Mr. Purshottam Gaggar vs Dyna Roof Private Ltd. & ors
WA 18 of 2023
Facts:
1.The respondent No.1 (writ petitioner No.1, Dyna Roof Private Ltd.) is a private limited company, having its registered office in the Ri Bhoi District of Meghalaya, whereas the respondent No.2 (writ petitioner No.2, Rohin Kumar Hansaria), is the proprietor of a firm named, Steel Sales Corporation, having its office at S.J. Road, Athgaon, Guwahati. Both the respondents are unsecured financial creditors of the Corporate Debtor RSH Agro Products Limited.
2.An insolvency proceeding was initiated under Section 10 of the IBC of 2016 before the NCLT, Guwahti, which came to be registered as C.P.(IB) No.18/GB/2021. As the proceedings could not be concluded, the proforma respondent No.6 herein, Shri Kamal Kumar Harlalka filed an application under Section 12(2) of the IBC of 2016 seeking time extension of the CIRP. Accordingly, by order dated 13.05.2022, the NCLT, Guwahati Bench granted extension of 90 (ninety) days to the Resolution Professional (appellant herein) to complete the CIRP within the extended period.
3.The Resolution Professional made another application, being I.A.(IBC)/60/GB/2022 in CP(IB)/18/ GB/2021 under Section 60(5) of the IBC of 2016 seeking further extension of the period by another 30(thirty) days at the request of Punjab National Bank (respondent No.3 herein). The said application, preferred by the Resolution Professional, was accepted by the NCLT, Guwahati Bench vide order dated 25.08.2022, whereby the prayer for extension of further period of 30(thirty) days beyond the 270 days already availed, was allowed.
3.Appeal was filed against the order which was allowed by the Single Bench of High Court vide order dated 22.12.2022. Appeal against the order dated 22.12.2022, passed by the learned Single Bench, whereby writ petition was allowed
Issue: Whether the order passed was correct ?
Arguments:
Appellant:
1.Counsel representing the appellant, vehemently and fervently contended that the Central Government itself recognized the fact that the resolution proceedings were not being completed within the prescribed period and thus, an amendment has been brought into Section 12 of the IBC of 2016.
2.He urged that the word “mandatorily” as occurring in the second proviso to Section 12(3) of the IBC of 2016, was struck down by Hon’ble the Supreme Court in the judgment rendered in Committee of Creditors of Essar steel India Limited Vs. Satish Kumar Gupta & Ors.
3.Counsel contends that the appellant being the Resolution Professional appointed under the Act of 2016 has the locus to file and prosecute the instant writ appeal. He further urged that the Resolution Professional was compelled to move the application for liquidation because of the mandatory requirements of Section 33 of the IBC of 2016.
Respondent:
1.Counsel has raised a serious objection regarding maintainability of the instant writ appeal at the instance of the appellant, being the Resolution Professional, urging that the Resolution Professional is supposed to act as an independent facilitator and thus, he is not required to act at the behest of any of the parties.
2.Counsel submitted that the fact that the appellant has approached this Court by way of the instant writ appeal for assailing the judgment of the learned Single Judge, clearly establishes that he is acting in a partisan manner and hence, the appeal, at the instance of the Resolution Professional, should be dismissed, as being not maintainable.
3.He further urged that the reliance placed by learned counsel for the appellant on Section 60(5) of the IBC of 2016 in an endeavour to surmount the bar created by Section 12(3), is misplaced because Section 60(5) begins with non obstante Clause and that the powers conferred upon the NCLT by this sub-Clause are subject to the statutory provisions in operation and the same cannot over-ride the existing law.
Decision: Hon’ble Division Bench uphled the order
Rationale:
1.Hon’ble High Court held that view taken by learned Single Judge, after making interpretation of Section 60(5) of the IBC of 2016 that the same would not prevail over and above the provisions of Section 12 of the Code, is the correct interpretation of the statute and hence, the same does not require any interference.
2.It noted that it is manifest that Hon’ble the Supreme Court, while striking down the word “mandatorily”, was of the view that if the CIRP is on the verge of being settled, then in such exceptional cases, the time for completion of the process may be extended even beyond the period of 330 days as stipulated in second proviso to Section 12(3) of IBC of 2016.
Order:
