Arrihum Tradelink Private Limited Vs. Shri Mano] Khattar Liquidator of Vimal Oil & Foods Limited - This application deserves to be dismissed treating the sale agreement as void, illegal and done with an intention to sell the liquidation estate without fully realising the proceeds by arbitrarily fixing a reserve price and allotting the same and through back door entry basis this applicant has sought certain concessions which cannot be granted,

 NCLT Ahd. (2024.10.07) in Arrihum Tradelink Private Limited Vs. Shri Mano] Khattar Liquidator of Vimal Oil & Foods Limited [1A/471(AHM)2022 |n CP(|B) 135 of 2017] held that;

• This application deserves to be dismissed treating the sale agreement as void, illegal and done with an intention to sell the liquidation estate without fully realising the proceeds by arbitrarily fixing a reserve price and allotting the same and through back door entry basis this applicant has sought certain concessions which cannot be granted,

• Thereby the liquidator has done an “Undervalued transaction” of the corporate debtor to this applicant.

Blogger’s Comments; Hon’ble Appellate Authority,  NCLAT (2023.11.21) in Punjab National Bank (International Ltd.) Vs. Perfect Day INC. and Ors. [Company Appeal (AT) (Insolvency) No.1427 of 2022] held that; 

• When the sale of the Corporate Debtor is as going concern, the Successful Auction Purchaser is entitled to receive certain reliefs and concessions to run the Corporate Debtor as going concern.

• The question of reliefs and concessions arises only when Successful Resolution Applicant requires certain reliefs and concessions to run the Corporate Debtor as going concern, which is consequential after acceptance of the highest auction bid by Successful Auction Purchaser. Non-mention in Process Document that reliefs and concessions can also be allowed is inconsequential.

Further, it is beyond my comprehension as to  how a sale transaction through public auction can be judged as an undervalued transaction. In my opinion the sale transaction through public auction cannot be held null & void, unless fraud & connivance of bidder/auction purchaser with the liquidator is established.

Excerpts of the Order;

# 1. The applicant who is the successful purchaser of the Corporate debtor presently under Liquidation (R1) as a going concern under Regulation 32(e) of IBC (liquidation Process) Regulation. 2016 for Rs.69,95 crores which was also approved by the Stakeholders Consultative Committee and paid the entire consideration which has been distributed amongst the lenders of the corporate debtor. The corporate debtor was admitted in to CIRP vide order dated 19.02.2017 by this Tribunal in CP IB 135 of 2017. As no resolution plan was approved by the CoC, this Authority approved the liquidation of the corporate debtor vide orders dated 19.12.2019 in MA No.17 of 2018.

# 2. The liquidator (R1) had published a sale notice dated 02.11. 2020 in public newspapers inviting bidders to purchase the corporate debtor as a going concern at a reserve price of Rs.69.'70 crores and an e-auction was conducted on 01.12. 2020. The applicant was found to be the highest and successful bidder in the e—auction thereby the corporate debtor was sold as a going concern and a sale agreement was executed on 03.03.2021 by the liquidator in favour of the applicant. Thereby the acquisition. of the corporate debtor was complete and the applicant acquired all the assets, with nil liability, dues, claims, obligations whatsoever, of any type which has been done as per Regulation 32 of IBBI (LP) Regulations 2016." The applicant therefore prays for necessary grant of the reliefs and concessions as prayed. to continue the corporate debtor as a going concern.

# 3. The applicant refers to some of judgments passed by various NCLT’s and Courts. The applicant pleads and seeks similar concessions given in the case of approval of resolution plan in the process of CIRP, also be given when there is a sale as a going concern, which is the present case for which this application is filed. The concept of clean slate would be available even in relation to the resolution of the corporate debtor in liquidation through the process of Section 230 scheme which is similar to granting the benefit of clean slate in relation to resolution through CIRP or through Sec 230 in the context of applicability of Sec 29A of the IBC.

