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TMI Blog2022 (3) TMI 14X X X X Extracts X X X X X X X X Extracts X X X X ..... ven though their prayer for cancellation of the Non-Bailable Warrants was rejected. The provision of Rule 77 of the NCLAT Rules, 2016 read with Order XVI Rule 10 of Civil Procedure Code fully empowers the Adjudicating Authority to issue a Non-Bailable Warrant for enforcing attendance of a person. The power exercised by the Adjudicating Authority in issuing a Non-Bailable Warrant to the Appellants is thus well within jurisdiction of the Adjudicating Authority and the submission of the Counsel for the Appellants that Adjudicating Authority is not clothe with any power to issue Non-Bailable Warrant has to be rejected - The proceedings under the IBC are proceedings of special nature object of which is resolution of insolvency of Corporate Debtor. The Resolution Professional for discharging various statutory duties as entrusted under the Code should have access to necessary documents and records without which the proceedings under the IBC cannot proceed as per the objective of the Code. The Code empowers the Adjudicating Authority to take appropriate measures for ensuring compliance of the provisions of the Code and for ensuring that all personnel extend co-operation to IRP/ RP. The ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... therein. The Appellant- Suspended Board of Directors of the Corporate Debtor did not co-operate with the Resolution Professional, hence, Application under Section 19(2) of the Code was filed by the Resolution Professional. By order dated 16.07.2021 passed by the Adjudicating Authority, Suspended Directors were directed to surrender before the Tribunal on 20.07.2021 and Non-Bailable Warrants were also issued. On 03.08.2021, Suspended Directors moved an Application for cancellation of the Non-Bailable Warrants which Application was dismissed by the Adjudicating Authority on 03.08.2021. By the same order, Suspended Board of Directors were again directed to surrender before the Registrar, NCLT on or before 06.08.2021 and they were also directed to handover all the documents. Since, Suspended Directors failed to surrender, on 11.08.2021, on the Application I.A- 3221 of 2021 filed by the Suspended Directors for exemption of appearance and surrender, the Adjudicating Authority on 11.08.2021 directed the Application to be listed with CA No. 400/2018. On 30.09.2021, Application I.A- 3221 of 2021 was heard and rejected. The Adjudicating Authority in its impugned order gave following reasons ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... orcement is sought must be physically present or that his presence must be secured by issuance of Non-Bailable Warrant. Learned Counsel further submits that conditions upon which Non-Bailable Warrant can be issued are not satisfied. 6. Mr. Swapnil Gupta, Learned Counsel appearing for the Resolution Professional has refuted the submissions of the Counsel for the Appellants and submits that there is ample jurisdiction with Adjudicating Authority to enforce the attendance of any person in the proceeding. It is submitted that the Suspended Directors did not co-operate with the Resolution Professional nor supplied the documents asked for, only few documents have been supplied and Resolution Professional has to file Application under Section 19(2) of the Code praying for direction to Suspended Directors to co-operate and in spite of various notices issued to Suspended Directors, they did not appear. Hence, the Adjudicating Authority has left with no option and issued Non-Bailable Warrants. 7. We have considered the submissions of the Learned Counsel for the parties and perused the record. 8. The first question to be answered is as to whether the Adjudicating Authority while exer ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , in its discretion, issue a warrant, either with or without bail, for the arrest of such person, and may make an order for the attachment of his property to such amount as it thinks fit, not exceeding the amount of the costs of attachment and of any fine which may be imposed under rule 12: Provided that no Court of Small Causes shall make an order for the attachment of immovable property. 11. Order XVI Rule 10 specifically empowers the Court to issue in its discretion at any time warrant either with or without bail for arrest of such person who without any lawful excuse, failed to attend or to produce the document in compliance with such summons. 12. The present is a case where the order was issued to Suspended Directors to produce the documents. When the Suspended Directors failed to produce documents required and appear before the Court, Non-Bailable Warrants were issued on 16.07.2021. 13. On 03.08.2021, the Court noticed the prayer made in Application I.A- 3221 of 2021 and had observed that the reason given by the Suspended Board of Directors for not surrendering is not liable to be accepted. In order dated 03.08.2021, the Adjudicating Authority made following o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Adjudicating Authority and the submission of the Counsel for the Appellants that Adjudicating Authority is not clothe with any power to issue Non-Bailable Warrant has to be rejected. The Appellants who are the Suspended Directors of the Corporate Debtor are required to submit the relevant documents and co-operate in the proceeding and are avoiding to comply with the direction and in the order dated 03.08.2021, the Adjudicating Authority had again directed the Suspended Directors to surrender and fresh Non-Bailable Warrants were issued but they have not surrendered rather press their Application for cancellation of warrant which was rightly rejected. The submission of the Counsel for the Appellants that the Adjudicating Authority could have proceeded ex-parte and passed order against the Corporate Debtor and Suspended Directors and it was not necessary to ask the presence of the Suspended Directors cannot be accepted. The proceedings under the IBC are proceedings of special nature object of which is resolution of insolvency of Corporate Debtor. The Resolution Professional for discharging various statutory duties as entrusted under the Code should have access to necessary documents ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... The Appellants were issued notice on 02.08.2018 in response to which they failed to appear. Thereafter, Bailable Warrants were issued on 29.08.2018 and 17.10.2018 but the presence of the Appellants could not be secured and it was thereafter on 19.10.2018, Non-Bailable Warrants were issued. Issuance of Non-Bailable Warrants were repeated thereafter as noticed above. When the Appellants in spite of notices and Bailable Warrants chose not to appear before the Tribunal, the Tribunal was left with no option except to issue Non-Bailable Warrants. 18. The Submission of the Learned Counsel for the Appellants is that Tribunal is not bound by procedures laid down under the CPC, we have already noticed that Rule 77 of the NCLT Rules, 2016 applies various provisions of Civil Procedures Code. We in the present case are only concerned with the procedure where a person fails to comply with summons which we have already dealt above. The procedure adopted by the Tribunal is in conformity with the NCLT Rules, 2016 as well as order XVI Rule 10 of the Code of Civil Procedure, 1908. Further submission of the Counsel for the Appellants is that due to non-compliance with Section 19 of the Code, the A ..... X X X X Extracts X X X X X X X X Extracts X X X X
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