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TMI Blog2022 (11) TMI 1009X X X X Extracts X X X X X X X X Extracts X X X X ..... Law Tribunal, New Delhi Bench II in CP(IB)-35(ND)/2017 which 'was thereby confirmed by the impugned order dated 26.02.2021. ii) Quash the warrants of attachment dated 24.12.2019 affixed on property bearing No. G-158, Sector 41, Noida, Uttar Pradesh 201301 as issued vide impugned orders dated 20.12.2019 passed by the Hon'ble National Company Law Tribunal New Delhi Bench II in CA-840/C-II/ND/2018 in CP(IB)-35(ND)/2017. iii) Pass any such order/further orders as this Hon'ble Court may deem fit and proper. 2. By order dated 26.02.2021 the Learned National Company Law Tribunal (hereinafter referred to as 'the Adjudicating Authority'), New Delhi has rejected the application vide CA No. 266/C-II/ND/2020 in (IB)-35(ND)/2017. The said application was primarily filed by the appellant to review the order dated 20th December, 2019 passed by the Adjudicating Authority in CA-840/C-II/ND/2018 in (IB)-35(ND) of 2017. By the said order the Learned Adjudicating Authority entertaining application filed by the Liquidator which was filed alongwith report of Forensic Auditor observed that since the property belongs to the corporate debtor i.e. M/s. Helpline Hospitality Pvt. Ltd. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s treated as siphoning of money and cheating, fraud, misrepresentation of facts to company financial position. The Agreement Number LBDEL00000921645 from ICICI Bank and the said loan EMI was auto debit from account No. 63005006943. The said auditor observed that on the aforesaid facts it was evident that directors made a willful attempt for diversion of funds from company account to their personal benefits fraudulently. Hence this amount was liable to be recovered alongwith interest @ 18%. The total amount diverted as a consolidated instalment in view of loan statement taken from ICICI Bank dated 30.08.2018 was Rs. 6529,836.56. The estimated value of the above said property as per special audit report was Rs. 4 crore which was created from the funds of company moving fraudulently for repayment of the loan taken for purchase of this house. The special audit report observed that the said house shall be transferred to company immediately to safeguard the interest of stakeholders especially Service Tax Department, Govt. of India. Rs. 3,91,04,886/- was overdue of Service Tax Department which was to be recovered on sale of said property. 5. On the basis of facts emerged from special aud ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 020 for modification of the order, before the Adjudicating Authority. After hearing the argument, the Adjudicating Authority has reserved for orders. No order has been passed till date. 4. Learned counsel for the Appellant submits that till passing of the order by the Adjudicating Authority, the order for handing over the possession of aforesaid property be stayed. 5. We are of the view that the prayer is reasonable and therefore, we pass the order that till passing of the order (in CA No. 266 of 2020 dated 07.01.2020) by the Adjudicating Authority taking the possession of the aforesaid property by the Liquidator is hereby stayed. 6. It is made clear that we are not passing any order on merit and the Adjudicating Authority is free to pass the order without influenced by this Order. 7. The Liquidator who is represented by Mr. Sameer Rastogi is directed not to proceed further in light of this order. 8. With this direction the Appeal is disposed of. Not order as to costs. 9. The Appellant if aggrieved by the order passed by the Adjudicating Authority in the aforesaid application then they are at liberty to challenge the order." 7. However, finally on 26.02.2021 the learne ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iquidator on 17.08.2020 through the 11th Progress Report filed with this Tribunal vide IA No. 27 44/2020 that the Applicant herein had preferred a Comp. Appeal (AT) (Ins) No. 262 of 2020 T.S. Murali & Anr. Vs. Liquidator of Helpline Hospitality Pvt. Ltd., wherein the Hon'ble NCLAT has passed the following order on. 13.03.2020: "3. It is submitted that after passing the impugned order, the Appellants have filed an application bearing No. C.A. No. 266 of 2020 dated 07.01.20.20 for modification of the order, before the Adjudicating Authority. After hearing the argument, the Adjudicating Authority has reserved for orders. No order has been passed till date. 4. Learned counsel for the Appellant submits that till passing of the order by the Adjudicating Authority, the order for handing over the possession of the aforesaid property be stayed. 5. We are of the view that the prayer is reasonable and therefore, we pass the order that till passing of the order (in C.A. No. 266 of 2020 dated 07.01.2020) by the Adjudicating Authority taking the possession of the aforesaid property by the Liquidator is hereby stayed. 