Radha Mohan Khandelwal vs Rajdhani Trading Company Pvt. Ltd. & Anr

NATIONAL COMPANY LAW APPELLATE TRIBUNAL, NEW DELHI

Company Appeal (AT) (Insolvency)No.360 of 2019 IN THE MATTER OF: Radha Mohan Khandelwal .....Appellant Vs. Rajdhani Trading Company ......Respondent With

Company Appeal (AT) (Insolvency)No.420 of 2019 IN THE MATTER OF: Radha Mohan Khandelwal .....Appellant Vs. Rajdhani Trading Company ......Respondent Present : For Appellant: Mr. Priyanshu Upadhyay, Mr. Abir Sumesh, Advocates For Respondents: Mr. Manish Kr. Choudhary, Mr. Ashutosh Kumar, Mr. Ali Sardar Zaidi, Advocates for R-3

01.10.2019 - 'Rajdhani Trading Company' ('Operational Creditor') filed an

application u/s 9 of the Insolvency & Bankruptcy Code, 2016 ('I&B' Code, for

short) for initiation of 'Corporate Insolvency Resolution Process' against M/s.

Romesh Power Products Pvt. Ltd. It is alleged that the Adjudicating Authority

('National Company Law Tribunal') , Jaipur without notice to the 'Corporate

Debtor' passed ex-parte order dated 20th December, 2018 admitting the

application u/s 9, leading to filing of Company Appeal (AT)(Ins.) No. 420/2019.

Company Appeal (AT) (Insolvency)No.360 of 2019 The Appellant, shareholder of M/s. Romesh Power Products Pvt. Ltd.

having come to know of the same, file a petition for review and recall of the

order which had been passed ex-parte, which has also been rejected by the

Adjudicating Authority by impugned order dated 21st February, 2019 and for

which Company Appeal (AT) (Insolvency)No.360 of 2019 has been filed. In this

background, two appeals have been preferred by the Appellant challenging the

aforesaid two orders.

Earlier, when the matter was taken up, learned counsel for the Appellant

submitted that 'M/s. Rajdhani Trading Company Pvt. Ltd.' at the instance of the

'Corporate Debtor' made supplies to 'South Bihar Power Distribution Company

Ltd.' It was informed that 'South Bihar Power Distribution Company Ltd.' had

agreed to pay the dues of the supplier, ''M/s. Rajdhani Trading Company Pvt.

Ltd.'('Operational Creditor')

The aforesaid fact has not been noticed by the Adjudicating Authority and

impugned order of admission was passed on 20th December, 2018.

Learned counsel appearing on behalf of the Appellant relied on the letter

issued by 'South Bihar Power Distribution Company Ltd.' in support of its claim

to suggest that the work was performed for rural electrification in Bihar and

therein it was stated that vendors will be paid by 'South Bihar Power Distribution

Company Ltd.' The letter contained in Memo No. 6177 dated 5th October, 2018,

copy of which was forwarded to 'M/s. Romesh Power Products Pvt.

Ltd.'('Corporate Debtor') has been enclosed, an extract of which is as follows:-

Company Appeal (AT) (Insolvency)No.360 of 2019 2 Company Appeal (AT) (Insolvency)No.360 of 2019 3 Company Appeal (AT) (Insolvency)No.360 of 2019 4 Mr. Ashutosh Kumar, learned counsel appears on behalf of 'South Bihar

Power Distribution Company Ltd.' (Respondent No. 3) accepts that the said

Respondent agreed to pay the money to the 'Rajdhani Trading Company Pvt.

Ltd.'('Operational Creditor').

Mr. Nileshwar Singh, learned counsel appear on behalf of 'Rajdhani

Trading Company Pvt. Ltd.' and submits that 1st Respondent 'Operational

Creditor' has no objection if the amount is paid by the 'South Bihar Power

Distribution Company Ltd.' He also requested to direct the Respondent to pay

the cost of litigation.

Mr. Amol Vyas, Advocate appears on behalf of 'Resolution Professional'

and submits that he had performed work for entire period and stated that he is

entitled for a sum of Rs. 17 lacs including Resolution cost.

The Resolution cost has been made and fee is payable. For each month

@Rs. 1,80,000/- fee is claimed and adding costs total Rs. 16,29,240/- is sought.

From the record, we find that 'Rajdhani Trading Company Pvt. Ltd.'

('Operational Creditor') had knowledged that 'South Bihar Power Distribution

Company Ltd.' has ordered to supply to the 'South Bihar Power Distribution

Company Ltd.' and it was also known that amount will be paid by the said

Company ('South Bihar Power Distribution Company Ltd.'). The third

Respondent, 'South Bihar Power Distribution Company Ltd.' has also stated

that it was liable to pay the amount to the 'Operational Creditor'.

Company Appeal (AT) (Insolvency)No.360 of 2019 5 In the circumstances, we hold that the application u/s 9 was filed against

M/s. Romesh Power Products Pvt. Ltd. with malicious intent for purpose other

than the Resolution of Insolvency or liquidation of the 'Corporate Debtor' and in

fact the application u/s 9 was not maintainable.

For the reason aforesaid, we set aside both the impugned orders dated 20th

December, 2018 which was passed ex-parte and the order refusing recalling

dated 21st February, 2019.

The 'Operational Creditor' will raise the bills and place it before the third

Respondent ('South Bihar Power Distribution Company Ltd.' ) which after

verification will clear the bills and pay the amount preferably within one month

from the date of receipt of the claim.

In so far as the fee of the 'Interim Resolution Professional' / 'Resolution

Professional' is concerned, we calculate it @ Rs. 1 lakh per month i.e. Rs. 9 lakhs

for total period of 270 days and cost of Rs. 3,58,000/- as claimed by the 'Interim

Resolution Professional'/ 'Resolution Professional', i.e. total Rs. 12,58,000/- and

additional amount of Rs. 30,000/- towards fee of the lawyers to appear twice

before this Appellate Tribunal and round off the same @ Rs. 13,00,000/- to be

paid after adjusting the amount, if any, already paid.

Company Appeal (AT) (Insolvency)No.360 of 2019 6 The amount of Resolution fee and costs as above is to be borne by the

'Corporate Debtor' and the 'Operational Creditor' equally i.e. 50.50% be paid to

the 'Interim Resolution Professional' / 'Resolution Professional' within 30 days.

The appeal is allowed with aforesaid observations.

[Justice S. J. Mukhopadhaya] Chairperson

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

[Kanthi Narahari] Member (Technical)

ss/gc

Company Appeal (AT) (Insolvency)No.360 of 2019 7