Biogenetic Drugs Private Limited vs Themis Medicare Limited

Biogenetic Drugs Private Ltd. ...Appellant

Versus

Themis Medicare Ltd. ...Respondent

For Appellant: Mr. Naresh Kr. Sejvani, Advocate

For Respondent: Mr. T. Sundar Ramanathan, Mr. Ishaan Chakrabarti, Mr. Vivek Pandey and Ms. Harshapreetha, Advocates

ORDER

(Virtual Mode)

29.11.2021 Heard learned Counsel for the Appellant as well learned

Counsel appearing for the Respondent. This Appeal under Section 61 has

been filed against the Judgement and Order dated 18th February, 2021 passed

by National Company Law Tribunal, Ahmedabad Bench, Ahmedabad

(Adjudicating Authority) in C.P.(I.B) No.696/NCLT/AHM/2019. The Appellant

before us claims to be a decree holder in Civil Suit No.06-NL/1 of 2017 which

decree was passed by learned Additional District Judge on 10th April, 2018.

Subsequent to passing of the Decree, the Appellant claiming to be Operational

Creditor has issued Demand Notice dated 21st July, 2018 which was duly

served. The said Notice was replied by the Respondent.

2. An Application under Section 9 came to be filed by the Appellant

claiming to be Operational Creditor in prescribed proforma i.e. Form 5. Total

amount of debt of Rs.28,35,880/- was claimed. In the list of documents, the 2

Application was duly replied by the Corporate Debtor. The Adjudicating

Authority by the Impugned Judgement has dismissed the Application.

Learned Counsel for the Appellant contends that although in para - 1 of the

Judgement, Adjudicating Authority has rightly noticed that Petition is under

Section 9. However, in the findings, the Adjudicating Authority has proceeded

on the ground that the Appellant is claiming to be Financial Creditor. The

Adjudicating Authority after referring to certain Judgements, has come to the

conclusion that although decree holder is covered under definition of Section

3(10) of the Insolvency and Bankruptcy Code, 2016 (IBC, in short) but does

not fall within the class of Financial Creditor and thus cannot initiate a

Corporate Insolvency Resolution Process. It is useful to extract para - 18 of

the Judgement. Para - 18 of the Judgement is reproduced below:-

"18. Under these circumstances, it is expedient to refer to the latest judgement of Hon'ble National Company Law Appellate Tribunal in the case of Sh. Sushil Ansal Vs Ashok Tripathi and Ors., wherein it is reiterated that a decree-holder though covered under the definition of creditor under Section 3(10) of the Insolvency and Bankruptcy Code (IBC) would not fall within the class of financial creditors and therefore, a decree holder cannot initiate a corporate insolvency resolution process (CIRP) against a corporate debtor with an object to execute a decree."

3. Learned Counsel for the Respondent submits that decree obtained was

ex parte decree. He submits that in fact, the Application under Section 9 has

been filed as a mode of recovery. He submits that IBC Code is not a forum for

Company Appeal (AT) (Ins) No.654 of 2021 3

recovery of the dues and hence, the Application was rightly dismissed. We

have heard Counsel for the parties and perused the record.

4. A Creditor is defined in Section 3(10) to the following effect:-

"(10) "creditor" means any person to whom a debt is owed and includes a financial creditor, an operational creditor, a secured creditor, an unsecured creditor and a decree-holder"

5. The present is a case where an Application has been filed by the

Appellant in Form 5 claiming to be Operational Creditor. In the very opening

of the Application, the Appellant has been referred as Operational Creditor.

The whole basis of Judgement of the Adjudicating Authority is that the

Appellant as a Financial Creditor, cannot maintain this Application. When the

Appellant has not filed the Application as Financial Creditor, there was no

question to go on the said issue.

6. Learned Counsel for the Respondent has also submitted that the

Application for dues was barred by time. The Application ought not to have

been entertained. Be as it may, the Adjudicating Authority having not gone

into any other issue, it is not necessary for us to consider any other issue in

this present Appeal. The very premise of the Judgement of the Authority being

incorrect, we set aside the impugned Judgement and revive the Application

under Section 9 before the Adjudicating Authority which may be considered

afresh in accordance with law. We make it clear that we are not expressing

Company Appeal (AT) (Ins) No.654 of 2021 4

any opinion on any other issue which may be involved in the Application

which is now to be decided by the Adjudicating Authority.

The Appeal is allowed as above.

[Justice Ashok Bhushan] Chairperson

[Dr. Alok Srivastava] Member (Technical) rs/nn

Company Appeal (AT) (Ins) No.654 of 2021