9911796707
TMI Blog2020 (8) TMI 348X X X X Extracts X X X X X X X X Extracts X X X X ..... the provisions of the Limitation Act, 1963 cannot be invoked for regulating the period of limitation governing appeals preferred under Section 61 of the I B Code which ordinarily provides a period of 30 days for preferring of an appeal by an aggrieved person qua an order passed under Part-II of the I B Code which is extendable by 15 days at the discretion of this Appellate Tribunal on sufficient cause being assigned for non-filing of appeal within the statutory period of 30 days. It is also manifestly clear that the outer limit of 45 days cannot be transgressed to enable an Appellant to maintain an appeal under this provision. If the appeal has been preferred beyond statutory period of 30 days and extended period of 15 days i.e. total 45 days, this Appellate Tribunal will have no jurisdiction to entertain such appeal. From which date the period of limitation is to be reckoned? - HELD THAT:- The appeal has been preferred even 30 days beyond the extended timelines of 45 days envisaged under Section 61(2) proviso of the I B Code . It is, therefore, irrelevant as to whether the cause assigned for non-filing of the appeal within statutory period of 30 days from the date of know ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . Kumar Anurag Singh, Ms. Vandana Sehgal and Mr. Zain A. Khan and Mr. Anando Mukherjee, Advocates JUDGMENT BANSI LAL BHAT, J. A Resolution Plan submitted by Consortium of Sri City Private Limited and KCR Enterprise LLP (Resolution Applicants) to resolve Corporate Insolvency of M/s. Sai Wardha Power Generation Limited (Corporate Debtor) approved by the Committee of Creditors with 75.91% voting shares and submitted by the Resolution Professional of the Respondent- Corporate Debtor along with application under Section 31 of the Insolvency and Bankruptcy Code, 2016 ( I B Code for short) before the Adjudicating Authority (National Company Law Tribunal), Hyderabad Bench, Hyderabad has been approved in terms of order dated 17th October, 2019. Same has been assailed by the Specified Officer, Special Economic Zone, Warora (Appellant) through the medium of instant appeal primarily on the ground that the exemption/ concession granted by the Adjudicating Authority in the impugned order is in direct conflict of the provision of Special Economic Zone Act, 2005 ( SEZ Act, 2005 / Act for short) as well as the Special Economic Zone Rules, 2006 ( SEZ Rules, 2006 / Rules for short ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mediate requirement of Corporate Debtor s operations. The plan dealt with the interest of all stakeholders providing for upfront payment to secured and unsecured Financial Creditors, payment to Operational and other creditors and servicing of residual surviving debt, contingent claims and resolution cost. The Resolution Plan was approved by the Adjudicating Authority as approved by the Committee of Creditors after recording its satisfaction that the Resolution Plan approved by the Committee of Creditors having 75.91% of voting shares meets the requirements of Section 30(2) of the I B Code . 3. The challenge to the approved Resolution Plan in the instant appeal filed by Special Economic Zone (Appellant) is limited to concession incorporated in Clause 3 (j) (r) of the impugned order which deals with Relief and Concession in the Resolution Plan sought by the Resolution Applicant . A cursory look at the relevant provision brings it to fore that an amount of ₹ 45 Crores was provided to be paid to Custom Department for the de-notification of Special Economic Zone ( SEZ ). The Resolution Applicant sought a direction for waiving off any additional amount required to be paid by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ommercial wisdom of the Committee of Creditors reigns supreme in the resolution of distressed assets under the Code. Fourthly, it is submitted that the Resolution Applicant did not arrive at the figure of ₹ 45 Crores for de-bonding unilaterally as the Resolution Plan clearly specified that the figure is an estimate arrived at by internal assessment at the time of submission of the Resolution Plan while the actual figure needs to be arrived at by the Competent Authorities on the written down value of the fixed assets of the Corporate Debtor on the date of application for de-bonding. 6. Heard learned counsel for the parties and also perused the written submissions filed by the Respondent. However, Appellant has not chosen to file written submissions. 7. Before leaping forward to come to grips with the merits of the case, it would be appropriate, at the outset, to deal with the issue of limitation. Section 61 of the I B Code provides for appeal against an order passed by the Adjudicating Authority under Part-II of the I B Code covering Sections 4 to 77 of the I B Code . An aggrieved person may prefer an appeal to NCLAT within 30 days. This Appellate Tribunal has been ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d in their case the period of limitation will have to be reckoned from the date of knowledge of such order having been passed by the Adjudicating Authority. In the instant case, Appellant claims that it was not a party to the proceeding before the Adjudicating Authority and it gained knowledge about the impugned order vide Respondent s letter dated 20th December, 2019 received on 23rd December, 2019 together with a copy of the impugned order. This is specifically pleaded in para 2. The appeal was admittedly filed on 4th February, 2020 i.e. after 42 days. If it be