Imp. Rulings - Section 19(2) Applications
Index;
NCLAT (2023.10.19) in Mr. Rahul Gupta Vs. Chandra Prakash [Company Appeal (AT) (Insolvency) No. 966 of 2022 ]
NCLT Chandigarh (2023.02.28) In Mr. Ajay Kumar Siwach. Vs. Shri Virender Dawar (Director of Suspended Board of Corporate Debtor) & Ors.[IA No. 295/2021 In CP (IB) No.19/ Chd/ Hry/ 2019 ]
NCLAT (2023.02.17) In Rajasthan State Mines & Minerals Ltd. Vs. Parag Sheth & Ors. [Company Appeal (AT) (Insolvency) No. 170 of 2023 ]
NCLT Mumbai-1 (2023.01.03) in Mr. Mahesh Sureka Resolution Professional Vs. Minesh Prints Limited & others, [I.A. 87 OF 2021 in C.P.(IB) No. 4461/MB/2019 ]
NCLT Kochi(22.12.2022) in K. Parameswaran Nair Vs. Mr. Jacob Samson & Ors. [IA(IBC)/ 230/ KOB/2022 IN CP(IB)/05/KOB/2021]
NCLAT (2022.11.29) in Ashok Mahindru & Anr. Vs. Vivek Parti (Company Appeal (AT) (Insolvency) No.1324 of 2022)
NCLT Indore (2022.07.18) in Sajjan Kumar Dokania RP of Divya Jyoti Industries Ltd V/s Gopal Nyati & Ors [IA/102(MP)2021 in TP 241 of 2019, CP(IB) 628 of 2018]
NCLT Guwahati (2022.02.04) in Sandeep Khaitian, IRP Vs. Piyush Periwal & others.(Cont. Application No. 1/2021 IN CP (IB)/09/GB/2019)
NCLAT (2021.07.05) in Mr. Venugopal Dhoot & Anr. Vs. Mr. Pravin R. Navandar RP & Ors. [Company Appeal(AT)(Insolvency) No. 173 of 2021],
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1). NCLAT (2023.10.19) in Mr. Rahul Gupta Vs. Chandra Prakash [Company Appeal (AT) (Insolvency) No. 966 of 2022 ] held that;
“The offences and penalties” as prescribed and dealt with in Chapter VII and appropriate Order of punishment can be passed only by way of trial of offences by a Special Court in terms of Section 236 of the Code.
That issuing of non- bailable warrant by the National Company Law Tribunal against the erstwhile directors for ensuring the compliance of the provisions of the Code fell within the ambit of Section 19 of the Code.
An act which is termed as offence within specific provision of Chapter VII of Part-II could not have been indirectly dealt with by the Adjudicating Authority by imposing a fine.”
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2). NCLT Chandigarh (2023.02.28) In Mr. Ajay Kumar Siwach. Vs. Shri Virender Dawar (Director of Suspended Board of Corporate Debtor) & Ors.[IA No. 295/2021 In CP (IB) No.19/ Chd/ Hry/ 2019 ] held that;
The present application is filed under Section 19(2) of the Insolvency and Bankruptcy Code, 2016 to pass necessary directions to respondents to cooperate with the IRP which is not maintainable against Respondent No. 3 as this adjudicating authority cannot adjudicate upon the dispute between the parties.
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3). NCLAT (2023.02.17) In Rajasthan State Mines & Minerals Ltd. Vs. Parag Sheth & Ors. [Company Appeal (AT) (Insolvency) No. 170 of 2023 ] held that;.
We are of the view that Adjudicating Authority ought to have issued notice to the Appellant before passing any order on the Application [Under Section 19(2)].
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4). NCLT Mumbai-1 (2023.01.03) in Mr. Mahesh Sureka Resolution Professional Vs. Minesh Prints Limited & others, [I.A. 87 OF 2021 in C.P.(IB) No. 4461/MB/2019 ] held that;
The Applicant has sought directions from this Tribunal to make the Suspended Board to contribute to the Corporate Debtor in terms of Section 19(2) of the Code, to the extent the money is not paid by the stated parties. However, we are of the considered view that such directions are not permissible under section 19(2) and this Bench can not direct them to co-operate.
Had this Application been filed in terms of Section 66 of the Code meeting the conditions precedent provided therein, this Bench could have assumed jurisdiction to consider the prayer of the Application, if such prayer would otherwise be permissible under that Section.
