Saurabh Kumar Pandey vs Ambica Enclave Private Limited

NATIONAL COMPANY LAW APPELLATE TRIBUNAL, PRINCIPAL BENCH, NEW DELHI Comp. App. (AT) (Ins) No. 1478 of 2024 & I.A. Nos. 5505 of 2024 (Arising out of Order dated 03.07.2024 passed by the Adjudicating Authority (National Company Law Tribunal), New Delhi, Principal Bench (IB)-183(PB)/2024)

IN THE MATTER OF: Saurabh Kumar Pandey, Suspended Director (Proplarity Infrastructure Pvt. Ltd.) Son of Sh. Surya Kumar Pandey A-401, Rohtas Presidential Tower Vibhuti Khand Lucknow UP-226010. ... Appellant

Versus

1. M/s. Ambica Enclave Pvt. Ltd. 2. M/s. Siddhant Diagnostic Pvt. Ltd. 3. M/s. Divya TIE-UP Pvt. Ltd. 4. M/s. Kusum Enclave Pvt. Ltd. All having its corporate office at 23, Jagganthpuri Colony Rath Yatra, Mahmoorganj Road, Varanasi Through their Authorised Representative Mr. Nirmal Kumar Jain

5. Proplarity Infrastructure Pvt. Ltd. Under CIRP Through Vinod Kumar Chaurasia B-022, Pragati Vihar Hostel, Lodhi Road, New Delhi-110003. ... Respondents

Present:

For Appellant : Mr. Abhishek Anand and Mr. Sugam Mishra, Advocates.

For Respondent : Mr. Sunil Fernandes Sr. Advocate with Mr. Anjaneya Mishra, Mr. Nidish Gupta, Ms. Rajshree Chaudhary, Ms. Diksha Dadu Advocates for Intervener.

Company Appeal (AT) (Insolvency) No.1478 of 2024 1 Mr. Krishnendu Datta Sr. Advocate with Mr. Aditya Nayyar, Ms. Niharika Sharma, Advocates for Intervener in IA- 5505 of 2024. Mr. Alok Tripathi, Advocate for Respondent. Mr. Nidish Gupta, Mr. Alok Tripathi, Advocates for R-1 to 4. Mr. Abhijeet Sinha, Sr. Advocate with Mr. Iswar Mohapatra, Mr. Kunal H., Advocates. Mr. Vinod C., Advocate for IRP.

JUDGMENT

ASHOK BHUSHAN, J.

This Appeal by the suspended Director of the Corporate Debtor -

Proplarity Infrastructure Pvt. Ltd. has been filed challenging the order dated

03.07.2024 passed by National Company Law Tribunal, New Delhi, Principal

Bench admitting Section 7 Application filed by the Financial Creditors

(Respondent Nos.1 to 4 herein). The Appellant aggrieved by the order has

come up in this appeal.

2. Brief facts necessary to be noticed for deciding the Appeal are:

(i) Respondent Nos.1 to 4 claiming to be Financial Creditors of

the Corporate Debtor alleging that as per Loan Agreement

dated 13.10.2016, total amount due and in default is

Rs.10,21,07,880/-, filed Application under Section 7 of the

Insolvency and Bankruptcy Code, 2016 (hereinafter referred

to as the "IBC") in April 2024. The Adjudicating Authority

issued notice to the Corporate Debtor on the Application. The

Company Appeal (AT) (Insolvency) No.1478 of 2024 2 Adjudicating Authority noticed in the order that notice having

been issued it deemed to be served on the Corporate Debtor

and since no one appeared, hence proceeded to consider the

Application on merits and passed an order of admission on

03.07.2021.

(ii) In pursuance of the order dated 03.07.2021, the Interim

Resolution Professional ("IRP") issued a publication on

12.07.2024 inviting claims and 23.07.2024 was the last date

for submission of the claim. Claims were filed by Respondent

Nos.1 to 4 and other claimants, claiming that they are

Financial Creditors. The IRP provisionally admitted the

claims and constituted the Committee of Creditors ("CoC") on

25.07.2024 and filed the report of constitution of CoC before

the Adjudicating Authority. An email was also sent to the

Appellant and other Financial Creditors on 26.07.2024,

informing about constitution of the CoC.

3. The Appellant, suspended Director of the Corporate Debtor filed this

Appeal on 29.7.2024, which came for consideration before this Tribunal on

31.07.2024, on which date, following order was passed:

"31.07.2024: Ld. Counsel for the appellant submits that Section 7 application have been admitted by the impugned order and in pursuance of which a Committee of Creditors have already been constituted. It is submitted that appellant has settled with all 4

Company Appeal (AT) (Insolvency) No.1478 of 2024 3 applicants and one other person who has filed the Section 7 application but the RP has admitted two persons as Members of CoC who according to the appellant are related party. The said submission is opposed by one of the CoC Members who seeks liberty to file an application for impleadment.