6. It is made clear that we are not passing any order on merit and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... om an order attributable to the Tribunal's mistake, error or omission, then it is the duty of the Tribunal to set it right. Atonement to the wronged party by the court or Tribunal for the wrong committed by it has nothing to do with the concept of inherent power to review. In the present case, the Tribunal was justified in exercising its powers under section 254(2) when it was pointed out to the Tribunal that the judgment of the coordinate bench was placed before the Tribunal when the original order came to be passed but it had committed a mistake in not considering the material which was already on record. The Tribunal has acknowledged its mistake, it has accordingly rectified its order. In our view, the High Court was not justified in interfering with the said order. We are not going by the doctrine or concept of inherent power. We are simply proceeding on the basis that if prejudice had resulted to the party, which prejudice is attributable to the Tribunal's mistake, error or omission and which error is a manifest error then the Tribunal would be justified in rectifying its mistake, which had been done in the present case." 11. During the hearing, it was stated by the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... itted by the Liquidator/Respondent that the extra-ordinary power of this Tribunal under Rule 11 of NCLT Rules 2016 cannot be used for review of its own order/judgment. It is added by the Respondent that Rule 154 of NCLT Rules 2016 can only be used for the purpose of rectification of any clerical or arithmetical mistake in the order arising from any accidental slip or omission and not for any other purpose. There being no clerical or arithmetical mistake in the Order of this Tribunal dated 20.12.2019, the present Application is not maintainable. 15. It is further stated by the Liquidator/Respondent that the Law of Limitation is not applicable on the proceedings initiated under Section 66 of IBC 2016 as the Forensic Auditor in his findings has found the ex-management fraudulently diverting funds of the corporate debtor for the purpose of acquiring assets in their own name and the assets acquired fraudulently in the name of ex-directors must be restored to the corporate debtor. 16. It is further submitted by the Liquidator/Respondent that as per Section 238 the Insolvency and Bankruptcy Code 2016, the IBC has overriding effect on any other laws for: the time being in force includi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d by collusion between respondents No. 2 and 3." 20. That Ld. Senior Counsel for the Applicant has placed reliance on para 30 of the Judgment passed by Hon'ble Supreme Court in Civil Appeal No. 1171 of 2004 in the matter of Assistant Commissioner, Income Tax, Rajkot Vs. Saurashtra Kutch Stock Exchange Limited, which is reproduced overleaf: "30. In our judgment, therefore, a patent, Manifest and self evident error which does not require elaborate discussion of evidence or argument to establish it, can be said to be an error apparent on the face of the record and can be corrected while exercising certiorari jurisdiction. An error cannot be said to be apparent on the face of the record if one has to travel beyond the record to see whether the judgment is correct or not. An error apparent on the face of the record means an error which strikes on mere looking and does not need long-drawn out process of reasoning on points where there may conceivably be two opinions. Such error should not require any extraneous matter to show its incorrectness. To put it differently, it should be so manifest and clear that no court would permit it to remain on record. If the view accepted by the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . Counsel for the Applicant and mentioned in Para 11 of this order are the ones, which can be rectified by exercising jurisdiction under Section 420(2) of the Companies Act, 2013. For adjudicating this, it is necessary to examine the nature of the alleged mistakes, in the light of Section 420(2) of the Companies Act 2013, within the boundaries of the documents available on record: a) In reference to the mistake alleged with respect to the transaction referred to this Adjudicating Authority under Section 66 being barred by Limitation it is seen that it has been rebutted by the Liquidator in his written submissions stating that Law of Limitation is not applicable to the proceedings under Section 66 of IBC 2016. Further, the aforesaid plea (of transaction referred to this Adjudicating Authority under Section 66 being barred by Limitation) was not raised by the Applicant at the time of the hearing of CA 840/C-II/ND/2018. Therefore, in our view, the Applicant cannot seek re-hearing of the matter under the garb of rectification under Section 420 of the Companies Act 2013. Here, it is worthwhile to refer to the Judgment passed by Hon'ble High Court of Calcutta in the matter of Prash ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ay deem fit. The provision of Section 66(2) of IBC 2016 is reproduced below: ((Fraudulent trading or wrongful trading. 