# 4. The applicant further pleads that mere purchase of the corporate debtor as a ‘going concern’ as per liquidation process does not suffice and certain additional reliefs / concessions/ relaXations/ and permissions may be allowed which would be essential to run the corporate debtor as a going concern, otherwise the purpose of revival of corporate debtor cannot be achieved in order to achieve value maximisation. Further applicant submits that this Adjudicating Authority is empowered to grant such concessions under Sec 60(5)(c) of the code. The applicant seeks the following reliefs:

a) Direction be issued to the applicant company to classify the amount deposited with the liquidator as follows:

• i. Equity Capital — Rs. 15 crores

• ii. ‘Unsecured Loans - Rs.60.20 crores;

• iii. All the existing shares of the corporate debtor including in the Demat mode or Physical mode shall be extinguished without any consideration, and rights and liabilities arising out of the same shall be extinguished;

• iv. A direction be given to allot the shares in the following manner without following any further process of Companies Act 2013:

• 
  

S. No.	Name of Shareholders	No.of shares
1.	Arrhum. Tradelink Pvt Ltd	1,49,99,400
2.	Rakesh Lahoti	100
3.	Balurain Lahoti	100
4.	Jyoti Lahoti	100
5.	Raghav Lahoti	100
6.	Karnala devi Lahoti	100
7.	Baluram Lahoti	100
	Total	1,50,00,000

• 
  

• v. Existing ISIN issued. by NSDL 85 CDSL shall stand cancelled/ revoked &, issue new ISIN, if required 

• vi. Existing authorised preference share capital be converted in to authorised equity share capital 

b). a direction be issued that the listing .rights of the corporate debtor be restored and the shares of the corporate debtor allotted pursuant to liquidation process shall get listed on BSE and NSE 

c). a direction be issued that, applicant company/ successful bidder may have the right to appoint the new board of directors of the company; 

d). a direction be issued that all claims or demands made by, or liabilities or penalty or obligations whatsoever, of any kind owned or payable to any actual or potential creditors including secured creditors of the corporate debtor including Government dues or to any statutory authorities whether direct or indirect, whether admitted or not, due or contingent, asserted or unasserted, crystallised or uncrystallised, known or unknown, secured or unsecured, disputed or undisputed in relation to any period prior to the date of acquisition will be written off in full and shall stand permanently extinguished;

e). a declaration be made to the effect that all charges / lien on the land and building and other assets of the corporate debtor including bank accounts of the corporate debtor by any statutory authority including any banks, ROC, Stamp authority, Tax Authority, shall stand permanently extinguished from the date of acquisition;

f). a direction be issued that all inquiries, investigations, assessments, notices, cause of actions, suits, claims disputes, litigations, arbitration, or other judicial, regulatory or administrative proceedings against, or in relation to; or in connection with the corporate debtor affairs of the corporate debtor(other than against the erstwhile promoters or former members of the management of the corporate debtor), pending or threatened, present or future, including any third party dispute, in relation to any period prior to the date of acquisition or arising on account of the acquisition shall be deemed to be withdrawn or dismissed;

g). a direction be issued that any non-compliance of provisions of any laws including non-compliance with the statutory authorities including ROC, BSE, NSE, IEPF, CSR and SEBI and non-compliance of any rules and regul.ations, directions, notifications, etc., prior to

the date of acquisition. shall be deemed to be complied or extinguished.

h). A direction be issued that all criminal proceedings that may have been filed against the corporate debtor before the date of acquisition, shall be deemed to have been extinguished;

i). a direction be issued that the bid submitted by the applicant be considered to be a resolution plan under Sec 79 of the IT Act, 1961;

j). A direction be issued that the bid submitted by the applicant be considered as resolution plan for the purposes of compliances with the BSE, NSE, SEBI, etc.

k). a direction be issued that the brought forward tax losses of the corporate debtorbe permitted to be carried forward and set off against future income as change of shareholding of the corporate debtoris pursuant to the bid submitted by the applicant is under the e-auction process;

# 5. Further, the applicant submits that; the applicant has filed IA 734 of 202.1 before this Hon'ble Adjudicating Authority seeking directions for cancellation of sale for the reason stated in the said application. This application is being filed without prejudice to the rights and contentions raised in IA 734 of 2021.

# 6. The applicant submits that as the applicant apprehended implication in false FIR registered against Vimal Oil 81, Foods Limited, applicant filed. quashing petition before the Hon'ble High Court of Gujarat vide Criminal Miscellaneous Application No.11557 of 2021, wherein the applicant was granted interim relief in terms of Para 8(0) vide orders dated 28.07.2021 staying further investigation/ proceedings of the FIR. The interim relief is getting extended from time to time.

