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TMI Blog2023 (8) TMI 1052X X X X Extracts X X X X X X X X Extracts X X X X ..... st that the Operational Creditor should not continue the proceedings. From the Settlement Agreement it is also clear that on account of breach the entitlement of Operational Creditor was Rs.92.70 Crores minus Rs.25 Lakhs with interest @12%. At time when the CoC was not constituted, there can be no impediment in power of Adjudicating Authority to exercise jurisdiction under Rule 11 to close the CIRP even if no application as per the procedure under Section 12A r/w Regulation 30A has been filed. The Adjudicating Authority itself has recorded finding that application filed by the Applicant was maintainable, which finding is recorded in Para 10 of the order. Thus, the mere fact that there are claims of other creditors against the Corporate Debtor are not impediment for closing the CIRP filed by an Applicant either under Section 7 or Section 9, if the Applicant enters into settlement with the Corporate Debtor and the debt is liquidated but present is a case where offer given by the Appellant in its application under I.A. No. 1571 of 2023 came after breach of the Settlement Agreement at the stage when Appeal against the admission order was dismissed by this Tribunal and the said or ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Rs.15 Lakhs dated 15.03.2022 was given in favour of Kone Elevator India Pvt. Ltd. (iii) The Corporate Debtor did not make any payment in pursuance of the Settlement Agreement. The Adjudicating Authority reserved its judgment on 03.02.2023. (iv) I.A. No. 529/2023 was filed in the Company Petition offering payment of Rs.20 Lakhs out of remaining Rs.80 Lakhs shall be paid immediately. The said application was rejected by the Adjudicating Authority by order dated 27.02.2023. (v) By judgment dated 27.02.2023, the Adjudicating Authority admitted Section 9 application finding debt and default. Adjudicating Authority also appointed Interim Resolution Professional. (vi) Company Appeal (AT) (Ins.) No. 262 of 2023 was filed by Tejinder Pal Setia. In the appeal, the Appellant offered to deposit an amount of Rs.35 Lakhs by Bank Draft. Appeal was entertained on 02.03.2023 and Appellant was permitted to deposit Rs.35 Lakhs, notices were issued and interim order was passed directing that no further steps shall be taken in pursuance of impugned order dated 27.02.2023. (vii) In the Appeal, an application was filed by one Sanjeev Chadha for being impleaded as one of the Respondent cla ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s and conditions of the Settlement Agreement dated 27.09.2021 has already been breached which were not adhered by the Appellant. The parties are not in agreement with each other with regard to offer given by the Applicant Tejinder Pal Setia, then the application was rejected. By separate order of the same date 25.07.2023, the Adjudicating Authority allowed I.A. No. 1584 of 2023, which was filed on behalf of the allottees/ Homebuyers, impleading the Homebuyers as party in I.A. No. 1571 of 2023. Aggrieved by both above orders dated 25.07.2023, these Appeals have been filed. (xiv) Tejinder Pal Setia also filed an MA before the Hon ble Supreme Court being MA No. 1656 of 2023 in Civil Appeal 4267 of 2023 seeking appropriate directions for closure of CIRP proceedings pending before NCLT, Chandigarh Bench. The said MA was taken up by the Hon ble Supreme Court on 04.08.2023 and disposed of the application observing that they are not inclined to entertain the MA in disposed of matter and left it open to the Applicant /Appellant to file an appeal before the NCLAT. The Hon ble Supreme Court further directed that there would be status quo with regard to the further proceedings for a perio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... each of Settlement was never ready to make the payment of debt as became due as per the Settlement Agreement. It is submitted that even after order of the Hon ble Supreme Court dated 14.07.2023, the email which was sent by the Suspended Director mentioned that they are ready to offer Rs.35 Lakhs + interest whereas as per the Settlement Agreement, in case of breach, entire amount of Rs.92,70,000/- minus payment received shall become due and shall be liable with interest. The Respondent No.3 has not committed any such conduct which can be complained of by the Appellant. Appellant s offer was never accepted by the Respondent No.3. Application under Section 12A was not maintainable. 