Telangana High Court
Sew Lsy Highways Limited vs Punjab National Bank on 19 February, 2024
THE HON'BLE SMT JUSTICE K. SUJANA
CIVIL REVISION PETITION No.815 OF 2022
ORDER :
This Civil Revision Petition is filed by the revision petitioner aggrieved by the order, dated 30.03.2022 passed in I.A.No.707 of 2021 in C.P. (IB) No.812/7/HDB/2019 by the National Company Law Tribunal, Hyderabad.
2. I.A.No.707 of 2021 in C.P. (IB) No.812/7/HDB/2019 is filed by the petitioner/Corporate Debtor praying the Court to direct the respondent/Financial Creditor to provide a copy of the entire company petition, as executed and filed before the Tribunal.
3. The contention of the petitioner/Corporate Debtor in I.A.No.707 of 2021 in C.P. (IB) No.812/7/HDB/2019 is that the company petition does not contain any signatures verified in the petition as per Rule 4(3) of the Insolvency and Bankruptcy, (Application to Adjudicating Authority) Rules, 2016. The said Rule provides that the applicant shall dispatch forthwith a copy of the application filed before the Adjudicating Authority by registered post or by speed post to the registered Office of the Corporate Debtor.
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4. The said I.A. is dismissed by the Tribunal stating that the regulation has been provided only to enable the petitioner/Corporate Debtor to have a copy of the petition and not more than that. Section 7 of Insolvency and Bankruptcy Code, 2016 is very clear and it does not even provide for the service of any notice to the petitioner herein and there is a duty cast upon the Adjudicating Authority to dispose of the same within 14 days from the date of filing of the petition and the petition has been duly served on the petitioner which the petitioner has not denied. The petitioner has also not denied that he has taken loans from the respondent/Financial Creditor and all that he says that there are certain amounts required to be received from the U.P. Government by virtue of an arbitration award and in case the same are paid, the petitioner/Corporate Debtor will make the payment to the respondent/Financial Creditor and matter will get settled. Aggrieved by the same, the present CRP is filed by petitioner/Corporate Debtor.
5. Heard Sri Avinash Desai, learned Senior Counsel for the revision petitioner, and Sri E.Madan Mohan Rao, learned Senior Counsel representing on behalf of Sri N.Meher Prasad appearing for respondent.
6. Learned Senior Counsel for the revision petitioner/Corporate Debtor would submits that the tribunal erred in observing the 3 SKS,J CRP_815_2022 Rule 4(3) of the Insolvency and Bankruptcy (Application to Adjudicating Authority) Rules, 2016 (For short "IBBI Rules") which states that only copy of the petition has to be served and not more than that. The tribunal ought to have noticed that the Rule 4(3) of the IBBI Rules categorically states that the entire application filed before the Adjudicating Authority has to be dispatched to the Office of the Corporate Debtor and the tribunal had committed fundamental and jurisdictional error by not considering the contention of the petitioner that under Rule 10 of IBBI Rules read with Rules 20, 21, 22, 23, 24 and 26 of part III of the National Company Law Tribunal Rules, 2016 (For short "NCLT Rules") which prescribed the procedure for filing of a petition before the tribunal. The tribunal ought to have noticed that the copy of the company petition served on the petitioner company is in clear violation of IBBI Rules and NCLT Rules as the company petition is not signed by any authorized representative and the contents of the petition and documents are not verified, thereby the tribunal committed a jurisdictional error stating that the observation was made beyond the scope of application.
7. It is further submitted that by filing the company petition, the respondent/Financial Creditor has to serve the signed copy of the company petition and also signed copies of the documents, however, they served the copies but there is no signature of 4 SKS,J CRP_815_2022 authorized signatory on the copies, as such, immediately they sent an email to the respondent/Financial Creditor stating the same for which they gave a reply to send a person for collecting the said documents and the petitioner sent one person, who collected the documents but those documents are also not signed copies and they sent a reply email to the respondent/Financial Creditor that the documents were signed by the advocate but not by the authorized signatory and the respondent has not replied for the same. As such, they filed a preliminary counter as the tribunal insisted for the same with a liberty to file a fresh counter narrating the manner in which they have not compiled the rules and the petitioner/Corporate Debtor filed this application, along with the counter, but the tribunal erroneously dismissed the petition. Therefore, the revision petitioner prayed this Court to set aside the order of the tribunal by allowing the present CRP.
8. In support of revision petitioner/Corporate Debtor contentions, learned Senior Counsel for the revision petitioner relied upon the judgment of High Court of Madras in the case of Cape Infrastructure Private LTD. vs Nupower Renewables Private Ltd. 1 and he also relied upon the following judgments of Hon'ble Supreme Court:
1 MANU/TN/5127/2017 5 SKS,J CRP_815_2022
a) In the case of Whirlpool Corporation vs Registrar of Trade Marks, Mumbai and Others 2
b) In the case of L.Chandra Kumar vs Union of India and Others, 3
c) In the case of Durga Enterprises (P) LTD. Another vs Principal Secretary, Government of U.P. and Others 4
d) In the case of Dr Bal Krishna Agarwal vs State of U.P. and Others 5
e) In the case of State of Jharkhand and Others vs Ambay Cements and Another 6
f) In the case of Veerappa Pillai vs Raman and Raman Ltd and Others 7
g) In the case of Ibrat Faizen vs Omaxe Buildhome Private Limited 8 2 (1998) 8 SCC 1 3 (1997) 3 SCC 261 4 (2004) 13 SCC 665 5 (1995) 1 SCC 614 6 (2005) 1 SCC 368 7 AIR 1952 SC 192 8 2022 SCC Online SC 620 6 SKS,J CRP_815_2022
9. On the other hand, learned Senior Counsel for the respondent/Financial Creditor would submit that they already served all the copies to the revision petitioner and even after filing the present CRP they served the signatory copy of the company petition, along with the documents, therefore, nothing survives in the CRP and prayed the Court to dismiss the CRP.
10. Having gone through the submissions of learned Senior Counsel for the revision petitioner and learned Senior Counsel for the respondent and the material placed on record, the CRP is filed against the order of the tribunal in I.A.No.707 of 2021. The said I.A. is filed by the revision petitioner showing the procedure irregularities committed by the respondent/Financial Creditor while serving the copies. As the petitioner is Corporate Debtor he has to rely only on the signed copies and if at all if there is an irregularity or mischiefs in the documents, he has to take action against the same and if the documents are not signed he will loose his opportunity to contest the same. However, he admitted that now the respondent herein served the signed company petition, whereas, his contention is that the documents served by the respondent are not signed by the authorized signatory.
11. It is an admitted fact that the respondent/Financial Creditor has to serve the company petition signed by the authorized signatory and also the documents to the petitioner/Corporate 7 SKS,J CRP_815_2022 Debtor as per Rule 4(3) of the IBBI Rules. According to the revision petitioner though the respondent herein now handed over the signed copies to the petitioner, those documents were not signed by the authorized signatory and further the contention of learned Senior Counsel for the revision petitioner is that the tribunal observation is beyond the scope of the petition, as such it has to be set aside. In view of the submissions and admitted facts, the impugned order is hereby set aside and the respondent herein is directed to comply with the Rule 4(3) of the IBBI Rules.
12. Accordingly, with the above observation, the Civil Revision Petition is disposed of. There shall be no order as to costs.
Miscellaneous applications, if any, pending shall stand closed.
__________________ K. SUJANA, J Date : 19.02.2024 Kgk