Pani Trading Corp. Through Its ... vs Jagadishchandra B Mistri I.R.P. Of Sona ...

NATIONAL COMPANY LAW APPELLATE TRIBUNAL, PRINCIPAL BENCH, NEW DELHI Company Appeal (AT) (Ins) No. 858 of 2021 IN THE MATTER OF: Pani Trading Corporation ....Appellant

Vs. Mr. Jagadish Chandra B. Mistry IRP of Sona Alloys Pvt. Ltd. ...Respondents

Present For Appellant: Ms. Lakshmy Iyengar, Sr. Advocate with and Ms. Ankita G Shelke, Advocate. For Respondents: Mr. Sumit Shukla and Ms. Ruchi Goyal, Advocates for RP.

ORDER

(Virtual Mode) 15.12.2021: Heard both sides.

According to the Learned Counsel for the Appellant, the

Appellant/Applicant had projected I.A. No. 458 of 2020 before the Adjudicating

Authority (National Company Law Tribunal, Ahmedabad Court No.-2), wherein

a direction was sought to be issued to the Resolution Professional to consider

the claim. However, the Adjudicating Authority had passed the impugned order

in I.A. No.458 of 2020 on 07.09.2021 by mentioning that it heard the Learned

Counsel for the Resolution Professional and proceeded to make an observation

'Since the Applicant has accepted the shares which were allotted in view of

settlement of loan which is being claimed now, the claim does not remain to be a

debt' and ultimately came to the conclusion that I.A. No. 458 of 2020 was not

maintainable and rejected the same.

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The Primordial Submission of the Learned Counsel for the

Appellant/Applicant is that the 'Adjudicating Authority' in the impugned order

had only heard the Learned Counsel for the 'Resolution Professional' and there

was no mention of other Learned Counsels being heard/were heard in the

subject matter in issue and hence, the impugned order is an unreasoned one,

without assigning reasons and this is to be set aside, to promote substantial

cause of Justice.

In this connection, it may not be out of place for this court to make a

pertinent mention that the Hon'ble Supreme Court of India in the matter of

"Assistant Commissioner, Commercial Tax Department, Works Contract

and Leasing, Kota" vs. " Shukla and Brothers" reported in (2010) 4 SCC

785 wherein at paragraph 13 and 19 had observed the following:

"The Supreme Court has consistently taken the view that recording of reasons is an essential feature of dispensation of justice. A litigant who approaches the court with any grievance in accordance with law is entitled to know the reasons for grant or rejection of his prayer. Reasons are the soul of orders. Non-recording of reasons could lead to dual infirmities; firstly, it may cause prejudice to the affected party and secondly, more particularly, hamper the proper administration of justice. These principles are not only applicable to administrative or executive actions, but they apply with equal force and, in fact, with a greater degree of precision to judicial pronouncements. The orders of the court must reflect what weighed with the court in granting or declining the relief claimed by the applicant."

Company Appeal (AT) (Ins) No. 858 of 2021 -3-

Be that as it may, this 'Tribunal' bearing in mind that the impugned

order passed by the Adjudicating Authority (National Company Law Tribunal,

Ahmedabad Court No.-2) is bereft of necessary qualitative and quantitative

reasons and further not ascribing reasons in the order in law amounts to

violation of the negation of 'Principles of Natural Justice' thereby affecting the

interest of the affected party/litigant and also causing prejudice and untold

hardship and misery to the concerned litigant.

Be it noted that a Judicial Authority/Quasi-Judicial Authority/Tribunal

while dealing with the subject matter issue is required to pass an order, and

such an order is to be comprehended by a party/litigant and in this regard, a

party is duty bound to know the reasons either for allowing or rejecting of his

application in our Prevailing Judicial System.

It cannot be gain said that assigning of reasons in an order is the 'Heart'

and 'Soul' of any 'order' and absence of the same are a classic case of

'Miscarriage of Justice' meted out to the affected party. Viewed in that angle,

this 'Tribunal' comes to the consequent conclusion that the impugned order

does not stand a moment scrutiny in the eye of Law, since the same is clearly

unsustainable. Resultantly, this 'Tribunal' is constrained to interfere with the

impugned order and sets aside the same to prevent an 'Aberration of Justice'.

Company Appeal (AT) (Ins) No. 858 of 2021 -4-

In fine, the instant CA (AT) (Ins) No. 858 of 2021 is allowed. No costs. The

impugned order dated 07.09.2021 in I.A. No.458 of 2020 is set aside.

The Adjudicating Authority (National Company Law Tribunal,

Ahmedabad, Court No.2) is directed to restore the I.A. No. 458 of 2020 in CP

(IB) No. 586 of 2019 to its file within two weeks from the date of receipt of the

copy of this order and to pass orders on merits in a fair and just manner. of

course, after providing enough opportunities to both parties, to raise factual

and legal pleas in the matter and the same be dealt with by the 'Adjudicating

Authority' in one way or other at the time of passing the final order in the

manner known to Law and in accordance with Law.

[Justice M. Venugopal] Member (Judicial)

[V. P. Singh] Member (Technical)

[Dr. Ashok Kumar Mishra] Member (Technical)

sr/gc Company Appeal (AT) (Ins) No. 858 of 2021