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

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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

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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

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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

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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

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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.