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TMI Blog2022 (5) TMI 579X X X X Extracts X X X X X X X X Extracts X X X X ..... or the Financial Creditor as the case may be. It is true that after having induced Respondent No. 2 to pay the entire claim amount, it would not be in the interest of fairness to put forth the plea of interest. But at the same time this Tribunal cannot direct Respondent No. 1 to act on the draft settlement deed which is not yet signed by the parties by considering the correspondence between the parties and Respondent No. 1 cannot be asked to forgo the above mentioned interest or to file a suit or proceeding for recovery of the same - taking into consideration the events presented before this Tribunal and by relying on what the NCLAT has done in the case of BHASKAR BISWAS VERSUS M/S. DEVI TRADING HOLDING PVT. LTD. ANR. [ 2019 (8) TMI 1731 - NATIONAL COMPANY LAW APPELLATE TRIBUNAL, NEW DELHI ], the Applicant is allowed to approach the Operational Creditor as sought for by them, for having further talks on the matter and with regard to the interest for the above mentioned period and Respondent No. 1 may consider the proposal that would be made by the Applicant with regard to the same and in the interest of fairness, consider withdrawing the Application. Application disposed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Company, arranged the said amounts and paid the amount after deduction of TDS, to the Indian Bank Account of Respondent No. 1. Immediately after making the aforesaid payments, the Applicant requested Respondent No. 1 to inform his Counsel and the IRP to file an application under Section 12A of IBC. A communication was also sent to the IRP vide email dated 13.03.2022, wherein the IRP was informed that after the orders passed on 04.03.2022, the Applicant had an oral agreement with Respondent No. 1 and the amount as per the Court order dated 04.03.2022 was paid to Respondent No. 1. In view of the satisfaction of the whole debt owed to Respondent No. 1, the Applicant requested the IRP for necessary action. d. On 14.03.20221(sic) another reminder email was sent to the IRP at 3.28 PM, reiterating that in the interest of smooth continuity of operations of Respondent No. 2 and the maximization of its value being the utmost importance under the IBC, which can best be ensured when an otherwise solvent company like Pi Data is not dragged unnecessarily into insolvency, the IRP has to take necessary steps to file an application for withdrawal under Section 12A of IBC. However, the IRP, wi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l. There was no reply to the same by the Applicant. Mutual negotiations between Respondent No. 2 and Respondent No. 1 were taking place but they did not culminate into a settlement between the parties. Respondent No. 1 received a WhatsApp message from an employee of Respondent No. 2, Mr. Lakshminarayana on 10.03.2022, enquiring with Respondent No. 1 about the default amount mentioned in the Court order. Accordingly, Respondent No. 1 replied stating that as per court confirmation need to pay Rs. 9,72,14,511/- with interest amount as provided. On 11.03.2022, Respondent No. 1 received message from the Applicant giving the details of two UTR numbers by which the above amount was remitted. The Counsel for Respondent No. 1 received an email from the Counsel for the Applicant enclosing certain documents and the same were forwarded to his associate, asking him to ensure that 1A under Section 12A is filed immediately and to strive for the listing of the matter on Monday. The Applicant sent an email dated 12.03.2022, stating that the amounts remitted by the Applicant are towards full and final settlement of its dues. Respondent No. 1 replied, stating that there are still dues. When the very ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... atter on Monday. It is on this Email that the Applicant strongly relies, to say that a settlement was arrived at and there was a direction by the IRP to file the Application under Section 12A. The mail is issued at 5.47 PM but there is no time mentioned in the letter dated 11.03.2022 issued by the Chief Financial Officer of Respondent No. 2 intimating about the payment. As to what is the amount settled between the parties is not mentioned in the mail sent by the IRP to Mr. Kondapalli Yashaswi. As per the reply mail dated 12.03.2022 the total amount due after adjusting the amount of Rs. 9 Crores and odd paid by Respondent No. 2 is Rs. 17,06,31,432/-. At this stage it can be remembered that the NCLT does not decide the amount due while allowing the Application under Section 9 of IBC. The only aspect that needs to be verified from the application is whether the admitted due amount is above the threshold limit or not. A judgment of the NCLAT in Company Appeal (AT) (Insolvency) No. 718/2020 between Mr. Joseph Jayananda vs. M/s. Navalmar (UK) Ltd. Another can be taken help of in support of the said aspect. The NCLAT has categorically held that it is not for the Adjudicating Authority t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of law by approaching a court of law or any forum, with motives ulterior, to what are really projected in the Application. It is the Applicant who has moved this Court, stating that there was a settlement which was not admitted as having been finalised. By mere change of mind with regard to the settlement, it cannot be said that there is an abuse of process of law. If there was an inducement to pay amount under certain promise, it may amount to cheating, for which Respondent No. 1 would be liable for appropriate action. But whether this Tribunal has jurisdiction to deal with such a situation and to adjudicate on the same is the question that needs to be decided. Section 12A is extracted hereunder for ready reference, since, application is filed seeking to direct Respondent No. 1 to file an application under the said provision. Section 12A of IBC-Withdrawal of application admitted under section 7, 9 or 10:- The Adjudicating Authority may allow the withdrawal of application admitted under section 7 or section 9 or section 10, on an application made by the applicant with the approval of ninety per cent voting share of the committee of creditors, in such manner as may be spe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... his Application filed by the Corporate Debtor cannot be entertained. The Counsel for the Applicant in order to support the contention regarding the locus, relies on the judgment of the Supreme Court in Swiss Ribbons Pvt. Ltd. and Another vs. Union of India and others (2019) 4 SCC 17. The question which came up before the Supreme Court in the said judgment is with regard to settlement which takes place prior to the constitution of CoC. Since Section 12 A specifies that 90% voting of the CoC is required for an application under Section 12A and since in the case dealt with by the Supreme Court, the settlement was arrived at even before the constitution of CoC, the Court had to deal with the question as to whether such application can be entertained before the constitution of CoC. In that context, it was held that Rule 11 of the NCLT Rules, 2016 can be invoked. The ruling of the Supreme Court in Swiss Ribbons case is limited only to the question of entertaining the Application for withdrawal, based on the settlement, prior to the constitution of CoC. The Supreme Court in Amit Katyal vs. Meera Ahuja Others in CA No. 3778/2020, reiterated the same ratio. The NCLAT, in the case of Sunil ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and who have claims against the Corporate Debtor. It does not mean that the Corporate Debtor is one of such parties. It is the NCLT, Ahmadabad Bench which dealt with the aspect as to who can approach NCLT for appropriate relief under Section 11 of NCLT Rules. It can be seen from the said judgment that the Supreme Court in case of BK Educational society held that provisions of NCLT Rules, 2016 would be applicable while discharging of the functions of NCLT as Adjudicating Authority under IBC, 2016 and thus having regard to provisions of Section 469(2) of Companies Act, 2013 NCLT can exercise its inherent jurisdiction under Rule 11 of NCLT Rules, 2016 for a situation not specifically covered under any provisions of IBC, 2016. But here Section 12A specifically provides for withdrawal of the application, which can be done only by a party who has filed the application, which in this case would only be Respondent No. 1. While dealing with the aspect as to who can approach the Authority under Rule 11 NCLT Rules, the NCLT, Ahmadabad Bench considered Regulation 30A of IBBI (CIRP) Regulations, 2016 and observed that the said Regulation provides as to who can file an Application in Form-FA and ..... X X X X Extracts X X X X X X X X Extracts X X X X
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