E. Shanmugam vs Bank Of India & Ors

IN THE MATTER OF: E.Shanmugam .....Appellant Vs. Bank of India & Ors. ......Respondents

Present : For Appellant: Ms. Ranjana Roy, Ms. Vasudha Sen, Ms. Ananya, Advocates

16.10.2019 - Two 'Financial Creditors' namely the 'Bank of India' and the

'Indian Overseas Bank' filed application for declaration that the Appellant

(Respondent No. 2 therein) and another 'M/s. Srinidhi Finance Pvt. Ltd.'

(Respondent No. 3 therein) are not 'Financial Creditors'.

The Adjudicating Authority ('National Company Law Tribunal')/Division

Bench, Chennai by impugned order dated 11th July, 2019 held that the Appellant

and the other person are rightly held to be the 'Financial Creditors'.

However, taking into consideration that the Appellant having continued

as Managing Director until before new management came in place of old

management there being a conflict of interest coming in between, the

'Resolution Professional' was directed not to include him as the member of the

'Committee of Creditors'. .....contd.

2

The grievance of the Appellant is against the orders of the Adjudicating

Authority wherein it is held that the Appellant is not to be included as a

member of the 'Committee of Creditors'. However, it is not in dispute that the

Appellant was the ex-Managing Director till new Management came in there

being a possibility of conflict of interest, the Appellant being an erstwhile

Managing Director he was rightly excluded as member of the 'Committee of

Creditors'. In the absence of any merit, the appeal is dismissed. No costs.

[Justice S. J. Mukhopadhaya] Chairperson

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

[Kanthi Narahari] Member (Technical)

ss/sk

Company Appeal (AT) (Insolvency)No.1053 of 2019