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TMI Blog2021 (2) TMI 1286X X X X Extracts X X X X X X X X Extracts X X X X ..... as well as fraudulent transactions done by and between the Respondents, namely, Mr. Om Prakash Pandey, member of the suspended board of Corporate Debtor (Respondent No. 1), Mr. Dhiraj Pandey, member of suspended board of Corporate Debtor (Respondent No.2), Imax Infrastructure Private Limited (Respondent No. 3), Mr. Vikash Murarka, director of Imax Infrastructure Private Limited (Respondent No. 4), Mr. Digvijay Pandey, director of Imax Infrastructure Private Limited (Respondent No. 5), Shree Ram Saw Mill Private Limited (Respondent No. 6) and Shova Properties Private Limited (Respondent No. 7). 3. The Applicant/RP submits that the Corporate Debtor was admitted into Corporate Insolvency Resolution Process (CIRP) on 18.10.2019 and the present RP was appointed as the Interim Resolution Professional of the Corporate Debtor. Upon assuming position, it came to the knowledge of the Applicant/RP that a third party is in control and possession of Corporate Debtor's factory premises and the said third party is also running a business parallel to the business of Corporate Debtor under Corporate Debtor's brand name - "Aeon". The Applicant/RP enquired about the status of the premises and demand ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y who is Respondent No. 1's brother and ex-director and current shareholders in Respondent No. 3 Company; and Mr. Ram Prakash Pandey who is also Respondent No.1's brother, one of the ex-directors of the Respondent No. 3 and is still the director of Respondent No.3's holding companies. Given the aforementioned relation, the transaction is a related party transaction. 9. The Applicant reiterates that the execution of the said lease deed is grossly undervalued than the market value of property belonging to the Corporate Debtor. He submits that such transaction has been entered into with intention to keep such assets out of the reach of the Financial Creditor and has been carried out to defraud the creditors. Therefore, the execution of lease deed amounts to fraudulent transaction. 10. The Applicant further contends that apart from the said lease deed, the Corporate Debtor has also entered into numerous related party transactions with Respondent Nos. 6 and 7. He has produced two tables elucidating the alleged related party transactions. He submitted that the period during which two such transactions were entered into starts on 01.04.2017 and end on 31.12.2019 in the first table and e ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ith prayer 'c'. e. Direct Respondent No. 6 to forthwith make payment amounting to Rs. 11,10,000/- (Rupees eleven lakh ten thousand only) along with interest to Corporate Debtor with respect to the preferential related party payments. f. Direct Respondent No. 7 to forthwith make payment amounting to Rs. 5,50,000/- (Rupees five lakh fifty thousand only) along with interest to Corporate Debtor with respect to the preferential related party payments. g. Restrain Respondent Nos. 3 to 5 from using the brand name "AEON" of the Corporate Debtor for sale of its goods. h. Direct seizure of infringing goods of respondent No. 3. i. Direct Respondent Nos. 3 to 5 to furnish a list of inventories of the infringing goods and the sale of register of the infringing goods sold by Respondent Nos. 3 to 5. j. Direct Respondent Nos. 3 to 5 to pay damages and compensation to the Corporate Debtor for infringement of the copyright. 15. Notice of the said application was issued on 05.10.2020 and Respondents were directed to file their reply affidavits within 4 weeks, however, the Respondents have chosen not to file their reply in the matter. 16. The Financial Creditor has filed an affidavit sup ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mmenced on 18.10.2019. As per regulation 35A of the CIRP Regulations, the RP was to form an opinion that the Corporate Debtor has been subjected to preferential transaction on or before 01.01.2020, and a determination with respect to the same on or before 10.02.2020. Upon RP's determination, an application should have been filed on or before 01.03.2020. 22. However, in the present case, although the RP submits that he has formed his opinion and determined that the lease deed dated 30.11.2016 amounted to preferential and undervalued transaction, he has not apprised us of the timeline in which he did so; except for the fact that he pointed it out to the CoC on 06.02.2020. The present application was filed on 04.09.2020, which is after three hundred and thirty-three days from the date of initiation of CIRP. The CIRP Regulations envisage no role to the CoC in respect of determination to be arrived at in the case of avoidance transactions. It is a duty cast solely on the RP. 23. Further, the RP submitted that there were numerous related party transactions and mentions two of them cumulating to Rs. 16,60,000/- (Rupees sixteen lakh sixty thousand only). These transactions were entered i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... raud needs to be specifically pleaded and proved.1 28. So far as proceedings under SARFAESI Act with respect to the property in question are concerned, the same was initiated by the Financial Creditor before the commencement of the CIRP. It is the Financial Creditor's duty to pursue the matter under SARFAESI Act. It does not require any intervention by this Adjudicating Authority. 29. Further, with respect to the two transactions with the Respondent Nos. 6 and 7, the RP submitted that the given two different closing dates before which the alleged transactions were entered into. He has failed to provide us with the particular dates on which such transactions were entered into. In absence of the particular date on which such transactions were entered into, it is not possible for us to conjure whether or not these fall within the bounds of section 46 of the Code. In any case, as mentioned earlier, the RP has only formed an opinion and not made a determination that these two transactions are preferential transaction. 30. The facts and circumstances of the present application do not inspire our confidence that it is maintainable ex facie. The application is first hit by regulation 35 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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