Lupin Dealers Pvt. Ltd. vs Ashish Vincom Pvt. Ltd.

15.07.2022: This appeal is directed against the order dated 12.12.2019 passed by the Adjudicating Authority (National Company Law Tribunal, Kolkata Bench, Kolkata) in CP (IB) No. 1171/KB/2019 in CA (IB) No. 1636/KB/2019 whereby an application filed under Section 7 of the Insolvency and Bankruptcy Code, 2016 (in short ‘Code’) read with Rule 4 of the Insolvency and Bankruptcy (Application to Adjudicating Authority) Rules, 2016 (in short ‘Rules’) has been dismissed only on the ground that evidence was not before it to prove that the Applicant/Appellant had actually advanced the loan to the Corporate Debtor which is sought to be recovered as a creditor.

In brief, the case set up by the Appellant is that it had advanced a sum of Rs. 40 lakhs on 24.07.2015 and Rs. 5 lakhs on 27.07.2015 to the Corporate Debtor in two instalments by way of RTGS. Since the Corporate Debtor failed to repay the interest on the amount which was advanced hereinabove w.e.f. 31.03.2018 onwards, therefore, the Applicant has termed it as a default and claimed a sum of Rs. 67,74,256/- which includes interest till the date 30.06.2019.

It is pertinent to mention that the Respondent did not file reply to the application filed by the Applicant rather filed an application under Section 60(5) of the Code. Counsel for Appellant has submitted that after the decision of the Tribunal on 12.12.2019, it came to their notice that the Respondent has uploaded on the MCA Website their balance sheet for the year ending 31.03.2019 in which an amount of Rs. 59,35,874.00 belonging to the Appellant has been shown as a unsecured loan. It is submitted that this fact was not within the notice of the Appellant when the application was preferred under Section 7 of the Code on 12.07.2019, otherwise, this fact would have also been included in the said application.

It is further submitted that this fact has now been pleaded categorically in the grounds of appeal which read as under:-

It is argued by the Appellant that the Respondent has filed reply to the memo of appeal instead of filing reply to the application and in the said reply they have replied to the aforesaid paragraph in the following manner:

It is submitted that the Respondent has deliberately avoided not to reply to the fact pleaded by the Appellant about the amount which is shown to the tune of Rs. 59,35,874.00 as a debt as on 31.03.2018 in the books of accounts of the Respondent itself rather an evasive reply has been given.

Counsel for Appellant has, thus, argued that keeping in view of the fact that there is an implied admission on the part of the Respondent about the amount of debt due towards the Appellant as on 31.03.2018 of an amount of Rs. 59,35,874.00 which includes the principal amount and the interest and it falls within the definition of Section 5(8) of the Code for the recovery of which the Appellant is entitled to maintain the Application filed under Section 7 of the Code.

It is further submitted that this Appeal may be allowed and the order of the Adjudicating Authority may be set aside and the matter may be remanded back to it for passing an order afresh.

In reply, Counsel for Respondent has vehemently argued that there is no error in the order of the Adjudicating Authority which can be interfered with by this Appellate Tribunal because the Appellant had failed to produce any evidence to show that it had advanced the aforesaid amount of Rs. 45 lakhs on which interest has also been accrued as well. He has further submitted that the claim has become time barred.

We have heard Counsel for parties and perused the record with their able assistance.

The issue before us is as to whether there is evidence on record to show that the Appellant had in fact advanced a sum of Rs. 45 lakhs as loan which bears interest as well and the Appellant is, thus, entitled to recover the said amount as a debt in terms of Section 7 of the Code?

It is true that the Appellant had filed the application under Section 7 of the Code on 12.07.2019 and has alleged that the amount of Rs. 45 lakhs was transferred to the account of the Respondent through RTGS but there was no evidence about the admission of that amount by the Respondent because the Respondent did not deliberately file the reply to the application and rather filed an application under Section 60 (5) of the Code. However, if the amount was not actually due then there was no hindrance before the Respondent to contest the application filed by the Appellant by filing a reply thereto.

Be that as it may, the Appellant, as soon as came to know about the accounts statement of the Respondent after it was uploaded on the MCA Website, it brought the said information in this appeal by way of paragraph VII(l). The Appellant has also appended a document as the annexure A-6 in this appeal. If this information, now in possession of the Appellant was incorrect, it could have easily been denied by the Respondent but the Respondent has not denied it categorically and has remained evasive. It is well settled that evasive replies are admissions. The Respondent has had the opportunity to contest the case set up by the Appellant in appeal but it has miserably failed to do it in the presence of document Annexure A-6. Thus, we are of the considered opinion that the present appeal deserves to be allowed and the matter deserves to be remanded back to the Adjudicating Authority for proceeding further in accordance with law while deciding the said application filed under Section 7 of the Code after treating the same as maintainable.

The present Appeal is, thus, allowed and the order of the Adjudicating Authority is set aside. The matter is remanded back to it to decide afresh.

The Respondent may, if so adviced can take all the pleas available to it for the purpose of challenging the application filed by the Appellant before the Adjudicating Authority.

The parties are directed to appear before the Adjudicating Authority on 02^nd August, 2022.

Registry is directed to send a copy of this order to the concerned Adjudicating Authority forthwith.