2017 (7) TMI 1055 - Tri - Companies Law

Trigger insolvency process against company where winding up proceedings are pending - Held that - In various orders passed by this Tribunal, we have expressed the opinion that in cases where winding up proceedings are pending against a Company, then it would not be conducive for the Tribunal to trigger insolvency process against that very company as there is likelihood of conflict between the two statutory entities, namely Official Liquidator and the Insolvency Resolution Professional. Therefore, the proceedings which are continuing in the Hon ble Delhi High Court may constitute a better basis for adjudication being earlier in point of time and the claim having been made by other Operational Creditors in the proceedings for winding up. The Ministry of Corporate Affairs has also issued notification on 29.06.2017 to that effect. Accordingly, we refer this matter for consideration of Hon ble Delhi High Court. The Registry is directed to send all the papers at the earliest. Parties through their Counsel are directed to appear before the Hon ble Delhi High Court on 18th September, 2017.

Summary

Issues:
Transfer of winding up petition to Delhi High Court for adjudication.

Analysis:
The Tribunal noted that a winding up petition against the respondent company was already pending before the Hon'ble Delhi High Court. Considering the potential conflict between the Official Liquidator and the Insolvency Resolution Professional in such cases, the Tribunal opined that triggering the insolvency process concurrently would not be advisable. Referring to previous orders and a notification by the Ministry of Corporate Affairs, the Tribunal decided to transfer the matter to the Delhi High Court for adjudication. The parties were directed to appear before the Delhi High Court on a specified date. The order was to be presented before the Chief Justice for further action.