# 7. The applicant was directed vide orders 10.10.2023, to issue notices to all the authorities with whom reliefs were sought. The tribunal also taken. note vide orders dated 23.02.2024 that the liquidator had not sought any permission for sale and the purchaser had filed this IA. The liquidator has also not filed any reply in this IA but had filed separate IA to be relieved. of his responsibilities as he had sold the corporate debtor as a going concern. There was no reply from the Income tax or other departments to whom notices were served by the applicant. 

# 8. The respondent SEBI has filed an affidavit reply in the matter. It submitted that it has no objection to reliefs and concessions sought against SEBI at Point No.5 of this IA. However, allotment of shares be done in. accordance with the approval of the plan. by NCLT and has to be in compliance with the Securities Contracts (Regulation) Act, 1956, Securities Contracts (Regulation) Rules 1957, Securities and Exchange Board. of India Act, 1992 and various SEBI regulations including SEBI (Issue of Capital and Disclosure Requirements) Regulations, 2018, as applicable from time to time. Apparently, this is conditional and the applicant has not given any declaration on capital issuance, the corporate debtor under liquidation being a listed entity, the proposal is meeting the regulatory requirements.

# 9. The NESL replied by affidavit dated 20.02.2024, there are dues amounting to Rs 22,61,390 payable by the corporate debtor, on account of SOP fines, penalty and for annual listing for non-compliance of listing agreement from time to time with interest for which a claim has been filed before the liquidator pursuant to the listing agreement dated 17.02.2016. The affidavit further states that the liquidator has till date not stated anything on the claim submitted. In case the penalties and claim amounts are paid (dues) till date of realisation, they will not have any objection to purchase of the corporate debtor. 

# 10. On a perusal of the documents submitted, the application was moved by a financial creditor, Bank of Baroda who had an exposure of outstanding debt amounting to Rs. 205.46 crores.

a) There were various lenders in the consortium of lending. Further the IA 734/2021 referred in the application, is allowed to have been withdrawn as per orders dated 10.06.2022 as requested by the LD counsel appearing for the applicant.

b) It is observed from the e~auction sale notice issued on 02.11.2020 by the liquidator, enclosed in page 37 of the application, that the entity. under liquidation was sold(Sale of assets and properties owned by Vimal Oil &.Foods Limited (in. l.iquidation)) as going concern (excluding 7 receivables described in the auction process document). The e-auction. is silent on the potential concessions that can be sought or given and merely states that it is conducted on “as is where is whatever  there is basis and without recourse basis” only. The Reserve price was quoted at Rs.69.70 crores. The applicant addressed a letter dated 10.11.2020 to participate in the auction, but never sought any concessions or any further details of the entity other than the process information document and deposited. The EMD amount of Rs l. lakh for participation apart from giving necessary disclosures under Sec 29A of IBC,2016. The advertisement does not reveal anything related to the status of the corporate debtor under liquidation, other than a mention of the e-Auction Process Information Document (containing details of the terms and conditions of online e- Auction, e-Auction Bid Form, Eligibility Criteria, Declaration by bidders, EMD Requirement etc.,) which has not been enclosed to this application nor any mention is in the sale agreement. 

c).The sale agreement dated 03.03.2021 between Liquidator (R1) and the applicant submitted has been examined. It is observed that the assets excluded under the present auction of 7 parties named in page 22 of the stated agreement (annexed to the application Page 44) amounts to Rs 508.47 lakhs, stated to be under litigation. There is also a caveat mentioned that the trademark logo of the corporate debtor has been assigned by the suspended management to another third party for which there is an IA filed before this appellate authority. Further, in the agreement there is no mention. between the applicant and the seller (liquidator) that the applicant can seek any concessions before this Appellate Authority or this can be considered as a resolution plan under CIRP, with a mention that the purchase consideration will be used for distribution to stakeholders in accordance with Sec 53 of the code. Buyer has acknowledged in the agreement to be in the knowledge of all the facts leading to liquidation and consequent sale of the company in Para 4.13 of the agreement. While the agreement clauses absolves any further liability on the liquidator, it does not mention anything about the passing off the liabilities of the corporate debtor (prior offences, dues etc.,) in clear terms and the consent is merely to sell the assets (restricted to those mentioned in the agreement) on as is where basis and distribute it to the liquidation estate. There is nowhere a mention that being a listed company, the rights that exists before a stock exchange is transferred along with the purported sale or that its liabilities due in this regard would be met. There is no mention either of concessions or regarding prior offences of the suspended management in the agreement (Sec 32A of the IBC 2016). The applicant has submitted a written submission vide dated 20.08.2024.

