Mr. Prathmesh Brar Director (Power ... vs Punjab National Bank And Anr
- CitationCompany Appeal (AT) (Ins) No. 21 of 2023
Ratio decidendi
The rule this decision rests on
The Tribunal reasoned that where substituted service of notice has been effected and publication made, there is a presumption that notice was validly served on the party. The Tribunal reasoned that a party on whom notice has been validly served but who chooses not to appear cannot secure a positive order on the appeal, and that the appropriate course is to dispose of the appeal and leave the appellant to seek recall of the impugned order before the Adjudicating Authority, which may recall the order only if it is satisfied that notice was not validly served, and must restore the impugned order if it finds that service was valid.
Written by Miss Lucy from the judgment below, not taken from a headnote.
Judgment
As delivered
IN THE MATTER OF: Prathmesh Brar ...Appellant Versus Punjab National Bank & Anr. ...Respondents Present: For Appellant : Mr. Pulkit Deora, Ms. Maitreyee Mishra, Advocates For Respondents : Mr. Manish Khurana, Advocate for R-2/IRP
ORDER
14.08.2023: The present appeal under Section 61 of the Insolvency and Bankruptcy Code, 2016 (herein after referred to as 'Code') has been preferred against the Judgment dated 24.11.2022 whereby National Company Law Tribunal, Chandigarh Bench, Chandigarh (herein after referred to as 'Adjudicating Authority') has admitted application filed by the Financial Creditor under Section 7 of the Code against the Appellant/Corporate Debtor.
The appeal was primarily preferred on the ground as if without notice to the Appellant the Adjudicating Authority has passed order ex-parte. It was argued by Mr. Pulkit Deora, Ld. Counsel for the Appellant that the address which was shown before the Adjudicating Authority in respect of premises of the Corporate Debtor was already taken in possession by the Bank and as such there was no reason for valid service of notice. However, on Perusal of paragraph 5 of the impugned order, it appears that twice notices were issued and subsequently affidavit was also filed regarding service of notice. Running page 56 of the Memo of Appeal also reflects that substituted service of notice was already effected. However, when the first time on 06.01.2023 the appeal -2-
was taken up, a Bench of this Tribunal, presided over by Hon'ble Chairperson was pleased to pass an order staying the order/Judgment dated 24.11.2022 passed by the Adjudicating Authority. Thereafter, continuously on 12.04.2023, 27.04.2023 and 12.07.2023 the appeal was listed and adjourned but there was none appearance on behalf of the Bank. Today, also there is none appearance.
Despite valid service of notice to the reasons best known to Bank, the Bank has preferred not to appear. Office note dated 20.02.2023, suggests that notice was served on Respondent No. 1, 2 however notice on Respondent No. 1A was not delivered. Only Mr. Manish Khurana, Ld. Counsel for Respondent No.2/IRP has entered appearance.
Mr. Pulkit Deora, Ld. Counsel for the Appellant reiterated that there was no reason for service of notice on the address shown in the Petition as reflected in the impugned order passed by the Adjudicating Authority. A plea has been taken that address in respect of the premises of the Appellant shown was already taken into possession by the Bank in the year 2015 itself and as such he submits that there was no valid service of notice.
We are of the opinion that if step for substituted service of notice was taken and paper publication was already done, it is presumed that notice was validly served on the party. However, considering the fact that despite service of notice Bank has preferred not to appear and interim order of stay is still continuing, we are of the opinion that instead of the passing any positive order the appeal can be disposed of granting opportunity to the Appellant to approach the Adjudicating Authority and file appropriate Petition for recall of the impugned order.
Company Appeal (AT) (Ins) No. 21 of 2023 -3-
If the Appellant is in a position to satisfy the Adjudicating Authority that notice was not validly served, then in that event the Adjudicating Authority may consider to recall the order and after hearing the Appellant pass appropriate order. For filing appropriate application for recall two weeks time is granted with indication that stay order which was passed by this Tribunal shall continue till final order is passed on the application/recall application filed by the Appellant by the Adjudicating Authority, provided such application is filed within two weeks from today. It goes without saying that if Adjudicating Authority, after hearing the parties considers that the notice was validly served earlier then in that event the order/Judgment dated 24.11.2022 impugned shall stand restored.
With above observation, the appeal stands disposed of.
[Justice Rakesh Kumar] Member (Judicial)
[Dr. Alok Srivastava] Member (Technical)
sr/md Company Appeal (AT) (Ins) No. 21 of 2023
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