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Judgment
Justice M. Venugopal
According to the Petitioner/Erstwhile Liquidator of The Jeypore Sugar Co Ltd (in Liquidation), he has filed IA No.622/2022 in Company Appeal (AT)(CH)(Ins) No.302/2021 (under Section 60(5) & I&B Code, 2016 r/w Rule 11 and 14 of NCLAT Rules, 2016 seeking to plead in the instant Appeal as Respondent No.11. Also the Petitioner has prayed for permission, to get the reimbursement of the legal expenses.
The Petitioner has averred in IA No.622/2022 in Company Appeal (AT)(CH)(Ins) No.302/2021 that there were severe allegations made against the Applicant’s ‘integrity’, ‘character’ and ‘efficiency’ therefore, the ‘Applicant’ has to defend the same to protect his ‘Honour’.
The Petitioner/’Party in Person’ has to defend the Learned Senior Counsel of the Respondents, if one goes by the past, or making serious allegations such as ‘Fraud’, ‘Criminal Breach of Trust’ etc. without any evidence.
According to the Petitioner/Party in Person he needs to take the advice of his team of ‘Legal Experts’, who do all the backup work and finally they approach during the arguments, in addition to the cost of paper work, filing fees, clerkage. Further, he being removed as Liquidator, he will be forced to pay from his pocket. Therefore, this Tribunal may please to consider the same amount what was being charged by them where the Petitioner was the Liquidator. Hence, the Petitioner, prays for allowing of IA No.622/2022 in Company Appeal (AT)(CH)(Ins) No.302/2021 to implead himself as R11 in the main Appeal preferred by the 1st Respondent/Appellant.
The Petitioner/appearing in person, points out that if IA No.622/2022 in Comp App (AT)(CH)(Ins) No.302/2021 is not allowed, he will be put to irreparable injury and loss because of the severity of allegations made against his ‘integrity’, ‘character’ and ‘efficiency’ among the ‘fraternity’ and ‘general public’, and may be exposed to penal consequences.
The Petitioner(in person) points out that when an inferior ‘Tribunal’, passes an order which is a nullity, the Hon’ble Supreme Court need not drive a party to the Appellant Forum mentioned under the Act.
The Petitioner, in person adverts to the judgement of the Hon’ble Supreme Court in Ratnagiri Gas and Power (P) Ltd. v. RDS Projects Ltd., (2013) 1 SCC 524:2012 SCC online SC 886 at pg. 538 wherein at paragraph 27 it is observed as under:-
“27.There is yet another aspect which cannot be ignored. As and when allegations of mala fides are made, the persons against whom the same are levelled need to be impleaded as parties to the proceedings to enable them to answer the charge. In the absence of the person concerned as a party in his/her individual capacity it will neither be fair nor proper to record a finding that malice in fact had vitiated the action taken by the authority concerned. It is important to remember that a judicial pronouncement declaring an action to be mala fide is a serious indictment of the person concerned that can lead to adverse civil consequences against him. Courts have, therefore, to be slow in drawing conclusions when it comes to holding allegations of mala fides to be proved and only in cases where based on the material placed before the Court or facts that are admitted leading to inevitable inferences supporting the charge of mala fides that the Court should record a finding in the process ensuring that while it does so, it also hears the person who was likely to be affected by such a finding.”
The Learned counsel for R2 to R7 in reply to IA No.622/2022 in the instant Company Appeal had averred that the Petitioner/Party in Person was appointed, as ‘Liquidator of the Corporate Debtor’ as per order dated 29.05.2020 passed by the ‘Adjudicating Authority/Tribunal’ and further the Petitioner had ceased to be a Liquidator of the Corporate Debtor pursuant to the order dated 01.07.2022 passed by Adjudicating Authority/Tribunal in IA No.815/2020, whereupon Mr. Hari Karthik/8th Respondent was appointed as new Liquidator.
The Petitioner had preferred a Comp App (AT)(CH)(Ins) No.269/2022 which was dismissed by this Appellate Tribunal. Hence, there is no question of providing the Petitioner/Party in Person an opportunity/audience to defend himself when the findings against him in the impugned order dated 17.11.2021 in IA No.255/2021 in CP No.1307/IB/2018 was affirmed in IA 815/2020 by the Adjudicating Authority and by this Tribunal in Comp App (AT)(CH)(Ins) No.269/2022.
According to the R2 to R7, the Petitioner/Party in Person, preferred a Civil Appeal No.1614/2023 and ‘no Stay’ was granted against the order of the ‘Adjudicating Authority/Tribunal’ or this ‘Appellate Tribunal’, removing the Petitioner, as Liquidator, of the ‘Corporate Debtor’ or as against the allegations affirmed as against him.
The Learned counsel for R2 to R7 points out that the Petitioner/Party in Person is no more the Liquidator of the Corporate Debtor and in his place new Liquidator viz. 8th Respondent, Mr. S. Harikarthik has come into the picture and, therefore, the Petitioner cannot pray for the allowing of the IA No.622/2022 in the instant Company Appeal (AT) (CH)(Ins) No.302/2021.
