Rakesh Kumar Bhanot vs Gunocean Inc

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NATIONAL COMPANY LAW APPELLATE TRIBUNAL PRINCIPAL BENCH, NEW DELHI Comp. App. (AT) (Ins) No. 1171 of 2024 & I.A. No. 4187, 4188, 4189 of 2024 IN THE MATTER OF: Rakesh Kr. Bhanot & Anr. ...Appellants Versus Gunocean Inc. & Anr. ...Respondents Present: For Appellants : Mr. Hans Raj Bhogra, & Mr. Sarvirender Goyal, Advocates. For Respondents : None. JUDGMENT

Per: Justice Rakesh Kumar Jain:

This appeal is filed by the two suspended directors of the Corporate

Debtor, namely, Arjun Mall Retail Holdings Pvt. Ltd., being aggrieved

against the order dated 14.05.2024 passed by the NCLT, Chandigarh (in

short 'the Tribunal') by which an application filed under Section 7 of the

Insolvency and Bankruptcy Code, 2016 (in short 'Code') by the Financial

Creditor, namely, M/s Gunocean Inc. bearing CP (IB) No. 174/Chd/Pb/2022

for the resolution of its debt of Rs. 2,44,96,537.99, has been admitted and

Hans Raj Bhogra was appointed as the Interim Resolution Professional

(IRP).

2. In brief, the CD started construction of a hotel, namely, Hotel Clarks

Inn Arjun (in short 'Hotel'). The CD availed loan facility from the Banks but

it was declared as wilful defaulter for the violation of terms and conditions

of the loan. The CD then approached the financial creditor for a loan of 2

Rs. 75 lakhs regarding which a MOU was entered into between the parties

but it was concealed by the CD that it had already been declared as NPA

by the banks which had earlier granted various loan facilities to it. The CD

failed to honour the terms and conditions of the MOU from its inception

as it did not pay the minimum assured monthly amount which fell due on

10.02.2015 till 20.02.2018 when the statement of claim was filed by the

Financial Creditor before the Arbitrator. The Arbitrator vide its order (Arb.

Case No. Arb01/2018) dated 20.02.2019 passed the award in favour of the

Financial Creditor and directed the CD to make the payment in terms of

the award but the CD failed to pay the same and committed further

default.

3. The CD filed an appeal against the arbitral award dated 20.02.2019

before the District Court (Tis Hazari Courts), Delhi bearing CNR No.

DLWTOI 003934-2019) (OMP (Comm.) No. 17/2020 which was dismissed

and the District Court observed that "the challenge to the arbitral award is

without any merit. The award is reasoned. It neither patently illegal nor

the finding shakes the conscience of the Court. The ground on which the

award is challenge fails. Therefore, I am of the opinion that there is no

ground to set aside the arbitral award".

4. The CD then filed an appeal against the order dated 15.07.2020

passed by the District Judge before the Hon'ble High Court of Delhi bearing

FAO (Comm) 31/2021 in which Interim order was passed to the effect that

"the Appellants are directed to deposit with the Registrar General of this

Court, 50 percent of the principle awarded amount i.e., Rs.75 lakhs within a 3

period of four weeks from today. The balance 50 percent be deposited within

a period of four weeks thereafter. For the remaining amounts due under the

award, inclusive of costs and interest, the Appellant No.2 i.e. Mr. Rakesh

Kumar Bhanot shall furnish an unconditional undertaking for self and on

behalf of Appellant No. 1, to the effect that subject to the outcome of the

appeal, he shall be personally liable to pay the balance awarded amount

alongwith with costs and interest accrued thereon and shall further forthwith

comply with the directions issued by this Court in this regard. It is made clear

that any breach of the undertaking shall entail all consequences, in

accordance with law".

5. The execution of the award was stayed subject to deposit of the amount

and furnishing of the undertaking as directed, however, the CD again failed

to comply with the directions of the Hon'ble High Court as neither any

amount, so directed, was deposited with the Registrar General of the Court

nor unconditional undertaking was furnished. This was again another step

of default on the part of the CD.

6. The CD, against the order of Hon'ble Delhi High Court dated

10.02.2021, filed an appeal before the Hon'ble Supreme Court bearing

SLP (C) No. 4357 of 2021 which was also dismissed on 17.03.2021 with the

following order "Having heard Ld. Sr. Counsel for the Petitioners and

carefully perusing the material placed on record, we see no reason to interfere

with the impugned interim order passed by the High Court".

7. The Hon'ble Delhi High Court vacated the interim order dated

10.02.2021 by making observation that "the Appellants having not complied 4

with the conditions, subject to which interim order was granted, the Interim

order granted on 10.02.2021 is vacated and CM No. 5051/2021 for stay is

dismissed."

8. The application under Section 7 of the Code was filed to claim the

amount of default of Rs. 2,44,96,537.99 which the date of default was

mentioned as 20.02.2019 when the award was passed and the amount

became payable. Notice in the application filed under Section 7 of the Code

was issued. Reply was filed by the Respondent (CD) on 25.01.2024. It was

alleged that the award is dated 20.02.2019 and the petition is filed on

30.05.2022, therefore, it is barred by limitation. It was also alleged that the

award dated 20.02.2019 has not attained finality because the appeal under

Section 37 of the Arbitration and Conciliation Act, 1996 is pending before

the Delhi High Court.

