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Judgment
ORDER
09.02.2022: Heard Learned Counsel for the Appellant as well as Counsel appearing for the Respondent- Operational Creditor.
This Appeal has been filed against an order dated 29.09.2021 passed by the Adjudicating Authority (National Company Law Tribunal), New Delhi, Court-III, by which the Adjudicating Authority has issued an interim direction restraining the Corporate Debtor, its directors, employees, agents, assignees etc. from disposing of their immoveable (Plant & machinery and other fixed assets) and immoveable property at A-4, Leather Complex, RIICO Area, Manpur- Machedi, Jaipur (Rajasthan) till the next date of hearing.
The Operational Creditor has filed an Application under Section 9 claiming defaulted amount of Rs. 39 Lakhs from the Corporate Debtor. The Application under Section 9 was filed on 10.08.2020. When the Application came for consideration before the Adjudicating Authority, following order was passed on 16.02.2021:
“Counsel for the Petitioner is present. It has been noted that the petition has been filed on 10.08.2020 and the default amount is Rs. 39 Lakhs approximately whereas the threshold for filing a petition under Section 9 was raised to Rs. 1 Crore w.e.f. 24.03.2020. The Counsel for the Petitioner prayed for time to seek fresh instructions from his client. At request, time is enlarged. List the matter on 01.03.2021.”
Subsequently, Application was proceeded and now impugned order has been passed on 29.09.2021 as noted above.
Learned Counsel for the Appellant submits that the Application filed by the Operational Creditor itself was not maintainable since the amount claimed was less than the threshold which has been provided by Notification dated 24.03.2020 of Rs. 1 Crore. He submits that the Application being not maintainable, the Adjudicating Authority ought to have rejected the same and not passed the impugned order on 29.09.2021.
Learned Counsel for the Operational Creditor submits that since notice under Section 8 of the Code was issued on 19.09.2019, hence, for this cause of action which was there when notice was issued, the Application can very well be entertained under Section 9 even after 24.03.2020.
We have considered the submissions of the Counsel for the parties and perused the record.
By Notification dated 24.03.2020, the threshold for entertaining an Application under Section 9 has been raised from Rs. 1 Lakh to Rs. 1 Crore. The Notification and the provisions for increasing threshold, shall operate prospectively i.e. after 24.03.2020. In the present case, the Application was filed by the Operational Creditor on 10.08.2020 i.e. subsequent to above Notification raising the threshold. The amount claimed in Section 9 Application only Rs. 39 Lakh hence, it was less than the threshold and Application ought to have been thrown out on this ground. The Adjudicating Authority on 16.02.2021 has noticed the question and has granted time to Petitioner to explain.
We are of the view that when the Application itself was not maintainable by virtue of Notification dated 24.03.2020, there was no necessity to proceed any further or pass any interim order as passed on 29.09.2021. We are satisfied that Application No. IB-100/(ND)/2021 was not maintainable and ought to have been dismissed. We thus, are of the view that Application No. IB-100/(ND)/2021 filed on 10.08.2020 was not maintainable and deserves to be dismissed. The Adjudicating Authority itself although had called upon the Appellant to explain the question for filing the petition but without adverting to the said question issued the interim order on 29.09.2021. In result, we allow this Appeal, set aside the order dated 29.09.2021 and also reject the Application No. IB-100/(ND)/2021 which does not fulfil the statutory requirements under Section 4 of the Code. The Appeal is allowed setting aside the order dated 29.09.2021 passed by the Adjudicating Authority as well as rejecting Application No. IB-100/(ND)/2021.
Registry shall forward the copy of this order to the National Company Law Tribunal, Court No.III to place copy of this order in the record and to make a note that Application No. IB-100/(ND)/2021 stands rejected. No order as to costs.