We are of considered view that the Applicant has lien over such Goods as “Unpaid Seller” in terms of Provisions contained in Section 47 of Sale of Goods Act, 1930. Accordingly, no specific direction is necessary from this Tribunal.
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5). NCLT Kochi(22.12.2022) in K. Parameswaran Nair Vs. Mr. Jacob Samson & Ors. [IA(IBC)/ 230/ KOB/2022 IN CP(IB)/05/KOB/2021] held that;
Accordingly, we direct all the Respondents to co-operate with Applicant/Resolution Professional and provide all the information/documents/clarifications sought for by the applicant Resolution Professional within a period of two weeks from the date of receipt of a copy of this order. It is made clear that failure to do so will attract the provisions of Section 70 of IBC, 2016.
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6). NCLAT (2022.11.29) in Ashok Mahindru & Anr. Vs. Vivek Parti (Company Appeal (AT) (Insolvency) No.1324 of 2022) held that;
Interim moratorium shall be for such proceedings which relate to a liability or obligation due i.e. due on date when interim moratorium has been declared. Section 96(1)(b) cannot be read to mean that any future liability or obligation is contemplated to be stayed.
Thus, stay of proceedings under Section 19(2) and Section 66-67 is not contemplated under Section 96(1)(b) and the scheme of Code in no matter provide for stay of such applications.
Section 66 of IBC empowered the Tribunal to pass appropriate orders when the suspended directors or insolvency professional of the Corporate Debtor carried on fraudulent trading or business during resolution process.
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7). NCLT Indore (2022.07.18) in Sajjan Kumar Dokania RP of Divya Jyoti Industries Ltd V/s Gopal Nyati & Ors [IA/102(MP)2021 in TP 241 of 2019, CP(IB) 628 of 2018] held that
We direct the Suspended Management to handover all the documents, assets to the RP and provide assistance as required by the RP within ten days from the date of this order, failing which the RP is at liberty to approach local police on the basis of this order and local police to render all necessary assistance to RP.
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8). NCLT Guwahati (2022.02.04) in Sandeep Khaitian, IRP Vs. Piyush Periwal & others.(Cont. Application No. 1/2021 IN CP (IB)/09/GB/2019) held that;
When sufficient provisions are available in the IBC especially under Sections 19, 66 and 74 of IBC to deal with the situations of non-cooperation by the Suspended Management to the RP in completion of CIRP, fraudulent trading or wrongful trading, if any, during Corporate Insolvency Resolution Process or a Liquidation Process, and Punishment for Contravention of Moratorium provisions of Section 14 of IBC then why he had filed FIR on 23.04.2020 with Margherita, Police Station.
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9). NCLAT (2021.07.05) in Mr. Venugopal Dhoot & Anr. Vs. Mr. Pravin R. Navandar RP & Ors. [Company Appeal(AT)(Insolvency) No. 173 of 2021], held that;
This Appellate Tribunal was repeatedly asking the parties the requirement of various documents and sources from where the documents can be obtained. Based on these observations on 10.06.2021 both the parties agreed the suggestions for a list of requisite documents and from where the documents can be obtained by the RP.
The sum and substance of both the submissions of Appellant and Respondents reveals that the Financial Statement of the CD is available with RP. What he is seeking is the details of the assets of the subsidiaries which is governed by the explanation to Section 18 of the Code and the same is stated as below:…..
The most important thing is the tally data of the CD which has to be obtained from Resolution Professional of VIL i.e. its holdings Company of CD. The bank accounts details for the last five years can be obtained by the Respondent No.1 from the Bank which are under his control at the moment and details of the Directors can be obtained from the MCA website.
On a specific query by the Bench, why RP for more than one year could not get the books reconstructed with the assistance of expert IT Professional from outside to ascertain avoidable transactions of the Code, if he suspects something based on inputs available with him.
What we find basically that a culture has come were Accounts people wants to do the job of Auditor, Auditor wants to do the job of Vigilance and Vigilance wants to do the job of CBI.
The RP being a competent professional and bankers within his charge, he should have reconstructed a book showing cash flow for the specified period as per the Code and by this time could have detected that whether any preliminary finding is for avoidance transactions and then the other party could have proved either way by this time.
The RP can take the assistance of concerned Registrar of Company / MCA website and could have obtained financial statements /annual return and his apprehension could have been proved either way.
Hence, we are unable to confirm that Appellants are fully responsible for non- availability of the documents with whatever data what has been provided to us. Hence, we are unable to sustain the Adjudicating Authority order at this juncture which has been passed in haste.
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