d). It is further observed that the sale of the entity as a going concern or as clean slate, even if was approved by SCC does not absolve him of any acts or liabilities as it is observed that inspite of other assets which are not recoverable, the corporate debtor being a listed entity had not revealed the exact status of the corporate debtor if was sold as a going concern and what has been agreed to be exchanged in the sale agreement are merely those land and building, plant and machinery which are listed in the sale agreement document. By restricting the sale in the agreement without including all the properties and its rights including the right to recover the 7 receivables as mentioned in the application and in the order wherein huge amounts are yet to be recovered, this sale is not done on a “going concern. basis” and without revealing the full details of the underlying liabilities, the liquidator has not effected, nor is authorised to have done the sale on a “clean slate basis” on which the applicant can file seeking any concessions, which is not appropriate, to be quashed as filed with a rnotive of acquiring the corporate debtor in connivance with the liquidator to seek

concessions, especially when the liquidator who is made a party to this application does not file any reply, files a separate application that he is discharged of any liability to reply in the matter (when there are 4 pending IAs) and the applicant also withdrawing a petition filed earlier seeking quashing of this sale deed without modifying the prayers or stand in this application wherein he had sought these concessions subject to considering the other application wherein he sought quashing of the sale agreement.

e). This application deserves to be dismissed treating the sale agreement as void, illegal and done with an intention to sell the liquidation estate without fully realising the proceeds by arbitrarily fixing a reserve price and allotting the same and through back door entry basis this

applicant has sought certain concessions which cannot be granted, whatsoever which include even penalties and punitive action that had been initiated, without considering the merits of the sale which has not included a large amount of receivables in the sale agreement, thereby the liquidator has done an “Undervalued transaction” of the corporate debtor to this applicant. In view of the above, we pass the following orders:

ORDER

• i). The sale of the property of the corporate debtor as “going concern” is null and void.

• ii). Penalty to be imposed for filing this application as having been done on “Clean Slate Basis”. Separate action to be initiated against the Liquidator in the IA filed seeking discharge from liquidator, who has done this act of sale when there are IAs including Sec 66 applications and recovery of Debts pending (which have been excluded from the sale) including the action of the SCC with directions to Registry to report to IBBI further disciplinary action against the liquidator on all acts and deeds committed. during the liquidation process including passing necessary orders against the Resolution Professional not be enrolled in any of the CIRP matters till the matter is decided by the Disciplinary Committee.

• iii). Pending IAs to be disposed at the earlier and the liquid.ation process to continue by appointing a new liquidator from the panel of IBBI.

• iv). IA 471 of 2022 in CP(IB) No.135/NCLT/AHM/2017is dismissed. 

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Shantech International Pvt. Ltd. Vs. Devendra Singh (Liquidator) - When the e-auction Notice itself does not contemplate grant of any relief from claims and liabilities up to the date of e-auction sale, the Appellant cannot be granted reliefs and concessions, which is not contemplated by e-auction Notice itself.

 NCLAT  (2024.09.20) in Shantech International Pvt. Ltd. Vs. Devendra Singh (Liquidator)  [(2024) ibclaw.in 598 NCLAT, Company Appeal (AT) (Insolvency) No. 1520 of 2024] held that; 

• Thus, all claims known or unknown on the date of liquidation commencement date has to be dealt as per Section 53. The prayer of the Appellant in this Appeal is to grant reliefs and concessions for all claims and liabilities up to the date of sale by e-auction i.e. 30.03.2023.

• When the e-auction Notice itself does not contemplate grant of any relief from claims and liabilities up to the date of e-auction sale, the Appellant cannot be granted reliefs and concessions, which is not contemplated by e-auction Notice itself.

• Regulations 12 and 16 as extracted above contemplate filing of a claim as on the liquidation commencement date. There can be no question of extinguishment of claim up to the date of sale of e-auction of the Corporate Debtor as ‘going concern’. When claim itself are as on the liquidation commencement date in the liquidation process, the argument that extinguishment of claims and liabilities should be granted till the date of sale by e-auction is not in accord with the statutory scheme as delineated by IBBI (Liquidation Process) Regulations, 2016.

