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2022 (7) TMI 101 - AT - Insolvency and BankruptcyLegality of Liquidation Process - Appellant / Liquidator points out that the Adjudicating Authority has not taken into consideration the Hon ble High Court of Orissa s Order, at the time of passing the Interim Stay, which has resulted in jeopardising the Liquidation Process - HELD THAT - This Tribunal after giving anxious consideration of the contentions advanced on either side with great care, caution and circumspection is of the considered opinion that ten days time is to be granted to the Respondent Nos.1 and 2 and to Respondent No.13 to file their Replies / Responses / Counters in IA(IBC)579/CHE/2022 in CP/1307/IB/2018 and accordingly, grants the same. On receipt of the Reply / Response / Counter of the Contesting Respondents (who has entered appearance), it is open to the Appellant / Liquidator to file Rejoinder, if any, through E-filing as well as through Hard Copy and to serve a copy of the same to the other side within one week, thereafter. Besides this, the other Respondents for whom the Notices were ordered by the Adjudicating Authority (National Company Law Tribunal, Division Bench II, Chennai) in the Impugned Order dated 03.06.2022, will also complete their Pleadings within seventeen days from Today and thereafter, the Adjudicating Authority (National Company Law Tribunal, Division Bench II, Chennai) is to take up the matter for Final Hearing and to pass Orders on merits - Appeal disposed off.
Issues: Stay of Impugned Order, Interim Order Validity, Opportunity to Respondents
The judgment by the National Company Law Appellate Tribunal, Chennai, involved several key issues. The Appellant, representing the Liquidator, argued that the Impugned Order by the Adjudicating Authority lacked consideration of material facts and went against the objectives of the Insolvency & Bankruptcy Code, 2016. Specifically, the Appellant contended that the Adjudicating Authority failed to consider a crucial Order by the High Court of Orissa, jeopardizing the Liquidation Process and exposing encroachment on certain land. The Appellant sought a stay on the Impugned Order to prevent an aberration of justice and uphold the cause of justice. Conversely, the Respondent's Senior Counsel argued that the Liquidator was directed not to interfere with the Corporate Debtor's assets until the disposal of the relevant Application. The Interim Order, according to the Respondent, was fair, just, valid, and balanced based on the case's circumstances. The Successful Bidder, represented by another Counsel, highlighted that they had paid a substantial sum and that the Interim Order adversely affected their interests regarding certain iron scraps. The Respondent No.13 also requested an opportunity to file a response to the Application filed by the Promoter, emphasizing the need for a fair process. After hearing all parties, the Tribunal granted ten days for the Respondents to file their responses to the Application. The Adjudicating Authority was directed to consider these responses, along with any rejoinder from the Liquidator, before passing a reasoned order adhering to the principles of natural justice. The Tribunal emphasized the importance of providing a fair hearing before issuing any order. Additionally, other Respondents were given seventeen days to complete their pleadings, after which the matter would proceed to a final hearing. The Adjudicating Authority was instructed to pass orders within two weeks of the final hearing, based on legal principles and uninfluenced by the Tribunal's observations. Ultimately, the Tribunal stayed the Interim Order until the disposal of the relevant Application, and the Company Appeal was disposed of with the mentioned observations and directions. The connected Interlocutory Applications were closed as well. The judgment aimed to ensure a fair and thorough process, respecting the rights and interests of all parties involved in the dispute.
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