66. (1) ........................................... (2) On an application made by a resolution professional during the corporate insolvency resolution process, the Adjudicating Authority may by an order direct that a director or partner of the corporate debtor, as the case may be, shall be liable to make such contribution to the assets of the corporate debtor as it may deem fit, if- (a) before the insolvency commencement date, such director or partner knew or ought to have known that the there was no reasonable prospect of avoiding the commencement of a corporate insolvency resolution process in respect of such corporate debtor; and (b) such director or partner did not exercise due diligence in minimising the potential loss to the creditors of the corporate debtor." In the case herein, the Ex-Directors instead of minimising losses of the Corporate Debtor, their action of fraudulently recording of the property belonging to the Corporate Debtor M/s. Helpline Hospitality in their own name has resulted in complete loss of the asset, which was duly procured in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... guarantor and as the ex-Directors failed to repay the loan, the payment was made by the Company in the capacity of a guarantor" ..... the same has been rebutted by the Liquidator in its submissions stating that the Ex-management was the co-applicant for seeking loan from the banker of the Corporate Debtor has no persuasive value as in the case for application for loan to a company, the Directors of the Company are made party to it. In this regard, it is worth perusing the relevant finding of Forensic Auditor, which was placed by the Liquidator and quoted in the Order of this Tribunal dated 20.12.20219 in the CA-840/C-II/ND/2018, recording that: "The Company has taken a loan of Rs. 36,59,250/- vide agreement dated 30.10.2004 for a tenure of 104 Months (8Years 8 Months) period ended on 22.07.2013 for asset located at Plot No. G-158, Sector-41, Naida, Uttar Pradesh 201302 for personal assets in the name of Mr. Thondiyil Sivarama Pillai Murali (T.S. Murali) Director, being a Co-applicant of said assets. The facts are not addressed by auditors in their audit report for the financial year 2004-05 to 2013-14. The Amount withdraw from company account for creating their personal wealth i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Judgment passed in the Review Application No. 09 of 2020 Company Appeal (AT)(Insolvency) No. 848 of 2019 in the matter of Deepakk Kumar Vs. M/s. Phoenix ARC Pvt. Ltd., we find that the Hon'ble NCLAT has held that: "27. It is worth for this Tribunal to recollect and recall the decision of Hon'ble Supreme Court in 'Lily Thomas' V. 'Union of India' reported in AIR 2000 Supreme Court pg. 1650 at spl. Pg. 1665 wherein it is held that the power to rectify or amend the order is exercised to remove the mistake without disturbing its finality." 25. Through the prayers in the present Application, namely: "(A) Pennit the Applicants herein to deposit/pay the sum of Rs. 65,29,836/- over a period of 6 months (B) Modify the Orders dated 20.12.2019 in CP (IB)-35(ND)/2017 passed by the Hon'ble NCLT New Delhi Bench-II in view of the submissions made hereinabove by staying/removing the warrants of attachment dated 24.12.2019 issued by the Liquidator pertaining to the property bearing No. G-158, Sector 41, Naida, Uttar Pradesh - 201301." ....... in our considered view, what the Applicant is asking (by seeking to amend the order) is to disturb the finality of the or ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 31.12.2004 25,00,000 By cheque No.149195 drawn on IcICI Bank Ltd, Mumbai against which Loan account taken by Helpline Hospitality Pvt Ltd 31.12.2004 7,00,000 Total 36,00,000 Copy of Loan Account Statement for Loan Account Number LBDEL00000921645, Repayment Schedule Report and Bank Statement of Punjab National Bank are attached herewith..." 3. That the Ld. Liquidator has placed a copy of the Sale Deed of property bearing. Plot No. 158, Block-G, Sector 41, Noida, Dist. G.B. Nagar, executed in the name of Respondent No. 1 on record. 4. It is further submitted by the Ld. Liquidator: "8. That in addition to EMI paid from Bank Account Number 630005006943 against Loan Agreement No. LBDEL00000921645 dated 30.10.2004 an amount of Rs. 20,00,000/- (Rupees Twenty Lacs only) was also paid as pre payment of loan vide Chq No. 399980 dtd. 31st March, 2012 from Company's Bank Account Number 172502000000730 maintained with the Indian Overseas Bank, Kribhco, Sector-1, Noida. Copy of Bank Statement of Indian Overseas Bank is attached herewith...." "9. That total loan amount of Rs. 65,29,836.56/- (Rupees Sixty Five Lacs Twenty Nine Thousand Eight Hundred Thirty Six and paise ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ly to safeguard the interest of stakeholders specially Service Tax department, Government of India. Rs. 3,91,04,886/- were overdue of Service Tax Department which can be recovered to sale this property. It is recommended that an early action will support the claim overdue of different stakeholders, the amount can be recovered by the court of law from their personal estate of directors or sale their property for which loan has taken by transfer into company account. FINDING NO. 2 EVASION OF SERVICE TAX AND NON PAYMENT THERE OF Rs. 3,91,04,886/- PLUS PENALTY Rs. 4,13,29,014/- SUM TOTAL (8.04 CRORES) As Per