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2021 (10) TMI 992 - Tri - Insolvency and BankruptcySeeking direction to Respondent, who is in possession of the movable properties of the CD, as the erstwhile landlord of the CD's old office, to cooperate with the company Liquidator, in collection of information about the movable assets which is in their physical possession and custody, so as to enable him to sell them in accordance with law - seeking permission to sell the movable assets of the CD as per the lists given in the Minutes of the 1st CoC meeting dated 25.04.2019 by private sale - scope of Liquidation Estate - HELD THAT - This Tribunal already vide its order dated 11.03.2021 has directed the Respondent to hand over voluntarily forthwith the items as listed at Page No. 26 of the typed set filed along with the present Application within a period of two weeks' from the date of the order, failing which, the Liquidator was directed to take assistance from the Police Station concerned in this regard for the implementation of the Order on the part of the Respondent. It is seen that the movable assets, which are kept in the old premise at Cathedral Road, Chennai, are still in the custody of the Ms. Sundaravel T, the Respondent herein and that the Respondent refuses the Liquidator to value the said assets. Further, it is also pertinent to note that the Respondent had filed claims in Form-C before the liquidator for a sum of ₹ 27,21,744/- by attaching the lease agreement and rent working in order to substantiate the claim. At this juncture, it is pertinent to point out that once the creditor had submitted the claim in Form-C, the Creditor cannot hold back the movable assets of Corporate Debtor as a security for his claim, which goes against the principles of IBC, 2016. Ultimately, the said moveable assets of the Corporate Debtor would come within the purview of 'Liquidation Estate' and the Respondent is in possession of the same and not willing to hand over the said moveable assets to the Liquidator. The Respondent is directed to hand over the moveable assets of the Corporate Debtor - application disposed off.
Issues Involved:
1. Recall/Set Aside of Order dated 11.03.2021. 2. Jurisdiction of Liquidator to maintain MA/54/2020. 3. Liquidation of Corporate Debtor and handling of movable assets. Issue-wise Detailed Analysis: 1. Recall/Set Aside of Order dated 11.03.2021: IA/507/CHE/2021 was filed by the Respondent to recall/set aside the order dated 11.03.2021. The Tribunal referenced the judgment in Deepakk Kumar, Director of M/s. Sovereign Infrastructure & Developers Ltd. -Vs- Phoenix ARC Pvt. Ltd. (2020 SCC Online NCLAT 648), stating that the power to 'Review' is not an 'inherent power' and must be expressly provided by law. The Tribunal concluded that NCLT Rules 2016 do not contain any powers similar to Review/Recall the order, and Rule 11 of NCLT Rules, 2016 is not a 'substantive rule' conferring any power or jurisdiction on the Tribunal. Therefore, IA/507/CHE/2021 was dismissed as not maintainable. 2. Jurisdiction of Liquidator to maintain MA/54/2020: The Respondent objected to the jurisdiction of the Liquidator to maintain MA/54/2020, arguing that the initiation of CIRP by the Operational Creditor was collusive and aimed at defrauding other creditors. The Respondent also alleged that the IRP failed to exercise administrative and management powers properly, did not collect necessary information from the Suspended Board of Directors, and failed to furnish information to the CoC. The Tribunal, however, found these objections insufficient to dismiss the application, as the Liquidator was acting within his powers to realize and manage the assets of the Corporate Debtor. 3. Liquidation of Corporate Debtor and handling of movable assets: The Corporate Debtor was ordered into CIRP on 26.03.2019, and the Liquidator was appointed following the CoC's resolution for early liquidation due to the company's lack of business, revenue, employees, and substantial assets. The Liquidator sought directions to take possession and sell the movable assets of the Corporate Debtor, which were in the custody of the Respondent, the erstwhile landlord. The Tribunal emphasized that under Section 36 of IBC, 2016, the Liquidator forms an estate of the assets of the Corporate Debtor, which includes movable assets in possession of third parties. The Respondent, having filed a claim for rent arrears, could not hold back the assets as security, as these assets form part of the 'Liquidation Estate'. The Tribunal directed the Respondent to hand over the movable assets within 15 days, failing which coercive action would be taken. Conclusion: The Tribunal dismissed IA/507/CHE/2021, affirming that it lacked the power to recall or review its own order. It upheld the Liquidator's jurisdiction to maintain MA/54/2020 and directed the Respondent to hand over the movable assets of the Corporate Debtor, reinforcing the principles of the Insolvency and Bankruptcy Code, 2016.
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