In the matter of REPUTE FOODS PRIVATE LIMITED
- CitationCP (IB) No. 303/AHM/2024
Ratio decidendi
The rule this decision rests on
The Adjudicating Authority, having been shown by the appellant's proof of deposit that the costs directed by its earlier order were paid within the time allowed, was required to take the appellant's reply on record; a reply rejected on the basis of non-payment of costs cannot stand once that payment is established. An order admitting an application under Section 7 that rests on the rejection of the corporate debtor's reply is a consequential order, and where the foundational rejection is set aside, the admission order falls with it and the application must be revived and considered afresh after the reply has been considered.
Written by Miss Lucy from the judgment below, not taken from a headnote.
Judgment
As delivered
O R D E R
(Hybrid Mode)
07.02.2025: Learned counsel for the Appellant submits that the Appellant has deposited the cost of Rs.5000 on 05.12.2024, which was also noted in order dated 06.12.2024, however, the proof of payment of cost could not be filed, hence, the Court did not consider the reply of the Corporate Debtor and reserved the order. Subsequently, by order dated 07.01.2025, Section 7 application has been admitted. It is submitted that the reply was already on the record as well as the rejoinder affidavit. Submission needs scrutiny.
Issue notice. Requisites along with process fee be filed within three days. Let Reply be filed within two weeks.
List this appeal for admission/ disposal on 28.02.2025.
Cont’d…/
In the meantime, no further steps shall be taken in pursuance of the order dated 07.01.2025.
[Justice Ashok Bhushan] Chairperson
[Barun Mitra] Member (Technical)
[Arun Baroka] Member (Technical) Archana/nn
Company Appeal (AT) (Insolvency) No.231 & 232 of 2025
PRINCIPAL BENCH, NEW DELHI Company Appeal (AT) (Insolvency) No. 231 & 232 of 2025 IN THE MATTER OF: Kishorbhai Bhanjibhai Vachhani …Appellant Versus Central Bank of India & Anr. …Respondents Present: For Appellant: Mr. Keith Varghese, Advocate. For Respondents: Mr. Tushar Singh, Ms. Aastha Kaushik, Advocates for R-1.
O R D E R
(Hybrid Mode) 16.07.2025: Heard learned counsel for the Appellant as well as learned counsel for the Central Bank of India. These two appeals have been filed against order dated 03.01.2025 and 07.01.2025 by which order the Adjudicating Authority directed that Appellant having not placed any proof for deposit of cost of Rs.5000/-, reply filed by the Appellant has not been taken into consideration and by subsequent order dated 07.01.2025, Section 7 application has been admitted.
2. When the Appeal was taken, submission of learned counsel for the Appellant was recorded that cost of Rs.5000/- was deposited on 05.12.2024, however, proof of payment of cost could not be filed. On 07.02.2025, this Tribunal passed following order:
“O R D E R (Hybrid Mode) 07.02.2025: Learned counsel for the Appellant submits that the Appellant has deposited the cost of Cont’d…/
Rs.5000 on 05.12.2024, which was also noted in order dated 06.12.2024, however, the proof of payment of cost could not be filed, hence, the Court did not consider the reply of the Corporate Debtor and reserved the order. Subsequently, by order dated 07.01.2025, Section 7 application has been admitted. It is submitted that the reply was already on the record as well as the rejoinder affidavit. Submission needs scrutiny. Issue notice. Requisites along with process fee be filed within three days. Let Reply be filed within two weeks. List this appeal for admission/ disposal on 28.02.2025. In the meantime, no further steps shall be taken in pursuance of the order dated 07.01.2025.”
3. A reply has been filed by the Respondent.
4. We have considered the submissions of learned counsel for the parties and perused the record.
5. There is no dispute that cost imposed by the Adjudicating Authority by order dated 25.11.2024 was to deposit the cost within 7 days of Rs.5000/- in Prime Minister Relief Fund. Appellant’s case is that the cost came to be deposited on 05.12.2024 i.e. within the time allowed by the Court. Proof of deposit of cost has also been brought on the record at page 120 of the paper book, which is receipt of payment of Rs.5000/- in Prime Minster Relief Fund. The cost having been deposited by the Appellant, we are of the view that Reply filed by the Appellant ought to have been taken on record.
Company Appeal (AT) (Ins.) No.1248 & 1566 of 2023
6. The Adjudicating Authority has passed order dated 07.01.2025 admitting Section 7 application after rejecting the reply of the Appellant.
7. After hearing learned counsel for the parties, we are of the view that the reply of the Appellant having been rejected to be taken on record, the order admitting Section 7 application is a consequential order without considering the reply. We are of the view that cost of Rs.5000/- having been already deposited by the Appellant, the reply was required to be looked into by the Adjudicating Authority. We, thus, set aside both orders dated 03.01.2025 and 07.01.2025 and revive Section 7 application filed by the Financial Creditor for fresh consideration after considering reply of the Appellant. Learned counsel for the Financial Creditor submits that rejoinder has already been filed before the Adjudicating Authority. We make it clear that we have not expressed any opinion on the merits of the Section 7 application and it is for the Adjudicating Authority to take a decision after considering the reply filed by the Appellant and the rejoinder, in accordance with law. With the aforesaid, both the appeals are disposed of.
[Justice Ashok Bhushan] Chairperson
[Barun Mitra] Member (Technical) Archana/nn
Company Appeal (AT) (Ins.) No.1248 & 1566 of 2023
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