Excerpts of the order;
The Present Appeal is filed against the Impugned Order dated 20.07.2020 passed by the Adjudicating Authority (National Company Law Tribunal, Chennai Bench, Chennai) in I.A. No.399/2020 in MA/1140/2019 in CA/1026/2019 whereby the Adjudicating Authority disposed of all the Applications.
Brief Facts:
Appellant’s Submissions:
# 2. The Counsel appearing for the Appellant submitted the brief facts.
# 3. It is submitted that the Appellant is aggrieved by the order passed by the Learned Adjudicating Authority, the present appeal is filed on the ground that the Adjudicating Authority held that the fees payable to the Appellant/Liquidator will become payable only upon occurrence of the events of respective receipts and disbursals at specified rates payable and not otherwise. The Adjudicating Authority directed the Appellant to desist from claiming the amounts towards liquidator fees as immediately payable. The impugned order is in contravention of Section 53 of the IBC read with Regulation 4(3), 42 and 44 of the I&B Code (Liquidation Process) Regulations, 2016 and also in contravention of the scheme for compromise and arrangement.
# 4. The Counsel for the Appellant submitted that under Regulation 42 of the I&B Code (Liquidation Process) Regulations, 2016, once the scheme for compromise and arrangement approved and the liquidator is directed to handover the management to the scheme proponent, the liquidator’s fees is due and the same is payable in terms of Section 53 of the Act within 30 days. After approval of the scheme for compromise and arrangement, the role of the liquidator is over and is fee becomes due in terms of Section 53 of the IBC.
# 5. It is submitted that CIRP was initiated against the Corporate Debtor on 09.02.2018. However, in absence of any resolution plan, the CoC passed a resolution for liquidation of the Corporate Debtor on 27.07.2018. The Adjudicating Authority passed the order of liquidation on 28.09.2018. Aggrieved by the order of liquidation, the promotors filed before this Tribunal. This Tribunal while dismissing the Appeal on 07.03.2019 directed the liquidator to proceed in terms of the judgment passed in the matter of Y. Shivram Prasad Vs. S. Dhanapal & Ors. in CA (AT)(Ins) No. 224/2018. The scheme was approved unanimously by the financial and operational creditors and workmen.
# 6. The promotors filed an application No. CA No. 1026/2019 under Sections 230 to 232 of the Companies Act, 2013, the scheme of compromise and arrangement in the light of the above judgment before the NCLT seeking approval of the scheme as approved by the equity shareholders and creditors of the company in liquidation. The Learned Adjudicating Authority vide order dated 10.01.2020 approved the scheme. The Appellant filed its report before the Adjudicating Authority to consider and pass appropriate orders and directions.
# 7. On 05.05.2020 the Hon’ble Adjudicating Authority disposed of the application being No. MA 1140/2020 and passed the order and one of the directions is the fees of the liquidator to the extent of Rs.91,69,769/-. However, in relation to liquidation cost other than fees, the same is required to be defrayed by scheme proponents based on actual expenses incurred by the Liquidator and upon the liquidator furnishing sufficient proof along with vouchers. The Appellant sent e-mails dated 20.05.2020 and 27.05.2020 to the Respondents to adhere to order dated 05.05.2020 with respect to the payments of liquidation cost including the liquidator’s fees within 30 days from the date of the order dated 05.05.2020. The Appellant also submitted the documents before the statutory auditors for certification and verification.
# 8. The Appellant filed above I.A. No. 399/2020 in M.A. No. 1140/2019 in CA No. 1026/2019 under Section 60(5) of the Code seeking payment of the liquidation cost including liquidator’s fees from the Respondents. The Learned Adjudicating Authority passed the impugned order dated 20.07.2020 which is in defiance of order dated 05.05.2020 passed in MA. No. 1140/2020 observing that the payment of liquidator’s fees shall be only upon occurrence of a disbursal and receipt and not otherwise.
