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TMI Blog2021 (4) TMI 144X X X X Extracts X X X X X X X X Extracts X X X X ..... aid down certain parameters while ordering for consolidation of CIRP. The said order was cited before Ld. Adjudicating Authority Bengaluru Bench, However, while passing the impugned order there is no finding whether these parameters are fulfilled or not in this case. Common Control - HELD THAT:- Both Companies are promoted by the same family and there is unity of ownership and interest - The Respondent No. 1 is controlling company of Respondent No. 2. Common Directors - HELD THAT:- Mr. M.V. Murlidher and Padma Murlidher both are Directors in Respondent Nos. 1 and 2 Company. Thus, the Directors of the both Companies are Common and there is common control of companies. Common Assets - HELD THAT:- There is inter-dependency between two Companies and the assets are common to such an extent that the Respondent No. 2 Company has provided its land and warehouse to the Respondent No. 1 Company to carry on its business activity. Common Liabilities - HELD THAT:- The liabilities of the Companies are also common and Companies had made themselves jointly and severally liable for the loans. Respondent No. 1 and 2 have common creditors i.e. Respondent Nos. 3 and 4. Directors of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ( Judicial ) And ( Kanthi Narahari ) Member ( Technical ) For the Appellant : Mr. Gopal Jain, Sr. Advocate, Ms WarmikaTrehan, Mr. Ajay Bhargava, Mr AvinashBalakrishna, Ms Maithili Moondra and Ms Vanita Bhargava , Advocates For the Respondent : Mr. Abhishek Singh, Ms Aayushi Mishra, Advocates for R3 and R4. Mr. Pankaj Srivastava, Advocate for R1. Ms BhuvaneshwariRamanathan, Advocate for R2. JUDGMENT Jarat Kumar Jain , J. The Appellant Radico Khaitan Ltd. (Operational Creditor) filed this Appeal against Impugned Order dated 02.09.2020 passed by Ld. Adjudicating Authority (National Company Law Tribunal, Bengaluru Bench). Whereby rejected the application (I.A No. 212 of 2020 in C.P. (IB) No. 165/BB/2018) filed by the Appellant, for consolidation of two Corporate Insolvency Resolution Process (CIRP). 2. Brief and relevant facts for this Appeal are that the Operational Creditor (Appellant) has filed an application C.P. (IB) No. 165/BB/2018 under Section 9 of Insolvency and Bankruptcy Code, 2016 (in short I B Code ) for seeking to initiate CIRP in respect of BT FC Pvt. Ltd. Corporate Debtor (Respondent No. 1) on the ground that it has committed default ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Thus, the Corporate Debtors had common shareholders and directors and the control of both the companies was in the hand of the same persons. The claims of Respondent Nos. 3 and 4 show that the Respondent No. 2 stood as a guarantor for the financial debt of Respondent No. 1. Therefore, the assets and liabilities of the Corporate Debtors are also interlinked. Therefore, CIRP of the Corporate Debtors ought to be consolidated. 5. The Respondent No. 1 6 i.e. BT and FC Pvt. Ltd. and Mr. Pankaj Srivastava (RP) have filed their Reply by supporting the application. 6. The Respondent Nos. 2 and 7 i.e. Bengaluru Dehydration and Drying Equipment Company and its RP Ms. R. Bhuvaneshwari have opposed the application and stated that merely having few common shareholders in Respondent Nos. 1 and 2 cannot be ground for consolidation of CIRP of both the Companies into a single entity. There is no provision under the I B Code to justify such consolidation. 7. The Respondent Nos. 3 and 4 in their common Reply have opposed the prayer and stated that the CoC have already resolved to liquidate the Respondent No. 1 company and same has been endorsed and submitted by the Resolution Professional o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s to consolidate them and offer them as a single unit for CIRP. 12. Per contra Ld. Counsel for the Respondent Nos. 3 and 4 submitted that the Appellant being an Operational Creditor has no locus standi to seek consolidation of CIPR of the Respondent Nos. 1 and 2 because the Appellant cannot form part of CoC. For this purpose, he placed reliance on the Judgment of Hon ble Supreme Court in the case of Swiss Ribbons (P) Ltd. Vs. Union of India (2019) 4 SCC 17 (Para 75) followed by COC Essar Steel India Ltd. Vs. Satish Kr. Gupta 2019 SCC Online SC 1478. 13. It is also submitted that the Respondent No. 1 has had no business relationship whatsoever with Respondent No. 2 and has no direct nexus with the Respondent No. 2. 14. Learned Counsel for the Respondent Nos. 3 and 4 submitted that the Respondent No. 2 possesses an immovable property (Mortgaged with Respondent Nos. 3 and 4 having a pari passu charge). Therefore, Appellant malafidely seeking consolidation of CIRP of the Respondent Nos. 1 and 2. 15. It is also submitted that in the Judgments relied on by the Appellant, the consolidation of CIRP was ordered for the sole reason that the Corporate Debtors constituted to be gro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and R-2 at Page 528 and 529 of Appeal Paper Book) (iii) Common Assets: The Respondent No. 2 Company owns a partial of land admeasuring 2 acres 36 gundas situated at No. 15, First Phase, Peenya Bengaluru and has constructed warehouse on the land. The Respondent No. 1 Company runs a bottling plant unit in the warehouse and owns the plant and machinery therein, therefore, there is inter-dependency between two Companies and the assets are common to such an extent that the Respondent No. 2 Company has provided its land and warehouse to the Respondent No. 1 Company to carry on its business activity. (iv) Common Liabilities: (a) The Respondent No. 3 has made a claim of ₹ 13,45,11,636/- against the Respondent No. 1 Company as a borrower and the Respondent No. 2 Company has a guarantor as a collateral for the loan obtained by the Respondent No. 1 Company and the Respondent No. 2 Company has mortgaged Peenya land and warehouse situated therein. Further Respondent No. 2 has provided a corporate guarantee as security for the loan obtained by the Respondent No. 1 Company. (b) In so far as the loan obtained by the Respondent No. 1 Company from the Respondent No. 4 is concerned, th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... .V Murlidher family has significant influence over both the Companies i.e. Respondent Nos. 1 and 2.Thus, the Respondent No. 2 Company is associated company of the Respondent No. 1 Company. (viii) Common Financial Creditors: The Respondent Nos. 1 and 2 have Common Financial Creditors i.e. the Respondent Nos. 3 and 4. 19. It can be clearly seen from the above that eight parameters are fully met and satisfied in this case. 20. Apart from this Financial Creditors i.e. Respondent Nos. 3 and 4 in their written submissions have not pointed out that how the consolidated CIRP shall prejudice their rights. Even if the combined CIRP is ordered the balance of convenience is squarely on Respondent Nos. 3 and 4 herein who are secured Financial Creditors and whose interest will remain protected even during the combined Insolvency as secured Financial Creditors. The Appellant being an Operational Creditor is placed sixth in hierarchy for the liquidation process in the I B Code, (See Section 53 (1) (f) of I B Code). 21. With the aforesaid, we are of the view that the Respondent Nos. 1 and 2 fulfilled the criteria of consolidation. Ld. Adjudicating Authority has not appreciated the fac ..... X X X X Extracts X X X X X X X X Extracts X X X X
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