9. The Tribunal has found that there was no representation on behalf of

the CD despite repeated calls, therefore, the CD was proceeded against ex-

parte vide order dated 09.04.2024.

10. The Tribunal also found that the amount in question falls within the

definition of financial debt which was acknowledged and admitted in the

MOU dated 24.01.2015. The Tribunal also decided the issue of limitation

against the CD while referring to the order of the Hon'ble Supreme Court

in the case of Re: Cognizance for extension of limitation registered as Suo

Motu Writ Petition (C) No. 3 of 2020 decided on 27.04.2021. It was also

observed that the SLP filed by the CD before the Hon'ble Supreme Court was

dismissed on 17.03.2021, therefore, the limitation can also be taken from 5

the said date considering it to be a date of default. It was also observed

that the CD cannot take the plea that award dated 20.02.2019 has not

attained finality because the appeal filed against it had also been dismissed.

Ultimately, the Tribunal recorded a finding that date and default is not in

question, the application filed under Section 7 is within limitation and hence,

the same was admitted and IRP was appointed.

11. Aggrieved against the aforesaid order, this appeal has been filed by the

suspended directors of the CD.

12. During the pendency of this appeal, the Respondent No. 1 and 2 were

proceeded against ex-parte because of their non-appearance.

13. Counsel for the Appellant has submitted that the Tribunal has erred

in admitting the application filed under section 7 of the Code in respect of

the amount of Rs. 2,44,96,536.99/- though only Rs. 18,55,000/- was

released by the FC to the CD. It is also submitted that the order passed by

the Hon'ble Supreme Court in Suo Motu Writ Petition No. 3 of 2020 has

wrongly been applied. It is further submitted that the default means non-

payment of debt when whole or any part has become due and payable and

as per the allegations of the FC, the default had occurred on 10.03.2015,

therefore, the period of limitation of three years is to be counted from

10.03.2015 which had expired on 09.03.2018.

14. We have heard Counsel for the appellant and perused the record.

15. There is no dispute that MOU was executed between the parties on

24.01.2015 and the CD has acknowledged the entire receipt of amount of 75 6

lakhs. There is also no dispute that the CD continuously failed to honour

the terms and conditions from the very beginning i.e from 10.02.2015 till

the matter was referred to the arbitrator and statement of claim was filed on

20.02.2018. The Arbitrator gave his award on 20.02.2019 which is in the

nature of a decree and is executable, therefore, if the application is filed on

30.05.2022 from the date of award dated 20.02.2019, the order passed by the

Hon'ble Supreme court in Suo Motu Writ Petition No. 3 of 2020 would come

to the rescue of the Appellant in so far as the limitation is concerned.

16. The award dated 20.02.2019 was challenged by the CD in appeal before

the District Court which was dismissed on 15.07.2020 and it was

categorically held that there is no error or illegality in the award of the

Arbitrator. Though the order dated 15.07.2020 was further challenged in

appeal before the Hon'ble Delhi Court yet stay earlier granted was vacated

because the condition in order of stay were not complied with by the CD

because it never wanted to pay anything to the Financial Creditor and had

rather preferred an appeal to the Hon'ble Supreme Court against the order

of 10.02.2021 but the said appeal was also dismissed by the Hon'ble Supreme

Court on 17.03.2021. Apropos, the Hon'ble Delhi High Court also vacated the

order of stay dated 10.02.2021 on the ground that the CD has totally failed

to comply with the condition which is in nature of depositing 50 % of the

principal awarded amount i.e. 75 lakhs within a period of four weeks with

the registrar of the Court and 50% within the period of four weeks thereafter.

17. Coupled with the aforesaid facts, the non-appearance of the CD in the

Tribunal in which it was proceeded against ex-parte would also indicate that 7

the CD had scant respect for the judicial process because it was ex-parte

before the Arbitrator as well.

18. Besides these facts, it is also pertinent to mention that the amount of

Rs. 2,44,96,537.99/- has been claimed on the basis of the award. The

operative part of the said award is reproduced as under:-

19. The CD cannot be permitted to take the plea that the award dated

20.02.2019 has not attained finality despite the fact that the CD had lost

one round of litigation up to the Hon'ble Supreme Court and has failed on

merit in appeal before the District Court. Although we will refrain from

commenting upon the act and conduct of the CD but suffice it to say that it

had no intention, at any time, to make the payment of the Financial Creditor

because it was already declared defaulter by the Bank when it obtained loan

from the banks and committed default coupled with the fact that the CD at

the time when it obtained the loan from the financial creditor and entered into

MOU, did not disclose that the it had already been declared defaulter or NPA

by the Banks.

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20. Thus, looking from any angle much less the facts narrated herein

above, we are of the considered opinion that there is hardly any merit in this

appeal for the purpose of interference in the well-considered order of the

Tribunal, hence, the appeal is dismissed though without any order as to

costs. I.As, if any, pending are hereby closed.

[Justice Rakesh Kumar Jain] Member (Judicial)

[Mr. Naresh Salecha] Member (Technical)

[Mr. Indevar Pandey] Member (Technical) New Delhi 29th August, 2025 SC