2022 (4) TMI 298 - SC - Companies Law

Seeking prayer that the socalled counter claims be ordered to be decided before adjudication on the applications - HELD THAT - The appellant financial creditor attempted to challenge the said order dated 10.08.2021 as passed by the Appellate Tribunal in appeal before us. Having regard to the circumstances, we had passed the said order dated 26.11.2021, as noticed at the outset. It is rather disturbing to note that despite specific orders of the Appellate Tribunal as also of this Court, the Adjudicating Authority has not been able to decide the pending applications and now, the submissions before us on behalf of the respondent No. 1 (applicant) are to the effect that there ought not to be tearing hurry in deciding those applications. Such a proposition on the part of the applicant cannot be countenanced, particularly looking to the previous orders passed in the matter - It is also noticed from the record that though we had restored the said appeal before the Appellate Tribunal so that appropriate and necessary orders could be passed, the Appellate Tribunal has chosen not to pass any other order in the matter, for the reason that the present application was said to be pending in this Court. The application so moved by respondent No. 1 of the appeal is specifically rejected - the Appellate Tribunal is requested to immediately take up the appeal for consideration and to pass such orders as may be deemed fit and necessary, keeping in view the observations and expectations in the order passed by this Court on 26.11.2021.

Summary

Issues:
1. Delay in disposal of pending applications by the Adjudicating Authority.
2. Request to decide counter claims before adjudication on pending applications.
3. Ex parte interim order directing parties to maintain status quo.
4. Failure of Adjudicating Authority to decide pending applications despite specific orders.
5. Challenge to the order of the Appellate Tribunal.
6. Application seeking enforcement of the order dated 26.11.2021.

Analysis:
1. The Supreme Court noted an inexplicable delay in the disposal of pending applications by the Adjudicating Authority despite expedite orders from the Appellate Tribunal. The Court had passed an order expecting expeditious proceedings, but the Authority failed to act promptly, leading to further complications.

2. An application was made requesting the decision of counter claims before adjudication on the pending applications. The applicant argued that there was no urgency to decide the pending applications and pay disputed sums to banks without resolving the counter claims. However, the Court found this approach incompatible with legal requirements and previous orders.

3. The Adjudicating Authority had passed an ex parte interim order directing parties to maintain status quo regarding the distribution of funds to financial creditors. Despite subsequent appeals and orders from the Appellate Tribunal, the Authority failed to decide on the applications within the specified time frames, leading to additional appeals and delays.

4. The Court expressed disappointment in the failure of the Adjudicating Authority to adhere to specific orders from higher tribunals. The respondent's argument against rushing the decision on pending applications was rejected, emphasizing the importance of complying with previous directives and legal obligations.

5. The appellant financial creditor attempted to challenge an order of the Appellate Tribunal before the Supreme Court. The Court, considering the circumstances and the lack of progress, passed an order restoring the appeal before the Appellate Tribunal for further action, urging prompt consideration and appropriate orders.

6. An application seeking enforcement of the order dated 26.11.2021 was deemed unnecessary by the Supreme Court as every aspect of the matter was left open for consideration by the Appellate Tribunal. Upon expressing reservations, the Court granted permission for the withdrawal of the application, leading to its dismissal.

This detailed analysis of the judgment highlights the issues of delay, counter claims, ex parte orders, failure to comply with directives, challenges to tribunal orders, and unnecessary applications, providing a comprehensive overview of the legal proceedings and decisions made by the Supreme Court.