9911796707
TMI Blog2021 (8) TMI 1237X X X X Extracts X X X X X X X X Extracts X X X X ..... olvency Resolution professional (IRP) has delayed filing of the application under Section 12A of the Code. Submissions by the Applicant: 3. The Applicant was an employee of the Corporate Debtor from 01.04.2013. the Applicant was relieved from the services of the Corporate Debtor on 14.06.2019 without settlement of arrears of salary and other dues. Therefore, Applicants / Operational Creditor/ Petitioner along with various other ex-employees filed the Petitions u/s 9 of the Insolvency and Bankruptcy Code, 2016 (Code) before this Hon'ble Tribunal. This Bench while hearing the Petitions took up one Petition in respect of each Rolta Group Company for hearing and heard both the parties extensively on 16.04.2021and reserved for Orders. 4. This Bench proceeded to pass order dated 13.05.2021 admitting the present petition under Section 9 of the Code, initiating Corporate Insolvency Resolution Process (CIRP) of the Corporate Debtor and appointed Ms. Vandana Garg as IRP of the Corporate Debtor. 5. Thereafter, further negotiations took place between the parties and the Corporate Debtor through its promoter director Mr. Kamal Singh, on or about 25.05.2021, agreed to settle the dues an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... med and as such the approval of 90% voting share of the Committee of Creditors is also not required. Therefore, this Bench has to exercise its jurisdiction and allow withdrawal of the Applications filed by the Applicants / Operational Creditors u/s 12A of the Code. 13. It is submitted by the Applicant that the Financial Creditors and the ex-employees who have not yet filed their Petitions have their own course to recover the dues payable to them by the Corporate Debtor. 14. The Applicant mentions that the Hon'ble NCLAT in its Order dated 07.07.2021 in the matter of Anuj Tejpal v/s Rakesh Yadav & Oyo Hotels and Homes Pvt. Ltd. permitted the withdrawal of the Company Petitions which were admitted by the Hon'ble NCLT. Therefore, the ratio of the said judgement has to be followed by this Tribunal. Submissions by the Promoter: 15. The present Applications have been filed by the Applicants seeking withdrawal in terms of Regulation 30A of the Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) Regulations, 2016 of the respective Company Petitions, admitted by this Bench vide Orders dated 13.05.2021 against Rolta India Limited. 16. P ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in reference, the list of such employees is provided hereinbelow: Sr. CP No. Employee Name Settlement Agreement date ROLTA INDIA LIMITED 1 1932/2019 Hiten Valia Joint Settlement Agreement dated 10.06.2021 2 1470/2020 Deepak Gupta Joint Settlement Agreement dated 10.06.2021 3 1466/2020 Anjali Sagar Kavishwar Joint Settlement Agreement dated 10.06.2021 4 38/2021 Sameer Anilkumar Lawande Joint Settlement Agreement dated 10.06.2021 5 1371/2020 Vipin Dayaram Yadav Joint Settlement Agreement dated 10.06.2021 6 151/2021 Jagdish A163/2021swath Joint Settlement Agreement dated 10.06.2021 7 163/2021 Mahesh Kumar Chalsani Joint Settlement Agreement dated 10.06.2021 8 1069/2021 Dinesh Gupta Joint Settlement Agreement dated 10.06.2021 9 409/2021 Laxmidhar Vinayakrao Gaopandey Settlement Agreement dated 24.06.2021 10 297/2021 Pradeep Kumar Sharma Joint Settlement Agreement dated 10.06.202 11 248/2021 Pawan Kumar Joint Settlement Agreement dated 27.05.2021 12 1372/2020 Biswa Ranjan Das Joint Settlement Agreement dated 27.05.2021 13 1354/2020 Animesh Pandit Joint Settlement Agreement dated 27.05.202 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt to apply for withdrawal without the consent of the creditors (Section 12A condition). 21. Concomitantly, Section 12A now read with the amended Reg. 30A in its current form envisages the withdrawal mechanism to be adopted in Pre-COC and Post-COC scenarios. Reg 30A(1) as amended is reproduced hereinbelow for reference: (1) An application for withdrawal under section 12A may be made to the Adjudicating Authority - (a) before the constitution of the committee, by the applicant through the interim resolution professional; (b) after the constitution of the committee, by the applicant through the interim resolution professional or the resolution professional, as the case may be: Provided that where the application is made under clause (b) after the issue of invitation for expression of interest under regulation 36A, the applicant shall state the reasons justifying withdrawal after issue of such invitation. 