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TMI BlogFILING FRESH APPLICATION UNDER SECTION 94(1) OF THE CODE AFTER ITS DISMISSAL OF EARLIER APPLICATIONX X X X Extracts X X X X X X X X Extracts X X X X ..... FILING FRESH APPLICATION UNDER SECTION 94(1) OF THE CODE AFTER ITS DISMISSAL OF EARLIER APPLICATION - By: - Mr. M. GOVINDARAJAN - Corporate Laws / IBC / SEBI - Dated:- 12-9-2024 - In GURSEV SINGH, PERSONAL GUARANTOR VERSUS IDBI BANK ANR. AND GAGANDEEP KAUR, PERSONAL GUARANTOR VERSUS IDBI BANK ANR - 2024 (9) TMI 7 - NATIONAL COMPANY LAW APPELLATE TRIBUNAL , PRINCIPAL BENCH , NEW DELHI , the two appeals have been filed by two personal guarantor challenging the order of the Adjudicating Authority on 17.05.2024 in Company Petition (IB) No. 60/Chd/HP/2024 and Company Petition (IB) No. 61/Chd/HP/2024 respectively. Corporate insolvency resolution process was initiated by the Financial Creditor before the Adjudicating Authority, Chandigarh Bench a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gainst the corporate debtor Ram Harbi Motors Private Limited. The said application was admitted by the Adjudicating Authority on 14.02.2020. Gurusev Singh, the personal guarantor to corporate debtor, filed an application under Section 94(1) of the Insolvency and Bankruptcy Code, 2016 ( Code for short) on 06.05.2022. The Adjudicating Authority directed the Gaurav Singh to comply with the provisions of the Code. Since the same has not been complied with the Adjudicating Authority directed, vide their order dated 01.02.2023 directing the applicant to comply with the provisions of Section 94(4) and 94(5) of the Code by means of filing an affidavit before the Adjudicating Authority. Vide order dated 01.02.2024, the Adjudicating Authority dismiss ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed the application for non-compliance of its order dated 01.02.2023. The Appellant filed an IA being IA No. 519 of 2024 for recall and restoration of the application which came for consideration before the Adjudicating Authority on 28.02.2024. The appellant filed an IA for recall and restoration of the application. The appellant prayed that he might be permitted to withdraw the application with liberty to re-file the petition under Section 94 of the Code as per law. The Adjudicating Authority admitted the said IA allowing the appellant to withdraw the petition. The appellant again filed a petition under Section 94(1) of the Act on 29.02.2024. While considering the said application an objection was raised by the Financial Creditor as to the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... maintainability of the petitioner. The Adjudicating Authority dismissed the said application on 17.05.2024 holding that the application was not maintainable. Against this order the appellant filed the present appeal before the National Company Law Tribunal. The appellant submitted the following before the Appellate Tribunal- When the Adjudicating Authority granted liberty by order dated 28.02.2024 to re-file the application under Section 94(1) , the application could not have been rejected as not maintainable. The liberty granted to refile was availed by the Appellant and immediately on 29.02.2024, a fresh application was filed which cannot be held to be non-maintainable. When the Adjudicating Authority granted liberty to file fresh applica ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion, the Appellant was well within its rights to file fresh application under Section 94 and the earlier order dated 01.02.2024 dismissing the application for noncompliance cannot come in the way of the Appellant. The Financial creditor submitted the following before the Appellate Tribunal- The Appellant had filed Section 94 application in the year 2020 being CP (IB) No. 77/CH/HP/2021. On 06.05.2022, Adjudicating Authority directed the Appellant to file an Affidavit for compliance. The Appellant dragged on the defective application to continue to enjoy the Moratorium which commenced on filing of the application and in spite of several orders passed by the Adjudicating Authority did not cure the defects. The order of the Adjudicating Author ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ity dated 01.02.2024 was never challenged by the Appellant and that become final. Withdrawal of the restoration application with liberty to re-file cannot take away the effect and consequences of the order dated 01.02.2024. The Appellate Tribunal considered the submissions of the Counsel for the parties and perused the record. The Appellate Tribunal analyzed the order of the Appellate Tribunal. The Appellate Tribunal observed that the Adjudicating Authority has passed the impugned order after hearing both the parties. It was pleaded that mortgaged property has been put for auction under the provisions of the SARFAESI Act, 2002 but because of the interim moratorium being misused by the Appellant for the last three years and there is no need ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to adjourn the matter again. Adjudicating Authority after noticing the aforesaid, dismissed the application. The Appellate Tribunal further observed that the order dated 01.02.2024 of the Adjudicating Authority has not been challenged by the Appellants and therefore it became final. Then the Appellate Authority analyzed the order of the Adjudicating Authority dated 17.05.2024 which was impugned in the present appeal. The Appellate Authority observed that the Adjudicating Authority has come to the finding that filing of the application under Section 94 by the Appellant was nothing but misuse of the interim moratorium available under Section 96 of the Code. While dismissing the application on 01.02.2024 by the Adjudicating Authority, no liber ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ty was granted to file a fresh petition. The Appellant was permitted to withdraw IA No.519 of 2024 with liberty to re-file under Section 94(1) of the Code. The Appellant himself taken liberty to re-file the petition under Section 94 (1) of the Code as per law. Thus, the Adjudicating Authority did not commit any error in dwelling on the question as to whether the application which is filed on 29.02.2024 being Company Petition (IB) No. 60/Chd/HP/2024 is maintainable or not. Liberty by withdrawing the restoration application cannot be treated to be liberty to file fresh application under Section 94(1) wiping out the earlier order dated 01.02.2024. The Appellate Tribunal did not find any error in the impugned order dated 17.05.2024 passed by th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Adjudicating Authority which has been challenged in these two Appeals. The Appellate Tribunal dismissed the appeals. - Scholarly articles for knowledge sharing authors experts professionals Tax Management India - taxmanagementindia - taxmanagement - taxmanagementindia.com - TMI - TaxTMI - TMITax ..... X X X X Extracts X X X X X X X X Extracts X X X X
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