Blogger’s Comments; Hon’ble NCLAT in other judgments had ruled that the successful auction purchase can request for certain reliefs & concessions which are not part of the process Note/Auction Notice.

i). NCLAT (2023.11.21) in Punjab National Bank (International Ltd.) Vs. Perfect Day INC. and Ors. [Company Appeal (AT) (Insolvency) No.1427 of 2022] held that; 

• The question of reliefs and concessions arises only when Successful Resolution Applicant requires certain reliefs and concessions to run the Corporate Debtor as going concern, which is consequential after acceptance of the highest auction bid by Successful Auction Purchaser. Non-mention in Process Document that reliefs and concessions can also be allowed is inconsequential.

[ Link Synopsis ]

ii). NCLAT (2022.02.25) in M/s Shiv Shakti Inter Globe Exports Pvt. Ltd. Vs. M/s KTC Foods Private Limited  [Company Appeal (AT) (Insolvency) No. 650 of 2020] held that;

• # 21. Adverting to the contention of the Learned Counsel for the Appellant that the Adjudicating Authority has erred in denying the sale of the ‘Corporate Debtor’ as a ‘going concern’ to the Appellant without including any contingent liabilities, we hold that it is a settled law that when the sale proceeds of a ‘Corporate Debtor’ are duly distributed in the Order of priority and in the manner prescribed under Section 53 of the Code, claims of any other Creditor cannot be entertained contrary to the provisions entailed under Section 53; subsequent to the distribution of sale proceeds under Section 53 no other entity including any Government entity can claim any past unpaid or outstanding dues against the Appellant who has purchased the ‘Corporate Debtor Company’ as a ‘going concern’. It is significant to mention that the second Respondent/Liquidator has specifically submitted that even these claims by the Uttar Haryana Bijili Vitran Nigam were not submitted in the prescribed form either during the CIRP Process or at the Liquidation stage. We are of the considered view that at this stage subsequent to the sale of the ‘Corporate Debtor Company’ as a ‘going concern’, these claims cannot be foisted upon the Appellant. The scope and objective of the Code is to extinguish all claims specifically the ones which were not even made during the CIRP or in the Liquidation stage, to aid the purchaser of the Company as a ‘going concern’ to start on a ‘clean slate’. The Hon’ble Supreme Court in ‘Ghanshyam Mishra & Sons Pvt. Ltd.’ Vs. ‘Edelweiss Asset Reconstruction Company Ltd. & Ors.’, Civil Appeal No. 8129 of 2019 and in ‘CoC of Essar Steel India Ltd.’ Vs. ‘Satish Gupta & Ors.’ (2020) 8 SCC 531 has laid down the proposition that the purchaser of the Company even in the Liquidation stage cannot be burdened with past liabilities when it is not mentioned in the ‘Sale Notice’.

[ Link - Synopsis ]

Excerpts of the Order;

This Appeal by Successful Auction Purchaser in the liquidation proceedings of the Corporate Debtor – Venus Rolling Mills Pvt. Ltd. has been filed challenging the part of the order dated 18.06.2024 passed in IA No.610 of 2024, by which order some of the reliefs and concessions as claimed by the Appellant were not granted by the Adjudicating Authority.

# 2. The brief facts of the case necessary to be noticed for deciding the Appeal are:

(i) The Corporate Insolvency Resolution Process (“CIRP”) against the Corporate Debtor – Venus Rolling Mills Pvt. Ltd. commenced by order dated 22.04.2019 of the Adjudicating Authority and Mr. Devendra Singh was appointed as Interim Resolution Professional (“IRP”), who was subsequently confirmed as Resolution Professional (“RP”).

(ii) Upon failure of the resolution of the Corporate Debtor, the Committee of Creditors (“CoC”) unanimously resolved to liquidate the Corporate Debtor. An order dated 09.06.2022 was passed by the Adjudicating Authority directing for liquidation of the Corporate Debtor. The liquidation order having been passed on 09.06.2022, 09.06.2022 became the liquidation commencement date.

(iii) Pursuant to the liquidation order, Liquidator made public announcement. The List of stakeholders of the Corporate Debtor was prepared. The Liquidator conducted total of 7 e-auctions in accordance with Regulation 33 of Insolvency and Bankruptcy Board of India (Liquidation Process) Regulations, 2016. (hereinafter referred to “Liquidation Regulations”) for sale of assets of the Corporate Debtor. The Corporate Debtor was specifically sold as a ‘going concern’ during 7th e-auction held on 30.03.2023.

