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Judgment
ORDER
04.01.2023: Heard the Learned Representing Counsel Ms. D. Kalaivani, for the ‘Petitioner’ / ‘Appellant’ in IA/1116/2022 in Comp. App. (AT) (CH) (Ins) No.441/2022.
According to the ‘Petitioner’ / ‘Appellant’ in IA/1116/2022 in Comp. App. (AT) (CH) (Ins) No.441/2022, the instant Comp. App. (AT) (CH) (Ins) No.441/2022, the ‘Appeal Papers’ were returned by the ‘Office of the Registry’ on 07.11.2022 and a ‘Week time’ was granted, enabling the ‘Petitioner’ / ‘Appellant’ to comply with the ‘Defects’. However, the reason ascribed on behalf of the ‘Petitioner’ / ‘Appellant’ is that the instant Comp. App. (AT) (CH) (Ins) No.441/2022 was entrusted to the Learned Counsel of the ‘Petitioner’ / ‘Appellant’ and he took some time to return the ‘Case Papers’, for compliance, only on 10.11.2022 and the Learned Junior Counsel was handling the instant Comp. App. (AT) (CH) (Ins) No.441/2022 in the ‘Petitioner’ / ‘Appellant’s’ Office, without informing the status of the instant Company Appeal. Only after coming to know of the ‘return of the papers’ from the ‘Office of the Registry’, the ‘Defects’ were complied with and in that process a delay of ‘21 Days’ had occurred, which is neither ‘wilful’ nor ‘wanton’, but due to the aforesaid reasons.
It is to be noted that ‘delay in representation’ is the matter concerned between the ‘Petitioner’ / ‘Appellant’ and the ‘Tribunal’. The other side cannot have anything to say in the matter.
Be that as it may, this ‘Tribunal’, on being subjectively satisfied, as the to the reasons ascribed on behalf of the ‘Petitioner’ / ‘Appellant’, in regard to the delay that has occurred, viz., ‘21 Days’ in representing the Comp. App. (AT) (CH) (Ins) No.441/2022, to secure the ends of ‘Justice’ and also by adopting a ‘lenient and liberal approach’, ‘condone the delay of 21 Days’ in filing this ‘Appeal’. No Costs.
04.01.2023: Heard the Learned Representing Counsel Ms. D. Kalaivani for the ‘Appellant’.
Earlier, the ‘Adjudicating Authority’, (National Company Law Tribunal, Division Bench – I, Chennai), while passing the ‘impugned order’ in CP/IB/37/CHE/2022 (filed by the ‘Appellant’ / ‘Applicant’ (‘Operational Creditor’) (Under Section ‘9’ r/w Rule 6 of the Insolvency and Bankruptcy Code, 2016) (Application to Adjudicating Authority, Rules, 2016) at Paragraph Nos.4 to 8 observed the following and specifically at Paragraph 11 had observed the following: -
“4.In Part-IV of the Application the Applicant Operational Creditor has alleged that a total amount of Rs.7,88,50,000/-(Rupees Seven Crore Eighty Eight Lakhs Fifty Thousand only) as the debt amount due and payable by the Corporate Debtor from February 2020 onwards till date.
5.Further, the details of the transactions as averred in Part-IV of the Application are as follows:-
(i)Rs.2,56,00,000.00/- (Rupees Two Crores Fifty -Six Lakhs only) – To be paid To Mr. E. Kamalesh Kumar, Resident Director for expenses incurred to run the factory, salary dues, full and final settlement and expenses incurred after the closure of the factory.
(II)Rs.1,82,50,000/- (Rupees One Crore Eighty-Two Lakhs Fifty Thousand Only) - To be paid to 200 employees who were working in the factory which includes salary, gratuity, closure settlement and full and final settlement.
(iii)Rs.1,20,00,000/- (Rupees One Crore Twenty Lakhs only) – To be paid to 30 fabric suppliers, trims suppliers, security agencies, transport service providers and other vendors.
(iv)Rs.45,00,000/- (Rupees Forty-Five Lakhs) To be paid to government agencies towards ESI and TDS.
(v)Rs.1,25,00,000/- (Rupees One Crore Twenty-Five Lakhs only) To be paid to Capella Fashions, Landlord towards factory rent.
(vi)Rs.60,00,000/- (Rupees Sixty Lakhs Only) to be paid to Mahindra World City Developers Private Limited towards monthly operation and maintenance charges.
