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TMI Blog2022 (8) TMI 1002X X X X Extracts X X X X X X X X Extracts X X X X ..... ly one meaning that is suspension of initiation of CIRP was only for a Corporate Debtor. Had the legislature intended suspension of initiation of CIRP against the Personal Guarantor also, similar amendment was also required to be made in Chapter III of Part III of the Code - Whether the suspension of insolvency resolution process has to be for Corporate Debtor and also for individuals including Personal Guarantor is the legislative policy which policy has to be looked into from the amendment brought in the Code by insertion of Section 10A. The statutory scheme does not contain any indication that CIRP shall also remain suspended for Personal Guarantor for any default between 25.03.2020 to 24.03.2021, therefore, submission of learned counsel for the Appellant cannot be accepted. Service of notice to the Appellant by the Adjudicating Authority - HELD THAT:- Application under Section 95(1) was filed by serving advance notice to the Appellant in Form-B and the Adjudicating Authority issued notice by order dated 03.02.2022 to the Personal Guarantor. Interim moratorium under Section 96 - HELD THAT:- The purpose of limited notice as has been laid down by this Tribunal in Ravi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cipal Borrower defaulted in paying the EMI in 2020. (c) A Company Petition (IB) No. 707/ND/2021 was filed under Section 95 of the I B Code by the Respondent in November, 2021, where amount in default has been mentioned as Rs.2,44,57,796/-. The application mentions the date on which account was declared NPA as 11.09.2020. The application was relisted before the Adjudicating Authority on 03.02.2022 on which date impugned order was passed by the Adjudicating Authority issuing notice to the Appellant and appointing Resolution Professional. 3. Learned counsel for the Appellant challenging the impugned order raises following two submissions: i. It is submitted that in the I B Code Section 10A was inserted by Ordinance which subsequently became Act 17 of 2020 providing that no application for initiation of Corporate Insolvency Resolution Process (CIRP) of a Corporate Debtor shall be filed for any default on or after 25.03.2020 for a period of six months, which was subsequently extended for further period till 24.03.2021. It is submitted that since there is bar from initiation of CIRP against the Corporate Debtor, no CIRP can be initiated against the Personal Guarantor also. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion of corporate insolvency resolution process of a corporate debtor for the said default occurring during the said period. Explanation.-For the removal of doubts, it is hereby clarified that the provisions of this section shall not apply to any default committed under the said sections before 25th March, 2020. 8. Section 10A begins with non-obstante clause. The section contains a prohibition against initiation of CIRP of a Corporate Debtor for any default arising on or after 25.03.2020. Object of insertion of Section 10A is well known. The whole country was gripped with corona virus COVID- 19 and to extend the protection to Corporate Debtor and to ensure that insolvency resolution process may not be initiated against the Corporate Debtor for any default during the currency of the aforesaid period was with object to permit Corporate Debtor to carry on their activities and they be insulated from threat of insolvency resolution process. 9. When we look into the scheme of I B Code, Chapter II of Part II deals with Corporate Insolvency Resolution Process. Section 6 of the Code provides as follows:- 6. Where any corporate debtor commits a default, a financial credito ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... atute are of themselves precise and unambiguous, then no more can be necessary than to expound those words in their natural and ordinary sense. The words themselves do, in such case, best declare the intention of the Legislature. 24. A Constitution Bench of this Court in Union of India Anr. v. Hansoli Devi and Others 7 , approved the rule exposited by Lord Chief Justice Tindal in The Sussex Peerage's case6 and stated the legal position thus: (Hansoli Devi case7, SCC p.281, para 9) 9. It is a cardinal principle of construction of a statute that when the language of the statute is plain and unambiguous, then the court must give effect to the words used in the statute and it would not be open to the courts to adopt a hypothetical construction on the ground that such construction is more consistent with the alleged object and policy of the Act. In Kirkness v. John Hudson Co. Ltd. 8 Lord Reid pointed out as to what is the meaning of ambiguous and held that: (AC p.735) A provision is not ambiguous merely because it contains a word which in different contexts is capable of different meanings. It would be hard to find anywhere a sentence of any length which ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s primarily to be gathered from the language used in the statute, thus paying attention to what has been said as also to what has not been said as observed by his Court in Dental Council of India v. Hari Prakash7. Relevant part of which is quoted hereunder: 7. The intention of the legislature is primarily to be gathered from the language used in the statute, thus paying attention to what has been said as also to what has not been said. When the words used are not ambiguous, literal meaning has to be applied, which is the golden rule of interpretation. 16. On the basic principle of statutory interpretation, the provision of Section 10A is capable of only one meaning that is suspension of initiation of CIRP was only for a Corporate Debtor. Had the legislature intended suspension of initiation of CIRP against the Personal Guarantor also, similar amendment was also required to be made in Chapter III of Part III of the Code. The legislature is presumed to be aware of consequences of statutory provision especially consequences of amendment made in the statute. Whether the suspension of insolvency resolution process has to be for Corporate Debtor and also for individuals i ..... X X X X Extracts X X X X X X X X Extracts X X X X
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