B. Arun Eashwar & Ors vs Opg Power Generation Pvt. Ltd. & Anr

Company Appeal (AT) (Insolvency) No. 352 of 2019

IN THE MATTER OF:

B. Arun Eashwar & Ors. ...Appellants

Versus

OPG Power Generation Pvt. Ltd. & Anr. ...Respondents

Present: For Appellants : Mr. Nikhil Nayyar, Senior Advocate with Ms. Pritha Srikumar Iyer, Advocate

For Respondent : Ms. Prerna Bhargava and Ms. Isha Bhalla, Advocates

ORDER

03.05.2019 The Appellants - 'B. Arun Eashwar & Ors.' (shareholders) of

'M/s. Balu Spinning Mills Private Limited' (Corporate Debtor) have filed this

appeal against order dated 28th March, 2019 passed by the Adjudicating

Authority (National Company Law Tribunal), Division Bench, Chennai admitting

the application u/s 9 of the Insolvency and Bankruptcy Code, 2016 ( for short,

the 'I&B Code') filed by 'M/s. OPG Power Generation Private Limited'

(Operational Creditor).

On 12th April, 2019 when the matter was taken up, learned counsel for

the Appellant submitted that the parties have settled the matter and the

'Committee of Creditors' have not yet been constituted. In the circumstances,

the parties were allowed to file the 'Terms of Settlement' and the notices were

issued to the 'Operational Creditor' and the 'Interim Resolution Professional'. 2

Pursuant to the notice, Ms. Prerna Bhargava, learned counsel for the respondent

- 'OPG Power Generation Pvt. Ltd.' (Operational Creditor) and Mr. Ramasamy

Shanmugam, Interim Resolution Professional have appeared. It is accepted that

before the constitution of 'Committee of Creditors', the parties have reached for

the settlement on 11th April, 2019, a copy of which has been enclosed as

Annexure 1 with the affidavit filed by the Appellant No. 1. In view of the aforesaid

statement that the parties have settled the matter prior to the constitution of

the 'Committee of Creditors' and in view of the decision of the Hon'ble Supreme

Court in 'Swiss Ribbons Pvt. Ltd. & Anr', - '2019 SCC Online SC73' and in

exercise of inherent powers under Rule 11 of the National Company Law

Appellate Tribunal Rules, 2016, we set aside the impugned order dated 28th

March, 2019 and allow the respondent (Operational Creditor) to withdraw the

application under Section 9 of the I&B Code. The Adjudicating Authority will

close the proceedings. The 'Terms of Settlement' should be treated as a direction

of this Appellate Tribunal and should be complied with in its letter and spirit.

So far as the fee and resolution cost of the 'Interim Resolution Professional' is

concerned, the Corporate Debtor will pay the fees of the Interim Resolution

Professional within three weeks.

In effect, order (s) passed by Ld. Adjudicating Authority appointing 'Interim

Resolution Professional', declaring moratorium and all other order (s) passed by

Adjudicating Authority pursuant to impugned order and action taken by the

'Resolution Professional' are set aside. The application preferred by the

Respondent under Section 9 of the I&B Code is disposed of as withdrawn. The

Adjudicating Authority will now close the proceeding. The Respondent Company

Company Appeal (AT) (Insolvency) No. 352 of 2019 3

is released from all the rigour of law and is allowed to function independently

through its Board of Directors from immediate effect.

The appeal is allowed with aforesaid observations and directions. No

costs.

[Justice S.J. Mukhopadhaya] Chairperson

[ Justice A.I.S. Cheema ] Member (Judicial)

[ Kanthi Narahari ] Member (Technical)

/ns/gc

Company Appeal (AT) (Insolvency) No. 352 of 2019