Order passed by Ms. Aruna N. Gupta, Commissioner of Service Tax, DLISVTAX002COM0511617 of Helpline Hospitality Private Limited vide letter No. IV(16) Hqrs/ST/Adj/HHPL/21/2015/3452 has levied a Penalty of 41329014/- and service Tax Amount due Rs. 39104886/-. It is appears from the records that HHPL is irregular in paying government dues and evaded government revenue which is cheating and fabrication of records under law. Same is treated as fraud and misappropriation of funds towards their personal benefit by directors hence liable to pay personally. Government can recover the su ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ons to tender his statement on 09.09.2014 (RUD-33) and stated that in HHPL, he was only an authorized signatory. On being shown the balance sheets for the year 2009-10 to 2011-12 of HHPL received from Registrar of Companies (RUD-21) where his name was written alongwith his position in the company as 'Director', he admitted that he was working as Director in HHPL. He was also shown copy of Balance Sheet of HHPL for 2011-12 along with ITR (Income Tax Returns) (RUD-34) resumed from his Noida office on 20.03.2014 vide S. No. 19 of Annexure to Panchnama and asked to identify the signature of Directors. He identified the signatures as of himself and that of his wife Mrs. Rema." 10. Basing on the certificate issued by the Company Secretary Sh. Alok Chandra Singh, the Ld. Liquidator has confirmed that Forms DIR-12 towards resignation of Directors Sh. T.S. Murali (Murali Sivaramapillai Thondiyil DIN:00399183) and Ms. Reema Murali (Rema Murali DIN:00399270) were digitally signed by Sh. Vikraman Pillai Sivarama Pillai, Director (DIN06928280) on 08.08.2014. Date of filing of the said form as on the website www.mca.gov.in is 18.08.2014. 11. From the additional documents and clarific ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... um Sale Deed dated 09.02.2005 matches and are from the Bank Accounts of the Corporate Debtor. Hence, it is clear that the property in question has been procured by utilizing the funds of the Corporate Debtor and, hence, the same deems to be the asset of the company. Here it is worthwhile to refer to the Judgment of the Hon'ble High Court of Delhi in the matter of Reserve Bank of India Vs. M/s. JVG Finance Ltd. in CO. APPL. 1818/2011 IN CO. PET. 265/1998 wherein, it has been upheld that the property purchased in Benami name from the funds of a company belongs to the company. In the instant case, the property having been purchased out of the funds of the Corporate Debtor, should naturally vest in the Corporate Debtor Company. 15. In the light of the facts and circumstances of the case, submissions made by the Liquidator, documents including report of the Forensic Auditor and other material on record, the prayer at serial (C) of the Application is allowed. Since the property belongs to the Corporate Debtor i.e. M/s. Helpline Hospitality Pvt. Ltd. and the Ex-Director Sh. T.S. Murali have fraudulently recorded the same in his name, the property bearing Plot No. G-158, Sector-41, N ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... our attention to para XII of Memo of Appeal filed before this Tribunal which is at Volume II Page 370. He submits that in earlier appeal filed before this Tribunal in para 12 at running page 370 the Appellant made a statement that as a way of abundant precaution keeping in view the limitation period for preferring the appeal, the appellant herein are filing the appeal against the impugned order dated 20.12.2019 passed by the Adjudicating Authority without prejudice to the right of the appellants with regard to the orders passed by the NCLT in CA No. 266/2020 in CP(IB)35(ND)/2017. 11. The learned senior counsel has further drawn our attention to the order dated 13.03.2020 passed by this Appellate Tribunal in Company Appeal (AT)(Ins) No. 262/2020. He submits that this Appellate Tribunal on earlier occasions by its order dated 13.03.2020 disposed off the appeal recording in para 5 as "we are of the view that the prayer is reasonable and, therefore, we pass the order that till passing of the order (in CA No. 266/2020) by the Adjudicating Authority taking the possession of the aforesaid property by the liquidator is hereby stayed". The order passed by this Tribunal in earlier appeal h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... In sum and substance it has been argued that both the orders i.e. order dated 20.12.2019 and order dated 26.02.2021 are liable to set aside. Besides making oral submission on behalf of the appellant Notes of Written submission has also been filed which is reproduced herein below. Alongwith the written submissions the appellant has also brought on record two judgments one passed by Hon'ble Supreme Court in Civil Appeal No. 5412/2007 Honda Siel Power Products Ltd. Vs. Commissioner of Income Tax and another judgment of this Tribunal i.e. M.A.S. Subramanian and Ors. Vs. TS Sivakumar and Ors., AMI/NL/0243/2018, Shri Tiku learned senior counsel referring to aforesaid judgment submits that since there was apparent mistake in order dated 20.12.2019 on application for review filed by the appellant the Learned Adjudicating