Let the application for impleadment be filed by tomorrow.

List on 05.08.2024.

In the meantime, meeting of CoC be adjourned after 05.08.2024."

4. IA No.5734 of 2024 has been filed by M/s Creta Infrastructure Pvt. Ltd.

and IA No.5505 of 2024 has been filed by M/s Proplarity Infratech Pvt. Ltd.,

seeking impleadment in the Appeal. The Appellant has filed reply to both the

IAs. We permit the Applicants to intervene in the Appeal.

5. We have heard Shri Abhishek Anand, learned Counsel for the Appellant;

Shri Sunil Fernandes, learned Senior Counsel appearing on behalf of

Intervenor; Shri Krishnendu Datta, learned Senior Counsel has also appeared

for Intervenor in IA No.5505 of 2024; and Shri Alok Tripathi, learned Counsel

has appeared for Respondent Nos.1 to 4.

6. Shri Abhishek Anand, learned Counsel for the Appellant submits that

Section 7 Application was filed by Respondent Nos.1 to 4 claiming to be

Financial Creditors, with whom the Appellant has entered into settlement on

26.07.2024 and under which settlement, the Appellant has to make payments

to the Financial Creditors. Respondent Nos.1 to 4, having settled the matter,

there is no occasion to continue with the CIRP on their instance. It is

Company Appeal (AT) (Insolvency) No.1478 of 2024 4 submitted that IRP hurriedly constituted the CoC, without proper verification.

The last date for receiving the claim being only 23.07.2024, he constituted the

CoC on 25.07.2024 on the basis of provisional admission without proper

verification. Claims submitted by M/s Certa Infrastructure Pvt. Ltd. and M/s

Proplarity Infratech Pvt. Ltd. were claims submitted by 'related parties', which

claims were also barred by time, but the IRP has hurriedly included them into

the CoC. It is submitted that CoC has not been properly constituted as the

Appellant has already settled with Respondent Nos.1 to 4 and another

Financial Creditor, i.e. Mr. Kshitij Jain. Both M/s Certa Infrastructure Pvt.

Ltd. and M/s Proplarity Infratech Pvt. Ltd. being related parties, cannot

become part of the CoC. The learned Counsel for the Appellant has submitted

that M/s Proplarity Infratech Pvt. Ltd. has filed return on 31.05.2016, where

it was declared that Corporate Debtor was a related party. It is submitted that

Corporate Debtor did not file any return after 21.03.2018. As per the balance

sheet of the Corporate Debtor, M/s Proplarity Infratech Pvt. Ltd. is holding

1,40,000 shares, i.e. 93.33%.

7. Learned Counsel appearing for the Intervenor, M/s Certa Infrastructure

Pvt. Ltd. submits that the Intervenor is in no manner related to the Corporate

Debtor. The Intervenor has advanced unsecured loan to the Corporate Debtor

of Rs.2,12,00,000/- and the Corporate Debtor, in the last balance sheet of the

year 2018 has acknowledged the said disbursement. The learned Counsel for

the Intervenor has also referred to Agreement dated 25.10.2017 executed

Company Appeal (AT) (Insolvency) No.1478 of 2024 5 between the Appellant and one Mr. Satyendra Singh Tomar, whereby the

parties have decided to part their ways, which clearly means that Intervenor

is not related party.

8. Learned Counsel appearing for the Intervenor - M/s Proplarity Infratech

Pvt. Ltd. submits that the Intervenor has held 1,40,000 shares in the

Corporate Debtor and 1,39,000 shares were sold to Mr. Ajay Singh, which was

also approved by the Board of Directors of the Corporate Debtor in meeting

dated 25.10.2017 and 1,000 shares were sold to Mr. Sandeep Kumar, after

approval of the Board Meeting dated 16.01.2018 and in general now it is not

holding any shares in the Corporate Debtor and it is not a related party. It is

submitted that IRP has constituted the CoC on 25.07.2024, where voting

share of the Applicant is 43.91%. No settlement can be entered by the

Appellant without approval of the CoC. The claim of the Appellant that it has

settled with the Financial Creditors and CIRP be closed is without any basis.

