Shri Mehulkumar Arvindbhai Patel ... vs Shri Vinod Tarachand Agrawal ...

Mehulkumar Arvindbhai Patel and Anr. ...Appellants

Versus

Vinod Tarachand Agarwal ...Respondent

Present: For Appellants: Mr. Palash S. Singhai, Advocate. For Respondent:

ORDER

19.12.2023: Heard learned counsel for the Appellant. This Appeal has

been filed by Suspended Director of the Corporate Debtor challenging order

dated 22.09.2023 by which order the Adjudicating Authority has ordered for

liquidation. The Appellant who is a Suspended Director aggrieved by the order

has come up in this Appeal. Learned counsel for the Appellant submits that

grievance of the Appellant is this that he has not been heard nor any notice

was issued to the Appellant before passing the order on the liquidation

application, which was filed by the Resolution Professional for liquidation.

2. The Adjudicating Authority in Para 20 of the order has made following

observations:

"20. No circumstances were made out in the application whereby the Applicant brings out circumstances for recalling the order, more particularly, when the Suspended Directors were part

Cont'd.../ -2-

and parcel of the CoC and were attending the CoC meetings including the meeting in which necessary resolution seeking liquidation of the Corporate Debtor was passed. It is also seen from page no. 13, para no. 15 that the Applicant herein was well aware of the reasons why the Resolution Plan was rejected by the CoC. As such in our view, the Suspended Management was in full know of the facts relating to the CIRP and its outcome."

3. The Adjudicating Authority has rightly observed that the Suspended

Directors were part and parcel of the CoC and when resolution was taken for

liquidation, Suspended Directors were well aware of the facts and the

application for liquidation is in accordance with the scheme of I&B Code.

4. We are of the view that in the application which was filed by the

liquidation by the Resolution Professional, the Appellant who are Suspended

Director were not required to be noticed nor they are necessary party to the

said liquidation application to oppose liquidation. Liquidation process

commences on resolution passed by the CoC deciding to liquidate the

Corporate Debtor as per the scheme of IBC.

5. We are of the view that no error has been committed by the Adjudicating

Authority in dismissing the application filed by the Appellant praying for recall

of the order dated 24.04.2023 by which the Adjudicating Authority has

directed for liquidation of the Corporate Debtor. We are of the view that the

grounds which were sought to be raised by the Suspended Director were not

Company Appeal (AT) (Insolvency) No.1598 of 2023 -3-

ground on which recall could be granted. We find 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.1598 of 2023