It is projected on the side of the R2 to R7 that the Petitioner/Party in Person, can neither seek for impleadment as a Party Respondent, in his personal capacity as well as the subject appeal emanating from his past acts, as a Liquidator, which was performed in his official capacity.
The Learned Counsel for R2 to R7 proceeds to point out since the present Appeal, relates to the issue of ‘valuation and publication of fresh advertisement’, in regard to Section 230 Scheme under the Companies Act, 2013 the Petitioner/appearing in person cannot seek to be impleaded as a ‘Party Respondent’ in main Appeal, especially when, the 8th Respondent/new Liquidator was appointed in his place.
It is the version of R2 to R7 that the Petitioner/Party in Person is neither a necessary nor proper party and has no ‘locus’ to intervene in the instant Appeal Comp App (AT)(CH)(ins) No.302/2021 nor has any interest in the present proceeding and hence the IA 622/2022 is liable to be dismissed, in the interest of justice.
The 8th Respondent/new Liquidator in his reply to IA No.622/2022 in Comp App (AT)(CH)(Ins) No.302/2021 (filed by the Petitioner/Party in Person) has averred that the Petitioner/Party in Person moved a Writ Petition No.21186 of 2023 against the Insolvency & Bankruptcy Board of India and others before the Hon’ble Madras High Court in assailing the ‘show cause notice’ issued by the IBBI and agitate the likewise issues, involved in the impugned order and ultimately, the Writ Petition came to be dismissed on 22.12.2023 wherein specific observations were made on valuation reports shared by the Petitioner/Impleading Party, to the Scheme Proponents.
The contention of the 8th Respondent is that the Petitioner in IA No.622/2022 in ‘instant Appeal’ is not a necessary party, in the capacity of Erstwhile Liquidator, to make any submission, about the Fresh Revival Process, specially when he was removed as Liquidator, due to his failure in exercising due care and diligence, in the performance of power and function prescribed under the I&B Code, 2016 etc.
According to R8, the impleading applicant, in IA No.622/2022 in instant Comp App (AT)(CH)(Ins No.302/2021, desires to support the instant Appeal filed by the Appellant and endeavouring to protract the case and therefore, prays for dismissal of the IA No.622/2022.
Principles on Impleadment of a Party.
Be it noted that, in Law, there is ‘no right’ to be joined as a ‘Party’, whether as necessary or proper party, as per decision of Hon’ble Supreme Court in Anil Kumar Singh Vs Shivnath Mishra and Gadasa Guru reported in 1995 3 SCC Pages 147. 149 and 150.
Admittedly, the question of ‘addition of parties’ is one of ‘judicial discretion’, to be exercised based on the facts and circumstances of each case, as per decision of the Hon’ble Supreme Court in Rup Chand Vs. Raghuvanshi Pvt Ltd reported in AIR 1960 SC 100.
A person will not be impleaded merely because he will be affected by an order of ‘Court/Tribunal’ incidentally. Further, ‘no party’, can be added unless he is a necessary party.
A ‘Tribunal’/a ‘Court of Law’ is to address a ‘question’ as to whether an ‘enforceable right of a person’, may be affected if he is not joined as a party, in a given proceeding.
As far as the present case is concerned the Petitioner/Party in Person, cannot seek permission from this Tribunal, to be impleaded as 11th Respondent in the main Comp App (AT)(CH)(Ins) No.302/2021 because of the fact that the instant Company Appeal (AT)(cH)(Ins) No.302/2021 relates to the ‘aspect’ of valuation and publication of fresh advertisement pertaining to the Section 230 Scheme of the Companies Act, 2013. Further, the ‘Petitioner/Party in Person’ cannot pray for an impleadment as a Party, in his ‘personal capacity’ because of the fact he is ‘Erstwhile Liquidator’ and in his place new Liquidator, 8th Respondent, has come into the picture in the ‘main Appeal’.
Considering the fact that the question of ‘adding a party’, in a pending proceeding before the Tribunal/Court, is one of judicial discretion to be exercised, based on the facts and circumstances of the given case, and also coupled with the fact that there is no right enjoined upon a party to be joined as a Party whether ‘necessary or proper party’, this Tribunal based on the facts and circumstances of the instant Comp App (AT)(CH)(Ins) No.302/2021 comes to a consequent conclusion that the Petitioner/Impleading Party, ‘presence is not absolutely necessary and even without his presence or being arrayed as ‘one of the Respondents’, to the ‘main Appeal’, the instant Company Appeal (AT)(CH)(Ins) No.302/2021 can be disposed of on the basis of ‘available materials’ on ‘record’. Viewed in that perspective, the Petitioner/Party in Person cannot maintain his IA No.622/2022 in the main Comp App (AT)(CH)(Ins) No.302/2021 when he has no ‘Locus Standi’ to intervene in the main Appeal, all the more, when he was replaced by the new Liquidator/8th Respondent and in short this Tribunal holds that he is not a necessary nor a proper party to the main Appeal. Resultantly the IA No.622/2022 in Comp App (AT)(CH)(Ins) No.302/2021 filed by the Petitioner fails.
In fine, the IA No.622/2022 in Comp App (AT)(CH)(Ins) No.302/2021 is dismissed. No costs.