2020 (9) TMI 1280 - HC - Insolvency and Bankruptcy

Jurisdiction exercised by the National Company Law Tribunal (NCLT) Kolkata - Respondent No.2/the Company in liquidation is being also proceeded against under the Prevention of Money Laundering Act 2002 - Section 32A of the IBC - HELD THAT - This Court is satisfied that the petitioners have made out a prima facie case for grant of an interim order. Application allowed.

Summary

Issues: Jurisdiction of National Company Law Tribunal (NCLT) and applicability of Prevention of Money Laundering Act, 2002 (PML Act) in the case of a Company in liquidation.

In this judgment, the petitioners challenge the jurisdiction exercised by the NCLT, Kolkata Bench regarding the Company in liquidation, also facing proceedings under the PML Act. The petitioner's counsel argues that when NCLT and another statutory authority have jurisdiction over a case, all issues concerning the Company in liquidation cannot solely fall under NCLT, citing the case of Embassy Property Development Private Limitted Vs. State of Karnataka. On the other hand, the Respondent No.1/Resolution Professional contends that Section 32A of the Insolvency and Bankruptcy Code (IBC) protects the NCLT's findings, as the assets of the Company in liquidation are to be managed by the RP, who is also the Official Liquidator. The Court, after hearing both parties and reviewing the evidence, finds that the petitioners have established a prima facie case for granting an interim order.

The Court grants a stay in terms of specific prayers of the writ petition until further orders. It allows the parties to exchange their Affidavits and Counter Affidavits within six weeks and instructs the petitioners to prepare comprehensive Paper Book(s) for the convenience of the final adjudication. Additionally, the Court disposes of an urgent application related to the stay petition and directs all parties to comply with the order downloaded from the official website of the Court.