Janak Dhawan vs Famous Innovations Digital Creative ...

Janak Dhawan ...Appellant

Vs

Famous Innovations Digital Creative Pvt. Ltd. & Ors. ...Respondents

Present: For Appellant: Mr. Anuj Shah, Advocate.

For Respondents: Mr. Pranav Sarthi, Advocate for R-1. Mr. Gautam Singhal, Advocate with Mr. Atul Tandon, IRP. Mr. Lzafeer Ahmad, Advocate for Intervener.

ORDER

20.12.2019: 'M/s Famous Innovations Digital Creative Pvt. Ltd.'

(Operational Creditor) preferred application under Section 9 of the Insolvency

and the Bankruptcy Code, 2016 (hereinafter referred to as 'I&B Code')

pursuant to which the Adjudicating Authority (National Company Law

Tribunal), New Delhi Bench II initiated Corporate Insolvency Resolution

Process against 'M/s Mode Advertising and Marketing Pvt. Ltd.' which is under

challenge. Initially, when the matter was taken up on 30th July, 2019, learned

counsel for the Appellant submitted that the 'agreement' cited by the

1st Respondent was the 'partnership agreement', pursuant to which

Respondent was entitled to profit sharing (35%), therefore, it cannot come

within the definition of 'Operational Creditor' as defined under Section 5(21) of

the I&B Code nor he can claim to be 'Financial Creditor' as the debt, if any, -2-

does not come within the definition of 'Financial Debt' as defined under Section

5(8) of the I&B Code.

2. It was further submitted that if any amount was payable to 'M/s Famous

Innovations Digital Creative Pvt. Ltd.', Operational Creditor, pursuant to the

agreement, the Appellant is ready for amicable settlement. It was informed

that the Committee of Creditors has not been constituted. Subsequently, it is

informed and accepted by Mr. Pranav Sarthi, the learned counsel for 'M/s

Famous Innovations Digital Creative Pvt. Ltd.' (1st Respondent) that they have

agreed for settlement and they have reached settlement to receive amount as

shown due in Form 5. Learned counsel for the Appellant has handed over four

Demand Drafts for total amount of Rs.17,47,436/- to learned counsel for the

1st Respondent. This apart Interest amount + TDS is being paid by cheques

and cheques are handed over to learned counsel for the 1st Respondent, who

accepts the same.

3. The learned counsel for the 1st Respondent is accordingly directed to

handover the Demand Drafts and Cheques to the 1st Respondent - 'M/s

Famous Innovations Digital Creative Pvt. Ltd.'.

4. An affidavit has been filed by the learned counsel for the Appellant and

in the Affidavit the Appellant has also enclosed the copy of Demand Drafts and

Company Appeal (AT) (Insolvency) No. 769 of 2019 -3-

Cheques. It was informed that another Operational Creditor - 'G. H. Prints Pvt.

Ltd.' also filed application under section 9 before the Adjudicating Authority for

initiation of Corporate Insolvency Resolution Process against the Corporate

Debtor, which was subsequently admitted on 15th October, 2019, which was

not permissible after initiation of Corporate Insolvency Resolution Process

against the Corporate Debtor, therefore, the Adjudicating Authority (National

Company Law Tribunal), New Delhi by subsequent order dated 5th November,

2019 recalled the order of admission being infructuous. The said order has

been brought on the record. It was informed that the Appellant has also

entered Memorandum of Understanding (MOU) on 13th December, 2019 with

'G. H. Prints Pvt. Ltd.', other Operational Creditor, to ensure that no insolvency

resolution process starts in future. The MOU dated 13th December, 2019 is

also placed on record.

5. Mr. Gautam Singhal, the learned Advocate appears on behalf of Mr. Atul

Tandon, Interim Resolution Professional, who has worked for about five and a

half months and claimed payment of Rs.75,000 per month towards his fee. In

addition to cost of Rs.15,000 incurred towards publication and Rs.70,000

towards cost of three days appearance of lawyers.

6. In the circumstances, we assess the fee of Mr. Atul Tandon, Interim

Resolution Professional at Rs.75,000/- per month, which will be calculated for

Company Appeal (AT) (Insolvency) No. 769 of 2019 -4-

period of five and a half months. He is also allowed a sum of Rs.15,000

towards cost of publication and another sum of Rs.70,000 towards cost

incurred as legal fee i.e. Rs.85,000 towards actual cost plus fee.

7. The learned counsel for the Appellant submits that he has already paid a

sum of Rs.1,68,500/- to Mr. Atul Tandon. The Appellant is directed to pay the

rest of the amount towards fee after adjusting the amount of Rs.1,68,500 in

terms of our decision, within three weeks.

8. Mr. Lzafeer Ahmad, the learned Advocate, wanted to intervene on behalf

of Ms. Rupa Gaur, one employee of the Corporate Debtor. It is submitted that

the said employee is entitle for Rs.4 Lakhs approx. and earlier cheques issued

has been bounced. The learned counsel for the Appellant submits that already

a Summary Suit has been filed by Ms. Rupa Gaur therefore no application

under Section 9 of I&B Code is maintainable their being a pre-existing dispute.

However, we are not inclined to determine such claim or counter claim.

10. In view of the fact that the 'Committee of Creditors' have not been

constituted, which is also accepted by Mr. Atul Tandon, Interim Resolution

Professional and also has reached settlement with both the creditors, as

discussed above and it is a going concern, we exercise power conferred to us

under Rule 11 of NCLAT Rule, 2016 and set aside the impugned order dated

4th July, 2019 passed by the Adjudicating Authority (National Company Law

Company Appeal (AT) (Insolvency) No. 769 of 2019 -5-

Tribunal), New Delhi Bench and dispose of the application under Section 9 filed

by 'M/s Famous Innovations Digital Creative Pvt. Ltd.' (1st Respondent) as

withdrawn. Company Petition No. IB-568/(ND)/2019 pending before the

Adjudicating Authority stands disposed off. The Adjudicating Authority will

close the proceeding. The Corporate Debtor - 'M/s Famous Innovations Digital

Creative Pvt. Ltd.' is released from the rigour of Corporate Insolvency

Resolution Process. The Appellant is directed to pay the rest of the amount to

the Interim Resolution Professional within three weeks. The Interim Resolution

Professional is directed to handover the 'Assets and Records of the Corporate

Debtor to Directors / Promoters of the Corporate Debtor'.

11. The appeal is allowed with aforesaid observations and directions.

[Justice S. J. Mukhopadhaya] Chairperson

[Justice Venugopal M.] Member (Judicial) am/sk

Company Appeal (AT) (Insolvency) No. 769 of 2019