Authority was required to review the order and remove error which was committed in earlier order. However, the Learned Adjudicating Authority has failed to discharge its duty. The appellant has filed the written submissions which are as follows: "1. That the present matter has been filed as appeal under Section 61 of the IBC, 2016 read with Rule 11 of the NCLAT Rule ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... paid by the corporate debtor" That in view of the above the Respondent is bound to confine itself to the said Orders which were passed on the statements and instructions of the Respondent herein and the said orders remain unchallenged. The appellants however have challenged the Order dated 26.02.2021 on various grounds which may be read as part and parcel of the present notes of submissions. A) That the appellants, being husband and wife, are the ex-directors of the corporate debtor i.e. M/s. helpline hospitality Pvt. Ltd. and are acquainted with all the facts & details of the matter B) That the present appeal is being preferred in the name of the Appellant No. 1 and No. 2 and not in the name of the Corporate Debtor since the property so attached by the Hon'ble Adjudicating Authority is in the registered name of the Appellant No. 1 who is also the Ex Director of the Corporate Debtor I.e. M/s. Helpline Hospitality Pvt. Ltd. C) That the Hon'ble Adjudicating Authority went beyond the scope and jurisdiction of their own orders by failing to appreciate its own orders dated 01.10.2019 and 09.10.2019 as mentioned hereinabove. D) That the Hon'ble Adjudicating Authorit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r and the Appellants can be directed repay the said amount to the Corporate Debtor. H) That the Hon'ble Adjudicating Authority has, without the force of law, assumed the powers of a civil court by directing the respondent to publicly auction the immovable property which is duly registered in the name of the Appellant No. 1 thus in turn negating the registered sale deed of the immovable property in the name of the appellant No. 1 which is wholly impermissible in law and amounts to overstepping the jurisdiction bestowed upon the Hon'ble Adjudicating Authority. I) That in any event since the property bearing No. G-158 Sector 41 Noida-201301 is duly registered vide a registered sale deed in the name of the Appellant No. 1, the power to cancel the sale deed is with the concerned civil court and hence the question of public auction of the same does not arise since it is not in the name of the Corporate Debtor and neither it was ever in the name of the Corporate Debtor. J) That the Respondent has acted beyond the jurisdiction and without any power of various sections of the IBC, 2016 and as such the impugned Order dated 26.02.2021 is beyond the scope and jurisdiction of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... year 2017. N) That assuming though not admitting, that the averment made by the liquidator, this was a transaction to defraud the creditors as contemplated under Section 49 of the Code even then a pre-requisite of setting aside a transaction u/s. 49 of the Code has to be an undervaluation of transaction u/s. 45 of the Code which will also have to satisfy the twin test of Section 49(1)(a) or (b) of the Code and Section 45(2)(a) or (b) of the Code, besides to overcome the limitation mandate of Section 46 of the Code. Citations referred to by the Appellants "HONDA SIEL POWER PRODUCTS VS. COMMISSIONER OF INCOME TAX" by Hon'ble Supreme Court of India on 26.11.2007 MANU/SC/4565/2007 : [2007] 12 SCR 552 "M.A.S. SUBRAMANIAN & ORS. Vs. T.S. SIVAKUMAR - by Hon'ble NCLAT, New Delhi on 24.09.2018 - MANU/NL/0243/2018" 14. The learned senior counsel for the appellant has further taken a stand that whatever mistake was committed, those mistakes were committed sometime in the year 2005 and as such under Section 66 of the companies Act, 2013 it was beyond period of limitation to be examined by the Adjudicating Authority. 15. Mr. Sameer Rastogi, learned counsel appearing on behal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Section 25(2)(j) talks about Initiation of avoidance transaction in accordance with Chapter Ill and as per Section 35(1)(b) which is in Chapter II, the Liquidator shall have power to take into his custody or control all the assets, properties etc. of the corporate debtor. 5. That the appellants have alleged that the Hon'ble Adjudicating Authority. without the force of law, has assumed the powers of a civil court by directing the respondent to publicly auction the immovable property which is duly registered in the name of the appellant No. 1 which is wholly impermissible in the law, contrary to the facts that the Hon'ble Adjudicating Authority issued direction to the appellants to transfer the said immovable property in the name of the corporate debtor which has been purchased out of the fund of the corporate debtor and accordingly, which ought to have been registered in the name of the corporate debtor and due to fraud perpetrated by the appellants being the ex-directors, the same has been registered in the name of the appellant No. 1. Further, the Liquidator has power to sale the property of the corporate debtor through public auction. However, the appellant to achieve ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g the corporate debtor and ultimately the creditors is continuing in nature. 