6.However, the Operational Creditor has claimed a total amount of Rs.7,88,50,000/- (Rupees Seven Crore Eighty-Eight Lakhs Fifty Thousand only) towards total debt due and payable by the Corporate Debtor, whereas from the averments stated supra it can be clearly inferred that only Rs.2,56,00,000.00/-(Rupees Two Crores Fifty Six Lakhs only) is alleged as debt payable to Mr. E. Kamalesh Kumar, the Applicant Operational Creditor herein for expenses incurred to run the factory, salary dues, full and final settlement and expenses incurred after the closure of the factory. The Petitioner has also clubbed the dues of 200 employees, 30 fabric suppliers, the dues payable to the government agencies, the dues towards factory rent and the dues payable towards monthly operation and maintenance charges.
7.Further, it is seen from Part – IV and V of the Application that the Operational Creditor has only averred that the debt is due and payable and has miserably failed to place on record that supporting documents and proof evidencing the alleged debt which is claimed to be due and payable. Hence, the present Application is bereft of documents in support of the alleged debt.
8.In Part V of the Application, the Applicant has placed the following list of documents in order to prove the existence of Operational Debt and the amount in default:
(a)Copy of Demand Notice vide mail issued by the Operational Creditor to the Corporate Debtor (Annexure I (A))
(b)Affidavit in support of the Application in accordance with the IBC (Application to Adjudicating Authority) Rules 2016 (Annexure V)
(c)Proof that specified application fee has been paid (Annexure VI)
(d)Copy of Bank Certificate and Bank Statement (Annexure VI)
11.The application against two Corporate Debtors is devoid of merits and not maintainable. There cannot be two Corporate Debtors in a single application. No records are filed to prove existence of Operational Debt. Furthermore, the applicant being the director of R1 Corporate Debtor has filed this application in the capacity as director of R1/Corporate Debtor and as such present application is not maintainable.” and ultimately came to the ‘Resultant Conclusion’ that CP/IB/37/CHE/2022 is a ‘frivolous one’, a ‘clear Case’ of ‘misuse’ of the Insolvency & Bankruptcy Code, 2016 and dismissed the said ‘Application’, by imposing a cost of Rs.1,00,000/- (Rupees One Lakh Only), payable by the ‘Applicant’ / ‘Appellant’ to the ‘Prime Minister’s Relief Fund’, within a period of ‘14 days’, from the date of the ‘Order’. Upon ‘Hearing’ the ‘arguments’ of the Learned Counsel for the ‘Appellant’ and also on going through the ‘impugned order’ passed by the ‘Adjudicating Authority’, (National Company Law Tribunal, Division Bench – I, Chennai) in dismissing the ‘Application’, and also by way of imposing the Cost of Rs.1,00,000/- (Rupees One Lakh Only) payable by the ‘Applicant’ / ‘Appellant’ to the ‘Prime Minister’s Relief Fund’, within the time specified therein, this ‘Tribunal’ is of the considered view, that any ‘Application’ filed under the ‘Insolvency & Bankruptcy Code, 2016’, there cannot be any ‘Two Corporate Debtors’ and all the more, in the present Case, the ‘Adjudicating Authority’, (National Company Law Tribunal, Division Bench – I, Chennai), had rendered a ‘categorical finding’ that ‘no Records’ were filed to establish the ‘existence’ of an ‘Operational Debt’.
Added further, as a Director, the ‘Appellant’ / ‘Applicant’ of the ‘Corporate Debtor’ had preferred the CP/IB/37/CHE/2022, before the ‘Adjudicating Authority’, (National Company Law Tribunal, Division Bench – I, Chennai), which itself is, per se, not maintainable in the eye of ‘Law’. Looking at from ‘any angle’, the instant Comp. App. (AT) (CH) (Ins) No.441/2022 is devoid of ‘Merits’ and it ‘Fails’.
In fine the instant Comp. App. (AT) (CH) (Ins) No.441/2022 is ‘dismissed’. No Costs. The ‘Appellant’ / ‘Applicant’ is directed to pay the ‘Cost’ of Rs.1,00,000/- (Rupees One Lakh Only) to the ‘Prime Minister’s Relief Fund’, within ‘Two Weeks’ from ‘Today’ and to produce the copy of the ‘Receipt’ before the ‘Deputy Registrar’ of this ‘Tribunal’, for keeping the same, for the purpose of ‘Records’, in the instant Comp. App. (AT) (CH) (Ins) No.441/2022. The connected pending IA/1115/2022 (For ‘Stay’) is Closed.