(iv) The Appellant became successful bidder and under orders of the Adjudicating Authority granted extension for depositing the entire bid amount. Sale Certificate dated 14.09.2023 was issued by the Liquidator to the Appellant.

(v) IA No.610 of 2024 was filed by the Appellant praying for taking on record the completion of the Sale Process of the Corporate Debtor. One of the reliefs prayed in the Application was for granting reliefs and concessions sought under para 15 of the Application. The Application – IA No.610 of 2024 was heard by the Adjudicating Authority and by order dated 18.06.2024, IA 610 of 2024 was disposed of by the Adjudicating Authority. Aggrieved by the order dated 18.06.2024, passed in IA No.610 of 2024, this Appeal has been filed.

# 3. We have heard Shri Dhaval Deshpande and Shri Amir Arsiwala, learned Counsel appearing for the Appellant and Shri Palash S. Singhai, learned Counsel appearing for the Respondent – Liquidator.

# 4. The learned Counsel for the Appellant submits that sale in favour of the Appellant as a ‘going concern’ of the Corporate Debtor was made, which entitled the Appellant to claim a declaration that Corporate Debtor shall not be liable on account of any transaction, dealing or arrangement or any liability till the date of issuance of Sale Certificate. All liabilities up to the date of issue of Sale Certificate required to be extinguished on principle of ‘clean slate’ theory. The Adjudicating Authority granted relief and concession only for the period prior to the date of CIRP, whereas relief and concession was required to be granted up to the date of issuance of Sale Certificate. It is submitted that Application – IA No.610 of 2024 ought to have been allowed in toto by granting all the reliefs and concessions, which were sought by the Appellant in the said Application. It is submitted that ‘clean slate’ principle extend not only to the liability prior to insolvency commencement date, but also extend to the date of actual sale date as a going concern. The learned Counsel for the Appellant has referred to reliefs and concessions granted at Sl. No.6, 8 and 9, where the reliefs and concessions as prayed in the Application were not granted. The learned Counsel for the Appellant further submits that Adjudicating Authority in paragraph 14 has directed that any other reliefs and concessions not mentioned in the table shall be deemed to have been not granted.

# 5. The learned Counsel appearing for the Respondent refuting the submissions of learned Counsel for the Appellant submits that the Appellant was a successful bidder and has purchased the assets of Corporate Debtor as ‘going concern’ on “as is where is & as is what is” basis and the reliefs and concessions to which the Appellant was entitled have already been granted by the Adjudicating Authority by the impugned order. The ‘clean slate’ theory as contended by the Appellant is applicable in reference to a Resolution Plan and does not apply to e-auction in the liquidation proceedings. The e-auction in the liquidation proceedings is held on the terms and conditions as per the e-auction Notice and Process Document. The Adjudicating Authority has granted all necessary reliefs and concessions to which the Appellant was entitled, which is clear from paragraph 13 of the judgment and the Adjudicating Authority has rightly given liberty to the Appellant to approach the appropriate and concerned authority to seek the relevant reliefs and concessions as may be available to the Applicant.

# 6. We have considered the submissions of learned Counsel for the parties and have perused the records.

# 7. The question of law which arises in the present Appeal as formulated by the Appellant in paragraph 8(b), are as follows:

• (i). Whether the “clean slate” principle extends only to liabilities prior to the insolvency commencement date or will extend to the date of actual sale of the Corporate Debtor as a “going concern”?

• (ii) Whether the Adjudicating Authority can refuse to grant necessary reliefs and concessions without even considering them and without assigning any reasons?

# 8. In the Appeal, the Appellant has prayed for following reliefs:

• “a. That this Hon’ble Tribunal be pleased to modify the order dated the 18th of June, 2024 passed in Interlocutory Application No. 610 of 2024 in Company Petition (IB) No. 350/MB/C-11I/2019 to the extent of granting all the reliefs and concessions which were sought by the Appellant in the said application;

• b. For such further and other reliefs, as this Hon’ble Tribunal may deem fit and proper in the nature and circumstances of the case.”

