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2019 (11) TMI 125 - AT - Insolvency and BankruptcyAdmissibility of application - initiation of CIRP - Operational Creditor - Corporate Debtor - HELD THAT - 1st Respondent has not disputed that it had no arrangement or agreement with M/s. Global Energy Talent Private Limited , an Indian entity shown as Corporate Debtor and had settled the matter with M/s. Global Energy Talent, Mauritius , it appears to us that the application under Section 9 was filed by 1st Respondent with malicious intention for purpose other than for the resolution of insolvency, or liquidation of M/s. Global Energy Talent Private Limited , as liable for action under Section 65 of the I B Code . The matter is also remitted to the Adjudicating Authority to decide whether any order is required to be passed against Mr. Mohamed Hesham Mohamed Amin Basha Mashaa l under Section 65 of the I B Code on the ground that the application was filed by him fraudulently with malicious intention for purpose other than for the resolution of insolvency, or liquidation - Appeal allowed.
Issues:
1. Maintainability of the application under Section 9 of the Insolvency and Bankruptcy Code, 2016. 2. Validity of the order passed by the Adjudicating Authority. 3. Liability of 'M/s. Global Energy Talent Private Limited' to pay the Resolution Professional. 4. Settlement between the parties and its impact on the case. 5. Payment obligation of 'M/s. Global Energy Talent Private Limited' towards the Resolution Professional. 6. Consideration of action under Section 65 of the Insolvency and Bankruptcy Code. 7. Directions regarding payment and recovery of costs. Issue 1: Maintainability of the application under Section 9: The appeal was filed against the order admitting an application under Section 9 of the Insolvency and Bankruptcy Code. The Appellant argued that there was no agreement between the parties, rendering the application not maintainable. The Respondent had settled the matter with a different entity, 'Global Energy Talent, Mauritius,' not with 'M/s. Global Energy Talent Private Limited,' the Corporate Debtor. The Tribunal held that the application was not maintainable due to the lack of a relationship between the Operational Creditor and the Corporate Debtor. Issue 2: Validity of the Adjudicating Authority's order: The Tribunal set aside the order dated 19th December, 2018, passed by the Adjudicating Authority, declaring it illegal. Consequently, all orders appointing the Interim Resolution Professional, declaring moratorium, freezing accounts, and any actions taken were also set aside. The Corporate Debtor was released from the legal obligations, and the proceedings were closed. Issue 3: Liability of 'M/s. Global Energy Talent Private Limited' to pay the Resolution Professional: The Resolution Professional had incurred costs amounting to approximately ?6 lakhs. The Tribunal directed 'M/s. Global Energy Talent Private Limited' to pay ?6 lakhs to the Resolution Professional, with an adjustment of ?2 lakhs already paid by 'M/s. Global Energy Talent, Mauritius.' The Corporate Debtor could recover this amount from the Operational Creditor. Issue 4: Settlement between the parties and its impact: The parties had settled the matter, leading to the withdrawal of appearances. The settlement influenced the Tribunal's decision regarding the maintainability of the application under Section 9. Issue 5: Payment obligation of 'M/s. Global Energy Talent Private Limited' towards the Resolution Professional: The Tribunal ordered the payment of ?6 lakhs to the Resolution Professional by 'M/s. Global Energy Talent Private Limited,' ensuring that the Interim Resolution Professional was not at a loss. Issue 6: Consideration of action under Section 65: The Tribunal considered the application filed with malicious intent and for a purpose other than insolvency resolution or liquidation. It held that action under Section 65 of the Insolvency and Bankruptcy Code could be taken against the Operational Creditor. Issue 7: Directions regarding payment and recovery of costs: The Tribunal allowed 'M/s. Global Energy Talent Private Limited' to recover the payment from the Operational Creditor. It also remitted the matter to the Adjudicating Authority to decide on any action under Section 65 against the Operational Creditor. Other creditors were permitted to seek appropriate relief through the appropriate forum.
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