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Judgment
KANTHI NARAHARI, MEMBER (TECHNICAL)
Preamble:
The Present Appeal is filed under Section 61 of the Insolvency & Bankruptcy Code, 2016 (for short “I&B Code”) against the Order dated 01st September, 2020 passed by the Adjudicating Authority (National Company Law Tribunal, Ahmedabad Bench, Ahmedabad) in I.A. No. 381 of 2018 in C.P. (IB) No. 208/9/NCLT/AHM/2017, whereby the Adjudicating Authority appointed Mr. Amit Gupta, the Respondent herein as Liquidator of the Corporate Debtor.
Brief Facts:
Appellant’s Submissions:
Sh. Rudreshwar Singh, Learned Counsel appearing for the Appellant submitted that the Appellant is a trust registered under the Indian Trust Act, 1882 formed with the object of protecting the interest of the shareholders of Winsome Diamonds and Jewellery Limited. The Appellant being the shareholder of the corporate Debtor is interested in the proceedings wherein decisions concerning the Corporate Debtor are being taken.
It is submitted that the Corporate Debtor is into CIRP vide admission order dated 13.02.2018 and Mr. Anshuman Chaturvedi was appointed as Resolution Professional on 30.05.2018. While so, the Respondent was introduced by the Standard Chartered Bank in the 4th Meeting of CoC held on 07.08.2018, even though the RP had shown his willingness to continue as Liquidator. However, the CoC decided to appoint the Respondent as Liquidator. The RP filed an application being IA No.381 of 2018 under Section 33 of the Code for liquidation of Corporate Debtor. However, the Appellant Association preferred an I.A. No. 465 of 2018 raising objections regarding non-execution of decrees and consequentially against passing of an order of liquidation against the Corporate Debtor. 4. While matter stood thus, an order was passed in I.A. No. 318 of 2018 liquidating the Corporate Debtor, however, I.A. No. 465 of 2018 is still pending for consideration.
The Learned Counsel submitted that the appointment of Respondent as Liquidator is in violation of Section 34(1) and Section 34(4) of the IBC, 2016.
It is submitted that the Appellant preferred the present Appeal challenging the order whereby the Adjudicating Authority appointed the Respondent as Liquidator. Having submitted the facts and the relevant provisions of law, Learned Counsel prayed this Bench to allow the Appeal by setting aside the appointment of Respondent as Liquidator.
Respondent’s Submissions:
The Respondent filed Reply Affidavit denying the averments made by the Appellant and submitted that the Adjudicating Authority passed the Order of Admission dated 13.02.2018 initiating CIRP against the Corporate Debtor and one Mr. Sunit Jagdishchandra Shah was appointed as IRP and later Mr. Anshuman Chaturvedi was appointed as RP by the CoC and confirmed by the Adjudicating Authority dated 30.05.2018.
It is submitted that in the 4th Meeting of CoC held on 08.08.2018, the CoC decided to liquidate the Corporate Debtor and resolved to appoint this Respondent as Liquidator and the RP filed I.A. No. 318 of 2018 before the Adjudicating Authority seeking liquidation of the Corporate Debtor and the Adjudicating Authority vide order dated 01.09.2020 passed order of liquidation.
It is submitted that the Appellant has no locus to challenge the appointment of the Respondent as Liquidator for the reason that the Association is not challenging the order of liquidation but only appointment of this Respondent as Liquidator. It is submitted that the Adjudicating Authority was well within its power and jurisdiction to appoint the Respondent as Liquidator and relied upon the decision of this Tribunal in Sandeep Kumar Gupta Vs. Stewarts & Lloyds of India Ltd. & Ors. in CA (AT) (Ins) No. 263 of 2017 dated 28.02.2018.
Analysis / Appraisal
Heard the Learned Counsel appeared for the respective parties. The short point for consideration is whether the Appellant has made out any prima-facie case to upheld the order passed by the Adjudicating Authority.
Admittedly, the Appellant is an Association ventilating its grievance against appointment of the Respondent as Liquidator. The fact remains that the RP has not challenged the appointment of this Respondent as Liquidator and this Tribunal does not find any allegations against this Respondent. No one aggrieved against the appointment of this Respondent as Liquidator except the Appellant and no genuine cause or reason shown neither any illegality or irrational has been pointed out by the Appellant except mere appointment as Liquidator by the Adjudicating Authority. Moreover, the Appellant failed to explain that the Adjudicating Authority lacks jurisdiction in appointing the Respondent as Liquidator. Furthermore, the CoC it its 4th meeting held on 07.08.2018 passed a Resolution and decided to appoint the Respondent as Liquidator. It is to be presumed that the CoC in its commercial wisdom has taken a decision and reposed its confidence in the Respondent to act as Liquidator.
Further, this Tribunal in Sandeep Kumar Gupta Vs. Stewarts & Lloyds of India Ltd. & Ors. in CA (AT) (Ins) No. 263 of 2017 held as under:
“In view of the aforesaid undisputed facts, while we hold that the observations made in the impugned order should not be construed to be misconduct on the part of the Appellant, but as we find that the Adjudicating Authority was not satisfied with the performance of the ‘Resolution Professional’, we hold that the Adjudicating Authority was well within its jurisdiction to engage another person as ‘Resolution Professional’ or ‘Liquidator’. Further, the list of ‘Resolution Professional’ being made available by the ‘Board’ to the Adjudicating Authorities, any person is appointed out of the said list submitted by the ‘Board’, it should be treated to be an appointment of ‘Resolution Professional’/‘Liquidator’ on the recommendation of the ‘Board’.”
Without going into the other aspects of the case this Tribunal is of the view that the order under challenge was passed by the Adjudicating Authority on 01.09.2020 and till passing of this order, if the period is taken into consideration from the date on which the impugned order was passed i.e. 01.09.2020, much time has passed i.e. more than 2½ years and it would be a futile exercise if the order is interfered with, keeping in view of the time bound proceedings of the IBC.
Conclusion:
This Tribunal comes to a resultant conclusion that the Appellant has not made out a prima-facie case to be interfered with the order passed by the Adjudicating Authority. Accordingly, the Appeal sans merit and liable to be dismissed.
The Appeal is dismissed. No orders as to cost. Applications, if any, pending stands closed.