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TMI Blog2023 (10) TMI 894X X X X Extracts X X X X X X X X Extracts X X X X ..... , NCLT), Guwahati Bench in IA(IBC) No. 60/GB/2022 in C.P.(IB) NO. 18/GB/ 2021, granting further extension of 30 days (beyond the 270 days already availed), was accepted. 2. The learned Single Judge, after consideration of the material placed on record, held that the provisions contained in Section 33 of the Insolvency and Bankruptcy Code, 2016 (in short, IBC of 2016) were mandatory and the NCLT had no jurisdiction to extend the limitation for completion of the Corporate Insolvency Resolution Process (hereinafter, for short, referred as the CIRP) beyond the statutory period as prescribed under Section 12 of IBC of 2016. 3. For better appreciation of the controversy, the provisions contained in Section 12 of the IBC of 2016, are reproduced hereinbelow for the sake of ready reference: "12. Time- limit for completion of insolvency resolution process.- (1) Subject to sub-section (2), the corporate insolvency resolution process shall be completed within a period of one hundred and eighty days from the date of admission of the application to initiate such process. (2) The resolution professional shall file an application to the Adjudicating Authority to extend the period of the cor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s the proceedings could not be concluded, the proforma respondent No. 6 herein, Shri Kamal Kumar Harlalka filed an application under Section 12(2) of the IBC of 2016 seeking time extension of the CIRP. Accordingly, by order dated 13.05.2022, the NCLT, Guwahati Bench granted extension of 90 (ninety) days to the Resolution Professional (appellant herein) to complete the CIRP within the extended period. The Resolution Professional made another application, being I.A.(IBC)/60/GB/2022 in CP(IB)/18/ GB/2021 under Section 60(5) of the IBC of 2016 seeking further extension of the period by another 30(thirty) days at the request of Punjab National Bank (respondent No. 3 herein). The said application, preferred by the Resolution Professional, was accepted by the NCLT, Guwahati Bench vide order dated 25.08.2022, whereby the prayer for extension of further period of 30(thirty) days beyond the 270 days already availed, was allowed. 5. As indicated in the order dated 25.08.2022, the reason for granting extension was that a resolution with regard to extension of CIRP was approved with 87.26% voting by the Members of the Committee of Creditors (in short, COC). The order dated 25.08.2022 further r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... esolution Professional to file the present appeal, Mr. Goenka urged that the Resolution Professional has been impleaded as a party respondent in this writ petition and hence, he is entitled to file the present appeal. He further urged that under the IBC 2016, the Resolution Professional is required to perform the duties as envisaged under the Code so as to protect the interest of the Corporate Debtor. 10. In this background, Mr. Goenka contends that the appellant being the Resolution Professional appointed under the Act of 2016 has the locus to file and prosecute the instant writ appeal. He further urged that the Resolution Professional was compelled to move the application for liquidation because of the mandatory requirements of Section 33 of the IBC of 2016. He further submitted that the bar in seeking second extension for conclusion of the CIRP proceeding is restricted to the extensions sought under Rule 12(2) of IBC of 2016. He urged that the instant application for extension was filed under Section 60(5) of the IBC of 2016 read with Rule 11 of the NCLT Rules of 2016 and hence, the application was maintainable. 11. He further urged that since the word "mandatorily" appearing ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he Court, wherein Hon'ble the Supreme Court, recorded its displeasure to the Resolution Professional filing an appeal in the matter. 13. Be that as it may, since the Resolution Professional was impleaded as a party respondent in the writ petition, we propose to dispose of the instant writ appeal on merits rather than non-suiting the appellant on the ground of locus. 14. Dr. Saraf, vehemently and fervently, opposed the submissions advanced by Mr. Goenka. He urged that the provisions contained in Section 12 of the IBC of 2016 are mandatory in nature and the effect thereof cannot be diluted. He further urged that the reliance placed by learned counsel for the appellant on Section 60(5) of the IBC of 2016 in an endeavour to surmount the bar created by Section 12(3), is misplaced because Section 60(5) begins with non-obstante Clause and that the powers conferred upon the NCLT by this sub-Clause are subject to the statutory provisions in operation and the same cannot over-ride the existing law. 15. Dr. Saraf contended that though in the case of Committee of Creditors of Essar Steel India Limited (supra), the word "mandatorily" as appearing in the second proviso to Section 12(3) was re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... riking down of the word "mandatorily" in second proviso to Section 12(3) of the IBC of 2016, by Hon'ble the Supreme Court in Committee of Creditors of Essar Steel India Limited (supra) judgment, the first proviso to Section 12(2) would also be diluted. 20. In this reference, we would like to reproduce the observations made by Hon'ble the Supreme Court at para No. 127 of the judgment in the case of Committee of Creditors of Essar Steel India Limited (supra), which have been referred to in the impugned judgment passed by the learned Single Judge, which reads as below: "127. Both these judgments in Atma Ram Mittal [Atma Ram Mittal v. Ishwar Singh Punia, (1988) 4 SCC 284] and Sarah Mathew [Sarah Mathew v. Institute of Cardio Vascular Diseases, (2014) 2 SCC 62 : (2014) 1 SCC (Cri) 721] have been followed in Neeraj Kumar Sainy v. State of U.P. [Neeraj Kumar Sainy v. State of U.P., (2017) 14 SCC 136 : 8 SCEC 454], SCC paras 29 and 32. Given the fact that the time taken in legal proceedings cannot possibly harm a litigant if the Tribunal itself cannot take up the litigant's case within the requisite period for no fault of the litigant, a provision which mandatorily requires the CIRP ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f 2019 is exceeded, there again a discretion can be exercised by the Adjudicating Authority and/or Appellate Tribunal to further extend time keeping the aforesaid parameters in mind. It is only in such exceptional cases that time can be extended, the general rule being that 330 days is the outer limit within which resolution of the stressed assets of the corporate debtor must take place beyond which the corporate debtor is to be driven into liquidation." 21. It is manifest that Hon'ble the Supreme Court, while striking down the word "mandatorily", was of the view that if the CIRP is on the verge of being settled, then in such exceptional cases, the time for completion of the process may be extended even beyond the period of 330 days as stipulated in second proviso to Section 12(3) of IBC of 2016. Thus, any proposal for extension of CIRP beyond 330 days should clearly reflect that the extension was being granted on account of the fact that the CIRP was nearing completion and grant of one further extension would result to a positive outcome so that the Corporate Debtor could be put back on its feet. 22. However, bare perusal of the order dated 25.08.2022, passed by the NCLT, Guwah ..... X X X X Extracts X X X X X X X X Extracts X X X X
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