2022 (4) TMI 651 - AT - Insolvency and Bankruptcy

Revival of Resolution Plan - petition already closed due to settlement and there was no Insolvency Resolution Process pending against the Corporate Debtor - HELD THAT - There is no dispute between the parties that the Application under Section 9 filed by the Operational Creditor was closed on 20th December, 2021 on the ground that CIRP of the Corporate Debtor has already been initiated in CP(IB) No. 813/2020. After the aforesaid Order dated 20th December, 2021, the Operational Creditor filed the I.A. No. 6010 of 2021 for modification of the Order but till the time modification came to be considered by the Adjudicating Authority, Adjudicating Authority was aware that CIRP in CP(IB) No. 813/2020 has already been closed hence there was no impediment in reviving the Application. It is true that I.A. 6010/2021 only praying for liberty to revive but on account of actual happening of settlement in CP(IB) No. 813/2020, no error has been committed by the Adjudicating Authority in reviving the CP(IB) No. 315/ND/2021. The Appeal is dismissed.

Issues:
1. Revival of an application under Section 9 of the Insolvency and Bankruptcy Code, 2016.
2. Modification of the order for granting liberty to Operational Creditor to revive the petition.
3. Dispute regarding the revival of the application CP(IB) No. 315/ND/2021.

Revival of Application under Section 9:
The appeal was filed against the Order passed by the Adjudicating Authority, reviving the Application CP(IB) No. 315/ND/2021 under Section 9 of the Insolvency and Bankruptcy Code, 2016. The Adjudicating Authority initially closed the application as a Corporate Insolvency Resolution Process (CIRP) against the same Corporate Debtor had already been initiated in a separate matter. However, an application was subsequently filed by the Operational Creditor seeking modification of the order to grant liberty to revive the petition in case of a settlement between the parties in the earlier matter. The Adjudicating Authority, aware that the CIRP in the earlier matter had been closed due to settlement, found no impediment in reviving the application. The Tribunal upheld the revival of the application, stating that no error was committed by the Adjudicating Authority in doing so.

Modification of Order for Liberty to Revive Petition:
The Operational Creditor had requested modification of the order to grant liberty to revive the petition in case of a settlement between the parties in the earlier matter. The Appellant's counsel argued that the application was only for modification, not revival, as there was no need to revive the petition. The Respondent's counsel contended that since the CIRP in the earlier matter had been closed due to settlement, there was no pending insolvency resolution process against the Corporate Debtor. The Tribunal considered the submissions and records, concluding that although the initial application sought only liberty to revive, the actual settlement in the earlier matter justified the revival of the application. Therefore, the Tribunal dismissed the appeal, finding no error in the Adjudicating Authority's decision to revive the application.

Dispute Regarding Revival of Application CP(IB) No. 315/ND/2021:
The dispute arose regarding the revival of the application CP(IB) No. 315/ND/2021, which had been closed initially by the Adjudicating Authority. The Appellant's counsel argued that there was no need for revival, as the application only required modification. On the other hand, the Respondent's counsel highlighted that the CIRP in the earlier matter had been settled, removing any obstacle for the Adjudicating Authority to initiate the CIRP against the Corporate Debtor. The Tribunal noted that the settlement in the earlier matter justified the revival of the application, as there was no error in the Adjudicating Authority's decision. The appeal was dismissed, granting the Appellant's counsel additional time to file a reply as allowed by the Adjudicating Authority.

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