2021 (8) TMI 613 - AT - Insolvency and Bankruptcy

Liquidation of Corporate Debtor - Section 61 of the Insolvency and Bankruptcy Code 2016 - HELD THAT - Liquidation process is governed by Chapter III Part - II of the Code. The Regulation governing Liquidation process providing elaborate provisions on Realizations of Assets vide Chapter VI of IBBI (Liquidation Process) Regulations 2016. The Appellant is forcing the Liquidator to sale the property to them only which is not permissible under the provisions of the Code and Regulations. It is undisputed fact that Appellant has no locus standi and accordingly he cannot seek the sale of the property to the Appellant only. The Appellant is reagitating the same matter in different rounds before the Adjudicating Authority. The Code provides for time bound resolution and if such frivolous actions are allowed it will be never ending process to complete the liquidation. The Appeal is not maintainable and deserves to be dismissed and is accordingly dismissed.

Summary

Issues:
Appeal against order under Insolvency and Bankruptcy Code, 2016 - Relief sought by Appellant - Rejection of relief by Adjudicating Authority - Appellant's request to buy factory premises - Liquidator's actions and responses - Appellant's occupancy rights - Legal standing of Appellant - Liquidation process regulations - Appellant's interference in liquidation process - Merits of the appeal.

Analysis:
The judgment involves an appeal under the Insolvency and Bankruptcy Code, 2016, filed by the Appellant, seeking various reliefs against the order passed by the Adjudicating Authority. The Appellant requested to set aside the impugned order, direct the Liquidator to consider its offer to purchase the factory premises, obtain a fresh valuation report, issue a fresh e-auction, allow continued use of the premises, and waive rent for a specific period due to lockdown. The Adjudicating Authority rejected these reliefs without providing reasons, leading to the appeal.

The facts of the case reveal that the Appellant, a leave and license holder of the premises, sought to buy the property and continue occupying it until the sale is finalized. However, the Liquidator did not accept the Appellant's offer and proceeded with an e-auction, directing the Appellant to vacate the premises and deposit rent arrears. The Liquidator argued that the Appellant had no legal standing, was an illegal occupant, and interfered in the liquidation process by not vacating the premises despite the lease agreement expiring in 2019.

The Tribunal noted that the Appellant's actions were frivolous and lacked merit. It emphasized that the liquidation process is governed by specific regulations that do not permit the Appellant to force the sale of the property to them. The Tribunal concluded that the Appellant had no locus standi and was reiterating the same matter repeatedly, causing delays in the resolution process. Therefore, the Tribunal upheld the Adjudicating Authority's order, dismissing the appeal as frivolous and maintaining the original decision.

In conclusion, the Tribunal declined to interfere with the Adjudicating Authority's order, finding no legal infirmity or factual error. The appeal was deemed not maintainable and was dismissed, with pending applications disposed of and interim orders vacated. No costs were awarded in the judgment.