# 9. The Learned Counsel submitted that the Hon’ble Adjudicating Authority vide order dated 05.05.2020 determined and decided the liquidator’s fees in terms of unamended Regulation 4 of the I&B Code (Liquidation Process) Regulations, 2016. It is contended that once the Corporate Debtor is out from liquidation process and management of the Corporate Debtor goes into the hands of scheme proponents, the approved fees of the liquidator be paid on priority in terms of Section 53 within 30 days from the change of hands since the role of the liquidator is over.
# 10. It is submitted that the Learned Adjudicating Authority erred in holding that the liquidator’s fee is only payable on receipt and disbursal and not otherwise. The Adjudicating Authority failed to appreciate that the Respondents have not complied with the compulsory requirement of complying with the provisions contained under Section 29A of the I&B Code.
# 11. In view of the reasons as stated above, the Learned Counsel prayed this Bench to set aside the impugned order dated 20.07.2020 in I.A. No. 399/2020 passed by the Adjudicating Authority and sought direction to the scheme proponent to pay the liquidator’s fee on priority (within 30 days of handing over of the management to the scheme proponent). Further sought direction to set aside the adverse remarks against the Appellant/liquidator in the impugned order dated 20.07.2020.
Respondent’s Submissions:
# 12. The Learned Senior Counsel for the Respondents submitted that the initiation of CIRP against the Corporate Debtor and the subsequent orders passed by the Hon’ble Appellate Tribunal and the Tribunal on various occasions.
# 13. It is submitted that the Shareholders and Creditors of the Corporate Debtor unanimously approved the scheme in the meeting convened by the Appellant on 05.09.2019. Vide order dated 10.01.2020 in CA No. 1026/2019 the Learned Adjudicating Authority directed the Appellant to file a report certifying that the Respondents herein did not suffer from any disqualification as provided under Section 29A of the Code. As per the directions of the Adjudicating Authority the Appellant/Liquidator filed his report dated 24.01.2020 before the Authority.
# 14. While so, the Appellant filed MA 1140/2019 in CA 1026/2019 before the Learned Adjudicating Authority inter alia seeking determination of the fees payable to the Appellant. While sanctioning the scheme, the Adjudicating Authority vide its order dated 05.05.2020 disposed of the said MA 1140/2019, made specific observation at para 10, 34 and 35 of the order.
# 15. The Appellant filed IA. 399/2020 before the Adjudicating Authority seeking payment of the fees with immediate effect. The Learned Adjudicating Authority vide its order dated 20.07.2020 (impugned order) disposed of the Application and held that ‘in respect of the fees payable to the Liquidator, as already dealt with vide order dated 05.05.2020, the fees will become payable only upon the occurrence of the events of respective receipts and disbursal at the specified percentage payable and not otherwise and in the circumstances we direct the Liquidator to desist from claiming the amounts towards the Liquidator fees as immediately payable’.
# 16. It is submitted that while approving the scheme vide its order dated 10.01.2020 the Hon’ble Adjudicating Authority clearly noted that the Respondents were never disqualified under Section 29A of the Code, however, the Adjudicating Authority gave an opportunity to the Appellant and directed him to file a report with respect to in-eligibility of the Respondents under Section 29A of the Code. The Learned Authority clearly noted in its order that at the time of liquidation the account of the Corporate Debtor was not a Non-Performing Asset as the amounts owed to the secured financial creditors were fully settled by the Respondents in December 2018 to the tune of Rs.39.75 crores out of total debt of Rs.39.75 crores.
# 17. The Appellant never even contested the issue of ineligibility of the Respondents before the Adjudicating Authority. Further the Appellant himself filed CA 1026/2019 for approval of the scheme before the NCLT. As per the recent amendment made under Regulation 2B of the Liquidation Regulation as inserted by notification dated 06.10.2019, any person ineligible for the reasons mentioned under Section 29A of the Code shall not be able to submit a scheme of compromise or arrangement. The said issue of applicability as well as ineligibility of the Respondents was discussed in detail before the Learned NCLT and the Learned NCLT held that the eligibility of the Respondents was not attracted under Section 29A of the Code.
