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TMI Blog2023 (1) TMI 191X X X X Extracts X X X X X X X X Extracts X X X X ..... the debt and default has been proved. The issue regarding the NPA, decided in favour of the Appellant by the DRT, Pune on 28.02.2022 has been put to rest by way of stay by the DRAT, Mumbai on 03.06.2022, therefore, the Adjudicating Authority has not committed any error in passing the order of admission as there is a debt and default which is required to be looked into for the purpose of initiation of proceedings under Section 7 of the Code. Appeal dismissed. - Company Appeal (AT) (Ins.) No. 531 of 2022 - - - Dated:- 4-1-2023 - [ Justice Rakesh Kumar Jain ] Member ( Judicial ) And [ Dr. Alok Srivastava ] Member ( Technical ) For the Appellant : Mr. Abhijeet Sinha, Mr. Abhirup Dasgupta, Mr. Ishaan Duggal, Ms. Bhawana Sharma, Mr. Kunal Godhwani, Ms. Jayshree Shukla Dasgupta, Advocates For the Respondent : Mr. Krishnan Venugopal, Sr. Adv. with Mr. Rahul Dev, Ms. Ekta Bhasin, Ms. Aastha Trivedi, Advocates JUDGMENT Per : Justice Rakesh Kumar Jain : This appeal is filed by a member of the suspended board of directors of Smaaash Entertainment Pvt. Ltd. (Corporate Debtor) against the order dated 06.05.2022, passed by the Adjudicating Authority (National C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Trusteeship Ltd. took measures under the Securitisation And Reconstruction Of Financial Assets And Enforcement Of Security Interest Act, 2002 (in short SARFAESI Act ) which was challenged by the Sam Family Trust and AHA Holdings Pvt. Ltd. before the DRT, Pune by way of SA No. 207 of 2021 and 208 of 2021. 8. It is alleged that in this interregnum, the Respondent No. 1 filed an application i.e. I.A. No. 1930 of 2020 before the Adjudicating Authority to restrain the Corporate Debtor from alienating or transferring the assets. The Respondent No. 1 also filed an application i.e. I.A. No. 2034 of 2020 for urgent listing of I.A. No. 1930 of 2020. Both I.As with CP (IB) 935/2020 were listed on 19.01.2021 and the Adjudicating Authority directed the Corporate Debtor to maintain status quo. I.A. No. 2034 of 2020 and 1930 of 2020 were disposed of. 9. It is pertinent to mention that the Financial Creditor/Respondent No. 1 has given the date of default as 28.05.2019 in the petition filed under Section 7 of the code. 10. The applications filed by Sam Family Trust and AHA Holdings Pvt. Ltd. before the DRT, Pune was allowed on 28.02.2022 holding that the account had not become NPA: ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pplicants/Plaintiffs were NPA/SMA-2 accounts. Accordingly, they cannot be acted upon. In view thereof, the Defendant Nos. 1 to 3, their servants, agents and officers are required to be restrained by an order and injunction of this court from in any manner acting in pursuance of the Assignment Agreement dated 28.06.2019 on substance or otherwise in any other from or in any other manner whatsoever. 15..... (i) Till the hearing of the interim applications, ad-interim relief is granted in terms of prayer clause (a) in both the interim applications i.e. interim application (L) No. 994 of 2022 and interim application (L) 1294 of 2020. 15. It is pertinent to mention that the order dated 19.04.2022 was challenged in appeal before the Bombay High Court and was stayed vide order dated 05.05.2022 which is as under: 6. Therefore, in short debts are admitted by Respondent No. 1 and admittedly amounts have not been paid since August, 2018 in the case of AHA Holdings Pvt. Ltd. and 28.02.2019 in the case of Smaaash Entertainment Pvt. Ltd. Hence, we do not agree with the impugned order which is hereby stayed. 16. However, the commercial suit (L) No. 987 of 2022, challen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vant to refer to certain orders passed by this Tribunal during the pendency of this appeal, which are reproduced as under: 23.05.2022: Heard Shri Abhijeet Sinha, Learned Counsel for the Appellant and Shri Ramji Srinivasan, Learned Senior Counsel for the Respondent No.1. 2. This Appeal has been filed against the order dated 06.05.2022 passed by the Adjudicating Authority (National Company Law Tribunal), Mumbai Bench, Court-III admitting Section 7 Application filed by the Respondent. Several submissions have been raised on behalf of the Appellant including violation of principle of natural justice, the Respondent being only Debenture Holder not entitled to initiate proceeding. 3. Shri Ramji Srinivasan, Learned Senior Counsel for Respondent No.1 opposing the submission of the Learned Counsel for the Appellant submits that in view of the fact that there are several materials which indicate that debt and default is proved, admission of the Application cannot be faulted. He submits that insofar as the principle of natural justice is concerned, the document which is sought to be relied and claimed by the Appellant not been able to produce before the Adjudicating Authority ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he 'Rejoinder Affidavit' within three weeks. List this Appeal on 26th July, 2022. 19. Counsel for the Appellant has argued that the Adjudicating Authority has not followed the principle of natural justice because due opportunity was not granted to argue the matter before it in as much as when the matter was taken up for hearing on 15.03.2022, Advocate Sujit Lohaty had appeared on behalf of the Appellant and requested for an adjournment to place on record subsequent events but no time was given and was not permitted to argue orally as well. In this regard, affidavit dated 21.03.2022 of Sujit Lohaty, Adv. of High Court of Bombay has been attached. 20. On the other hand, Counsel for Respondent, in this regard, has submitted that the Adjudicating Authority had given opportunity to both sides for arguments and thereafter reserved the order. It is further submitted that even in the order dated 15.03.2022 the said Adv. Sujit Lohaty is not recorded as present rather another Adv. Ankit Worlikar was present on behalf of the CD/Appellant. In this regard, Counsel for the Respondent has relied upon a decision of the Hon ble Supreme Court in the case of State of Maharashtr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s also submitted that mere pendency of the suit for declaration is thus not suffice to stall the proceedings for the initiation of CIRP when the debt and default has been proved. 23. Counsel for the Appellant has then argued that the issue regarding the debt was decided in favour of the Appellant by the DRT, Pune on 28.02.2022 and once there was no NPA, the question of filing of the application under Section 7 of the Code on account of a default was neither here nor there. In this regard, Counsel for Respondent has submitted that since the subsequent events have been seen by this Tribunal, it would be apt to mention that the order of 28.02.2022 purported to have been passed by the DRT, Pune was stayed by the DRAT, Mumbai in appeal No. 31 of 2022 on 03.06.2022. 24. It is further submitted that even the order dated 05.05.2022 of the Division Bench of High Court of Bombay passed in appeal was tested by the Appellant by way of SLP filed before the Hon ble Supreme Court which was disposed of on 19.09.2022. Therefore, it is submitted that the effect of the order dated 19.04.2022 has been wiped out as also the order dated 28.02.2022 of the DRT, Pune by the order dated 03.06.2022 by ..... X X X X Extracts X X X X X X X X Extracts X X X X
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