5. Learned counsel for the Homebuyers who are impleaded by the impugned order dated 25.07.2023 submits that the Homebuyers filed their Section 7 application in the year 2020 for a claim of more than Rs.121 Crore. It is submitted that the Corporate Debtor for last several years has refused to provide allotted premises to the Homebuyers. The Corporate Debtor neds insolvency resolution, looking to the sequence of the events and facts of the present case. 6. Learned counsel for the IRP submits that in pur ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... de, 2019 bearing number CP (IB) No. 248/Chd/Chd/2019 before the NCLT at Chandigarh and the said Petition is at the stage of final disposal. AND WHEREAS with the indulgence and sincere efforts of the representatives of KONE and COPL both the parties herein have agreed for the amicable solution to the claim of KONE before the NCLT on the terms and conditions which are being recorded in this Settlement Agreement. NOW THIS SETTLEMENT AGREEMENT WITNESSETH AS UNDER: 1. COPL acknowledges that pursuant to the above, they are liable to pay the claimed amount to KONE. However, due to financial constraints, COPL has offered to pay a sum of Rs.60,00,000/- (Rupees Sixty Lakhs Only) to KONE as a full and final settlement of all the dues of KONE as are payable by COPL. 2. KONE has accepted the aid offer of COPL, and are agreeable to accept an amount of Rs.60,00,000/- (Rupees Sixty Lakhs Only) as a full and final settlement of the claim pending before the NCLT on COPL complying with the terms of payment as per this Settlement Agreement. 3. COPL shall pay an amount of Rs.25,00,000/- (Rupees Twenty Five Lakhs Only) being the first instalment at the time of signing of this ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... perational Creditor should not continue the proceedings. From the Settlement Agreement it is also clear that on account of breach the entitlement of Operational Creditor was Rs.92.70 Crores minus Rs.25 Lakhs with interest @12%. 11. When the Appellant filed Appeal challenging the admission order dated 27.02.2023, it only offered to make payment of Rs.35 Lakhs which was not as per the Settlement Agreement. Appeal has been dismissed by this Tribunal, as noted above. Against said order an appeal was filed before the Hon ble Supreme Court by Tejinder Pal Setia, on which order dated 14.07.2023 was passed, which is to the following effect: ORDER We are in agreement with the findings recorded by the National Company Law Appellate Tribunal (NCLAT), Principal Bench, New Delhi dated 04.07.2023 with regard to the debt due and payable by the Corporate Debtor - Chandigarh Overseas Private Limited (COPL), the respondent no. 2 before us. At this stage, the Learned Senior Advocate appearing for the appellant - Tejinder Pal Setia, suspended Director of the Corporate Debtor/respondent no. 2 - COPL, states that the appellant - Tejinder Pal Setia is ready and willing to pay the de ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... period of ten days from today or till the appeal is listed before the NCLAT, whichever is earlier. Recording the aforesaid, the miscellaneous application is disposed of. 13. The Hon ble Supreme Court by order dated 04.08.2023, relegated Appellant to file an appeal before this Tribunal and directed for status quo with regard to the further proceedings for a period of ten days from 04.08.2023 or till the appeal is listed before the NCLAT. The application 1571 of 2023 was filed by the Appellant at time when CoC was not constituted. In event Settlement is reached before the CoC is constituted, the settlement between the parties can be accepted in an application under Section 12A and the Adjudicating Authority can close the CIRP proceeding accepting the settlement. The present is a case where offer made by the Appellant was not accepted by the Assignee Respondent No.3. The Adjudicating Authority proceeded to reject the application on the ground that Settlement Agreement between the parties has already been breached and parties are not in agreement with the offer given by the Appellant to Respondent No.3. In Paras 11, 12 and 14 following observations have been made by the Adj ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ly indicate that the Corporate Debtor has not been able to clear the dues of the Operational Creditor in last 8 years and the cheques given by the Corporate Debtor were dishonoured and Settlement Agreement dated 27.09.2021 was breached. The facts clearly indicate that the Corporate Debtor needed resolution of its insolvency. The fact that after the Appeal was dismissed by this Tribunal admitting CIRP process and after the order of Hon ble Supreme Court dated 14.07.2023, Corporate Debtor for the first time in an application I.A. No. 1571 of 2023 has come forward with case that he shall make payment as per the Settlement Agreement of the dues, does not absolve the Corporate Debtor from its breaches and failure, which has been noted above. (ii) Secondly, the Homebuyers who have been impleaded by the Adjudicating Authority by order dated 25.07.2023 in I.A. No. 1571 of 2023 are now respondent in this Appeal and they have stated that Section 7 application has been filed by the Homebuyers against the Corporate Debtor in the year 2020 which proceedings have been going against the Corporate Debtor from 2020. The Homebuyers have filed the Section 7 proceeding for an amount of more than Rs ..... 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