# 18. It is submitted that the NCLT vide its order dated 10.01.2020 directed the Appellant to file a report of such eligibility of the Respondents. However, the said issue was never raised by the Appellant before the Learned NCLT. In fact, the Appellant himself submitted before the NCLT that the issue of ineligibility of the Respondents shall not be pressed by the Appellant. However, the issue of applicability of Section 29A in the present appeal is nothing but an afterthought and a counter reaction to the Respondents not ceding to the unreasonable demands of the Appellant in respect of the fees demanded by the Appellant which is contrary to law and against the impugned order.
# 19. It is submitted that the Respondents submitted the scheme to the Appellant and the Appellant himself submitted the said scheme before the NCLT and convened a meeting of creditors and shareholders of the Corporate Debtor. The scheme was approved by a majority of 98% of the creditors, statutory authorities and members of the Corporate Debtor. The Learned NCLT approved the scheme of the Respondents vide order dated 10.01.2020. The Learned NCLT specifically recorded in the order dated 05.05.2020 passed in MA 1140/2019 that the liquidation process have been revoked and the scheme was directed to be implemented. Therefore, the appeal is misconceived and the Appellant being officer of Court neither has any vested right nor any locus standi to challenge the scheme filed by himself before the NCLT and the Learned NCLT approved the scheme as approved by a majority of 98% of creditors.
# 20. The Appellant illegally and unauthorisedly, due to reasons best known to him delayed in handing over of the Corporate Debtor to these Respondents on one pretext or other for 10 months. After much delay a partial handover was done by the Appellant to these Respondents wherein only dredgers of the Corporate Debtor were handed over by the Appellant. Because of the delay in handing over, the Respondents incurred an expense of Rs.2 crores in repairing the dredgers. The Appellant has been in-charge of managing the Affairs of Corporate Debtor since the very initiation of CIRP of the Corporate Debtor and thus all the contemporaneous records of the Corporate Debtor as mentioned hereunder, continue to be in the control and possession of the Appellant.
“a. Books of Accounts including the bank account opened for liquidation;
b. Income tax records up to the period 2019-20;
c. Audited Balance sheets for 2017-18, 2018-19 and 2019-20;
d. Tax audit reports, GST returns (filed copies), PF returns;
e. ROC returns for 2017-18, 2018-19 and 2019-20, inter alia.
f. Removal of charge from ROC for the assets secured.
g. Files and the correspondences of the legal cases going on and attended by Liquidator.”
# 21. It is submitted that the above-mentioned records till date have not been handed over by the Appellant which clearly depicts that the Appellant disregards the facts that the Corporate Debtor is in the process of resuscitation and the Appellant is only concerned about his fees.
# 22. It is submitted that the Appellant is guilty of misrepresenting the facts in the appeal. The Appellant in the memo of parties still mentions that he is a Liquidator of the Corporate Debtor, whereas by virtue of operation of the orders dated 10.01.2020, 05.05.2020, 15.05.2020 passed by the NCLT, it is clear that on approval of the said scheme, the scheme proponents took over the management of the Corporate Debtor in terms of the Scheme and thus, the Appellant was appointed as the independent observer on the board of the Corporate Debtor. The Appellant deliberately concealed material facts that he appointed as independent observer to oversee the enforcement and implementation of the said scheme.
# 23. It is submitted that the findings in the impugned order dated 20.07.2020 are nothing but a reiteration of its findings in its orders dated 10.01.2020, 05.05.2020 and 15.05.2020 which have duly been accepted by the Appellant. Further, the present Appeal is only endeavour of the Appellant to make a wilful gain to himself and cause a wilful loss to the Corporate Debtor without performing his responsibilities during the process of the implementation of the scheme. On this account itself the conduct of the Appellant being a professional deserves to be deprecated and required to pass strict directions against the Appellant and the present Appeal is deserves to be dismissed with punitive costs.
