Ashok Kumar Srivastava vs Naseem Vohra
- CitationComp. App. (AT) (Ins.) No. 123 of 2022
Ratio decidendi
The rule this decision rests on
The reasoning here is thin but present. The tribunal rests its decision on the following principles. Where a corporate debtor has been given adequate opportunity by the Adjudicating Authority to apply for setting aside an ex parte order, and has neither made such an application nor had the ex parte order set aside, it cannot later complain that the Adjudicating Authority acted illegally in proceeding with the matter in its absence or in hearing and deciding it on a listed date. Where the corporate debtor has not replied to the demand notice under Section 8 of the Insolvency and Bankruptcy Code, 2016, nor filed a reply to the Section 9 application, the Adjudicating Authority's order admitting the application under Section 9 is not vitiated by illegality. The institution of a civil suit by the operational creditor in respect of the same claim does not, by itself, preclude the corporate debtor's resort to, or the operational creditor's invocation of, the provisions of Section 9 of the Code.
Written by Miss Lucy from the judgment below, not taken from a headnote.
Judgment
As delivered
Ashok Kumar Srivastava ....Appellant (Ex Director of the Corporate Debtor) Vs. Mrs. Naseem Vohra ...Respondent For Appellant: Mr. Ashutosh Gupta, Mr. Gaurav Rana, Advocates. For Respondent: Mr. Meet Malhotra, Senior Advocate with Mr. Vijay Kaundal, Mr. Nitish K Sharma, Mr. Ravi Chauhan, Ms. Pallak Singh, Advocates.
ORDER
(Through Virtual Mode)
08.02.2022: Heard Learned Counsel for the Appellant and Learned Counsel for the Respondent.
2. This Appeal has been filed against the order dated 07.12.2021 passed by the Adjudicating Authority (National Company Law Tribunal), New Delhi (Court No.III) by which the Adjudicating Authority has admitted the Application under Section 9 of the Insolvency and Bankruptcy Code, 2016. The Respondent- Operational Creditor has filed Section 9 Application against the Corporate Debtor claiming the amount of lease rent from 01.11.2008 to 31.07.2011 in pursuance of the agreement entered with the Corporate Debtor. Prior to filing of the Application, Demand Notice in Form-3 under Section 8 was issued on 04.01.2019 which was not replied by the Corporate Debtor. When the Application was filed, notice was issued to the Corporate Debtor on 08.02.2021. Then, on the next date i.e. on 03.03.2021, the Adjudicating Authority noted that although service has been effected but no one appeared, hence, the Corporate Debtor was proceeded ex parte. On next date i.e. on 15.04.2021, Corporate Debtor appeared and was granted 10 days' time to file an appropriate Application for setting aside ex parte order.
2 It does not appear that any Application was filed for setting aside ex parte order. However, one-week further time was allowed on 08.07.2021 to the Corporate Debtor. The matter was thereafter adjourned on 28.09.2019, the case was adjourned and date was fixed on 27.11.2021. The copy of the cause list which was filed on the record indicates that the case was listed on 27.10.2021. Learned Counsel for the Appellant submits that it was heard and thereafter judgment delivered.
3. Learned Counsel for the Appellant submits that he did not get opportunity to address his submission since the case was heard on 27.10.2021. He further submits that there was pre-existing dispute and suit was already filed by Operational Creditor in the Civil Court of Gautam Budh Nagar which fact was not brought in notice by the Operational Creditor to the Adjudicating Authority. He further submits that no commercial use of the premises was being done.
4. Learned Counsel for the Respondent submits that the Appellant who is suspended Director of the Corporate Debtor has neither replied to the notice under Section 8 nor filed any Reply to the Section 9 Application and in spite of granting opportunity did not file Application to set aside the ex parte order. It is submitted that the Appellant has not contested the matter in any manner and now in this Appeal making all submissions. The suit which was filed was regard to taking possession of the property.
5. After having heard Learned Counsel for the parties and perusing the record, we are satisfied that the ample opportunity was granted to the Appellant by the Adjudicating Authority by giving him time to file Application for setting aside the ex parte order. No Application was filed to set aside the order nor ex parte order was set aside. The grievance of the Appellant is that on 27.10.2021, the matter was heard. He himself has filed the copy of the cause list in which the matter was listed on 27.10.2021 before the Adjudicating Authority. The order dated 28.09.2021 which has referred for fixing a date on 27.11.2021 that was order of Court Officer and not by the Court. We see no illegality in the order of the Adjudicating Authority hearing
Comp. App. (AT) (Ins.) No. 123 of 2022 3
the matter on 27.10.2021. The Appellant having chosen to neither reply while under Section 8 nor reply Section 9 Application, we do not find any illegality in the order of the Adjudicating Authority admitting the Application under Section 9. Filing of the suit by the Operational Creditor in no manner preclude the Corporate Debtor in invoking the provisions of Section 9 of the IBC. We do not find any good ground to entertain this Appeal. The Appeal is dismissed.
[Justice Ashok Bhushan] Chairperson
[Dr. Ashok Kumar Mishra] Member (Technical)
[Dr. Alok Srivastava] Member (Technical) Anjali/n
Comp. App. (AT) (Ins.) No. 123 of 2022
This page reproduces a public judgment and a summary of it. It is research material, not legal advice, and it is no substitute for advice from an advocate on your own facts.
Research this judgment with Miss Lucy
Ask what it holds, what has followed it, and what it means for your matter — in plain English, with the citations.
Try Miss Lucy free