Karan Automotives Private Limited vs Prudent Arc Limited

IN THE MATTER OF: Karan Automotives Pvt. Ltd. ...Appellant Versus Prudent ARC Ltd. (Prudent Trust 58/22) ...Respondent

Present: For Appellant : Mr. Sahil Yadav and Mr. Rishabh Arora, Advocates.

For Respondent : Mr. Sumeet Raj, Advocate.

ORDER

(Hybrid Mode)

22.05.2025 : Heard learned counsel for the appellant as well as learned

counsel appearing on behalf of the financial creditor, respondent herein.

2. This appeal has been filed against an order dated 02.05.2025 by which

order, the adjudicating authority has closed the opportunity to argue the

matter. Prior to the 02.05.2025, Section 7 application was listed before the

adjudicating authority on 03.04.2025, on which following order was passed:

"Ld. Counsel for the Applicant as well as Ld. Counsel for the Respondents are present physically.

Reply filed by the respondents is on board.

Ld. Counsel for the Applicant seeks some time to file rejoinder to the reply.

Three days time is granted to the Applicant to file Rejoinder with advance copy to other side.

List the matter on 02.05.2025."

3. On 03.04.2025, adjudicating authority fixed the matter on 02.05.2025

and on 02.05.2025, financial creditor sough some more time to file rejoinder affidavit. Adjudicating authority on the said request refused to adjourn the

matter for arguments. It is useful to extract the entire order 02.05.2025,

which is as follows:

"Learned Counsel for the applicant and Learned Counsel for the respondent are present physically and requested for pass over. Since the present matter i.e. Restored Company Petition (IBC) /22/ND/2024 (Old Case CP (IB)/60/ND/2023) is a matter which was earlier filed in 2023 and the same is pending for admission for a very long time. This Adjudicating Authority vide order dated 03.04.2025, had granted three days' time to the applicant to file rejoinder, however, till today i.e. 02.05.2025, the rejoinder is not available on e-portal of this Adjudicating Authority. Today, Learned Counsel for the applicant seeks some more time to file rejoinder. This Adjudicating Authority is of the view that already long time has been lapsed which is much beyond the prescribed period for such matter in Insolvency & Bankruptcy Code, 2016. Therefore, we do not wish to again adjourn the matter for arguments. Accordingly, the opportunity to argue the matter stands closed. Both the parties are permitted to file written submissions along with judgments/citations, if any, within one week. List this matter on 23.05.2025 for compliance."

4. From the order sheet it does not appear that at any point of time

adjudicating authority has heard the parties. Opportunity to argue the matter

can be closed when party does not make any submission, offer any argument.

There is no finding in the order that parties refused to argue the matter on

02.05.2025 and the last date 03.04.2025, no arguments were heard and the

matter was adjourned and time was granted to file rejoinder affidavit.

5. We thus are of the view that on 02.05.2025 there was no occasion to

close the opportunity to argue the matter. We thus are of the view that

direction in the order "accordingly the opportunity to argue the matter stands

closed" needs to be set aside.

6. It is submitted by the parties that the matter is listed for tomorrow

before the adjudicating authority. It shall be open for the appellant to request

for hearing of the matter or fixing a date for hearing.

Comp. App. (AT) (Ins.) No. 788 of 2025 2 of 3 With these observations, appeal disposed of.

[Justice Ashok Bhushan] Chairperson

[Barun Mitra] Member (Technical)

[Arun Baroka] Member (Technical) himanshu/nn

Comp. App. (AT) (Ins.) No. 788 of 2025 3 of 3