# 24. Further the Appeal is barred by the estoppel for the reasons that the Appellant himself filed an application bearing MA No.793/2019 seeking leave of the Learned NCLT to convene a meeting of creditors and shareholders for consideration of the scheme proposed by the Respondents. The scheme was duly presented by the Appellant himself and the NCLT vide its order dated 10.01.2020 approved the said scheme. As per Clause 4.5 of the Scheme, it was provided that the liquidator’s fee will be decided and approved by the IBBI. In order to get more clarity with respect to his fees again preferred an application being MA No. 1140/2019 seeking fixation or approval of the fee of the liquidator. The said MA No.1140/2019 allowed vide order dated 05.05.2020 and fixed the fees payable to the Appellant and the Learned NCLT relied on the calculations submitted by the Appellant on the basis of the estimated fees payable if the said distribution was happening under Section 53 of the Code. However, the Learned Adjudicating Authority vide impugned order dated 20.07.2020 reaffirmed its directions passed vide orders dated 10.01.2020 and 05.05.2020, hence the present appeal is barred by the principles of estoppel.
# 25. It is submitted that the CIRP cost was duly paid by the Respondents as per the directions of the Learned NCLT in its orders dated 15.05.2020 and 22.05.2020.
# 26. It is submitted that the conduct of the Appellant was in fact strongly deprecated by the Learned NCLT while passing the impugned order to repeated and consistent endeavour to abuse his power and to derail the implementation of the scheme in order to suit his personal agenda which is most unbecoming of a Liquidator under the provisions of the Code.
# 27. It is submitted that the Appellant filed the present Appeal misrepresenting and by concealing the facts only in order to unjustly enrich himself. In view of the facts as stated above the appeal deserves to be dismissed with cost.
Analysis / Appraisal:
# 28. Heard the Learned Counsel appeared for the respective parties, perused the pleadings, documents filed in support of their case. After analysing the pleadings, the issue felt for consideration is whether the Appellant has made out any prima facie case seeking the reliefs as prayed in the Appeal and whether the order passed by the Adjudicating Authority need any interference.
# 29. The Appeal is directed against the order of the Adjudicating Authority dated 20.07.2020 whereby the Adjudicating Authority disposed of the application filed by the Appellant and settled the issue of fee payable to the Appellant thereby the Appellant prayed this Tribunal to set aside the order dated 20.07.2020 in I.A. No. 399/2020 in M.A. No. 1140/2019 and sought direction to pay the liquidators fee on priority basis and also sought direction to set aside the adverse remarks passed against the liquidator in the above impugned order.
# 30. Accordingly, this Tribunal deciding the issue of fee payable to the Appellant and the consequence reliefs.
# 31. It is an admitted fact that the CIRP initiated against the Corporate Debtor i.e. Meka Dredging Company Pvt. Ltd. on 09.02.2018. In absence of any Resolution Plan the CoC passed a resolution for liquidation of Corporate Debtor. In pursuance thereof the RP filed an Application No. MA No. 344/2018 seeking liquidation of the Corporate Debtor. While so, the Adjudicating Authority passed an order of liquidation in respect of the above Corporate Debtor on 28.09.2018 and appointed the Appellant as Liquidator. While so, the Promoters of the Corporate Debtor filed an Appeal CA (AT) (Ins) No. 696/2018 against the order of liquidation and this Tribunal disposed of the said Appeal on 07.03.2019 with an observation and direction as under:
“Learned Counsel appearing on behalf of the Appellant submits that a sum of Rs.14 cores was due and out of which a settlement for Rs.10.38 crores has been made. Earlier, also two financial creditors paid total amount of Rs.37 crores to Asset Reconstruction Company (India) Limited and Rs. 2.5 crores to L&T Finance, who have given no dues certificate. However, on completion of the resolution process we cannot allow any settlement with the Promoters and the creditors.”
