2023 (8) TMI 554 - HC - Companies Law

Seeking transfer of present petition to the National Company Law Tribunal NCLT - It is submitted that since no effective steps have been taken in the present matter pursuant to the appointment of the Provisional Liquidator, as such the present matter may be transferred to the NCLT - Section 434 (1)(c) of the Companies Act, 2013. HELD THAT - The Supreme Court in ACTION ISPAT AND POWER PVT. LTD. VERSUS SHYAM METALICS AND ENERGY LTD. 2020 (12) TMI 535 - SUPREME COURT held that So long as no actual sales of the immovable or movable properties have taken place, nothing irreversible is done which would warrant a Company Court staying its hands on a transfer application made to it by a creditor or any party to the proceedings. It is only where the winding-up proceedings have reached a stage where it would be irreversible, making it impossible to set the clock back that the Company Court must proceed with the winding up, instead of transferring the proceedings to NCLT to now be decided in accordance with the provisions of the Code. Whether this stage is reached would depend upon the facts and circumstances of each case. In view of the judgment passed by the Supreme Court in Action Ispat, the present application is allowed subject to the petitioner clearing the expenses incurred by the OL. The OL is directed to raise a demand upon the petitioner within one week, which the petitioner will clear within two weeks thereafter.

Summary

Issues involved: Transfer of company petition to National Company Law Tribunal (NCLT) under Section 434(1)(c) of the Companies Act, 2013.

Summary:
The Petitioner, Ultratech Cement Ltd., filed an application seeking the transfer of the present petition to the NCLT as no effective steps were taken post the appointment of the Provisional Liquidator. The Respondent had deposited Rs. 5 Lacs with the Court to keep the previous order in abeyance. The Official Liquidator (OL) had no objection to the transfer but requested the petitioner to clear the expenses amounting to Rs. 48,069. Citing the Supreme Court's rulings in Action Ispat and Forech India Limited cases, the Court allowed the transfer application on the condition that the petitioner settles the expenses with the OL. The OL was directed to raise a demand within one week, to be cleared by the petitioner within two weeks. Consequently, the company petition was transferred to the NCLT, with all pending applications disposed of, while reserving the rights and contentions of the parties.