinafter 'EPCG Authorisation') from Additional Directorate General of Foreign Trade (CLA), New Delhi (hereinafter 'DGFT') for Duty Saved amount of INR 3,63,75,515.74/- against an Export Obligation of INR 29,80,86,017.92/- and USD 55,93,452.05 for import of capital goods. viii) That as against the authorisations and licenses, 'Anush Finlease & Construction Private Limited' was maintaining certain Fixed Deposit Receipts (hereinafter 'FDR') with the Respondents Nos. 1 and 2. The details of the same are as under: FDRs with Erstwhile State Bank of Mysore 3,4 and 5, DDA Building, Nehru Place, New Delhi FDR No. 1. 64175959969 FDRs with State Bank of India A-5, Ring Road, South Extension....
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....55729 6,00,000 0505112BG1000015 6,00,000 17.01.2022 32782848055 1,50,000 0505112BG1000019 1,50,000 27.01.2022 32796424801 4,000 0505112BG1000022 3,500 30.01.2022 32822666117 1,10,000 0505112BG1000040 1,08,774 12.02.2022 32822673102 4,50,000 0505112BG1000039 4,48,643 12.02.2022 32830552552 8,80,000 0505112BG1000047 8,78,870 18.02.2022 32900604388 7,27,589 0505112BG1000089 7,25,634 22.03.2022 32900597211 7,92,731 0505112BG2000090 7,90,433 22.03.2022 32960716412 2,91,000 0505112BG2000131 2,90,918 25.04.2022 32619562701 13,27,000 0505112BG1000305 13,26,286 25.10.2022 Total 1,12,92,820 1,12,72,191 ix) Further case is that vide later dated 07.04.2020 (Annexure A-8 at page 197 to 199 of the Appeal Paper Book), State Bank of India was requested to release the said FDR amounts into the controlled account of 'Anush Finlease & Construction Private Limited'. However, State Bank of India has failed to comply with the same. x) Further case is that the representatives of the Monitoring Agency have on sever....
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....nbsp;3 - Customs Department. 8. I tis further submitted that admittedly the Respondent No. 3 has not filed a claim. It is further an established fact that the claim of the Customs Department if any, is not dealt with under the resolution plan. The Ld. Adjudicating Authority has failed to consider that the Respondent No. 3 - Customs Department failed to file a claim before the Resolution Professional, the liability of the Corporate Debtor to the Customs Department has been extinguished. The said extinguishment is provided for in the resolution plan (at page 136, Clause 3.8.2 of the Appeal Paper Book). 9. Learned Counsel for the Appellant further referred on a judgment of the Hon'ble Supreme Court passed in Committee of Creditors of Essar Steel India Limited V/s Satish Kumar Gupta and Others (2019 SCC OnLine SC 1478), where the Hon'ble Supreme Court has held that no claims apart from those decided on merits by the RP can survive after plan approval. It is further submitted that the liability, if any, of the Corporate Debtor towards the Respondent No. 3 has been extinguished. Consequently, the Bank Guarantees have no reason to say alive and therefore, the margin m....
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....ntees have expired and has also not discharged the Bank and returned the original Bank Guarantees to the Bank. 15. It is further submitted that the Appellant herein filed an application being I.A. No. 2057 of 2020 before the Ld. Adjudicating Authority seeking directions against Respondent Nos. 1 to 3 for release of fixed deposits receipts of AFCPL. The said application was erroneously based on the resolution plan approved in the CIRP of AFCPL vide order dated 01.04.2020 passed by Ld. Adjudicating Authority. 16. It is further submitted that the Appellant has in fact vide its aforesaid application sought for extinguishment of the guarantees between the bank and the beneficiaries (to which it is not even a party) and release of margin money deposited with the Bank without the Bank Guarantees having been discharged. 17. It is further submitted that the Ld. Adjudicating Authority passed a well reasoned order dated 04.08.2020 and rightfully dismissed the IA No. 2057 of 2020 which is challenged in the instant Appeal filed by the Appellant, the same being unsustainable in law. The appellant challenging the order passed by the Ld. Adjudicating Authority on baseless a....
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....r submitted that reliance placed on the approved resolution plan in the CIRP of AFCPL is completely misplaced and untenable in law. Resolution Plan cannot provide for extinguishment or cancellation of a contract of bank guarantee between third parties i.e. the Bank and the beneficiaries. The contract between the Bank the Beneficiaries is independent of the contract between AFCPL and the concerned Government Department. Therefore, the contention that the bank guarantee stands extinguished by the resolution plan is highly misplaced as the contract between the bank and the beneficiary is subsisting, valid and in force and the same could not be extinguished or cancelled, except in accordance with law. 25. It is further submitted that while obtaining the approval of resolution plan from the Ld. Adjudicating Authority, it was demonstrated as if the FDRs are mere fixed deposits as understood in banking parlance. Whereas, these actually comprise of the margin money towards the bank guarantees issued by the Respondent Bank in favour of the beneficiaries named therein. There is no mention or description of the same in the Resolution Plan. 26. It is further submitted that the purported ....
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....spondent under the said guarantee. 32. It is further submitted that the Ld. Adjudicating Authority passed a well-reasoned order dated 04.08.2020 rightfully dismissed the I.A. No. 2057 of 2020 filed by the Appellant herein, the same being unsustainable in law. The appellant challenging the order passed by the Ld. Adjudicating Authority on baseless and frivolous grounds, therefore, it is liable to be dismissed. 33. It is further submitted that the moratorium as envisaged under Section 14 of the Insolvency and Bankruptcy Code would not be applicable to the bank guarantee as firstly the same is not covered under the moratorium and also because the moratorium period subsists only till the approval of the resolution plan and not indefinitely. So, based on these submissions the Ld. Adjudicating Authority has rightly passed the impugned order. There is no merit in the instant Appeal, the Appeal is fit to be dismissed. FINDINGS 34. After hearing the parties and gone through the records of the case as also Written Submissions, we are of the considered view that the following facts are admitted in the instant Appeal. ● The Respondent No. 1 - State Bank of ....
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....ee the beneficiary is entitled to invoke the bank guarantee and seek encashment of the amount specified in the bank guarantee. It does not depend upon the result of the decision in the dispute between the parties, in case of the breach. The underlying object is that an irrevocable commitment either in the form of bank guarantee or letters of credit solemnly given by the bank must be honoured. The court exercising its power cannot interfere with enforcement of bank guarantee/letters of credit except only in cases where fraud or special equity prima facie made out in the case as triable issued by strong evidence so as to prevent irretrievable injustice to the parties..."." ● It is also admitted fact that the assets of the Corporate Debtor are envisaged in Section 36 of the Code which is read as hereunder: "36. Liquidation Estate.- (1) For the purposes of liquidation, the liquidator shall form an estate of the assets mentioned in sub-section (3), which will be called the liquidation estate in relation to the corporate debtor. (2) The liquidator shall hold the liquidation estate as a fiduciary for the benefit of all the creditors. (3) Subject t....