In the matter of SURYA MILK PRODUCTS PRIVATE LIMITED
- CitationIB-549/ND/2024
Ratio decidendi
The rule this decision rests on
The Tribunal may reverse an admitted corporate insolvency resolution process and restore the position as it stood on the date of initiation where the process was initiated with an ulterior motive, and it may infer such motive from the surrounding material, namely a resolution for dissolution passed by three operational creditors without any effort to resolve insolvency, and a substantial tax demand against the corporate debtor which the initiation of the process would have the effect of avoiding.
Written by Miss Lucy from the judgment below, not taken from a headnote.
Judgment
As delivered
IN THE NATIONAL COMPANY LAW TRIBUNAL: NEW DELHI SPECIAL BENCH (COURT – II) Item No. 214 IB-549/ND/2024 IA-14/ND/2025 IN THE MATTER OF: Kaveri Sales Corporation … Applicant/Petitioner Versus Surya Milk Products Pvt. Ltd. … Respondent Under Section: 9 of IBC, 2016 Order delivered on 15.07.2026 CORAM: SH. ASHOK KUMAR BHARDWAJ SH. BANWARI LAL MEENA HON’BLE MEMBER (J) HON’BLE MEMBER (T) PRESENT: For the Applicant : Adv Shubham Gupta For the Respondent : Hearing Through: VC and Physical (Hybrid) Mode ORDER IA-14/ND/2025: On being asked regarding the availability of the requisite certificate required to be given by the Liquidator in prescribed form, Ld. Counsel for the Liquidator submitted that no such form has yet been filed. Ld. Counsel for the RP could draw our attention to the resolution dated 05.03.2025 passed in second meeting of CoC. In his submission, the CoC could pass a resolution for dissolution of the Corporate Debtor. The resolution reads thus:
UPASANA/RUCHITA
It is seen from the resolution, the same has been passed by three of the Operational Creditors. Ld. Counsel for the RP could fairly submit that the Corporate Debtor has liability to pay an amount of Rs. 6,77,34,100/-. According to him, the demand was challenged in appeal which was rejected and now the appeal preferred by the Corporate Debtor is pending before Income Tax Appellate Tribunal (ITAT). We cannot be oblivious of the fact that when the demand by Income-Tax Department is Rs. 6,77,34,100/-, the application under Section 9 of IBC, 2016, was preferred by M/s Kaveri Sales Corporation, an Operational Creditor for default of an amount of Rs. 1,00,32,980/- i.e. an amount marginally above the threshold limit. Passing of the resolution for dissolution of the Corporate Debtor, without there being any effort to resolve the insolvency of the same and the demand by Income-Tax Department for an amount of Rs. 6,77,34,100/- is sufficient material to indicate that the process was initiated with ulterior motive to absolve the Corporate Debtor from liability to pay the UPASANA/RUCHITA
Income-Tax Department. In the wake, we reverse the CIRP and restore the position as was prevalent as on the date of initiation of CIRP. IB-549/ND/2024 stands restored and IA-14/ND/2025 stands disposed of accordingly.
Sd/- Sd/- (BANWARI LAL MEENA) (ASHOK KUMAR BHARDWAJ) MEMBER (T) MEMBER (J)
UPASANA/RUCHITA
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