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TMI Blog2020 (11) TMI 846X X X X Extracts X X X X X X X X Extracts X X X X ..... ignee of Gita Power is Financial Creditor under the IBC, 2016. As to the present case, it is seen that the Applicant was the Assignee of a loan from the Related Party of the Corporate Debtor and by following the principles laid down in the Judgment of the Hon'ble NCLAT, in Pankaj Yadav Anr. [ 2018 (9) TMI 1223 - NATIONAL COMPANY LAW APPELLATE TRIBUNAL, NEW DELHI ] as enumerated in para 7, the rights of the 'Assignee' are no better than those of the 'Assignor', the Applicant is stepping into the shoes of the Assignor and thereby takes over the right of the Assignor with the onerous crown, which also includes the disadvantage as found in the Assignment Agreement. Thus, if the Assignor of a debt is a Related Party of the Corporate Debtor, as per the ratio laid down by the Hon'ble NCLAT, the Assignee, who is a third party, is also liable to be held as a Related Party of the Corporate Debtor. This Tribunal is of the considered view that the Applicant being Assignee of the Loan from the Assignor, is also a Related Party of the Corporate Debtor and as such the Application as filed by the Applicant is liable to the dismissed - Application dismissed. - Sucharitha R ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... C Ltd. 12,77,29,97,091.00 12,77,29,97,091.00 53.39 2 Punjab National Bank 3,73,03,08,082.00 3,37,97,94,238.00 14.13 3 State Bank of India 3,11,28,96,180.00 3,02,28,96,180.00 12.63 4 Indian Bank 92,68,00,742.00 73,15,99,853.00 3.06 5 Syndicate Bank 34,23,34,826.00 34,23,34,826.00 1.43 6 Bank of Baroda 15,99,49,686.00 6,99,49,686.00 0.29 7 Garg Iron and Energy Pvt. Ltd. 73,24,88,381.00 73,24,88,381.00 3.06 8 OPG Power Generation P Ltd. 1,65,69,95,921.00 1,65,69,95,921.00 6.93 9 Shoka Tradelink Pvt. Ltd. 1,06,47,18,157.00 1,06,47,18,157.00 4.45 10 Radha Industries Pvt. Ltd. 15,14,20,126.00 15,14,20,126.00 0.63 TOTAL 24,65,09,09,192.00 23,92,51,94,459.00 100.00 6. The Minutes of the Meeting it was recorded as follows:- During the course of the meeting, the Respondent/IRP informed that she carried out preliminary verification of claims including status of relationship of Creditors with Corporate Debtor based on information furnished to her by the Creditors along with claim form and the documents available with Corporate Debtor and in public domain. All four Financial Creditors listed in serial No. 7 to 10 have furnished affidavits declaring that they are not related to Corporate Debtor, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a items. 7. The counsel for the Applicant states that the Applicant has challenged the order of admission of this Tribunal dated 27.01.2020 before the Hon'ble High Court of Judicature of Madras vide CRP No. 1123 of 2020 pending on the file of Hon'ble High Court of Judicature at Madras. According to the Applicant, CRP is pending on the file till date. 8. The Applicant in support of his claim, quotes the following citations: a). Edelweiss Asset Reconstruction Company Limited Vs. Synergies Dooray Automotive Limited and Ors. in NCLAT; b). Swiss Ribbons Private Limited and Anr. Vs. Union of India and Ors. W.P. Civil No. 99 of 2018 in Hon'ble Supreme Court of India. 9. The counsel for the Applicant states that the Respondent/IRP acted in violation of the well established principles of the judicial process. It is wrong on the part of the Respondent/IRP to have kept this Applicant out of the CoC based on the allegations submitted by the Financial Creditors who are Public Sector Banks. 10. The counsel for the Applicant further states that there was a communication from the Respondent/IRP dated 02.03.2020 calling upon this Applicant to produce necessary particulars and documents ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1.2020. 21. From the counter filed by the Respondent/IRP, it is clear that the Respondent did not pass any quasi-judicial order on 26.02.2020. However, the Financial Creditors based on the documents submitted by the Corporate Debtor strongly opposed the participation of the Applicant on the ground that it is clearly a Related Party . After the meeting, the Respondent/IRP sent e-mails dated 02.03.2020, 12.03.2020 and 24.03.2020 and reasonable opportunity was given to the Applicant to produce document to negate the fact that the Applicant is not a Related Party . However, the Applicant had replied to the Respondent/IRP dated 01.04.2020. 