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Judgment
KANTHI NARAHARI, MEMBER (TECHNICAL)
Preamble:
The present Review Application is filed under Section 420(2) of the Companies Act, 2013 seeking review of the common Judgment/Final Order dated 28.06.2021 passed by this Appellate Tribunal in Company Appeal (AT) (Insolvency) No. 233 of 2021 and Company Appeal (AT) (Insolvency) No. 333 of 2021.
Brief Facts:
Appellant’s Submissions:
Mr. Krishnendu Datta, Learned Senior Counsel appeared for the Review Applicant submitted the brief facts leading to filing of the present Review Application as under:
Learned Senior Counsel submitted that originally the CP No.2156 of 2019 was admitted on 10.10.2019 and CIRP proceedings were initiated by the Adjudicating Authority. After the last date of Expression of Interest (EoI), the erstwhile RP received an email dated 12.03.2020 from Dwarkadhish Sakhar Kharkhana Limited (DSKL) expressing interest to submit a resolution plan for the Corporate Debtor, which was rejected by the erstwhile RP and CoC. The erstwhile RP was replaced with the Review Applicant on 27.05.2020. While so, on 05.06.2020 DSKL wrote to the erstwhile RP informing that they will be filing an I.A. before the NCLT against the decision of CoC in rejecting its EoI. The said e-mail was replied by the erstwhile RP on the same day informing about the appointment of the Applicant (herein) as the new Resolution Professional of the Corporate Debtor, marking the copy to the Applicant and Members of CoC.
The Applicant herein on the same date wrote to DSKL granting an opportunity to resubmit its EoI on the basis of relevant judgments. The said e-mail was also marked to the Members of CoC including Canara Bank, Central Bank, Samata Nagari Sahakari Patsanstha Maryadit and Ms. Sheetal Rajesh Anand and the Advocate of the DSKL and there was no suppression of the said decision.
On 09.06.2020 during the 9th CoC meeting, the Applicant informed the CoC that an I.A. has been served by DSKL challenging the rejection of its EoI by the RP and members of CoC. The CoC resolved to allow DSKL to participate in the resolution process. Challenging the said decision, the Gangamai Industries and Construction Ltd. filed an application before the Adjudicating Authority and the same was allowed on 01.03.2021. Aggrieved by the said order of the Learned Adjudicating Authority, the applicant herein filed Company Appeal (AT) (Ins) No. 333 of 2021 praying for expungement of the adverse remarks passed against him in the order dated 01.03.2021 of the Adjudicating Authority (NCLT).
The DSKL also filed Company Appeal (AT) (Ins) No. 233 of 2021 before this Tribunal. Both the Appeals were disposed of by this Tribunal vide a common (final) order dated 28.06.2021. The Applicant is aggrieved by the adverse observations and remarks made against the applicant in the said common impugned order to the extent that they are contrary to the record.
The Learned Senior Counsel submitted that following are the adverse observations made in the final order:
“a. At the 9th COC meeting, the Applicant had suppressed the fact that he was served with the application by DSKL and that had the COC been made aware of the same, they would not have revisited their earlier decision (Para 38, 41(vii) of IO).
b. the Applicant had suppressed that he himself had permitted DSKL to submit its EOI (Para 39, 41(viii) of IO).
Based on the above, the IO concluded that the decision in the 9th COC was not transparent, fair and was under the influence of the Applicant (Para 41, 46 and 47 of IO).”
The Learned Senior Counsel submitted that the said observations are self-evident errors apparent from the record as the record clearly establishes that the applicant had not suppressed that he was served with the application by DSKL. Further, his decision to permit DSKL to submit EoI was communicated simultaneously to the members of the CoC as evident from his e-mail dated 05.06.2020.
The Learned Senior Counsel further submits that the present Review Application is being filed for corrections of the manifest errors by expungement of the said observations, and prayed this Bench to allow the Review Application as prayed for.
Respondent’s Submissions:
The Learned Counsel appeared for the Respondent submitted that the Review Application is not maintainable and the same is liable to be dismissed on the ground that no review powers conferred under the Companies Act, 2013 or in the IBC, 2016. He submits that the entire matter in the Appeals are subject matter of conduct of the Review Applicant and there is no error in the order passed by this Appellate Tribunal. He prayed this Bench to dismiss the Review Application, as it devoid of merit and lack of jurisdiction.
