Edelweiss Asset Reconstruction ... vs M/S Winsome Yarns Ltd

IN THE MATTER OF: Edelweiss Asset Reconstruction Company Ltd. ...Appellant

Versus Winsome Yarns Ltd. ...Respondent

Present: For Appellant: Mr. Neerja Malhotra, Mr. RP Agrawal, Ms. Manisha Agrawal, Vidhisha Haritwal and Nimish Kumar, Advocates For Respondent: Mr. Pulkit Deora, Mr. Sajeve Deora and Arnav Vidyarthi, Advocates

ORDER

(VIRTUAL MODE) (ORAL)

(Per: Justice Rakesh Kumar Jain)

21.07.2022: This appeal is directed against the order dated

17.03.2020 passed by the Adjudicating Authority (National Company Law

Tribunal, Chandigarh Bench, Chandigarh) by which an application filed by

the Appellant under Section 7 of the Insolvency and Bankruptcy Code, 2016

(in short 'Code') read with Rule 4 of the Insolvency and Bankruptcy

(Application to Adjudicating Authority) Rules, 2016 (in short 'Rules') has

been dismissed only on the ground that the assignment deed dated

10.12.2015 in favour of the Appellant was insufficiently stamped.

Counsel for the Appellant has submitted that the order of the

Divisional Commissioner in regard to insufficient stamp on the assignment

deed was challenged by the Appellant by way of a Writ Petition No. 13346 of 2020, which has been allowed by the Hon'ble Punjab & Haryana High Court

on 26.10.2021 by setting aside the order of the Divisional Commissioner.

In view thereof, Counsel for the Appellant has submitted that once the

only reason for dismissal of the application filed under Section 7 of the Code

is no more there because the order of the Divisional Commissioner has been

set aside by the Hon'ble Punjab and Haryana High Court on 26.10.2021,

this matter may be remanded back to the Adjudicating Authority to decide it

on merits.

Counsel for Respondent, however, has submitted that the order dated

26.10.2021 has been challenged by way of a Letters Patent Appeal (LPA) in

which notice has been issued but no stay has been ordered so far though an

application has been filed.

In rebuttal, Counsel for the Appellant has submitted that at this stage

the order of the Divisional Commissioner does not exist which was the only

reason for the Adjudicating Authority to dismiss the application filed by the

Appellant under Section 7 of the Code, therefore, the matter may be

remanded back to the Adjudicating Authority to decide it in accordance with

law and insofar as the pendency of the LPA or the application for the stay is

concerned that may be seen by the Adjudicating Authority if any order is

passed.

We are one with the argument raised by Counsel for the Appellant

and in view of the fact that the order of the Divisional Commissioner, which

was the sole reason for dismissal of the application filed under Section 7 of

the Code, has been set aside by the Hon'ble Punjab and Haryana High

Court in the Writ Petition, we are of the considered opinion that this appeal deserves to be allowed and the matter requires to be remanded back to the

Adjudicating Authority for decision on merits. No other point is raised in

this appeal.

In view of the above facts and circumstances, the present appeal is

hereby allowed and the order dated 17.03.2020 is set aside. The matter is

remanded back to the Adjudicating Authority to decide the application filed

under Section 7 of the Code in accordance with law. It is made clear that

while passing this order we have not touched any aspect of the merits of the

case. The parties may take up all the issues available to them before the

Adjudicating Authority.

The parties are directed to appear before the Adjudicating Authority

on 25th August, 2022.

The registry is directed to send a copy of this order to the concerned

Adjudicating Authority forthwith for compliance.

[Justice Rakesh Kumar Jain] Member (Judicial)

[Mr. Kanthi Narahari] Member (Technical)

[Dr. Alok Srivastava] Member (Technical)

Sheetal/RR