22. The legislative intent behind amendment of Regulation 30A would clearly show that at a pre COC stage, the right of an Applicant to seek withdrawal is not subject to any consent or approval or the collective wisdom of the other creditors. The same is only triggered once a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he Petitioners. 29. Further, a bare perusal would show that there are about 600 employees in the three Corporate Debtors with total claims amounting to more than Rs. 100 crores. That the above is the factual position to bring on records the same is for perusal of this Tribunal. 30. That it may be mentioned here that only the three Petitions wherein admission orders dated 13.05.2021 have been passed for three Corporate Debtors are being withdrawn and remaining more than 70 Petitions are pending before various Benches are not being withdrawn despite settlement agreements with the operational creditors/employees. Further, there are no settlement agreements filed in Company Petitions filed by the following Financial Creditors and pending before the Hon'ble NCLT Mumbai Bench- 1: a. Union Bank of India V/s Rolta India Ltd C.P.(IB)530/MB/2020; b. Value Partners Greater China High Yield Income Fund & Anr V/s Rolta India Ltd C.P.(IB)- 4375/(MB)/2018 Without withdrawal of all the Company Petitions, the withdrawal in the three petitions would mean the multiplicity of litigation and readmission of the Corporate debtors to CIRP. 31. The IRP further mentions that at this juncture, it is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e tax more specifically mentioned in Schedule 1 hereinunder, shall be paid on the date of the Adjudicating Authority approving the withdrawal of the Admitted Company Petition and the captioned Company Petition, by handing a demand draft pr bank transfer to that effect, issued in the name of the Operational Creditor, to their authorized representative; b. The second tranche payment i.e., 85% of the Settlement Amount after deduction of applicable income tax, more specifically mentioned in Schedule 1 hereinunder, shall be paid on or before 30th July 2021 by way of demand draft or bank transfer to that effect, issued in the name of the Operational Creditor, to their authorized representative." 34. That the above application is not maintainable in terms of Regulation 30A of the IBBI Insolvency Resolution Process of Corporate Persons Regulations (CIRP Regulations). 35. It is submitted by the IRP that the above Application has been claimed to be a withdrawal application in Form FA. It is pertinent to mention here that the Form FA has been provided under Regulation 30A CIRP Regulations. However, in terms of Regulation 30A(1), an Application under 12A has to be filed by the Applic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... missible against the applicant under the Code. 37. The Hon'ble Supreme Court in the matter of Swiss Ribbons Pvt. Ltd. & Anr. vs. Union of India & Ors. [(2019) 4 SCC 17] clearly directed that interest of all stakeholders have to be considered while accepting or disallowing an application for withdrawal. 38. That the Hon'ble Supreme Court has recently in the matter of Indus Biotech Pvt. Ltd. vs. Kotak India Venture (Offshore) Fund & Ors. (2021 SCC OnLine SC 268) has clearly observed that when a petition under is admitted/triggered it becomes a proceeding in rem and even the creditor who has triggered the process would also lose control of the proceedings as Corporate Insolvency Resolution Process is required to be considered through the mechanism provided under the IB Code. 39. In the case of Swiss Ribbons Private Limited vs. Union of India (2019) 4 SCC 17 and Pioneer Urban Land and Infrastructure Limited vs. Union of India & Ors. (W.P.(C) No.43/2019) relied on behalf of Kotak Venture, the entire scope and ambit of the IB Code was considered and the validity of the provisions were upheld. 