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TMI Blog2023 (7) TMI 1407X X X X Extracts X X X X X X X X Extracts X X X X ..... fessional. In the balance sheet of the Assignor Company also there was no mention of the aforesaid dues against the Corporate Debtor before they were assigned to the Appellant. Non-reflection of amounts in the financial accounts of either of the Assignor or the Assignee creates substantial doubt in the case of the Appellant. Looking to the facts and circumstance and the manner in which the claim has been put up by the Appellant, the opinion of the Adjudicating Authority agreed upon that all three transactions are sham and the matter needs to be examined by appropriate authority to prevent misuse of the forum and defeat the objectives of the Code. The Adjudicating Authority after considering in detail the entire facts and circumstances and material on record has rightly come to the conclusion that none of the claim submitted by the Appellant in Form C could have been admitted in the CIRP of the Corporate Debtor. Claims submitted by the Appellant were all non-genuine claim and have rightly been rejected. The Adjudicating Authority has rightly directed the Resolution Professional to send all related papers received from the Applicant, Financial Creditors, Documents in his possession a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Rs.1315,29,99,000/- on the basis of Assignment Deed dated 29.01.2019 executed by M/s Pallavi Synthetics Private Limited (Assignor No.2) for a consideration of Rs.4.66 Crores. (c) Claim of amount of Rs.715,86,30,000/- on the basis of Assignment Deed dated 13.04.2017 executed by M/s Midas Powertech Pvt. Ltd. (Assignor No.3) arising out of financial facilities and assistance availed by the Corporate Debtor for an amount of Rs.45 Crores. v. IRP by email dated 13.04.2022 acknowledged the claims provisionally. IRP called for various documents from the Appellant as mentioned in the email. By subsequent email dated 18.04.2022, the IRP informed to the Appellant that Modern Terry Towel is one of the related party of the Corporate Debtor, hence, the Appellant stepping in the shoes of assignor being related party has to be treated as related party and cannot be considered as part of the CoC. Certain documents were also called for from the Appellant. The email dated 18.04.2022 was sent with regard to (separate emails) all the three claims submitted by the Appellant. vi. The Appellant filed an application under Section 60(5) of the I B Code on 26.04.2022 being I.A. No. 203/JPR/2022. In the appl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ments. xii. The Adjudicating Authority after hearing the parties, by impugned order dated 19.04.2023 rejected I.A. No. 203/JPR/2022. Aggrieved by which order this Appeal has been filed. 2. We have heard Shri Alok Dhir, learned counsel for the Appellant, Shri Deeptakirti Verma, learned counsel appearing for Respondent No.2 and Shri Partha Sarathy Sarkar, the Resolution Professional. 3. Shri Alok Dhir, learned counsel for the Appellant in support of the Appeal submits that the Appellant had submitted three claims on the basis of three Assignments made in favour of the Appellant Viz. Assignment by Modern Terry Towels dated 03.04.2017, which assignment clearly stated that Modern Terry Towels was a guarantor to financial facility provided by Uni Credit Bank (formerly BV Bank) to the Corporate Debtor. On 29.07.2014 as per settlement agreement entered by Modern Terry Towels, an amount of Rs.19,44,96,000/- was paid as settlement amount. Since the total debt was more than Rs.169 Crores, the Appellant has filed his financial claim claiming interest on the said amount from 1997, which claim amounted to Rs.10862,22,74,000/-. With regard to Second Assignment from Pallavi Synthetics Private Limi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he Respondent No.2 has refuted the submissions of learned counsel for the Appellant and submitted that claims filed by the Appellant of more than Rs.13,000/- Crores were all sham and un-genuine claims. The Appellant was hand in gloves with the Corporate Debtor and the claim of exorbitant amount without any basis has been filed by the Appellant to control the CoC to benefit the Corporate Debtor. None of the claims are backed by sufficient and relevant documents. The Appellant despite clear direction of the Adjudicating Authority on 10.05.2022 to provide the original Assignment Deeds failed to file original Assignment Deeds which clearly indicate that documents were all manufactured and antedated. It is submitted that inspite of direction of the Adjudicating Authority to file the bank statements of Appellant for last six years of the ICICI Bank, bank statements were not filed by the Appellant deliberately to conceal that there was no transaction for payment of any amount towards assignment as claimed. All the claims are based on cooked up documents to somehow enter into the CoC. With regard to the Assignment Deed dated 03.04.2017, learned counsel for the Respondent No.2 submitted tha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d the Balance Sheets of the Appellant before the Adjudicating Authority, in none of the balance sheets for the period 2017-18 to 2020-21 any recoverable amount from Corporate Debtor was mentioned. The claim of the Appellant is not corroborated from the balance sheet of the Appellant itself, hence, it has no legs to stand. The claim filed by the Appellant before the Adjudicating Authority was through an associate of Ranka family, Promoter of the Corporate Debtor, to derail the CIRP. Details of all the three Assignment and relevant documents were produced and the Adjudicating Authority after hearing the parties has rightly rejected the claim of the Appellant. 