Ravi Mahajan vs Jalesh Kumar Grover & Ors

Ravi Mahajan ...Appellant

Vs

Jalesh Kumar Grover & Ors. ....Respondents

Present: For Appellant: Ms. Annannya Ghosh, Mr. Mehul Parti and Mr. Gaurav Arora, Advocates. For Respondents: Mr. G. P. Medora, Mr. Utkarsh Mishra and Ms. Pankhuri Kaur, Advocates for Liquidator. Mr. Krishnendu Datta, Mr. Mohit Bakshi and Mr. Yohaann Limathwalla, Advocates for R-3. Mr. Jitendra Kumar and Mr. Anjaneya Singh, Advocates for SBI. Mr. Prashant, Advocate for PNB.

ORDER

15.04.2019: This appeal has been preferred by Appellant - 'Mr. Ravi

Mahajan', Promoter of 'M/s Muskaan Power Infrastructure Ltd.' (Corporate

Debtor) against order dated 11th December, 2018 passed by Adjudicating

Authority (National Company Law Tribunal), Chandigarh Bench, whereby it

passed order of liquidation of the Corporate Debtor.

2. Learned counsel for the Appellant submitted that the initiation of the

Corporate Insolvency Resolution Process was set aside by this Appellate Tribunal

on 6th December, 2017 and the said order was set aside by Hon'ble Supreme

Court by order dated 3rd August, 2018. Therefore, according to her the time -2-

spent in litigation in Hon'ble Supreme Court i.e. 232 days should be excluded

for counting the period of 270 days.

3. Learned counsel for the Financial Creditor opposed the prayer and

submitted that the order of this Appellate Tribunal dated 6th December, 2017

setting aside the initiation of proceeding was stayed by the Hon'ble Supreme

Court on 14th December, 2017 since then the Resolution Professional continued

to function, therefore at the best 8 days can be excluded and in such case, 270

days will expire on 2nd May, 2018.

4. When we asked learned counsel for the Appellant, learned counsel for the

Appellant submits that if the Resolution Process continues then the plan

submitted by it can be considered. On the other hand according to learned

counsel for the Respondent, the Appellant was ineligible in terms of Section 29A

and the resolution plan submitted by Appellant was rejected by the Committee

of Creditors in April, 2018. According to Counsel for the Appellant, the Corporate

Debtor is a Small Scale Industry, therefore, the Promoter will be eligible to file

resolution plan. However, it is accepted that such provision has been made by

amendment of the I&B Code on 6th June, 2018 before which 270 days had

already completed, therefore, the Appellant could not have derived advantage of

this provision on the basis that it was Promoter of Small Scale Industry.

Company Appeal (AT) (Insolvency) No. 66 of 2019 -3-

5. For the reason aforesaid, while we are not inclined to interfere with the

impugned order dated 11th December, 2018 but make it clear that the Liquidator

is to act in terms of order passed by this Appellate Tribunal in 'Y. Shivram Prasad

Vs. S. Dhanapal & Ors. etc.' - Company Appeal (AT) (Insolvency) No. 224 of 2018

& 286 of 2018', disposed of on 27th February, 2019, wherein this Appellate

Tribunal directed, observed and held as follows:-

"19. In view of the observations aforesaid, we hold that the

liquidator is required to act in terms of the aforesaid

directions of the Appellate Tribunal and take steps under

Section 230 of the Companies Act. If the members or the

'Corporate Debtor' or the 'creditors' or a class of creditors like

'Financial Creditor' or 'Operational Creditor' approach the

company through the liquidator for compromise or

arrangement by making proposal of payment to all the

creditor(s), the Liquidator on behalf of the company will move

an application under Section 230 of the Companies Act, 2013

before the Adjudicating Authority i.e. National Company Law

Tribunal, Chennai Bench, in terms of the observations as

made in above. On failure, as observed above, steps should

be taken for outright sale of the 'Corporate Debtor' so as to

enable the employees to continue."

Company Appeal (AT) (Insolvency) No. 66 of 2019 -4-

6. It is made clear that at the stage of liquidation under Section 230 of the

Companies Act, it is open to the members of Promoter to propose scheme in

terms with the statement and object of the 'I&B Code and any scheme given by

the Promoter is also to be considered in accordance with aforesaid order. The

appeal stands disposed of with aforesaid observation. No costs.

[Justice S. J. Mukhopadhaya] Chairperson

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

(Kanthi Narahari) Member (Technical)

am/gc

Company Appeal (AT) (Insolvency) No. 66 of 2019