9. That the corporate debtor also failed to deposit the statutory liability of Rs. 8,59,13,147/- due to which the corporate debtor was pushed on the verge of death bed and therefore, the Adjudicating Authority while rejecting the application filed by the appellant has rightly held that the property purchased from the coffer of the corporate company i.e.. corporate debtor belongs to the corporate debtor and therefore, should vest in the corporate debtor. 10. That the liquidation value of the said immovable property is Rs. 1,49,21,332/- which got appreciated from the purchase price of Rs. 36,00,000/- for which Rs. 65,29,836/- was paid towards loan liability up to July 2013 from the Corporate Debtor Bank Accounts and now the appellants are alleging that they can be directed to pay the said amount ignoring the time value of money Lo., interest on the said amount till date. Moreover, the proceeding under Insolvency and Bankruptcy Code is not a recovery proceeding. 11. That order dated 01/10/2019 and 09/10/2019 was passed by the Hon'ble Adjudicating Authority on an application which was partly heard an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hat the company had taken loan of Rs. 36,59,250/- vide Agreement dated 30.10.2004 and the said loan through EMI was auto debited from the account of the corporate debtor. On the Corporate Debtor service tax due of Govt. of India was outstanding to the tune of Rs. 3,91,04,886/-. The estimated value of the property in question was about Rs. 4 crores. It is not in dispute that during liquidation proceedings in respect of the corporate debtor an interim forensic audit report dated 10.11.2018 was received. In forensic audit report it appears that it was noticed that fraud was committed by the appellant in getting the property registered in his name. It has further been noticed that after getting the property registered in his name both the directors tendered resignation from the Board of the company. However, the record suggests that both the directors were continuing to run the corporate debtor even thereafter. 18. So far as argument of learned senior counsel for the appellant that the application filed by the liquidator before the Adjudicating Authority was under Section 25(i)(j) which was not applicable is concerned, we are of the opinion that levelling of section does not matter if ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the same and pass appropriate order. In the present case on the basis of forensic audit report it was noticed that in relation to registration of property in the name of appellant fraud was committed. Loan for the purchase of the said property was taken on the joint agreement of appellants as well as corporate debtor and thereafter entire loan amount was repaid from the corpus of the corporate debtor itself and as such it can be inferred that by committing fraud the property was got registered in the name of Appellant No. 1. Accordingly considering the fraud which was noticed in the Forensic audit report the appellant is not entitled to raise question of limitation. So far as argument advanced by the learned senior counsel on behalf of appellant that the learned Adjudicating authority has interfered with the property which was covered under the Benami Transaction Act is concerned, on perusal of the impugned order it is difficult to infer that Learned Adjudicating Authority has recorded as if the property was benami. Moreover, the Liquidator in its application had made a prayer for directing the appellant to transfer the property in the name of Corporate Debtor. The Adjudicating Au ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assigning detail reasons answered in negative. Neither under Rule 11 of NCLT Rules, the NCLT was competent to review/recall its earlier order nor Section 420 of the Companies Act was applicable in view of the fact and circumstances of the case particularly the fact that the liquidation proceeding was continuing under the provisions of the IBC Code. The Learned Adjudicating Authority also did not find any apparent error in the order which could have been considered as an order contrary to the record and as such both the questions were negated by the Adjudicating Authority assigning detailed reasons. 23. So far as two judgments on which reliance was placed by the Learned senior counsel for the appellant is concerned we are of the opinion that on the facts and circumstances of the present case those judgments are not applicable. In Honda Siel case (Supra), the Hon'ble Supreme Court was consideration the applicability of Section 254(2) of the Income Tax Act. Under the Income Tax Act, the Income Tax Authority was having jurisdiction to rectify any mistake in an order within a period of four years from the date of order. It is appropriate to reproduce Section 254(2) of the Income Ta ..... X X X X Extracts X X X X X X X X Extracts X X X X
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