Abhigam Shares & Securities Pvt. Ltd vs Infrastructure Leasing And Financial ...

Abhigam Shares & Securities Pvt. Ltd. ...Appellant

Versus

Union of India & Ors. ...Respondents

Present: For Appellant: Mr. Krishnendu Dutta, Sr. Advocate For Respondent: Mr. Ramji Srinivasan, Sr. Advocate with Mr. Raunak Dhillon, Ms. Isha Malik, Mr. Nihaad Dewan, Ms. Shruti Pandey, Ms. Namrata Saraogi, Advocates for IL&FS

ORDER

26.05.2023: Heard Learned Sr. Counsel Mr. Krishnendu Dutta for the

Appellant, Learned Sr. Counsel for IL&FS as well as Learned Counsel for Union

of India.

2. This Appeal has been filed against the Order dated 04.05.2023 passed

by Adjudicating Authority in C.A. No. 137 of 2023. C.A. No. 137 of 2023 was

filed by the Appellant, where following interim prayers were made:

"(i) Pending the hearing and final disposal of this Application, defer the interim distribution of Respondent No.

3 till such time the inter se priority and classification of claim of creditors of Respondent No. 3 is ascertained;

(ii) Pending the hearing and final disposal of this Application, restrain Respondent No. 3 from making any payment by way of interim distribution or otherwise to Respondent No. 2 till such time such time the inter se priority -2-

and classification of claim of creditors of Respondent No. 3 is ascertained;

(iii) Pending the hearing and final disposal of this Application, restrain Respondent No. 3 from making any payment by way of interim distribution or otherwise to Respondent No. 2 till such time that amounts due and payable by Respondent No. 3 under the Debentures issued and forming subject matter of Debenture Trust Deeds are paid in priority to the Applicant No. 1 and other debenture holders (represented by Applicant No. 2);

(iv) Pending the hearing and final disposal of this Application, direct that Respondent No. 3 will be kept out of the scope of the Interim Distribution Order, or grant an ad- interim stay on the interim/proposed or any other distribution of funds of Respondent No. 3, till the Application is finally heard and decided; and

(v) pass any other or further orders/directions as this Hon'ble Tribunal may deem fit and proper in the facts and circumstances of this case."

3. The Adjudicating Authority heard the Application on 04.05.2023 and

rejected the prayer for Interim Reliefs and with regard to which a detailed order

dated 04.05.2023 was passed. The Application C.A. No. 137 of 2023 has been

listed for consideration on 28th June, 2023. With regard to Interim Prayers

made by the Appellant, the Adjudicating Authority did not accept the prayer

of the Appellant that Interim Distribution be stayed. The Adjudicating

Authority observed that in the Interim Distribution, there are several checks

Company Appeal (AT) No. 80/2023 -3-

and balances to protect the interest of all stakeholders hence there is no

occasion to stay the Interim Distribution as prayed for by the Appellant.

4. Mr. Krishnendu Dutta, Learned Sr. Counsel for the Appellant submits

that the Interim Prayer which Appellant is pressing is that the amount which

is to be given to Respondent No. 2 under the Interim Distribution be not

distributed and kept in separate account.

5. Learned Sr. Counsel for the Respondent submits that order of Interim

Distribution was passed by this Tribunal on 31st May, 2022 and the

Adjudicating Authority itself has noticed about the checks and balances. There

has to be a specific undertaking from the respective creditors to bring back

the amount in case it was required. It is submitted that Interim Distribution

is subject to final distribution.

5. We have considered the submissions of learned Sr. Counsel for the

parties and have perused the record.

6. The prayer which was pressed by the Appellant before the Adjudicating

Authority was to stay the Interim Distribution. We are of the view that

Adjudicating Authority did not commit any error in not acceding to the said

prayers. The submission that the Contractual Rights of the Appellant which is

subject matter of the C.A. No. 137 of 2023 cannot be whished away by the

Respondent No. 2 and under the contractual obligations, the Respondent no.

2 is not entitled to have precedence in payment in the Interim Distribution.

The Application 137 of 2023 is still under consideration and as informed, has

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been fixed for 28th June, 2023. We have no reason that said application shall

be finally considered and decided by the Adjudicating Authority and at the

time of deciding Application C.A. No. 137 of 2023, Adjudicating Authority is

clothed with all necessary power and jurisdiction to issue necessary

consequential order to protect the interest of the Appellant if required. We thus

are of the view that at this stage we see no reason to interfere with the order

passed by the Adjudicating Authority on 04.05.2023.

With these observations, the Appeal is disposed of.

[Justice Ashok Bhushan] Chairperson

[Dr. Alok Srivastava] Member (Technical)

Basant/nn

Company Appeal (AT) No. 80/2023