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07.03.2025: I.A. No. 1106 of 2025
This is an application praying for condonation of 11 days’ delay in filing the appeal. Ld. Counsel for the appellant submitted that although order was passed on 20.12.2024 but copy was made available only after a week later and certified copy was filed on 08.01.2025 and therefore some time was taken in finalising the draft. Cause shown is sufficient. Delay condoned.
CA (AT)(Ins) NO. 287 of 2025
This appeal has been filed against the order dated 20.12.2024 passed by National Company Law Tribunal, Guwahati Bench, Guwahati. An interlocutory application bearing IA No. 117/GB/2024 was filed by the appellant who is Suspended Director of the CD seeking leave of the court to pursue the tile suite bearing 334 of 2021 filed against the financial creditor in the Civil Court. The Adjudicating Authority in the order has noticed that in the liquidation proceeding the CD has already been sold as going concerned and it is the liquidator of who is entitle to pursue the proceedings on behalf of the corporate debtor as per Section 33 of the Insolvency and Bankruptcy Code. Adjudicating Authority rejected the application and did not grant the leave to appellant to pursue the proceeding. Adjudicating Authority in paragraph 7 & 11 of the order has made following observations:-
“7.It is trite law that the application filed by the Applicant is now infructuous and he has no locus standi to even file this application, as the CD has already been sold as a going concern and therefore, only the successful bidder can pursue or continue any related litigation. Moreover, after being sold a going concern, all the assets of the CD are required to be handed over to the purchaser, as per the judgment that has been laid down in the matter of Visisth Services Limited Vs. S. V. Ramani & Ors. 2022 sec Online NCLAT 24. Henceforth, the Title Suit No. 334/2021, filed by the CD, belongs solely to the CD and it alone is entitled to any proceeds, which makes it clear that the Applicant's prayer to pursue and defend the afore-mentioned Title Suit cannot be allowed.
11.It has very well been established by various authorities that this Adjudicating Authority has no powers to review an order and the recalling of an order can be done in cases of procedural error. Presently, there is no procedural error which occurred during the passing of the Order dated 18.12.2023 and if the relief sought for in the Application is granted, it would amount to adjudication upon the matter which has earlier been dealt with in the Order dated 18.12.2023. Moreover, the Liquidator/Respondent has distributed and proceeded with liquidation estate in terms of provisions enshrined in the Code. The process of sale of the business of the Corporate Debtor has been already resorted. Therefore, at this juncture allowing the prayers made by the Applicant would amount to undoing the liquidation process/sale as going concern.”
Ld. Counsel for the appellant submits that the liquidator cannot be allowed to pursue the proceeding since there maybe conflict of interest with the appellant and the liquidator. When the law provides that it is only the liquidator after the liquidation proceedings has to pursue litigation on or behalf of the corporate debtor, we fail to see any error in the order of the Adjudicating Authority refusing leave to the appellant to pursue the civil litigation. Hence, we do not find any error in the order, appeal is dismissed.