9911796707
TMI Blog2024 (5) TMI 1152X X X X Extracts X X X X X X X X Extracts X X X X ..... make appropriate pleading before the Court. It is not a case advocate who appeared submitted that he shall file vakalatnama during the course of the day. Interpretation and Application of Rule 49(2) of the NCLT Rules, 2016 - HELD THAT:- Rule 49 gives ample jurisdiction to the Adjudicating Authority to proceed for ex parte as corporate debtor does not appear. Appearance as contemplated under Rule 49(1) is appearance by the corporate debtor or by an authorised representative. The financial creditor has also submitted that present is a case where debt and default is not even questioned since there is a consent decree passed by the DRT against the corporate debtor, hence, the appellant in this appeal is not making any submission on merits of the appeal although time was taken by the appellant on 31.01.2024 to file an additional affidavit so as to address the appeal on merits. It is noticed that during the oral submissions challenging the order rejecting the application under Rule 49(2), no submission has been advanced by the appellant on debt and default. In the facts of the present case and submission of the counsel for the parties, the present is not a case where this Tribunal may i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2.02.2022 which were served on Corporate Debtor on 07.03.2022. On 25.03.2022, when the application was listed before the Adjudicating Authority, no reply was filed by the Corporate Debtor. On 25.03.2022, Counsel appeared on behalf of the corporate debtor before the Adjudicating Authority and made a statement that he has not filed any vakalatnama. Neither any reply being filed nor any authorised counsel having put in appearance, the Adjudicating Authority proceeded to hear the application on merits and by order dated 25.03.2022 admitted Section 7 application. Adjudicating Authority returned a finding on debt and default and admitted Section 7 application. Appellant aggrieved by the order dated 25.03.2022 passed in company petition filed an appeal being Company Appeal (AT) (Insolvency) No.418 of 2022 before this Tribunal. Counsel appearing for the Appellant sought liberty to withdraw the appeal and file an application under Rule 49(2) of the NCLT Rules 2016. This Tribunal noticing the above submission granted liberty to file an application under Rule 49(2) vide its judgment and order dated 04.07.2022. In order dated 04.07.2022, this Tribunal made it clear that it is not expressing an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ly but has not filed his vakalatnama who was not heard by the Adjudicating Authority although wanted to take time for filing the reply. It is submitted that the Adjudicating Authority proceeded to hear the application and admit the same on 25.03.2022 which was clear denial of opportunity of the corporate debtor. It is submitted that the order dated 25.03.2022 admitting Section 7 application was challenged by the appellant by Company Appeal (AT) (Insolvency) No.418 of 2022 which appeal was withdrawn by the Appellant with liberty to file an application under Rule 49(2) before the adjudicating authority. It is submitted that the application has been filed on 19.07.2022 under Rule 49(2) being IA No.3470 of 2022 which has been rejected by the adjudicating authority by impugned order. Counsel submits that a Section 7 application has also filed against the corporate guarantor which was also admitted on 29.03.2022 and was also challenged by the corporate guarantor in Company Appeal (AT) (Insolvency) No.464 of 2022 which was allowed by this Tribunal. In Section 7 application filed against corporate guarantor, corporate guarantor has appeared and prayed for time to file reply which was denie ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is only harping that he could not file any reply and the order dated 25.03.2022 is ex-parte. Appellant has not questioned the debt and default in its submission. Section 7 application which is pending for last two years and due to various applications CIRP could not proceed any further and despite there being multiple opportunity given to the corporate debtor to raise the submission on merits on Section 7 application, no submission has been advanced which clearly indicate that the appellant s intention is only to delay the matter. Section 7 application is to be admitted when the Adjudicating Authority finds that there is debt and default. It is further submitted that the Adjudicating Authority rightly rejected application under Rule 49(2). Since present was not a case where notice was neither served on the corporate debtor nor corporate debtor was prevented in any manner from appearing before the Adjudicating Authority on the date fixed, the Adjudicating Authority has rightly rejected the application filed by the appellant being IA No.3470 of 2022. There is no merit in the appeal. The appeal deserves to be dismissed. 6. We have considered the submissions of the counsel for the par ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... response, Adjudicating Authority shall proceed to examine whether there is admitted debt and default. In paragraph 11 of the order, the Adjudicating Authority made following observations:- 11. Today, when the matter was taken Mr. Gunjesh Ranjan states that he has been engaged recently, but he has not filed his Vakalatnama, and therefore, we are unable to accept any arguments on behalf of the Corporate Debtor. As such notice has gone but there is no proper response. Be that as it may, the only other aspect to consider in this case is whether there is an admitted debt and default. 