Devamata Commercials Private Limited vs Sunrise Tsr Factory & Ors

Subhlaxmi Campusis Pvt. Ltd. ...Appellant

Versus

IDFC First Bank Ltd. & Ors. ...Respondents

Present:

For Appellant: Mr. Saurabh Kalia, Mr. Pankaj Jain and Mr. Sidhartha Tandon, Advocates For Respondents: Mr. Ajay Monga and Mr. Navneet Gutpa, Advocates for IDFC Bank Ltd. Mr. Wills Mathews, Mr. Dhanesh M Nair, Advocates for R-2.

With

Comp. App. (AT) (Ins.) No. 1476 of 2019 & I.A. No. 4197 & 4198 of 2019 & 2881 & 2909 of 2021

IN THE MATTER OF:

Devamata Commercials Pvt. Ltd. ...Appellant

Versus

Sunrise TSR Factory & Ors. ...Respondents

With

Company Appeal (AT) (Ins.) No. 33 of 2020 & I.A. No. 96 of 2020

IN THE MATTER OF:

Devamata Commercials Pvt. Ltd. ...Appellant

Versus

Sunrise TSR Factory & Ors. ...Respondents -2-

Present: For Appellant: Mr. Ashok Kumar Jain, Advocate For Respondent: Mr. Ajay Monga and Mr. Navneet Gutpa, Advocates for IDFC Bank Ltd. Mr. Wills Mathews, Mr. Dhanesh M Nair, Advocates for R-1.

ORDER

25.08.2022: Company Appeal (AT) (Ins.) No. 1475 of 2019

This appeal is directed against the impugned order dated 18.10.2019 by

which the National Company Law Tribunal, Mumbai Bench has allowed the

application bearing MA No. 2883 /2019 filed by IDFC First Bank (Respondent

No. 1 herein) on the issue that the Appellant herein, who is otherwise holding

59.57% of the voting percentage in the CoC, is a related party. Counsel for the

appellant has submitted that when the application was filed, the Ld. Tribunal

had reserved the order on 23.08.2019 without issuing notice to the Appellant.

However, the impugned order was passed on 18.10.2019.

Although, it is submitted that there are issues relating to the merits of

the case as well but the impugned order has been challenged by the Appellant

firstly on the issue of violation of principle of natural justice i.e. audi alteram

partem.

It is submitted that the Appellant being a Financial Creditor, holding

59.57% of the voting percentage of the CoC, could not have been shown the

door in the manner in which the Tribunal has passed the order i.e without

giving any opportunity.

Comp. App. (AT) (Ins.) No. 1475, 1476 of 2019 & 33 of 2020 -3-

It is also submitted that even an administrative order could not be

passed, without giving an opportunity of hearing if the said order affects the

civil life of the person concerned.

Counsel for the Respondent has been fair enough with the court to

submit that it is nowhere reflected from the record of this case that any notice

was given to the Appellant at the time when the order was reserved on

23.08.2019 much less the opportunity of hearing.

Thus, in view of the aforesaid circumstances and the law settled that

nobody should be condemned unheard, the impugned order is found in

violation of principal of natural justice and is thus hereby set aside.

The matter is remanded back to the Tribunal to hear the application

again bearing MA No. 2883 /2019 after providing an opportunity to the

Appellant, being the effected party and then pass a speaking order. We further

direct the Tribunal to decide aforesaid application as early as possible but not

later than 15 days from the date of appearance of the parties before it.

The parties are directed to appear before the Tribunal on 2nd September,

2022.

It is needless to mention that all the parties shall cooperate with the

Tribunal to get the application disposed of within the time prescribed by this

Tribunal.

Comp. App. (AT) (Ins.) No. 1475, 1476 of 2019 & 33 of 2020 -4-

Company Appeal (AT) (Ins.) No. 1476 of 2019 & Company Appeal (AT) (Ins.) No. 33 of 2020

This appeal is directed against the impugned order dated 18.10.2019

passed by the National Company Law Tribunal, Mumbai Bench by which an

application bearing MA No. 1061 of 2019, filed by the RP was allowed. Counsel

for the Appellant has submitted that it had executed a Slump Sale Agreement

dated 05.05.2018 with the Corporate Debtor and the entire business was

closed with the appellant for a sum of Rs. 52.50 crores, however, as per the

allegations of the Respondents, in the forensic audit report dated 31.03.2018

the net value of the property in question was fixed at Rs. 110 crores.

Counsel for the Appellant while assailing the validity of the impugned

order passed in MA No. 1061 of 2019 has submitted that said application filed

by the Resolution Professional has been allowed by the 'Tribunal' without

issuing notice to him and as a result it infringed the civil right. Counsel

appearing on behalf of the respondent could not contest this argument of the

appellant about the non issuance of the notice by the Tribunal and passing the

order.

We have heard counsel for the parties and after perusal of record are of

the considered view that the Tribunal should have followed the principle of

natural justice i.e. audi alteram partem which says that nobody should be

condemned without hearing. Since the facts are not dispute about the filing of

the application, non issuance of the notice by the Tribunal and also not

providing any opportunity of hearing to the Appellant, the impugned order Comp. App. (AT) (Ins.) No. 1475, 1476 of 2019 & 33 of 2020 -5-

suffers from the vice of violation of principle of natural justice of condemning

the appellant without hearing.

At this stage, counsel for the appellant has also pointed out that another

application bearing MA No. 2265 of 2019 filed by the IDFC Bank Ltd.,

supporting the contention of the Resolution Professional was also allowed

without notice and without hearing.

Needless to mention that the 'Tribunal' should have issued notice in the

application bearing M.A. No. 2265/2019 also as its supports the cause of the

Resolution Applicant who had filed MA No. 1061 of 2019.

In view of the aforesaid circumstances, we have come to this conclusion

that the impugned order has been passed in both MA No. 1061/2019 & M.A.

No. 2265/2019 violating the principal of natural justice.

The appeal is thus allowed. The impugned order passed in MA No.

1061/2019 & M.A. No. 2265/2019 are set aside. The matter is remanded back

to the National Company Law Tribunal, Mumbai for passing a fresh order after

affording an opportunity of hearing to the appellant and also by passing a

speaking order.

The Tribunal shall make all its endeavours to decide the application

within a period of 15 days from the date of the appearance of the parties before

it.

Comp. App. (AT) (Ins.) No. 1475, 1476 of 2019 & 33 of 2020 -6-

The parties are directed to appear before the Tribunal on 2nd September,

2022. Status quo be maintained till the application is decided by the Tribunal.

[Justice Rakesh Kumar Jain] Member (Judicial)

[Dr. Alok Srivastava] Member (Technical)

sa/rr

Comp. App. (AT) (Ins.) No. 1475, 1476 of 2019 & 33 of 2020