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Home Case Index All Cases Insolvency and Bankruptcy Insolvency and Bankruptcy + Tri Insolvency and Bankruptcy - 2024 (4) TMI Tri This

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2024 (4) TMI 536 - Tri - Insolvency and Bankruptcy


Issues involved:
The issues involved in the judgment are the appointment of an Insolvency Resolution Professional (IRP) for a personal guarantor, the recommendation for acceptance of the petition by the IRP, objections raised by the Financial Creditor, filing of multiple applications by the parties, and the intention of the debtor in filing the application.

Appointment of IRP:
The Tribunal appointed Mr. Rajendra Jain as the IRP under Section 94(1) of the Insolvency and Bankruptcy Code, 2016, with directions to file a report within 10 days. The IRP subsequently filed a report recommending the acceptance of the petition based on various grounds, including loan defaults by the Corporate Debtor and the Personal Guarantor, registration of default in the Information Utility, and the actions of the Financial Creditor to recover the outstanding amount.

Financial Creditor's Objections:
The Financial Creditor filed IA 515 of 2022 seeking various prayers, including recalling the previous order and alleging that the application was filed with fraudulent and malicious intentions to enjoy moratorium and thwart recovery proceedings. The Financial Creditor detailed the loan disbursement, NPA status, demand notices, and legal actions taken to recover the amount. The Financial Creditor contended that the application was an attempt to obstruct recovery proceedings.

Debtor's Response and Multiple Applications:
The Debtor filed a reply stating that the IRP's report should be accepted, and the Financial Creditor had no standing to object to the resolution process. The Debtor denied filing the application to scuttle recovery proceedings and mentioned that any plan would be presented to secured creditors only after a specific order. Additionally, the Debtor filed IA 514 of 2022 seeking declarations regarding the application's alleged fraudulent or malicious intentions.

Judgment and Disposition:
The Tribunal considered the arguments presented by all parties and observed that the IRP's report seemed biased towards the debtor. The Tribunal noted the timing of the application in relation to previous legal actions and concluded that the debtor's intention was to enjoy the moratorium and delay proceedings. Consequently, the Tribunal rejected the main application and the IRP's report. IA 515 of 2022 seeking to recall the previous order was dismissed, while IA 514 of 2022 was allowed, and the application was disposed of accordingly. The Tribunal emphasized the importance of justice in the decision and directed the issuance of a certified copy of the order upon request.

 

 

 

 

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