This Tribunal however, directed the Liquidator to proceed with in terms of the decision made in “Y. Shivram Prasad Vs. S. Dhanapal & Ors. in CA (AT) (Ins.) No. 224/2018.”
# 32. In view of the judgment of this Tribunal, the Respondent submitted a scheme of compromise and arrangement under Section 230 of the Companies Act, 2013 on 01.06.2019 in the light of the judgment in the matter of Y. Shivram Prasad. The liquidator moved an Application MA No. 793/2019 before the Adjudicating Authority seeking leave to convene a meeting of the creditors and shareholders for considering scheme proposed by the Promoters. The Adjudicating Authority allowed the said I.A. on 02.08.2019. The meeting of creditors and shareholders convened and the Promoters proposed a scheme to settle all class of creditors.
# 33. The scheme proponents filed the scheme of compromise and arrangement under Section 230 of the Companies Act, 2013. Thereafter, the Liquidator filed an application being CA 1026/2019 before the Adjudicating Authority seeking relief that the scheme of compromise and arrangement approved by the equity shareholders and creditors of the company in liquidation be approved so as to bind the equity shareholders and creditors. The Adjudicating Authority passed a detailed order on 10.01.2020 regarding sanctioning the scheme and the eligibility of the Respondents under Section 29A of the Code.
# 34. The Appellant filed an application being MA No. 1140 of 2019 in CA No. 1026/2019 under Section 60(5) of the Code praying the Tribunal to approve and payment of the fee of the Appellant. The Adjudicating Authority passed a detailed order on 05.05.2020.
# 35. The contention of the Appellant is that he is entitled to his fees calculated on the basis of both realization of liquidation estate and its assets on the transaction of sale as a going concern and as well as fees for distribution of proceeds to be calculated as per the distribution time schedule filed along with the Application No. 1140/2019.
# 36. It is an admitted fact that vide order dated 10.01.2020 in CA No. 1026/2019 the Adjudicating Authority approved the scheme of compromise and arrangement.
# 37. The case of the Appellant before the Adjudicating Authority is that prior to the amendment of the Regulation made w.e.f. 25.07.2019, the presentation of a scheme under Section 230 in absence of any specific provision during the liquidation of the Corporate Debtor was not envisaged in the scheme, for the same. Under the circumstances subsequent to order of liquidation in case of a scheme being placed, the same is required to be treated as a sale of Corporate Debtor as a going concern under liquidation effectively to bring it within the ambit of the Regulations as it stood prior to 25.07.2019. Accordingly, the claim of the Appellant is that he is entitled to his fees calculated on the basis of both realization of liquidation estate and its assets on the transaction of sale as a going concern.
# 38. The fact remains that the liquidation order was passed on 20.09.2018 in respect of Corporate Debtor. The Respondents filed scheme before the Adjudicating Authority in view of 11th Schedule to IBC, 2016 read with Section 230 of the Companies Act, 2013. The IBBI (Liquidation Process) Regulation, 2016,
# 39. A combined reading of Regulation 2 (ea) read with Regulation 4 of IBBI (Liquidation Process) Regulation, 2016 shows that the fees of the Liquidator can be decided by the CoC before a liquidation order is passed by the Tribunal in terms of Section 33 of IBC, 2016 and in its absence sub-regulation (3) of Regulation 4 of the liquidation process Regulations shall come into play wherein it is provided that the liquidator shall be entitled to a fee both on a percentage of the amount realize net of other liquidation costs, and of the amount distributed as per the percentages given in the table provided under sub-regulation (3) of Regulation 4 itself. The parties are in concord that at the time of passing resolution under Section 33(2) of the IBC, 2016 seeking for liquidation of the Corporate Debtor, the Liquidator’s fee being part of the Liquidation cost in terms of Section 5(16) read with Regulation 2(ea) and Regulation 4(2) had not been fixed by the CoC and in the circumstances sub-regulation (3) of Regulation 4 of IBBI (Liquidation Process) Regulations comes into play.