40. The underlying principle, therefore, from all the above noted decisions is that th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... but is envisaged to be a proceeding involving all creditors of the debtor. The 9 intent of the Code is to discourage individual actions for enforcement and settlement to the exclusion of the general benefit of all creditors. ..." Submissions by the Financial Creditor/Intervenor: 45. The Financial Creditors are filing these submissions to intervene and oppose the withdrawal U/s 12A of the IBC, 2016 of the CIRP initiated against Rolta India Ltd. 46. The Financial Creditors are a consortium of Public Sector Banks comprising of Union Bank of India (Lead Bank), Bank of India, Central Bank of India, Bank of Baroda and Canara Bank. The details of the claims of these Financial Creditors against Rolta India Ltd. are as follows: CLAIM OF FINANCIAL CREDITORS AGAINST ROLTA INDIA LTD. NAME OF BANK CLAIM AMOUNT (INRUPEES) UNION BANK OF INDIA (LEAD BANK) 17,567,071,355.56 BANK OF INDIA 9,792,017,355.24 CENTRAL BANK OF INDIA 12,052,738,033.00 BANK OF BARODA 10,969,142,702.53 CANARA BANK 3,966,441,261.00 TOTAL (RS.) 54,347,410,707.33 TOTAL (IN CRORES) 5,434.74 47. The financial debt owed to the Financial Creditors is substantial. Considering the nature of the Financial C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ) on the aforesaid paragraph whilst passing the decision. As opposed to the aforesaid decision, in the present case, not only are there several Financial Creditors who have lodged their claims, there are Financial Creditors who are owed a debt in excess of Rs. 8,000 Crores. This by itself would be a sufficient ground to disallow the present application for withdrawal under Section 12A. 53. It is further submitted that in view of there being a large outstanding financial debt of Rs. 8,493.22 crores payable by the Corporate Debtors herein to the Financial Creditors, this is a fit case for this Hon'ble Tribunal to not exercise its discretion under Section 12A of IBC, 2016. It is further submitted that the financial debt owed to these Financial Creditors being a consortium of public sector banks is public money which fact needs to be taken into consideration before CIRP initiated against these Corporate Debtors is permitted to be withdrawn under Section 12A of IBC, 2016. 54. It is further submitted that the Corporate Debtor herein apart from having several petitions filed and against it under Section 7 and Section 9 of the IBC, 2016 before this Hon'ble Tribunal, this Corporate Debtor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Debtors. Therefore, ex-facie, the purported settlement does not appear to be bona fide. Secondly and in any event, sympathy cannot over-ride law. Be that as it may, the interests of the employees would in any event be taken into consideration during the CIRP of the Corporate Debtors and they being Operational Creditors, will be entitled to their rights as provided for under the IBC. Considering the scheme of the Code and considering that CIRP proceedings are proceedings in rem, substantial claims of Financial Creditors cannot be disregarded and/or ignored in view of the purported settlement of certain employees of the Corporate Debtors. Findings: 60. The present application IA 1196/2021 in CP 1069/2020 has been filed u/s 12-A of the IBC read with Rule 11 of the NLCT Rules, 2016 by Mr. Dinesh Gupta, an employee of the Corporate Debtor Company in the capacity of Operational Creditor seeking withdrawal of the present company Petition in terms of Regulation 30(A) of the IBC. The present Company Petition was "Admitted" vide Order dated 13.05.2021 of this Bench, thereby initiating CIRP against the Corporate Debtor and appointing Ms Vandana Garg as IRP of the Corporate Debtor. The Ap ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... te to both the promoter as well as to the Corporate Debtor Company to conveniently wriggle out of the partial mini settlement at any point of time. 64. The Bench is also aware of the fact that the present Application is not strictly speaking as per the procedure prescribed in Regulation 30A of the CIRP Regulations. The Regulation 30A of the CIRP Regulations requires that the Applicant have to put any application for withdrawal under Section 12A through the IRP, before the constitution of the Committee of Creditors. However, this Bench is not going to get into that issue in terms of the view of the Hon'ble Supreme Court in "Swiss Ribbons