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TMI Blog2022 (5) TMI 1121X X X X Extracts X X X X X X X X Extracts X X X X ..... t to transfer Rs. 25,13,38,078/- (Rupees Twenty-five crore thirteen lakhs thirty-eight thousand seventy-eight) deposited by way of Fixed Deposit and interest accrued thereon till date and Rs. 5,46,08,871.37/- (Rupees Five crore forty-six lakh eight thousand eight hundred seventy-one and thirty-seven paise) retained by the Respondent under the direction of this Tribunal to the account of the Liquidator mentioned in Annexure A-4, Account No. 4271002110005708 of Punjab National Bank at Market Road Branch having IFSC Code: PUNB0427100 for utilizing the said amount for the distribution of assets under Section 53 of the Code. 2. The brief facts of the case are as under: - 3. The Applicant is appointed as Liquidator of M/s. Albanna Engineering (India) Pvt. Ltd. by this Tribunal vide Order dated 02/12/2021 in IA(IBC)/147/KOB/2021 who was the IRP/ Resolution Professional during the CIRP which commenced on 1st November 2019. The Stakeholder's Committee was not formed since there are no assets to liquidate. It is further stated that since the Corporate Debtor is non-operational, they have not handed over books of accounts and other statutory and contractual documents to the IRP/RP/Liquidato ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 019, an application seeking initiation of Corporate Insolvency Resolution Process against Corporate Debtor was admitted by this Tribunal. 8. It is also stated that there are several Miscellaneous/Interlocutory Applications filed by the RP/Liquidator of Corporate Debtor seeking the invocation of the performance bank guarantee submitted by AELLC (parent company of Albanna India) with the Respondent as well as the transfer of amounts due to AELCC that were in the custody of the Respondent. In MA/25/KOB/2020 filed by Sanghvi Movers Limited & Others and in MA/71/KOB/2020 filed by Mr. Vinod Balachandran, the Liquidator the Respondent had filed its reply stating that there exists no privity of contract between Corporate Debtor and the Respondent as well as the factum of injunction orders passed by various courts in several pending suits/garnishee proceedings filed by sub-vendors of Corporate Debtor, whereunder the Respondent was restrained from invocation/release of the bank guarantee and/or release of amounts due to AELCC. Subsequently, the AELLC approached the Hon'ble High Court of Kerala by filing WP(c) No. 6755 of 2020 for a direction to the Respondent to close the contracts and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... thousand seventy-eight) payable to AELLC which is currently deposited in an interest-bearing fixed deposit in the name and style "Bharat Petroleum Corporation Limited - Account Albanna Engineering" and the final bill amount of Rs. 5,46,08,871.37/- (Rupees Five crore forty-six lakh eight thousand eight hundred seventy-one and thirty-seven paise) have been attached by various courts in several pending suits/garnishee proceedings. However, they have not produced any orders to that effect. 11. It is stated that the period of moratorium under Section 14 of the Insolvency & Bankruptcy Code, 2016 has ceased to have an effect since the Corporate Debtor is now under liquidation and on the Applicant's appointment as the Liquidator vide Order dated 02.12.2021 in IA(IBC)/147/KOB/2021. Therefore, the onus is on the Liquidator (Applicant) to appear before the Civil Courts where the aforesaid proceedings are pending and to do the needful to vacate/lift the injunction/garnishee orders. Unless the aforesaid injunction/garnishee orders are vacated by the Civil Court, the Respondent is legally precluded from parting with the amounts due to AELLC. 12. It is stated that the relief sought in this appl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r stated that MA/25/KOB/2020 for invocation of bank guarantee was filed by the Contractors of the Corporate Debtor and not by the RP during CIRP. 14. It is stated that the moratorium is ceased to have an effect since the Corporate Debtor is under liquidation. The Applicant states that the moratorium continues during the liquidation stage as per Sec 33(5 and 6) and Sec 238 of the code overrides other laws. Since the Respondent has admitted its mistake of erroneously appearing in the Garnishee proceedings due to confusion in names, it is upto them to submit the order in MA/25/KOB/202 dated 30 June 2021 for closure of cases at the other Courts. Therefore, the pendency of garnishee/ pendency of several suits/garnishee proceedings was considered by this Tribunal in MA No. 25/KOB/2020 and directed to invoke the bank guarantees. There is nothing to prevent the respondent from parting with the amounts due to the holding company or the Corporate Debtor. 15. The Liquidator stated that all the Garnishee holders have submitted their claims before the Liquidator under Regulation 37 of the IBBI (Liquidation Process) Regulations, 2016 and Sec 52 of the code. All the Garnishee holders have a sec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... provisions of this Regulation shall not apply if the secured creditor enforces his security interest under the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (54 of 2002) or the Recovery of Debts and Bankruptcy Act, 1993 (51 of 1993). (8) A secured creditor shall not sell or transfer an asset, which is subject to security interest, to any person, who is not eligible under the Code to submit a resolution plan for insolvency resolution of the corporate debtor. 37A. Assignment of not readily realisable assets. (1) A liquidator may assign or transfer a not readily realisable asset through a transparent process, in consultation with the stakeholders' consultation committee in accordance with regulation 31A, for a consideration to any person, who is eligible to submit a resolution plan for insolvency resolution of the corporate debtor. Explanation. -For the purposes of this sub-regulation, "not readily realisable asset" means any asset included in the liquidation estate which could not be sold through available options and includes contingentor disputed assets and assets underlying proceedings for preferential, undervalued ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ent of such secured assets. (8) The amount of insolvency resolution process costs, due from secured creditors who realise their security interests in the manner provided in this section, shall be deducted from the proceeds of any realisation by such secured creditors, and they shall transfer such amounts to the liquidator to be included in the liquidation estate. (9) Where the proceeds of the realisation of the secured assets are not adequate to repay debts owed to the secured creditor, the unpaid debts of such secured creditor shall be paid by the liquidator in the manner specified in clause (e) of sub-section (1) of section 53. 17. We have gone through the Garnishee List submitted by the Liquidator as Annexure - 5 in the rejoinder, who have filed claims before the Liquidator. Since they have made claim before the Liquidator, they have relinquished their claim in the Lower Courts by filing claims before the Liquidator and their cases have automatically become infructuous. 18. We have also noticed that the Respondent is a party in all those proceedings pending before Civil Courts and the Respondent owes a duty to mention the existence of moratorium passed by this Tribunal i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (ii) debts owed to a secured creditor for any amount unpaid following the enforcement of security interest; (f) any remaining debts and dues; (g) preference shareholders, if any; and (h) equity shareholders or partners, as the case may be. (2) Any contractual arrangements between recipients under sub-section (1) with equal ranking, if disrupting the order of priority under that sub-section shall be disregarded by the liquidator. (3) The fees payable to the liquidator shall be deducted proportionately from the proceeds payable to each class of recipients under sub-section (1), and the proceeds to the relevant recipient shall be distributed after such deduction. Explanation. -For the purpose of this section- (i) it is hereby clarified that at each stage of the distribution of proceeds in respect of a class of recipients that rank equally, each of the debts will either be paid in full, or will be paid in equal proportion within the same class of recipients, if the proceeds are insufficient to meet the debts in full; and (ii) the term "workmen's dues" shall have the same meaning as assigned to it in section 326 of the Companies Act, 2013. 21. There is no asset ..... X X X X Extracts X X X X X X X X Extracts X X X X
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