# 9. The moot question to be answered in this Appeal is as to whether the Appellant was entitled to grant of reliefs and concessions not on the date prior to insolvency commencement date, but ought to have been granted the reliefs and concessions till the date of actual sale of the Corporate Debtor as a ‘going concern’. Item Nos. 6, 8, 9 of paragraph 13 of the impugned order, which have been specifically referred to by the Appellant are as follows:

“Sr. No.	Reliefs/ concessions sought by the Applicant	Orders thereon
6.	A direction and declaration that the Corporate Debtor shall not be liable on account of any transaction, dealing, or arrangement between it and any other person relating to the period prior to the date of relief being granted in the present application. It is clarified that any existing and on-going contracts between the Corporate Debtor and any other person shall continue to be valid and binding between the parties as per their terms; provided, however, that the Corporate Debtor shall bear no liability for any claim for compensation or damages arising out of any act or omission prior to the date of grant of relief in the present application.	Granted, for the period prior to the date of CIRP.
8.	A direction for waiver of any liabilities in relation to any water dues of the Corporate Debtor to any State Government or Central Government Department before the Acquisition Date.	May apply to appropriate authorities of respective department based on this Order.
9.	A direction for waiver of any past liabilities in relation to any electricity dues of the Corporate Debtor to any State Government or Central Government Department before the Acquisition Date.	May apply to appropriate authorities of respective department based on this Order.”

# 10. With regard to relief granted at Item No.6 of paragraph 13 of the order, the Appellant submission is that the Adjudicating Authority committed error in granting relief only for the period prior to the date of CIRP. Further, the relief ought to have been granted up to the date of actual sale in favour of the Appellant, i.e. up to 30.03.2023. The Appellant has filed copy of Certificate of Sale as Annexure-A3 along with which terms and conditions of auction sale has also been annexed as Annexure-1. Clause 5 of terms and conditions provides as follows:

• “5. Successful Auction Bidder has been provided with Corporate Debtor as going concern strictly on “as is where is & as is what is” basis and is subject to approval of Hon’ble NCLT, Mumbai Bench. The information in respect of the Asset has been stated to the best of the knowledge of the Liquidator, however, he shall not be responsible for any inadvertent error, or omission in the said particulars. It should be noted that the Liquidator does not make any representation as to the correctness, validity or adequacy or otherwise of any ownership of asset or the conditions of the asset or its quality for any specific purpose or use.”

# 11. Schedule-1, which deals with Block-A contains the following note:

• “Note:

• • All known or unknown, claimed or unclaimed, disclosed or undisclosed liabilities/obligations risk as on the cut-off date( i.e. date of commencement of liquidation ) including prior claims of all creditors whether secured, unsecured, workers, employees, statutory authorities on account of Income Tax, Sales Tax, GST, Service Tax, DGFT, Excise, Customs, etc., shareholders on account of transactions prior to the cut-off date ( i.e. date of commencement of liquidation) shall be dealt as per Section 53 of the Insolvency and Bankruptcy Code, 2016 as full and final settlement of their dues. The Liquidator shall be in no event be responsible for any liabilities/obligations/risks pertaining to the period prior to the Cut-off date, and the same shall be dealt with as per the provisions of law and Directions of Hon’ble NCLT or any higher authority thereof.”

# 12. Above Note clearly provide that all known or unknown or unclaimed, disclosed or undisclosed liabilities/ obligations risk as on the cut-off date (i.e. date of commencement of liquidation) is to be dealt with including prior claims of all the creditors whether secured, unsecured, statutory authorities shall be dealt with as per Section 53 of the IBC. Thus, e-auction was conducted on the above conditions as captured in the Note. As noted above, the reliefs and concessions was granted to the Appellant with regard to declaration that Corporate Debtor shall not be liable on account of any transaction, dealing, or arrangement between it or any other person relating to the period prior to the date of CIRP. We do not find any illegality in the above relief granted to the Appellant prior to the date of CIRP. Insofar as claims of known or unknown, disclosed or undisclosed liabilities, the obligation is up to the cut-off date, i.e. date of commencement of liquidation. The e-auction Notice clearly mention that transactions prior to the cut-off date shall be dealt as per Section 53 of the IBC. Thus, all claims known or unknown on the date of liquidation commencement date has to be dealt as per Section 53. The prayer of the Appellant in this Appeal is to grant reliefs and concessions for all claims and liabilities up to the date of sale by e-auction i.e. 30.03.2023. When the e-auction Notice itself does not contemplate grant of any relief from claims and liabilities up to the date of e-auction sale, the Appellant cannot be granted reliefs and concessions, which is not contemplated by e-auction Notice itself.