# 40. The Appellant calculated the fees payable to him as a percentage in relation to both realization as well as distribution based on the scheme itself. The Liquidator’s fee has been quantified to the extent of Rs. 91,69,768/- in the aggregate with a break up of Rs.70,69,670/- towards fees calculated on the basis of realization and the remaining amount computed on the basis of amount to be distributed to the stakeholders as a percentage amount to a sum of Rs.21,00,098/-.
# 41. The stand of the Respondents is that the composite scheme as envisaged by the scheme proponents as a scheme of compromise and arrangement, the same cannot be divided into two parts namely; one for fixing the percentage of fees of the Liquidator upon realization and the other on the basis of distribution of proceeds to the stakeholders as contemplated under the unamended Regulation 4 of IBBI (Liquidation Process) Regulation, 2016.
# 42. The Adjudicating Authority having considered all the aspects and observed that the scheme as contemplated by the Respondents cannot be considered as a transaction of the sale falling within the ambit of Regulation 32 of Liquidation Process Regulation, 2016. The amended Regulation 4 of the Liquidation Process Regulation, 2016 draws a distinction in this connection in the event of a scheme proposed and as well as in his absence as repeatedly brought forth in the earlier portion no such distinction or for that matter no specific mention has been made in relation to a scheme and in relation to the fees payable to the Liquidator under the concerned Regulations pre-amended. The IBBI issued a clarification to the Regulation 4 as it was amended on and from 25.07.2019 as under:
“Clarification: Regulation 4 of these Regulations, as it stood before the commencement of the IBBI (Liquidation Process) Regulation, 2016 shall continue to be applicable in relation to the Liquidation Process already commenced before the coming into force of the said amendment Regulations.”
# 43. In view of the above clarification, the Adjudicating Authority at para 31 of the order dated 05.05.2020 observed as under:
“31. Thus, in view of the clarifications and also taking into consideration the scheme per se as propounded by the Scheme proponents itself, applying Regulation 4 of Liquidation Process Regulations, 2016 as it stood prior to amendment made w.e.f. 25.07.2019, we find that the calculation as given by the Liquidator in the typed set filed along with the application which tabulation has also been extracted in para 22 supra is sustainable and in the absence of Committee of Creditors fixing the fees of the Liquidator or the Liquidation costs, is required to be hence allowed.”
# 44. The Adjudicating Authority at para 34 observed that in case of any infraction on the part of the Respondents in implementing the scheme as sanctioned, with regard to Liquidator’s fee in accordance with tabulation as given in para 22 of the order dated 05.05.2020 shall be brought to the notice of the Adjudicating Authority.
# 45. After the order of the Adjudicating Authority dated 05.05.2020 several applications have been filed by the parties. The Appellant filed an application seeking payment of his fees. On the other hand, the Respondents filed application seeking direction to the Appellant to handover the assets of the company and also to adjudicate the dispute in relation to the liquidation cost. The Adjudicating Authority vide order dated 20.07.2020 disposed of the applications filed by the Appellant and the Respondents.
# 46. The Adjudicating Authority clearly stated that, upon occurrence of the event of a disbursal or a receipt the payment becomes due to the liquidator on a percentage basis of such actual receipts and disbursal and not otherwise. The Adjudicating Authority already directed vide its order dated 05.05.2020 that the Appellant/Liquidator to be an independent observer of the Board which is a part of the implementing agency of the scheme. The Learned Counsel for the Respondents vehemently contend that the Appellant has not handed over the assets of the Corporate Debtor and continued to be liquidator of the Corporate Debtor, thereby huge loss caused to the Respondent. In the order dated 20.07.2020, the Adjudicating Authority also observed that the Liquidator has failed to hand over the reins of the company in liquidation to the scheme proponents on the ground that the CIRP cost, liquidation cost as well as liquidation fee have not been remitted. The NCLT observed that the liquidator should not have withheld the handing over of the reins of the company in liquidation and its management even upon approval of the scheme as early as 10.01.2020. It is clearly held that the Appellant being the implementing agency which is required to manage the affairs of the company in liquidation and not the Liquidator.