so, it would fall within the purview of extended timeline of 45 days within the ambit of Section 61 (2) proviso of the I B Code subject to assigning of a sufficient cause but the controversy does not end here. According to respondent, the impugned order was communicated to Appellant by Respondent vide letter dated 29th November, 2019 forming Annexure R1 to the Affidavit filed by the Respondent. Same appears to have been replied on 10th December, 2019, the reply forming Annexure R2 to the Affidavit of the Respondent. In the aforesaid reply, the Appellant has acknowledged receipt of impugned order of the Adjudicating Autho ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s dealt with under the Act are inconsistent with the provisions of the Act, the provision of the Act will prevail. The Act provides for exemption from duties of Customs with provisions contained in Section 76(E), (F), (G) and (H) which are reproduced hereinbelow: 76.E. Exemption from duties of customs. Without prejudice to the provisions of Sections 76F, 76G and 76H, any goods admitted to a special economic zone shall be exempt from duties of customs. 76.F. Levy of duties of customs.- Subject to the conditions as may be specified in the rules made in this behalf: (a) any goods admitted to a special economic zone from the domestic tariff area shall be chargeable to export duties at such rates as are leviable on such goods when exported; (b) any goods removed from a special economic zone for home consumption shall be chargeable to duties of customs including anti-dumping, countervailing and safeguard duties under the Custom Tariff Act, 1975, where applicable, as leviable on such goods when imported; and (c) the rate of duty and tariff valuation, if any, applicable to goods admitted to, or removed from, a special economic zone shall be the rate and tariff ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... positive Net Foreign Exchange, the exit shall be subject to penalty that may be imposed under the Foreign Trade (Development and Regulation), Act, 1992. (2) The following conditions shall apply on the exit of the Unit, namely:- (i) Penalty imposed by the competent authority would be paid and in case an appeal against an order-imposing penalty is pending, exit shall be considered if the unit has obtained a stay order from competent authority and has furnished a Bank Guarantee for the penalty adjudicated by the appropriate authority unless the appellate authority makes a specific order exempting the Unit from this requirement; (ii) In case the Unit has failed to fulfil the terms and conditions of the Letter of Approval and penal proceedings are to be taken up or are in process, a legal undertaking for payment of penalties, that may be imposed, shall be executed with the Development Commissioner; (iii) The Unit shall continue to be treated a Unit till the date of final exit. (3) In the event of a gems and jewellery unit ceasing its operation, gold and other precious metals, alloys, gem and other materials available for manufacture of jewellery shall be handed o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Resolution Plan for de-notification of the Corporate Debtor from SEZ is not a crystallised debt but an amount to be assessed by the Development Commissioner in exercise of its jurisdiction. Thus, it is abundantly clear that the estimated amount of ₹ 45 Crores has been set apart in the approved Resolution Plan to take care of the duties chargeable and penalties imposable by the Development Commissioner while according approval to opting out of Corporate Debtor from SEZ. Admittedly, the Resolution Applicant has applied for the de-notification of the unit of the Corporate Debtor before the Development Commissioner. The approved Resolution Plan is binding on all stakeholders including the Central Government but it would not be correct to hold that the amount of ₹ 45 crores set apart is a crystallised debt and in that sense same is not subject to any variation or change. The proposed Resolution Plan allocated an amount of ₹ 45 Crores for being paid to the Development Commissioner as chargeable duty/ penalty for de-notification from SEZ purely on the basis of an estimate. Such allocation was to take care of the duties chargeable/ penalties imposed being realized from t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Crores has been set apart only as an estimated value of the chargeable duties/ leviable penalties being imposed by the Development Commissioner while approving the exit of Corporate Debtor from SEZ, contravention of any law is not made out. Issue regarding chargeable duties and penalties imposable by the Development Commissioner while considering exit/ opting out of Corporate Debtor from SEZ and its de-notification adjudicatable by the Competent Authority being not in controversy and the Adjudicating Authority being found to have exercised its jurisdiction in approving the Resolution Plan of the Successful Resolution Applicant within the parameters of law and contours of settled legal position, it cannot be said that the Adjudicating Authority has encroached upon the jurisdiction of the Development Commissioner under the Act and usurped his authority. The argument on this score being devoid of merit is rejected. 16. Claim of Appellant amounting to ₹ 36,21,42,252/- having been rejected during the Resolution Process and the same not having been assailed by the Appellant before the Adjudicating Authority, the Appellant is not entitled to raise issue in this regard for the fir ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