# 13. The IBBI (Liquidation Process) Regulations, 2016, Regulation 12, which deals with ‘Public announcement by liquidator’. Regulation 12, sub-regulation (2) (a) call upon stakeholders to submit their claims or update their claims submitted during the CIRP, as on the date of liquidation commencement date. Regulation 12, sub-regulations (1) and (2) provides follows:

• “12. Public announcement by liquidator. (1) The liquidator shall make a public announcement in Form B of Schedule II within five days from his appointment.

• (2) The public announcement shall–

• (a) call upon stakeholders to submit their claims or update their claims submitted during the corporate insolvency resolution process, as on the liquidation commencement date; and

• (b) provide the last date for submission or updation of claims, which shall be thirty days from the liquidation commencement date.”

# 14. Further, Regulation 16 provides for “Submission of claim”, which is as follows:

• “16. Submission of claim. (1) A person, who claims to be a stakeholder, shall submit its claim, or update its claim submitted during the corporate insolvency resolution process, including interest, if any, on or before the last date mentioned in the public announcement.

• (2) A person shall prove its claim for debt or dues to him, including interest, if any, as on the liquidation commencement date.”

# 15. Regulations 12 and 16 as extracted above contemplate filing of a claim as on the liquidation commencement date. There can be no question of extinguishment of claim up to the date of sale of e-auction of the Corporate Debtor as ‘going concern’. When claim itself are as on the liquidation commencement date in the liquidation process, the argument that extinguishment of claims and liabilities should be granted till the date of sale by e-auction is not in accord with the statutory scheme as delineated by IBBI (Liquidation Process) Regulations, 2016. In any view of the matter, we have already noticed that e-auction was held under the terms and conditions and with regard to Block-A, under which the Appellant having declared successful bidder, for the sale of Corporate Debtor as a ‘going concern’ for all known or unknown claims; disclosed or undisclosed liabilities and obligations were to be dealt as per Section 53 of the IBC. Hence, all claims were required to be considered by Section 53 in the liquidation process. Hence, relief of the Appellant, which is sought in the IA as well as in this Appeal to extinguish all claims and liabilities as on date of e-auction, is contrary to the very conditions under which e-auction was held. Hence, the prayer of the Appellant that it should have been granted reliefs and concessions up to the date of e-auction sale, cannot be accepted and has rightly not been granted by the Adjudicating Authority.

# 16. Coming to Item Nos.8 and 9, where the Appellant has prayed for a direction for waiver of any liabilities in relation to any water dues of the Corporate Debtor or any past liabilities in relation to any electricity dues of the Corporate Debtor. The Adjudicating Authority has rightly directed the Corporate Debtor to apply to appropriate authorities of respective department based on the order. Waiver of the liabilities with regard to dues of the Corporate Debtor to any State or Central Government or statutory Authorities, was to be dealt with as per Note extracted above and no exemption or waiver could have been granted as prayed by the Appellant.

# 17. The learned Counsel for the Appellant has also referred to paragraph 14 of the order, which is as follows:

• “14. Any other relief and concession not mentioned in the above table shall be deemed to have been not granted. However, the Applicant may in accordance with applicable law and procedure, approach the appropriate and concerned authority to seek the relevant reliefs and concessions as may be available to the Applicant.”

# 18. Paragraph 14 of the order of the Adjudicating Authority is clarificatory in nature, which provided that any other relief and concession not mentioned in the table in paragraph 13, shall be deemed to have not been granted. The Adjudicating Authority has considered all relevant reliefs and concessions, which were part of the reliefs contained in paragraph-15 of the Application – IA 610 of 2024 and all relevant reliefs and concessions were specifically dealt with. Hence, we do not find any error in paragraph 14 of the order of the Adjudicating Authority, where Adjudicating Authority has observed that any relief and concessions not mentioned in paragraph 13 shall be deemed to have not been granted. Further, in paragraph 15 itself, the Adjudicating Authority has observed that Applicant may in accordance with applicable law and procedure, approach the appropriate and concerned authority to seek the relevant reliefs and concessions as may be available to the Applicant.

# 19. In view of the foregoing discussions, we are of the view that the relief claimed by the Appellant to grant extinguishment of all claims and liabilities up to the date of e-auction, i.e. 30.03.2023, cannot be accepted and Adjudicating Authority by the impugned order has granted reliefs and concessions to which the Appellant was entitled and the reliefs and concessions not granted were in accordance with law and statutory scheme of the liquidation process. We do not find any error in the order impugned, warranting interference in this Appeal. The appeal is dismissed. There shall be no order as to costs.

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