9. Adjudicating Authority proceeded to consider the application and held that the application filed by applicant is well within the time, hence, by order dated 25.03.2022, Section 7 application is admitted. Aggrieved by the said order, the appellant filed an appeal being Company Appeal (AT) (Insolvency) No.418 of 2022 which was heard on 27.04.2022. This Tribunal disposed of the appeal on 04.07.2022, following was noticed in paragraphs 4, 5 and 6 : - 4. Mr. Arvind Verma, Learned Sr. Counsel for the Appellant submits that the Appellant be granted liberty to file an Application under Rule 49(2) of the NCLT, Ru ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er of the NCLT in the aforesaid application. With these observations, the Appeal is disposed of. 10. Subsequent to the order of this Tribunal dated 04.07.2022, IA No.3470 of 2022 was filed by the appellant for recall of the order dated 25.03.2022. 11. In the application IA No.3470 of 2022, appellant has prayed for recall and set aside the order dated 25.03.2022. Following prayers were made in the application:- a) Allow the present application; b) Recall and set-aside the order dated 25.03.2022 i.e., the order for initiation of Corporate Insolvency Resolution Process be set aside. c) Pass any other necessary orders or directions as may deem fit in the present matter. 12. As noted above, by order dated 04.07.2022 disposing of Company Appeal (AT) (Insolvency) No.418 of 2022, interim protection was granted for a period of two weeks. Appellant filed an application praying for further interim relief in which notices were issued on 01.08.2022 which order was also challenged in this Tribunal. This Tribunal on 10.08.2022 disposed of Company Appeal (AT) (Insolvency) No.934 935 of 2022, which reads as follows:- 10.08.2022: Heard Learned Counsel for the Appellant as well as Learned Counsel app ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r is run as a going concern. Appeal disposed of. 13. The Adjudicating Authority by the impugned order has dismissed the IA No.3470 of 2022. Adjudicating Authority while dismissing the application took the view that application filed by the appellant is not covered by Rule 49(2), held that decision in Section 7 application was taken on merits. Adjudicating Authority in the impugned order has made following observations rejecting the application with regard to Rule 49(2). As has been analysed hereinabove, the Rule 49(2) can be resorted to by us only when there is no service of notice upon the Respondent or the Respondent does not appear in the matter on being prevented by sufficient cause. In a case where the Respondent in the petition was represented by the Ld. Counsel, who stated that he had been engaged recently and had not filed his power cannot be ground for us to recall the detailed order dated 25.03.2022 passed on merits. In view of the aforementioned, finding the present application not covered by the provisions of Section 49(2), we reject the same. 14. The submission which has been pressed by the Counsel for the appellant that the Adjudicating Authority has not correctly con ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vakalatnama cannot be said that the corporate debtor was prevented by any sufficient cause from appearing. Corporate debtor has to blame himself for not appointing an Advocate to appear and make appropriate pleading before the Court. It is not a case advocate who appeared submitted that he shall file vakalatnama during the course of the day. Adjudicating Authority made further observations with regard to cause pressed by the appellant for recall of the order:- A careful perusal of Rule 49(2) reveals that this Tribunal can set aside an order being ex-parte, only when the Respondent/Respondents satisfy the Tribunal that the notice was not duly served on the Respondents or they were prevented by any sufficient cause from appearing in the matter. In the present case indubitably notice was served upon the CD on 07.03.2022 and Mr. Gunjesh Ranjan, Ld. Counsel entered appearance on it's behalf before the Tribunal to espouse that he had not yet filed his power. So the present case is not a case where either the notice was not served upon the CD or there was any sufficient or justified/plausible cause preventing the CD/Applicant in present IA from appearing before this Adjudicating Autho ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ural justice. In paragraph 12 of the judgment, following has been observed:- 12. The procedure, which is to be adopted by the Tribunal has to be in consonance with the rules of natural justice and equity as required by the rules itself. Unless, it is held that due to non-filing of the reply before the date of hearing by the Corporate Debtor, the Adjudicating Authority is obliged to decide the application under Section 7, the Adjudicating Authority has ample jurisdiction to consider any request for reasonable time by a Corporate Debtor for filing a reply. The Tribunal is fully entitled to grant time for filing a reply asked for by the Corporate Debtor on the first date of hearing. Rejecting the request of the Corporate Debtor on the very first day for grant of time to file a reply, cannot be said to be in consonance with the principles of natural justice. There can be no dispute that in appropriate case, if the Adjudicating Authority is satisfied that the Corporate Debtor is deliberately delaying the matter, the request for grant of any further time to file a reply can be refused. But present is not a case where it can be said that Corporate Debtor was delaying the disposal of the c ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
