2019 (3) TMI 959 - Tri - Insolvency and Bankruptcy

Travel restraint to respondents nos. 2 to 5 from leaving the country without prior permission of this Bench - overseas trip to Abu Dhabi, UAE to attend the wedding ceremony of friend s son as per e-invitation received by the present applicant - Respondent moved seeking direction against the respondent Nos. 2 to 5 to deposit their passports with the Registry of this Tribunal during the pendency of IA - allegation of applicant as siphoned off huge amounts of the Company and is not cooperating with the liquidator in the liquidation proceedings HELD THAT - There are various allegations levelled upon the friend of the present applicant and in view of those allegations, applicant should also be restrained to travel abroad. In fact, no clinching evidence produced against the present applicant (respondent No. 2) so as to make any ground to restrain him from travelling abroad and/or for attending wedding ceremony of his friend s son. All the allegations are only against third party. That the present applicant has filed his travel program along with e-invitation card specifying the place of visit for a period from 19.02.2019 to 24.02.2019. The respondent has also failed to produce any evidence of the recent past about the conduct of the present applicant (respondent No. 2 ). Moreover, it is the domain of the liquidator to raise objection, if any, when the company is already under liquidation. It is pertinent to mention herein that as per Section 35 of the IBC, the moment, the order of liquidation is passed, the Liquidator takes into his custody or control, all the assets, properties, effects and the actionable claims of the corporate debtor. It is only the Resolution Professional and/or Liquidator as the case may be, is/are competent to file an application before the Adjudicating Authority under sections 60(5)(c), 66 and 67 of IBC. Under the facts and circumstances and the discussions in sequel, we do not find any reason for not granting permission to the present applicant (respondent No. 2) to attend the wedding ceremony of his friend s son for a limited period. However, with abundant caution, we hereby direct the present applicant to furnish Indemnity Bond of ₹ 5.00 lakhs and the surety of a like amount with the Registry of this Tribunal. The present applicant is also directed to inform this Bench immediately through his authorised counsel, after return from his overseas trip to Abu Dhabi, UAE. It is further directed that the applicant shall produce order of this Bench at the Indian Embassy at Abu Dhabi, UAE.

Summary

Issues Involved:
1. Permission to travel abroad for attending a wedding ceremony during insolvency proceedings.

Detailed Analysis:
1. The application sought permission for the applicant to travel to Abu Dhabi, UAE, from 19.02.2019 to 24.02.2019 to attend a wedding ceremony. The respondent had earlier moved an application under sections 60(5)(c), 66, and 67 of the Insolvency and Bankruptcy Code, 2016 (IBC) seeking directions against the applicant to deposit their passports with the Tribunal during the proceedings.

2. Allegations were made that the applicant had siphoned off funds from the company and was not cooperating with the liquidator. An ad interim order was passed restraining the applicant from leaving the country without permission. The applicant denied the allegations, claiming they were false and fabricated, and that the respondent had suppressed material facts regarding a director's permission to travel abroad.

3. The respondent, as the operational creditor, argued that the applicant had not hindered the insolvency resolution process and that the company was under liquidation. The respondent objected to granting permission for the applicant to travel, citing concerns about the applicant's friend's involvement in fraudulent activities.

4. The Tribunal noted that the respondent was neither a corporate debtor nor a corporate person under the IBC, making the application not maintainable. The respondent failed to provide substantial evidence against the applicant, and all allegations were against third parties.

5. The Tribunal highlighted that the liquidator is responsible for managing the assets of the corporate debtor once liquidation is ordered. Only the Resolution Professional or Liquidator can file applications under relevant sections of the IBC. Considering the circumstances, the Tribunal granted permission for the applicant to attend the wedding but required an Indemnity Bond and surety.

6. The applicant was directed to inform the Tribunal upon return and produce the order at the Indian Embassy in Abu Dhabi. The application was allowed with the specified conditions to ensure compliance and accountability.

This detailed analysis covers the various legal aspects and considerations involved in the judgment regarding permission to travel abroad during insolvency proceedings.