# 47. The Adjudicating Authority clearly observed that the Appellants/Liquidator’s fee is not payable immediately as demanded by the Liquidator and is required to be excluded from the statement as annexed along with Auditor’s certificate. The Adjudicating Authority further directed the Appellant/Liquidator to make arrangement to handover the reins of the management of the Corporate Debtor including the possession of assets of the Corporate Debtor, if not already done within a period of 10 days from the date of order i.e. 20.07.2020. It is also observed that no fees shall be chargeable by the Liquidator for the same and if not handed over as above, the risk and responsibility and costs shall be to the personal account of the Liquidator without any recourse to the funds or assets available with that of the Corporate Debtor.
# 48. The Learned Counsel for the Respondents contend that in spite of the directions passed by the Adjudicating Authority the Appellant has not handed over the assets of the Corporate Debtor with an intention to arm twist the Respondent for achieving illegal gains. It is also submitted that still the Appellant had not handed over the following books as stated in para 32 of the counter affidavit filed by the Respondents.
“a. Books of Accounts including the bank account opened for liquidation;
b. Income tax records up to the period 2019-20;
c. Audited Balance sheets for 2017-18, 2018-19 and 2019-20;
d. Tax audit reports, GST returns (filed copies), PF returns;
e. ROC returns for 2017-18, 2018-19 and 2019-20, inter alia.
f. Removal of charge from ROC for the assets secured.
g. Files and the correspondences of the legal cases going on and attended by Liquidator.”
# 49. The Respondents in the short note of legal submissions dated 14.07.2022 at para 22, page 5 it is state as under:
“In view of the order dated 20.07.2020 passed by the Learned NCLT, in view of the above, Amma Lines vide its letter dated 27.07.2020 duly sent the cheques bearing Nos.666414 and 666515 for a total amount of Rs.98,69,502/- to the Appellant towards undisputed portion in the Liquidation costs and towards the undisputed portion in the invoice of knowledge marine and engineering works private limited, a company appointed by the Appellant for manning and maintaining the dredgers of the Corporate Debtor.”
# 50. It is stated that the above-mentioned cheques were duly presented and encashed by the Appellant on 31.07.2020.
# 51. The Respondents contended that they have made the entire CIRP costs as well as the liquidation costs (barring the disputed sum of Rs.4,21,100/- which is still pending mediation before the statutory auditors), in accordance with the directions of the Learned NCLT.
Finding:
# 52. Having gone through the order passed by the Adjudicating Authority dated 20.07.2020 this Tribunal do not find any infirmity or illegality in the above order. This Tribunals takes serious note on the part of the Appellant that the Appellant failed to disobey the orders of the Adjudicating Authority dated 20.07.2020 in toto and also it is evident from the observations of the order itself. Further, the Respondents also clearly mentioned that the Appellant purposely delayed in handing over the reins of the Corporate Debtor to the Respondents for the reasons best known to him. It was only a partial handing over was done by the Appellant to the Respondents.
# 53. Keeping in view of the of the paramount interest of the Corporate Debtor, this Tribunal directs the Appellant to handover the books of accounts to the Respondents herein as mentioned in para 48 hereinabove, within a period of one week from the date of receipt of copy of this judgment, if not already handed over.
# 54. Viewed in that perspective this Tribunal comes to a resultant conclusion that the Appellant has not made out any case either on law or on facts. Further, this Tribunal holds that the Appeal is frivolous and vexatious and the same is dismissed. However, no orders as to cost. Applications if any, pending stand closed.