Pvt. Ltd. vs. Union of India" that "at any stage where the Committee of Creditors is not yet constituted, a party can approach NCLT directly, the Tribunal may in exercise of the inherent powers under Rule 11 of NCLT Rules may allow or disallow an application for withdrawal of CIRP. The claim and rights of other creditors as it stands is not prejudiced/altered by the withdrawal of CIRP of Corporate Debtor." (Emphasis supplied) 65. It is also a fact that this Bench during the initial phase of hearing was considering favourably this Application rega ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... king this discussion further the Bench would like to rely upon some of the prominent Judgments in respect of the scope and ambit of Section 12A of IBC. The Hon'ble Supreme Court in "Swiss Ribbons Pvt. Ltd. vs. Union of India & Ors." [(2019) 4 SCC 17] clearly directed that interest of all stakeholders have to be considered while accepting or disallowing an application for withdrawal: " .... 82...... .... We make it clear that at any stage where the Committee of Creditors is not yet constituted, a party can approach NCLT directly, which Tribunal may, in exercise of its inherent powers under Rule 11 of NCLT Rules, 2016, allow or disallow an application for withdrawal or settlement. This will be decided after hearing all the parties concerned and considering all relevant factors on the facts of each case. ..." (Emphasis supplied) 67. The Hon'ble Supreme Court has recently in the matter of Indus Biotech Pvt. Ltd. vs. Kotak India Venture (Offshore) Fund & Ors. (2021 SCC OnLine SC 268) has clearly observed that when a petition under is admitted/triggered it becomes a proceeding in rem and even the creditor who has triggered the process would also lose control of the proc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... admission, third party right is created in all the creditors of the corporate debtors and will have ergaomnes effect. The mere filing of the petition and its pendency before admission, therefore, cannot be construed as the triggering of a proceeding in rem. Hence, the admission of the petition for consideration of the Corporate Insolvency Resolution Process is the relevant stage which would decide 7 the status and the nature of the pendency of the proceedings and the mere filing cannot be taken as the triggering of the insolvency process......." (Emphasis Supplied) 68. That in a similar situation the Hon'ble NCLT Principal Bench did Ranjeet Ramakrishna Yadav vs. JNC Construction Pvt. Ltd. [C.P.(IB) No. 272(PB)/2019] vide its order dated ...07.2018, directed the Applicant and the Ex-management to propose a plan to settle all the claims received by IRP. The Hon'ble Principal Bench NCLT held as follows: "....In the present case settlement was reached on 18.06.2019 and CoC has been constituted on 19.06.2019. In the mean while the Interim Resolution Professional, who is present in the Court has received 308 claims from the other financial creditor-home buyers. It is true that in so ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by the Financial Creditor. However, in the present case, the bench notes that there are several Financial Creditors and the total financial claim collated by the Insolvency Resolution Professional in the matter of Rolta India Ltd is upward of Rs. 5000 crore. Thus, this itself would be an enough ground to disallow the present Application for withdrawal u/s.12A. 70. All above decision of Hon'ble Supreme Court and NCLAT clearly shows that even in the event of the original creditor the Corporate Debtor settling their disputes prior to the constitution of the CoC, the Tribunal has sufficient jurisdiction to reject an application under Section 12A of the IBC if the facts and circumstances of the case warrants such rejection. 71. The Bench also notes that this Corporate Debtor in the past had defaulted in the repayment of its financial obligation to its employees and Financial Creditor. The Bench also is also aware of the fact that a Judicial authority ought not to pass Orders which would lead to further multiplicity of proceedings. Even if this Bench permits withdrawal, it is a fact that all the dues of all the employees of the Corporate Debtor Company are not being settled. As the Ben ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