6. We have considered the submissions of learned counsel for the parties and perused the record. 7. The Adjudicating Authority in detail has noted the three claims submitted by the Appellant in Para 2.1, 2.2 and 2.3 of the impugned order. The pleadings and documents submitted by the Resolution Professional has also been noted. Financial Creditor s pleadings i.e. Respondent No.2 has also been noticed. The Adjudicating Authority has also noticed its earlier order dated 10.05.2022 by which it directed the Applicant/Appellant to fil ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . 2. No link has been established between Assignor Company No. 2 and M/s K3N and M/s Adarsh Prathishthan, the companies that made payment to the M/s Modern Petrofils (A unit of Corporate Debtor) for disbursing the alleged settlement amount to Mashreq Bank. The nature of the transactions carried out by the above 2 companies cannot be ascertained in the present circumstances. 24. Mere glance of the documents shows that there is no cogent evidence to prove the existence of any loan in favour of the Assignor No. 3 which was availed by the Corporate Debtor. The Assignor Company No.3 has plainly assigned its rights to recover from the Corporate Debtor to the Applicant for a consideration of Rs. 50 Lakhs but no document is on record which can show that there was an existing debt. Hence, in the absence of any loan, the assignment done by Assignor Company No. 3 automatically stands nullified. There is no iota of proof which can substantiate the claim of the Applicant vis- -vis the claim of Assignor Company No. 3. 9. Shri Alok Dhir, learned counsel for the Appellant has given much emphasis on Assignment made by Modern Terry Towel dated 03.04.2017. The photocopies of the Assignment Deed dated ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... en mentioned on the basis of any of the three assignments, as claimed before the Resolution Professional. In the balance sheet of the Assignor Company also there was no mention of the aforesaid dues against the Corporate Debtor before they were assigned to the Appellant. Non-reflection of amounts in the financial accounts of either of the Assignor or the Assignee creates substantial doubt in the case of the Appellant. 11. Looking to the facts and circumstance and the manner in which the claim has been put up by the Appellant, we concur with the opinion of the Adjudicating Authority that all three transactions are sham and the matter needs to be examined by appropriate authority to prevent misuse of the forum and defeat the objectives of the Code. In this regard observations have been made by the Adjudicating Authority in Para 29, which is to the following effect: 29. There is a clear cut procedure; guidelines and the requirements of minimum payment, capacity of the Assignee, reflections of transactions in Balance Sheets of the Assignor Companies and the Assignee in case of assignment of any debt. All of the aforesaid are missing in the present case. It appears that all there are sh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ving not been able to prove any payment towards three assignments which is claimed by the Appellant by filing balance sheet or any other proof, clearly indicate that the documents were prepared only for the purpose of filing claim in the CIRP of the Corporate Debtor without there being any genuine transaction. 13. We may also look into the second assignment made by M/s Pallavi Synthetics Private Limited. According to own case of the Appellant, debt dues of Mashreq Bank were settled in Section 7 application filed by Mashreq Bank by M/s K3N and Adarsh Pratishthan demonstrating payment of settlement amount of Rs.4.66 Crore. How M/s Pallavi Synthetics Private Limited acquired right to assign debt to Appellant is the mystery which has not been unfolded by any documents and claim on the basis of said assignment has rightly been rejected by the Adjudicating Authority. 14. The third assignment is assignment by M/s Midas Powertech Pvt. Ltd. Appellant s case was that financial assistance was taken by the Corporate Debtor from Midas Powertech Pvt. Ltd. of Rs.45 Crores, on the basis of which principal amount, assignment was made in favour of the Appellant on 30.04.2017. The amount of Rs.45 Cro ..... X X X X Extracts X X X X X X X X Extracts X X X X
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