Analysis / Appraisal:
Heard the Learned Counsel appeared for the respective parties. The present Application is filed under Section 420(2) of the Companies Act, 2013 seeking review of the order passed by this Tribunal dated 28.06.2021. This Tribunal passed a common order of two Appeals i.e. Company Appeal (AT) (Insolvency) No. 233 of 2021 which was filed by Dwarkadhish Sakhar Kharkhana Limited against Pankaj Joshi RP and Company Appeal (AT) (Ins) No. 333 of 2021 was filed by Pankaj Joshi RP against Gangamai Industries and Construction Ltd. Both the Appeals are directed against the common order dated 01.03.2021 passed by the Adjudicating Authority (NCLT, Special Bench, Mumbai) whereby the Adjudicating Authority allowed the Application of Gangamai Industries and Construction Ltd. in I.A. No. 1029 of 2020 in CP No. 2156 of 2019. The said I.A. was directed against the decision of CoC, accepting the EoI of DSKL. The Adjudicating Authority set aside the decision of CoC in accepting EoI of DSKL and deprecated the conduct of Resolution Professional namely Pankaj Joshi (Review Applicant herein).
After filing of this Appeal, this Tribunal afforded the parties to file their pleadings and the matter was heard, duly affording opportunity to all the parties and passed the common order.
While matter stood thus, the point arises for consideration is whether this Tribunal has the power of review of its order under the Companies Act, 2013 as relied upon by the Learned Senior Counsel for the Review Applicant.
It is an admitted fact that the Review Application is filed under Section 420(2) of the Companies Act, 2013. The provision thus read as under:
“S.420. Orders of Tribunal:
(1)The Tribunal may, after giving the parties to any proceeding before it, a reasonable opportunity of being heard, pass such orders thereon as it thinks fit.
(2)The Tribunal may, at any time within two years from the date of the order, with a view to rectifying any mistake apparent from the record, amend any order passed by it, and shall make such amendment, if the mistake is brought to its notice by the parties.
Provided that no such amendment shall be made in respect of any order against which an appeal has been preferred under this Act.”
From the above provision of law, the Tribunal may rectify any mistake apparent from the record. However, there is no power of review under the Act.
The Learned Senior Counsel contended that the adverse remarks passed at para 38, 39 and 47 are error apparent from the record as the record clearly establishes that the applicant had not suppressed that he was served with the application and on the said basis sought expungement of remarks. This Tribunal passed the following order in its judgment dated 28.06.2021 at para 38, 39 and 47 which are extracted hereunder:
“38.At the time of 9th CoC meeting, Pankaj Joshi has supressed the fact that he was served with the Application of DSKL and that they are going to file Application before the Adjudicating Authority against the decision of 7th CoC. If such fact was disclosed by Pankaj Joshi at the time of convening 9th CoC then they might be precluded from revisiting their earlier decision on the ground that the Adjudicating Authority is seized of the matter. On the other hand, being RP, he should have advised the CoC to wait till the decision of the Adjudicating Authority.
39.Pankaj Joshi has suppressed the fact that he himself has overturned the decision of 7th CoC meeting and permitted DSKL to submit its EoI. Pankaj Joshi also misguided the CoC that ‘he is not required to take express permission from the CoC to issue a request for Resolution Plan to an eligible Prospective Resolution Applicant’. This is not the position in this case the request for submission of EOI after due date was rejected by the CoC then there is no question to issue a request for resolution plan to DSKL.
47.In the light of the aforesaid facts and circumstances, we are of the considered view that Mr. Pankaj Joshi has failed to explain that the actions are bonafide. It is expected from a Resolution Professional that he must act in a fair and balanced manner without getting influenced by the conflicting interest of the partis. In the present case, Mr. Pankaj Joshi suppressed material facts and misguided the members of CoC to achieve the desired decision in favour of DSKL. Therefore, we are of the considered view that the adverse remarks and observations made in the Para 54 of the impugned order are not baseless and uncalled for and on the other hand, for appreciating the materials on record and to decide the matter, such observations are necessary.”
From the aforesaid paras the finding of this Tribunal is on the basis of material available before this Tribunal. Further, in para 47 this Tribunal clearly held that the Applicant suppressed material facts and misguided the members of CoC to achieve the desired decision in favour of DSKL. Further, this Tribunal observed that the adverse remarks and observations made in para 54 of the order of the Adjudicating Authority dated 01.03.2021 are not baseless and further observed that for appreciating the materials on record and to decide the matter, such observations are necessary.
It is reiterated that the order passed by this Tribunal dated 28.06.2021 is on the basis of material available before this Tribunal and it cannot be said that the said finding / observation against the Review Applicant is only a patent error. Therefore, the provision relied upon by the Learned Senior Counsel for the Review Applicant is not at all applicable to the facts of the present case. Further, it is made clear that this Tribunal does not have any power to review its own orders.
Unequivocally, this Tribunal comes to a resultant conclusion that the Application filed by the Review Applicant is without any jurisdiction under law as stated (supra). Accordingly, the Review Application No. 1 & 2 of 2021 is dismissed. However, no order as to costs.