Madhusudan Sharma vs J.D. Aneja Edibles Pvt. Ltd

Company Appeal (AT) (Insolvency) No. 764 of 2019

IN THE MATTER OF:

Madhusudan Sharma ...Appellant

Versus

J.D. Aneja Edibles Pvt. Ltd. ...Respondent

Present:

For Appellant: Mr. Vinod Kr. Chaurasia, Advocate

ORDER

27.08.2019 This appeal has been preferred by Mr. Madhusudan Sharma,

'Resolution Professional' of the 'Corporate Debtor' against the order dated 7th

June, 2019 passed by the Adjudicating Authority (National Company Law

Tribunal), Jaipur Bench. By the impugned order, the Adjudicating Authority

while approving the 'resolution plan' made certain observations against the

'Resolution Professional' as under:

"29. In relation to IA No. 58/JPR/2018 filed by the

RP bringing to the notice of this Tribunal about

the transactions as contemplated under the

provisions of Section 43, 45, 50 and 66 for

orders under the corresponding sections, it is

required to notice that even though the said 2

application was filed on 15.10.18 no serious

effort was taken by RP to press this application

for disposal. In relation to the same it is required

to note that the RP had not been too vigilant in

pressing for an order to be passed as it is

required to notice that under Section 29A (g) a

person will not be eligible to be a resolution

applicant who has been a promotor or in the

management or in control of CD in which a

preferential transaction, undervalued

transaction, extortionate credit transaction or

fraudulent transaction has taken place and in

respect of which an order has been made by the

adjudicating authority under this code.

30. However, no such order has been passed even

though in application IA No. 58/JPR/2018 has

been filed by the RP of which we have already

expressed our opinion in relation to the conduct

of the RP in not seriously pressing for this

application to be disposed of prior to accepting

Company Appeal (AT) (Insolvency) No. 764 of 2019 3

the Resolution Plan filed by the RA. Further it is

also required to note that during the course of

submission, learned RP brought to the notice of

this Tribunal that the COC has also been

apprised of the several transactions alleged to

be falling under the above sections however, the

CoC has not chosen to press for the charges/

allegation made against the promotors of the

Corporate Debtor, however has chosen to

approve the resolution plan taking into

consideration the commercial wisdom and in

fact has given a clean chit while an appeal was

pending before the Hon'ble NCLAT vide letter

dated 16.08.2018 in relation to default. Further,

it is also pointed out and a repeated assertion

is made by the respondents, including the

Resolution Applicants, in relation to IA No. 57 of

2018 that the Corporate Debtor is a closely held

company and pre-dominantly carried with

funds made available by related parties and

Company Appeal (AT) (Insolvency) No. 764 of 2019 4

that funds of the public are not involved for

carrying out the affairs/business of the

Corporate Debtor. It is also stressed that all the

activities like purchase or sale are carried at

arms length transactions only and not as

averred by the RP, who at the time of oral

submissions by learned counsel for

RA/Respondent contends that the same has

been made by the RP without understanding

the nature of business done by the Corporate

Debtor being that of dealing in mustard seeds,

mustard cake, mustard oil are driven by its own

mechanics, however for the time being we are

not closing application in CA No. 58 of 2018

filed by the RP in view of the directions issued

to direct the monitoring agency in the concluding

part of this order."

2. Learned counsel appearing on behalf of the Appellant referred to 8 orders

dated 25.10.2018; 30.11.2018; 04.01.2019; 07.02.2019; 14.02.2019;

22.02.2019; 28.02.2019 and 07.03.2019 to suggest that I.A. No. 58/JPR/2018

Company Appeal (AT) (Insolvency) No. 764 of 2019 5

filed by the 'Resolution Professional' was taken up 8 times but no order was

passed by the Adjudicating Authority. In spite of the same, the Adjudicating

Authority has wrongly made the observations that no serious effort was made by

the 'Resolution Professional'. It is submitted that the 'Resolution Professional'

brought the facts to the notice of the Adjudicating Authority who took up the

matter 8 times but no order is passed by the Adjudicating Authority.

3. Taking into consideration the aforesaid facts, we accept the stand taken

by the Appellant and find that when the I.A. was listed before the Adjudicating

Authority no order was passed by the Adjudicating Authority on the aforesaid

dates and as such no observation can be made against the performance of the

'Resolution Professional'.

4. For the reasons aforesaid, we set aside the observations as made against

the 'Resolution Professional in paragraphs 29 and 30 of the impugned order and

allow the appeal.

[Justice S.J. Mukhopadhaya] Chairperson

[ Justice A.I.S. Cheema ] Member (Judicial)

[ Kanthi Narahari ] Member (Technical) /ns/gc

Company Appeal (AT) (Insolvency) No. 764 of 2019