2021 (10) TMI 1273 - Tri - Companies Law

Maintenance of status quo with respect to assets of the company - HELD THAT - The records inadvertently that submission made by Learned Counselfor the Corporate Debtor that the immovable property/assets of the Company are in possession of the Corporate Debtor which is incorrect. Yes Bank has already taken physical possession of the assets of the Corporate Debtor and the said fact is confirmed by Mr. Datta, Learned Senior Counsel for Yes Bank that Yes Bank. Order dated 30.09.2021 stands corrected to that effect. Mr. Srinivasan, Learned Senior Counsel further states that according to them Yes Bank is not in legal possession of the assets of the Corporate Debtor. List on 15.11.2021.

Summary

Issues: Application to vacate order, status quo on assets, legal possession of assets

Application to vacate order:
The judgment pertains to an application filed by Yes Bank seeking to vacate an order dated 30.09.2021. Mr. Datta, the Learned Senior Counsel for Yes Bank, informed the Tribunal about another application, IA No. 4439/ND/2021, where the order was passed maintaining status quo with respect to the assets of the company. He requested that this new application be considered as a reply to the previous one. Respondent No. 1, represented by Mr. Srinivasan, accepted the notice and undertook to file a reply within two weeks. The Counsel for respondent No. 2, the Corporate Debtor, stated that a reply was unnecessary but requested permission to assist the Court during the hearing. It was clarified that Yes Bank had already taken physical possession of the assets of the Corporate Debtor, contrary to the earlier submission by the Corporate Debtor that they were in possession of the assets. The order dated 30.09.2021 was corrected to reflect this fact. However, Mr. Srinivasan contended that Yes Bank was not in legal possession of the assets of the Corporate Debtor. The matter was listed for further proceedings on 15.11.2021.

Status quo on assets:
The Tribunal addressed the issue of maintaining status quo on the assets of the company, which was the subject of the previous order dated 30.09.2021. Yes Bank sought to vacate this order, indicating that they had already taken physical possession of the assets of the Corporate Debtor. The Tribunal corrected the record to reflect the actual possession status, as confirmed by Mr. Datta, the Learned Senior Counsel for Yes Bank. However, Mr. Srinivasan, representing the respondent, argued that Yes Bank was not in legal possession of the assets, raising a potential dispute over the ownership or control of the assets. This discrepancy in the legal and physical possession of the assets may require further examination by the Tribunal to determine the rightful possession and any associated legal implications.

Legal possession of assets:
A significant point of contention in the judgment was the legal possession of the assets of the Corporate Debtor. While Yes Bank asserted that they had taken physical possession of the assets, Mr. Srinivasan contended that legal possession was still in question. This discrepancy between physical and legal possession could have serious implications for the ongoing proceedings and the rights of the parties involved. The Tribunal may need to delve deeper into the nature of possession, the relevant legal provisions, and any agreements or arrangements governing the possession of the assets to resolve this issue effectively. Clarification on the legal status of possession is crucial for determining the rights and responsibilities of the parties and ensuring a fair and just resolution in the matter.