Velamur Varadan Anand vs Union Bank Of India & Anr
- CitationCompany Appeal (AT) (Insolvency) No. 161 of 2018
Ratio decidendi
The rule this decision rests on
Where the Adjudicating Authority is satisfied that a Resolution Professional was not in a position to take charge of the Corporate Insolvency Resolution Process immediately upon admission, the period between the date of admission and the date on which the Resolution Professional actually takes charge may be excluded in computing the 180-day period for completion of the process, on the ground that such delay is an unforeseen circumstance justifying exclusion; any further extension must not, in total, exceed the maximum time limit prescribed under the Code.
Written by Miss Lucy from the judgment below, not taken from a headnote.
Judgment
As delivered
Velamur Varadan Anand ...Appellant
Versus
Union Bank of India & Anr. ...Respondents
Present: For Appellant : Ms. Varsha Banerjee and Mr. Tarun Mehta, Advocates
For 1st Respondent: Mr. Kamal Satija, Advocate
ORDER
16.05.2018 On 26th April, 2018 when the case was taken up, the following
order was passed :
"The question arises for consideration in this appeal is as
to how the period of 180 days is to be counted for Corporate
Insolvency Resolution Process i.e. from the date of admission, as
per the provisions of the Code or from the date of knowledge of
the Resolution Professional? If there is a gap between knowledge
of Resolution Professional and the actual date of admission, then
how such period is to be treated? Whether such period should be
excluded for the purpose of counting the period of 180 days or
additional time is to be allowed beyond 180 days for completing
the Resolution Process?"
2. Similar issue was fell for consideration in "Quinn Logistics India Pvt. Ltd.
vs. Mack Soft Tech Pvt. Ltd. and others in Company Appeal (AT) (Insolvency) No.
185 of 2018" wherein after taking into consideration all the relevant provisions of
the Insolvency and Bankruptcy Code, 2016, this Appellate Tribunal by judgment
dated 8th May, 2018 observed as follows:
"9. From the decisions aforesaid, it is clear that if an application
is filed by the 'Resolution Professional' or the 'Committee of
Creditors' or 'any aggrieved person' for justified reasons, it
is always open to the Adjudicating Authority/Appellate
Tribunal to 'exclude certain period' for the purpose of
counting the total period of 270 days, if the facts and
circumstances justify exclusion, in unforeseen
circumstances.
10. For example, for following good grounds and unforeseen
circumstances, the intervening period can be excluded for
counting of the total period of 270 days of resolution
process:-
(i) If the corporate insolvency resolution process is stayed by 'a
court of law or the Adjudicating Authority or the Appellate
Tribunal or the Hon'ble Supreme Court.
(ii) If no 'Resolution Professional' is functioning for one or other
reason during the corporate insolvency resolution process,
such as removal.
2 Company Appeal (AT) (Insolvency) No. 161 of 2018
(iii) The period between the date of order of
admission/moratorium is passed and the actual date on
which the 'Resolution Professional' takes charge for
completing the corporate insolvency resolution process.
(iv) On hearing a case, if order is reserved by the Adjudicating
Authority or the Appellate Tribunal or the Hon'ble Supreme
Court and finally pass order enabling the 'Resolution
Professional' to complete the corporate insolvency resolution
process.
(v) If the corporate insolvency resolution process is set aside by
the Appellate Tribunal or order of the Appellate Tribunal is
reversed by the Hon'ble Supreme Court and corporate
insolvency resolution process is restored.
(vi) Any other circumstances which justifies exclusion of certain
period.
However, after exclusion of the period, if further period is
allowed the total number of days cannot exceed 270 days which
is the maximum time limit prescribed under the Code."
3. In the present case, we find that after admission of the application the
'Resolution Professional' was informed who took over the charge after 30 days
of admission. In fact the case was admitted on 16th August, 2017 and on
receipt the intimation, he took charge on 14th September, 2017.
3 Company Appeal (AT) (Insolvency) No. 161 of 2018
4. Having heard the learned counsel for the parties following the decision
in "Quinn Logistics India Pvt. Ltd.' (Supra), we direct the Adjudicating Authority
to exclude 30 days for the purpose of counting the period of 'corporate
insolvency resolution process' and thereby allow the 'Resolution Professional'
to complete the 'corporate insolvency resolution process' by 15th June, 2018.
5. The impugned order dated 16th March, 2018 passed by the Adjudicating
Authority, Mumbai Bench in M.A. No. 131/2018 in C.P. (IB) - 1197(MB)/2017
stands modified to the extent above. The observation made by the Adjudicating
Authority against the 'Resolution Professional' is expunged and is set aside.
6. The appeal stands disposed of with the aforesaid observations.
[Justice S.J. Mukhopadhaya] Chairperson
[ Justice Bansi Lal Bhat ] Member (Judicial)
/ns/uk
4 Company Appeal (AT) (Insolvency) No. 161 of 2018
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