Kunal Finance & Credit Pvt Ltd vs Mani Square Ltd

Kunal Finance & Credit Pvt. Ltd. ...Appellant

Versus

Mani Square Ltd. ...Respondent

Present: For Appellant : Mr. Kunal Tandon, Advocate For Respondent: Mr. Pranaya Goyal and Mr. Aman Raj Gandhi, Advocates

ORDER

(Through Virtual Mode)

08.06.2020 After hearing the learned counsel for the Appellant for a

while, we find that the order for admission or rejection of application under

Section 7 of the 'Insolvency and Bankruptcy Code, 2016' ('I&B Code', for short)

filed at the instance of the Appellant - Financial Creditor is yet to be passed and

in terms of the impugned order which is in continuation of an earlier order dated

5th November, 2019 directing the 'Corporate Debtor' not to dispose of fixed assets

so as to secure the interest of the 'Financial Creditor', the Adjudicating Authority

(National Company Law Tribunal), Kolkata Bench modified such order by

providing that a specific plan be submitted by the 'Corporate Debtor' before

disposal of the property for securing the interest of all stakeholders including the

'Financial Creditor'. It is, therefore, manifest that the Adjudicating Authority,

acting at the behest of the 'Corporate Debtor', considered it prudent to defer

consideration of admission of application under Section 7 of the 'I&B Code' by 2

providing opportunity to the 'Corporate Debtor' to submit a plan for satisfying

the claim of various stakeholders including the Appellant. It is in this context

that the impugned order has to be appreciated which ex- facie purports to secure

the interest of the creditors by placing an embargo on the exercise of rights by

the 'Corporate Debtor' qua disposal of its assets.

Be that as it may, the fact remains that the 'corporate insolvency

resolution process' is yet to commence as no order of admission of application

under Section 7 of the 'I&B Code' has been passed by the Adjudicating Authority.

It is equally true that the application has also not been rejected or triggering of

'corporate insolvency resolution process' has not been declined. Maintainability

of instant appeal itself is questionable.

In this fact situation, learned counsel for the Respondent - 'Corporate

Debtor' submits that the 'Corporate Debtor' intends to settle the claim of the

Appellant - 'Financial Creditor'. Since, the 'corporate insolvency resolution

process' has not been commenced, the 'Corporate Debtor' is at liberty to

approach the 'Financial Creditor' for settlement and if the settlement is reached,

'Settlement Terms' can be filed before the Adjudicating Authority who may upon

recording of the same, close the matter.

We accordingly dispose of the appeal by providing that the Respondent -

'Corporate Debtor' shall be at liberty to file the 'Settlement Terms' within three

weeks before the Adjudicating Authority who may close the case upon recording

the same. In the event of Respondent - 'Corporate Debtor' failing to file the

'Settlement Terms', the Adjudicating Authority shall accord consideration to the

application under Section 7 of the 'I&B Code' and if satisfied, pass an order of

admission commencing the 'corporate insolvency resolution process'. We make

Company Appeal (AT) (Insolvency) No. 514 of 2020 3

it clear that in doing so, the Adjudicating Authority will not be influenced by the

impugned order.

The appeal is accordingly dispose off.

A copy of this order be sent to the Adjudicating Authority (National

Company Law Tribunal), Kolkata Bench for information.

[ Justice Bansi Lal Bhat ] Acting Chairperson

[ Justice Jarat Kumar Jain ] Member (Judicial)

[ Shreesha Merla ] Member (Technical) /ns/RR/

Company Appeal (AT) (Insolvency) No. 514 of 2020