9. Shri Abhijeet Sinha, learned Senior Counsel appearing for IRP submits

that IRP has not acted hurriedly and after receiving the claim it sent the email

to M/s Proplarity Infratech Pvt. Ltd. enquiring the relationship of the

Intervenor and the Corporate Debtor and reply was received from the

Intervenor on 25.07.2024 that they are not related party. It is submitted that

the report of the constitution of the CoC has been submitted by the IRP before

the Adjudicating Authority on 25.07.2024. Both the intervenors being

Company Appeal (AT) (Insolvency) No.1478 of 2024 6 Member of the CoC, the claim of settlement by Appellant, cannot be accepted.

The IRP has never been informed of any settlement by the Appellant.

10. We have considered the submissions of learned Counsel for the parties

and have perused the records.

11. There is no dispute between the parties that after initiation of CIRP on

03.07.2024, publication was made on 12.07.2024 inviting claims. The IRP

constituted the CoC on 25.07.2024 and submitted Report on 26.07.2024. In

the affidavit which has been filed by the IRP in this Appeal, the IRP has

brought on the record the report submitted by him before the Adjudicating

Authority for constitution of the CoC. One of the Annexure to the report

contains the List of CoC as on 23.07.2024. It is useful to extract the said list,

which is part of the report, which is as follows:

Company Appeal (AT) (Insolvency) No.1478 of 2024 7

12. The submission has been advanced by learned Counsel for the

Appellant that the Appellant has settled with Respondent Nos.1 to 4, who were

the Applicants under Section 7 Application and further he has settled with

one Mr. Kshitij Jain, who has also filed the claim. There is no dispute that

CoC was constituted on 25.07.2024, in which CoC both the Intervenors, i.e.

M/s Creta Infrastructure Pvt. Ltd. and M/s Proplarity Infratech Pvt. Ltd. were

part of the CoC. The vote share allocated to M/s Proplarity Infratech Pvt. Ltd.

was 43.91% and vote share of M/s Certa Infrastructure Pvt. Ltd. is 7.31%.

The Appellant is challenging the inclusion of both the above Intervenors in the

CoC on the ground that they are related party and their claim has wrongly

been admitted.

13. The present Appeal has been filed challenging admission order under

Section 7. The debt and default on the part of the Corporate Debtor is not

even questioned, which is an admitted fact. Hence, apart from challenging

the order of admission, we need not enter into issues sought to be raised by

the Appellant that both the Intervenors are related party and their claims have

wrongly been admitted. The issue regarding they being related party and their

claims have wrongly been included, are issues, which need to be raised by the

Appellant before the Adjudicating Authority by filing appropriate application

under Section 60, sub-section (5) of the IBC. We, thus, are of the view that

the ends of justice will be served in giving liberty to the Appellant to file an

appropriate application before the Adjudicating Authority, questioning the

Company Appeal (AT) (Insolvency) No.1478 of 2024 8 admission of claim of M/s Certa Infrastructure Pvt. Ltd. and M/s Proplarity

Infratech Pvt. Ltd., including the challenge to their inclusion in the CoC, which

issues need to be decided by Adjudicating Authority after hearing the parties.

14. Learned Counsel for the Appellant has expressed apprehension that

disposal of the application may take time and, in the meantime, IRP may

proceed to conclude the CIRP to the prejudice of the Appellant. The learned

Counsel for the IRP himself has submitted that IRP shall hold his hands from

convening any meeting of the CoC for a period of 10 days, during which the

Appellant may file appropriate application.

15. In the facts of the present case, we are of the view that ends of justice

will be served in disposing of this Appeal in following manner:

(I) The order passed by Adjudicating Authority dated 03.07.2024 is

not interfered with.

(II) The Appellant is given liberty to file an appropriate application

under Section 60, sub-section (5) of the IBC, challenging the

inclusion of M/s Certa Infrastructure Pvt. Ltd. and M/s Proplarity

Infratech Pvt. Ltd. in the CoC and admission of their claims,

which application may be filed within a week from today.

(III) For a period of two weeks, the IRP shall not convene the meeting

of the CoC. The IRP shall be entitled to convene the meeting of

the CoC after two weeks from today, subject to any order or

Company Appeal (AT) (Insolvency) No.1478 of 2024 9 directions passed by Adjudicating Authority in the application to

be filed by the Appellant, as above.

The Appeal is disposed of in above terms. All pending IAs are also

disposed of. Parties shall bear their own costs.

[Justice Ashok Bhushan] Chairperson

[Barun Mitra] Member (Technical)

[Arun Baroka] Member (Technical)

NEW DELHI

9th September, 2024

Ashwani

Company Appeal (AT) (Insolvency) No.1478 of 2024 10