TaxTMI 
TaxTMI 
2024 (7) TMI 1765
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....ny Appeals satisfy the parameters required to be satisfied under Section 99 to be read with Section 100 of the I & B Code, 2016, for the purposes of initiation of Insolvency Resolution proceedings under Section 95 in light of the directives as issued by the Hon'ble Apex Court, in the matter where the vires of Sec. 95 was the subject matter of consideration". 2. Before dealing with the aforesaid issue as argued by the respective learned Counsels appearing for the parties, we feel it apt to precisely deal with the controversy which has been attempted to be argued by the learned Practising Company Secretary appearing for the Appellant, as against the impugned order, by virtue of which, Section 95 of the I & B Code, 2016, has been directed to be admitted and consequent to it, the IRP proceedings had been initiated. 3. In Company Appeal (AT) (CH) (INS) No. 169 / 2023, the challenge is given by the Appellant to the Impugned Judgment dated 28.04.2023, passed in the Company Petition (IB) No. 181 / 95 / HDB / 2022, Bank of Maharashtra V. Smt. Nukala Savithri & Anr., by the learned Adjudicating Authority, NCLT, Hyderabad. As a consequence of the Impugned Judgment, Section 95 proceeding....
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....uthority qua the report submitted by the Resolution Professional under Sec. 99, that the Personal Guarantors could be placed to face the proceedings under Sec. 95. For the Personal Guarantors, the stage of contest arises, only when the proceeding actually reaches the stage of Sec. 100 of the I & B Code, 2016. Section 100 reads as under: "Section 100: Admission or rejection of application. - (1) The Adjudicating Authority shall, within fourteen days from the date of submission of the report under section 99 pass an order either admitting or rejecting the application referred to in section 94 or 95, as the case may be. (2) Where the Adjudicating Authority admits an application under sub- section (1), it may, on the request of the resolution professional, issue instructions for the purpose of conducting negotiations between the debtor and creditors and for arriving at a repayment plan. (3) The Adjudicating Authority shall provide a copy of the order passed under sub section (1) along with the report of the resolution professional and the application referred to in section 94 or 95, as the case may be, to the creditors within seven days from the date....
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....stified to initiate the proceedings for initiation of the IRP proceedings against the Personal Guarantor and that, the Personal Guarantors cannot challenge the same at those stages. 12. The Hon'ble Apex Court in said Order observed in very clear terms that, as far as the Personal Guarantors are concerned, they will not have any role as such to play nor they are required to be even heard, up to the stage till the Resolution Professional submits its report, before the learned Adjudicating Authority justifying the necessity to initiate the IRP proceedings under Sec. 95. Hence, at the stage up to Sec. 95 to 99, no opportunity of hearing is contemplated to be given to the Personal Guarantors to have their say. The Hon'ble Apex Court has summarised its views in the aforesaid judgment in para 86, which is extracted hereunder: "86. We summarise the conclusion of this judgment below: (i) No judicial adjudication is involved at the stages envisaged in Sections 95 to Section 99 of the IBC; (ii) The resolution professional appointed under Section 97 serves a facilitative role of collating all the facts relevant to the examination of the application for the commenc....
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....loading the vires of Sec. 95 to 100 of I & B Code, 2016, was subsequently in time i.e. 09.11.2023, in relation to the Orders delivered by the learned Adjudicating Authority in the instant cases. 14. Let us now examine whether the Impugned Orders satisfy the prescriptions laid down in the said Judgment of Hon'ble Apex Court. The Hon'ble Apex Court makes it clear that the judicial determination will take place only at the stage of Sec. 100 during the proceedings for initiation of the proceedings under Sec. 95 against the Personal Guarantors, when the Personal Guarantors are called upon by the learned Adjudicating Authority to hold their defence, as to whether under the given circumstances, IRP proceedings under Section 95 is required to be initiated against them or not. The Code lays down that the report submitted under Sec. 99 by the Resolution Professional needs to be examined by the learned Adjudicating Authority and that it has to apply its mind before passing Order under Sec. 100(1), either admitting or rejecting the Application under Sec. 95 for initiation of IRP proceedings in respect of the Personal Guarantors. 15. The Hon'ble Apex Court under the premises that the righ....
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.... for admission of this instant Petition are that the Personal Guarantor stood as a guarantor to the loans availed by the Corporate Debtor and Corporate Debtor failed to repay the same and since the Personal Guarantor has admitted the debt and non-existence of dispute'' and based on such, he has admitted the Company Petition. Nowhere in his Order, the learned Adjudicating Authority has tried to take into account the Counter of the Respondents (the Appellant herein) and has simply relied on RP's findings. 19. The learned Practising Company Secretary for the Appellant has contended that the matter in which the conclusion in the Impugned Order has been arrived at by the learned Adjudicating Authority is contrary to the directions given by the Hon'ble Apex Court as well as the provisions contained under Sec. 100 of the I & B Code, 2016. 20. This argument extended by the learned PCS for the Appellant is being attempted to be controverted by the Respondent's Counsel stating that if the Impugned Judgment is taken into consideration in its entirety, it can be seen that the Appellant's objections have been recorded in the Order and so it rather satisfies the ingredients of Sec. 100 of ....