9911796707
TMI Blog2024 (7) TMI 318X X X X Extracts X X X X X X X X Extracts X X X X ..... r dated 05.01.2024, this appeal has been filed. 2. Brief facts of the case necessary to be noticed for deciding this appeal are:- 2.1. Appellants have purchased flat from 'Signia Pearl Co-operative Housing Society' and entered into Agreement for Sale by the Corporate Debtor- 'Starlight Systems (I) Pvt. Ltd.', the developer. Appellants claim to have paid amount of Rs.30,00,000/- towards maintenance/ corpus fund and management charges. Under Clause 9 of the Agreement for Sale, the Corporate Debtor was under an obligation to transfer the unutilized amount out of the aforesaid sum of Rs.30,00,000/- paid by Appellant No.1 to the Association of Unit Holder. On 04.09.2020, Appellant registered a Society before Dy. Registrar, Co-operative Societies H-East Ward. On 05.01.2021, Appellant Society claim to have sent a legal notice to the corporate debtor calling upon to take requisite steps to assign and the remainder of the amount to the said Society. Respondent have failed to make the payment. Appellant entered into informal discussion with the Corporate Debtor which did not fructify. Civil Suit (L) No. 196 of 2020 was filed by the Appellant before the Bombay High Court praying for grant o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... art IV of Section 7 application which date of default fell within bar under Section 10 A of the IBC, the Appellant cannot be allowed to change the date of default to defeat the law which bars any application for default committed during 10A period. It is submitted that by amendment no fresh cause of action can be introduced by the appellant. By the amendment application, the Appellant is seeking to change the cause of action which is total inconsistent of the case as set out in Section 7 application. Amendment cannot be allowed when it is intended to overcome statutory bar. Judgment relied by Counsel for the Appellant in support of the submissions are all distinguishable and no amendment seeking change in Section 10A period can be permitted. 6. Counsel for the parties have placed reliance on various judgment of the Hon'ble Supreme Court which we shall refer to by considering the submissions in detail. 7. Part IV of Section 7 application filed by the Appellant is as follows:- "PART-IV Particulars of the Financial Debt 1. Total Amount of Debt granted Date(s) of Disbursement Rs.7,65,00,000/- (Rupees Seven Crores Sixty Five Lakhs Only) and particular details are provided in ta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eserved the notice dated 05.01.2021, hence, the same could not be brought on the record. Learned counsel for the Appellant submits that he may advance submission without bringing the said notice on record. List this Appeal on 01.05.2024. " 11. The amendment application being IA No. 5044 of 2023 was filed by the Appellant where Part-IV of the application was sought to be amended in following manner:- "SCHEDULE (Schedule for Amendment) In Part IV- Particulars of the Financial Debt The following second row to be substituted in place of the existing second row Part IV at Page 30 of the captioned petition. 1. Amount Claimed to be in default and the date on which the default occurred (Attach the working for computation of amount and days of default in tabular form) Total default : Rs. 7,65,00,000/- Date of Default: 1 April 2021 (Society was formed in September 2020, and thus till the end of financial year 2020-2021, the Petitioners have waited and the default would start from the 1st day of next financial years) 12. The date of default which was mentioned as 05.09.2020 is now sought to be changed as 01.04.2021. In paragraph 7 of the application, following has been ple ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tification, especially when the amendments as sought for would give rise to a fresh cause of action, by validating the cause of action already admitted by the FCs. The attempt of the FCs is otherwise hit by the statutory prohibition under Section 10A. Hence, we find that this new plea of the FCs is to alter the date of default mentioned in the Main Application as the alleged date of default fell during the suspension period. If we allow this IA, it would have the effect of negating the legislative bar against filing applications for initiation of CIRP during the COVID-19 pandemic period. Further, we are conscious of the settled proposition of law that an amendment of pleading cannot be allowed which takes away the valuable defence available to the opposite side. This Adjudicating Authority cannot cause irretrievable prejudice to one of the parties, especially when the amendment sought has the effect of nullifying a statutory mandate. 4.4 The contention of the FCs that they did not file application for amendment Immediately after filing the application because of certain settlement talks with the CD is not convincing as the FCs admit that the so-called settlement talks were merel ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ant to file additional pleadings and/or documents, and proceed to pass a final order. In our considered view, the decision of the adjudicating authority to entertain and/or to allow the request of the appellant Bank for the filing of additional documents with supporting pleadings, and to consider such documents and pleadings did not call for interference in appeal. " 15. The Hon'ble Supreme Court in the above case held that there is no bar in law to the amendment of pleadings in an application under Section 7 of the IBC, or to the filing of additional documents. There cannot be no quarrel to the above preposition of law laid down by the Hon'ble Supreme Court in the above case. Present is a case where application which was filed by the appellant and date of default mentioned therein clearly fell in Section 10A period and no satisfactory explanation was given by the appellant to permit amendment in the date of default in the application. Counsel for the Appellant has relied on an order of this Tribunal dated 28.02.2024 passed in "Company Appeal (AT) (Insolvency) No.380 of 2024- M/s. SE Transstadia Pvt. Ltd. vs. Bank of Baroda" that amendment was allowed by the Adjudicating Authorit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lly destructive of each other. 29. An explanation can be offered provided there is any scope therefor. A clarification may be made where the same is needed." 17. The above judgment of the Hon'ble Supreme Court itself has laid down that categorical admission cannot be resiled but in a given case, it may be explained or clarified. The present is not a case where any clarification or explanation is sought to be offered for date of default 05.09.2020 mentioned in Section 7 application. The date of default in itself is sought to be changed as 01.04.2021 without there being any reason or cause. As noted above, Appellant themselves has stated that after registration of society of the appellant on 04.09.2020, the corporate debtor was liable to refund the amount to the appellants which default took place on 05.09.2020. In the application as pleaded that they entered into informal talks with the corporate debtor which did not fructify. Appellant themselves has stated that in the formal talks proceeded to take time till financial year of the corporate debtor. Firstly, according to the case of the appellant, informal talk did not fructify, hence, there was no settlement with regard to dat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... amendment of date of default is being clarified or explained. Section 10A which was inserted in the IBC with object to give relief to the corporate debtor against initiation of the insolvency proceeding when default committed comes within the period of Section 10A. Section 10A is as follows:- " 10A. Suspension of initiation of corporate insolvency resolution process. Notwithstanding anything contained in sections 7, 9 and 10, no application for initiation of corporate insolvency resolution process of a corporate debtor shall be filed, for any default arising on or after 25th March, 2020 for a period of six months or such further period, not exceeding one year from such date, as may be notified in this behalf: Provided that no application shall ever be filed for initiation of corporate insolvency resolution process of a corporate debtor for the said default occurring during the said period. Explanation. - For the removal of doubts, it is hereby clarified that the provisions of this section shall not apply to any default committed under the said sections before 25th March, 2020." 19. Section 10A is a beneficial provision to extend certain protection to the corporate debtor ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
