Rishabh Chand Lodha Erstwhile ... vs Shri Anant Syntex Ltd

Risbah Chand Lodha Erstwhile Resolution Professional of Baldava Textiles Pvt. Ltd. ...Appellant

Versus

Shri Anant Syntex Ltd. ...Respondent

Present: For Appellant: Present but appearance not marked. For Respondent:

ORDER

(Hybrid Mode)

05.03.2024: I.A. No. 1589 of 2024: This is an application praying for

condonation of 17 days delay in refiling the appeal. Sufficient cause has been

shown in the application to condone delay in refiling. Refiling delay is

condoned. I.A. No.1589 of 2024 stands disposed of.

2. Heard learned counsel for the Appellant. This Appeal has been filed by

the Appellant against order dated 08.12.2023 passed by the Adjudicating

Authority in I.A. No.195/JPR/2022. I.A. was filed by the Appellant seeking

direction to get the possession of stock belonging to the Corporate Debtor

which was in possession of Shri Anant Synex Ltd.

3. Appellant's case was that no sale took place prior to CIRP and hence

the assets still belong to the Corporate Debtor and should be handed over to

the Appellant.

Cont'd.../ -2-

4. The Adjudicating Authority heard the parties, considered the reply and

returned finding that sale was completed prior to initiation of CIRP. In Para

16 of the order following finding has been returned:

"16. It is also an admitted fact that auction of the finished and grey stock was conducted on 23.02.2021 which is prior to admission of the Application filed under Section 9 by the Applicant against the Corporate Debtor namely M/s Baldva Textiles Pvt. Ltd. This application under Section 60(5) has been filed by the Applicant challenging the auction of finished and grey cloth by the Respondent on the pretext that the Company in favour of which the auction sale was conducted is a related party to the Respondent."

5. CIRP of the Corporate Debtor was commenced on 11.11.2021 and the

Adjudicating Authority after noticing the submissions has taken the view that

assets were sold prior to initiation of CIRP.

6. Learned counsel for the Appellant submits that assets were sold to a

sister company and the sale was not valid transaction and actually it was all

fraudulent exercise.

7. After hearing learned counsel for the parties, we are of the view that the

Adjudicating Authority having returned a finding that transaction took place

prior to initiation of CIRP, if the Appellant is of the view that transaction was

illegal or irregular, it is open for the Resolution Professional to file an

appropriate application under Section 43, 45 and 66 of the IBC. However, we

do not find any error in the order of the Adjudicating Authority refusing to

Company Appeal (AT) (Insolvency) No.472 of 2024 -3-

hand over the assets to the Appellant which according to the Adjudicating

Authority was sold prior to initiation of CIRP. There is no merit in the Appeal.

Appeal is dismissed.

[Justice Ashok Bhushan] Chairperson

[Barun Mitra] Member (Technical)

[Arun Baroka] Member (Technical) Archana/nn

Company Appeal (AT) (Insolvency) No.472 of 2024