2022 (4) TMI 566 - Tri - Insolvency and Bankruptcy

Revival of petition - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - Operational Creditors - existence of debt and dispute or not - HELD THAT - It is stated that since CIRP against the Corporate debtor in IB-08 of 2019 has been withdrawn, the applicant has been left with no remedy with regards to its claim against the corporate debtor. After withdrawal of the CIR proceeding against the corporate debtor in that matter, the present applicant was left with no alternative, but to file the present application, as vide order dated 13.04.2021, this applicant was also allowed to present its claim before the Ld. IRP appointed with C.P.(IB)-2992/ND/2019. No doubt, the detailed order was not passed, but in the interest of justice the application must be allowed and the matter has to be returned to its original position. Although, vide notification dated 24.03.2020, the threshold limit has been increased to 1 crores, but it is matter of fact that the present CP/IB/08/ND/2019 was filed way back on 26.12.2018 and order was passed on 13.04.2021, therefore, the threshold limit should not come in the way of the present applicant as by virtue of Rule 11 of NCLT Rules 2016, only the revival of the present petition has been sought. Further, it is also the matter of fact that this petition was not withdrawn in view of any settlement rather the order was passed by this Tribunal, whereby the applicant herein was directed to present its claim before the IRP. Once the CIR proceedings stood initiated in the other matter and taking into consideration the fact that two consequent orders qua initiation of CIR proceedings cannot be passed against the same Corporate Debtor - certainly the present petition is required to be revived, after withdrawal of the said CIRP proceedings under Section 12A of the Code. This Tribunal is of the view that the applicant herein is entitled to revival of the petition, accordingly, it is ordered that the petition be brought back to its original number - Let the matter be fixed for filing of rejoinder and arguments for 21.04.2022.

Summary

Issues:
Revival of CP(IB)-098 of 2019 under Rule 11 of NCLT Rules, 2016 for an Operational Creditor.

Analysis:
The application filed sought revival of CP(IB)-098 of 2019 under Rule 11 of NCLT Rules, 2016 by M/s. Arihant Trading Company on behalf of the Operational Creditor. The matter originated from IB-08 of 2019 under section 9 of the Insolvency and Bankruptcy Code, 2016, where CIRP was sought against the respondent. The proceedings were extensively argued, and an order was reserved on 14.01.2021. Another related matter, C.P.(IB)-2992/ND/2019, against the same Corporate Debtor was also pending and reserved on the same date. The Tribunal admitted the latter matter and directed the applicant to file its claim before the IRP. Subsequently, the applicant filed its claim as directed.

The applicant later discovered that IB-08 of 2019 had been settled between the parties, leading to the withdrawal of CIRP against the Corporate Debtor. This left the applicant with no recourse for its claim. Despite the settlement, the applicant was initially permitted to file a claim before the IRP, as per the Tribunal's order. However, with the withdrawal of CIRP proceedings, the applicant sought revival under Section 12A of the IB Code, which was allowed, terminating the CIR proceedings against the Corporate Debtor due to the settlement.

The Tribunal acknowledged the applicant's right to revive IB No. 08/ND/2019, emphasizing the need to return the matter to its original position. Despite the increased threshold limit under a notification, the Tribunal deemed the revival of the petition necessary, considering the circumstances and the applicant's entitlement. The Tribunal highlighted that the petition was not withdrawn due to a settlement but was disposed of after the initiation of CIR proceedings in another matter, emphasizing the need for revival post the withdrawal of CIRP proceedings under Section 12A of the Code.

Consequently, the Tribunal ordered the revival of IB No. 08/ND/2019 to its original number, granting the petitioner an opportunity to file a rejoinder within seven days. The matter was scheduled for filing of rejoinder and arguments on 21.04.2022.