22. Based on all these documents and the submissions, the IRP vide letter dated 27.04.2020 has conveyed the findings that the Applicant is a Related Party and hence it is debarred from participating in any of the CoC meeting of the Corporate Debtor. 23. Surprisingly, this entire fact has been suppressed by the Applicant. The application dated 15.05.2020 was filed before this Tribunal vide e-mail dated 17.05.2020. 24. The Applicant has also not brought to our notice the subsequent findings of the IRP vide correspondence between them and the letter date ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r men in the CoC? The Corporate Debtor was already a sinking ship in a very deep financial crisis. At that point of time, the loan was assigned to the Applicant may be with a foresight to put their men in the CoC Meeting. However, the decision of the Respondent/IRP that Applicant is a Related Party is not challenged in this application. 33. The Applicant states that during the meeting of committee of creditors a biased opinion was formed by the Financial Creditors and the creditors alleged that Gita Power is a Related Party of the Corporate Debtor. Therefore, the Applicant being an assignee of Gita Power is Financial Creditor under the IBC, 2016. 34. At this juncture, it is significant to refer to the decision of the Hon'ble NCLAT in the matter of Pankaj Yadav Anr. -Vs- State Bank of India Anr. in Company Appeal (AT)(Insolvency) No. 28 of 2018, wherein at para 7 and 8 it has held as follows; 7. It is not in dispute that the assignor Mr. Sudhakar Mulay was the Director/promoter of the 'Corporate Debtor'. Therefore, he is 'related party' within the meaning of Section 5(24). A legal transfer of 'debt' account from a 'creditor' (assignor) to a third ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the matter of Edelweiss Asset Reconstruction Company Ltd. -Vs- Synergies Dooray Automotive Ltd. Ors. in Company Appeal (AT)(Insolvency) No. 169 of 2017, wherein the Hon'ble NCLAT, seems to have taken a different view from its earlier decision rendered in Pankaj Yadav (supra). However, the view taken by the Hon'ble NCLAT in the matter of Edelweiss Asset Reconstruction (supra) is justified on the basis of the specific facts arising in that particular case. The facts of the case in Edelweiss Asset Reconstruction (supra) can be discerned from that on the Pankaj Yadav (supra), so as to say, that in the former case, the Loan was originally granted by a Bank which was later on assigned to a Related Party, however in the latter case, the original loan itself was granted by the Related party of the Corporate Debtor. It is a settled law, that that whatever the rights the original assignor got from the original lender will automatically accrues to subsequent assignees based on executing appropriate legal documents in accordance with law. Thus, as to the case of Assignment of debt to a Related/Non - Related Party, there can be no straight-jacket formula which can be applied to ascerta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is the time of submission of the resolution plan, antecedent facts reasonably proximate to this point of time can always be seen, to determine whether the persons referred to in Section 29A are, in substance, seeking to avoid the consequences of the proviso to sub-clause (c) before submitting a resolution plan. If it is shown, on facts, that, at a reasonably proximate point of time before the submission of the resolution plan, the affairs of the persons referred to in Section 29A are so arranged, as to avoid paying off the debts of the non-performing asset concerned, such persons must be held to be ineligible to submit a resolution plan, or otherwise both the purpose of the first proviso to sub-section (c) of Section 29A, as well as the larger objective sought to be achieved by the said sub-clause in public interest, will be defeated . 38. However, as to the facts of the present case, the same is squarely covered by the decision of the Hon'ble NCLAT in the matter of Pankaj Yadav (supra). Thus, in view of the dispositive reasoning that have been set out supra, this Tribunal is of the considered view that the Applicant being Assignee of the Loan from the Assignor, is also a Relat ..... X X X X Extracts X X X X X X X X Extracts X X X X
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