Rajasthan Drugs And Pharmaceuticals ... vs M/S Ate Projects Pvt. Ltd

IN THE MATTER OF: Rajasthan Drugs and Pharmaceuticals Ltd. Through its Authorised Representative Laiqur Rahman Khan ...Appellant Versus

ATE Project Pvt. Ltd. & Ors. ...Respondents Present:

For Appellants : Mr. Manoj K Srivastwa, Advocate For Respondents : Mr. Alok Tripathi and Ms. Pooja Aggarwal, Advocates for R-1.

ORDER

22.08.2022: This Appeal is directed against the order dated 11.11.2021

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

Bench) in CA (IB) No.324/9/JPR/2019 by which an Application filed by the

Operational Creditor/Respondent No.1 under Section 9 of the Insolvency and

Bankruptcy Code, 2016 (for short 'Code') read with Rule 6 of the Insolvency

and Bankruptcy (Application to Adjudicating Authority) Rules, 2016 has been

admitted. In short, the Appellant (Corporate Debtor) invited tenders for various

works in the year 2015. The Respondent No.1 being the Successful Bidder was

awarded the contract on 04.12.2015 which was accepted by the Appellant on

the same date through email. In pursuance thereof, the Corporate Debtor

issued various purchase orders dated 28.12.2015, 29.12.2015 & 23.12.2015

worth Rs. 5,38,50,590/-.

-2-

It is averred by Respondent No.1 that after depositing the security and

receiving the advance it started working and submitted the running bills.

However, the Respondent No.1 received a letter dated 17.01.2017, issued by

the Government of India on 09.01.2017 regarding the shutting down of the

Corporate Debtor as a result thereof, the working at the site was stopped and

Respondent No.1 was informed that the outstanding liabilities, whatsoever,

shall be cleared. The Appellant vide letter dated 17.01.2017 asked the

Corporate Debtor/Respondent No.1 to send the total outstanding dues on

which the Corporate Debtor had submitted the details of the Principal amount

of Rs. 1,80,36,531/- accrued as on 26.03.2017 against all the three

agreements, which was due since October, 2016. Since, there was no response

by the Appellant to the amount demanded by the Respondent No.1, it sent a

legal notice dated 11.01.2019 demanding the outstanding payments. It also

filed an application under Section 9 of the Arbitration and Conciliation Act,

1996 for seeking direction qua the Corporate Debtor to handover the C-Form

for the material supplied. But the said application was rejected on the technical

ground that mandatory injunction cannot be granted. Thereafter, the

Respondent No.1, issued a demand notice dated 13.11.2019 under Section 8 of

the Code claiming an amount of Rs. 2,98,79,294.12/- as the operational debt.

Company Appeal (AT) (Ins) No. 1003 of 2021 -3-

In the said application notice was issued to the Appellant who appeared for the

purpose of filing of Reply and thereafter chose not to appear even on the date

when the case was finally heard on 23.09.2021. However, the Tribunal took

into consideration the Reply filed by the Appellant herein and passed the

impugned order.

Counsel for the Appellant has vehemently argued that the Respondent

No.1 has not submitted the joint measurement. But at the same time he has

failed to reply as to whether at any point of time the Appellant had asked

Respondent No.1 in that regard. Counsel for the Appellant has then argued

that since it is a Government Company therefore it should be spared from the

insolvency. We are really amazed with this amusing argument raised by Ld.

Counsel for the Appellant because on the one hand it is argued that it is a

Government Company therefore, Insolvency proceedings should not be carried

out against it and on the other hand the Government Company did not choose

to look after its interest before the Tribunal as it hardly appeared and remained

silent. We have been crying hoarse that the litigation of the Government is not

being looked after the way it should have been and this is one of such

examples.

Company Appeal (AT) (Ins) No. 1003 of 2021 -4-

No other arguments have been raised. In view of the aforesaid facts and

circumstances we do not find any error in the Impugned order which requires

our interference and hence, the Appeal is dismissed. No costs.

[Justice Rakesh Kumar Jain] Member (Judicial)

[Dr. Alok Srivastava] Member (Technical)

sr/rr

Company Appeal (AT) (Ins) No. 1003 of 2021