Udayraj Patwardhan vs Shree Yash Stainless Private Limited
- CitationCompany Appeal (AT) (Insolvency) No. 1098 of 2024
Ratio decidendi
The rule this decision rests on
A penalty or costs direction imposed by the Adjudicating Authority against a party must rest on reasons stated in the impugned order; where the order records no basis for such a direction, it cannot be sustained and is liable to be set aside.
Written by Miss Lucy from the judgment below, not taken from a headnote.
Judgment
As delivered
IN THE MATTER OF: Udayraj Patwardhan ...Appellant
Versus
Shree Yash Stainless Pvt. Ltd. & Anr. ...Respondents
Present: For Appellant : Mr. Satendra K. Rai and Mr. Udayraj Patwardhan, Advocates in person.
For Respondent : Mr. Gaurav Suryavanshi, Advocate for R-2. Ms. Anjali Soni, Advocate for R-1.
ORDER
(Hybrid Mode)
24.02.2025 This appeal has been filed by the Erstwhile Resolution
Professional challenging the order dated 15.05.2024 passed in I.A. No. 348 of
2024 in Company Petition (IB) No. 236(AHM)/2021. The I.A. was filed by one
Prospective Resolution Applicant seeking refund of the EMD. The Application
was allowed and by allowing the application Adjudicating Authority issued
following direction in paragraph 10(III):
"...
III. Also the frivolous and non-maintainable contention of the erstwhile RP is viewed seriously and he is directed to deposit a penalty of Rs.1 lakh to the Prime Ministers relief fund within 15 days of this order with copy of compliance to the liquidator."
The appeal has been filed limited to the aforesaid direction which was
issued by imposing a cost of penalty of Rs. 1 lakh (Rupees one lakh).
Learned Counsel appearing for the Respondent Prospective Resolution
Applicant as well as the Committee of Creditors submits that they have no
objection for the aforesaid directions to be deleted.
It is further submitted by the Appellant that there is no observation
made regarding the Appellant in the impugned order except the direction
issued in paragraph 10 (III). We have considered submissions of the Appellant
as well as submissions raised by the Counsel for the Respondent No.1 and 2
who are the Prospective Resolution Applicant and the Committee of Creditors.
There being no basis of the directions reflected in the order, we are of
the view that directions issued in paragraph 10(III) cannot be sustained. In
view of the aforesaid, we allow the appeal. Set aside the directions issued in
paragraph 10(III). The Appeal is disposed of.
[Justice Ashok Bhushan] Chairperson
[Barun Mitra] Member (Technical)
[Arun Baroka] Member (Technical) pks/nn
Company Appeal (AT) (Insolvency) No. 1098 of 2024 2 of 2
This page reproduces a public judgment and a summary of it. It is research material, not legal advice, and it is no substitute for advice from an advocate on your own facts.
Research this judgment with Miss Lucy
Ask what it holds, what has followed it, and what it means for your matter — in plain English, with the citations.
Try Miss Lucy free