NCLAT (2024.04.23) in JC Flowers Asset Reconstruction Pvt. Ltd. Vs. Laxmi Oil and Vanaspati Pvt. Ltd. [(2024) ibclaw.in 267 NCLAT, Comp. App. (AT) (Ins) No. 1052 of 2022 & I.A. No. 4514 of 2022 ] held that;
We observe that as per the Code, it is for the Adjudicating Authority to satisfy himself at the stage of admission of application under Section 7 of the Code that default has occurred w.r.t. the debt was due and payable, which remains unpaid, then the Adjudicating Authority is required to admit such application.
Excerpts of the order;
# 1. The present Appeal has been filed by Yes Bank Limited (in short ‘the Original Appellant/ Financial Creditor) under Section 61 of the Insolvency & Bankruptcy Code, 2016 (in short ‘Code’) in Company Appeal (AT) (Insolvency) No. 1052 of 2022 against the Impugned Order dated 13.06.2022 passed by the National Company Law Tribunal, Allahabad Bench, Prayagraj (in short ‘Adjudicating Authority’) in CP (IB) No. 05/ALD/2022
# 2. An I.A. No. 991 of 2023 was filed under Rule 11 r/w Rule 31 of the National Company Law Appellate Tribunal Rules, 2016 by J.C. Flowers Asset Reconstruction Private Limited ( in short the Appellant) seeking its substitution as the Appellant/ Financial Creditor in place of Yes Bank on the virtue of an assignment agreement executed between the J.C. Flowers Asset Reconstruction Private Limited and the Axis Bank on 16.12.2022 for the loan given to the Corporate Debtor by the Yest Bank which has been assigned to the Applicant. The Application was allowed by this Appellate Tribunal on 06.03.2023 and as such J.C. Flowers Asset Reconstruction Private Limited replaced the Yest Bank Limited as the Appellant.
# 3. Laxmi Oil and Vanaspati Private Limited the Corporate Debtor is the Respondent herein.
# 4. Heard the Counsel for the Parties and perused the records made available including the cited judgements.
# 5. It is noted that the Respondent availed credit facilities from the original Appellant vide credit facility letter bearing reference no. YBL/ DEL/ FL/ 200/ 2016-17 dated 26.03.20217 for Rs. 10 Crores as cash credit facility for a period of 12 months against the exclusive charge on the residential land and building. This facility was to expire on 15.03.2018. In pursuance to this facility, a Master Facility agreement (Facility Agreement) was signed between the Appellant and the Respondent on 29.03.2017. This secured cash credit limit was extended vide letter dated 15.02.2018 enhancing from Rs. 10 Crores to Rs. 20 Crores and was valid up to 22.01.2019 which was further renewed upto 24.07.2019. A Supplementary Master Facility Agreement (Supplementary Agreement) and a Deed of Hypothecation (Hypothecation Deed) were executed on 21.02.2018. These facilities were secured by way of letters of continuing guarantees dated 02.02.2018 and 08.05.2018 executed by Mr. Shib Shankar Roy, Kamal Deep Tripathi, Satish Kumar Rawat, Keshav Singh Gaur, Ms. Tarulata Biswas and Nipun Garg as Personal Guarantors in favour of the Appellant.
# 6. It is case of the Appellant that the Respondent delayed in making payments towards interest against the facilities for the month of November 2019, December 2019 and January, 2020 and interest for this period from November, 2019 to January, 2020 were debited in the cash credit facilities on 01.12.2019, 01.01.2020 and 01.02.2020 which were serviced by the Respondent on 26.02.2020 and 27.02.2020 albeit with delay.
# 7. The Appellant stated that interest for the month of February, 2020 was Rs. 27,93,039/- which was charged in the cash credit account on 01.03.2020 for outstanding dues dated 29.02.2020 and cash credit limit was over drawn to Rs. 20,27,91,254.42/- as such the cash credit was over due by a period of one day for the interest amount.
# 8. The Appellant further submitted that in terms of RBI Guidelines dated 27.03.2020 regarding NPA during Covid period, where banks were directed not to declare borrowers as NPA for default of payments arising during the period from 01.03.2020 to 31.08.2020 and accordingly the Appellant did not charge any interest on the cash credit facilities of the Corporate Debtor during this period and only on 01.09.2020, the Appellant charged interest towards cash credit facilities of the Respondent, which has also not been serviced by the Respondent till date.
# 9. The Appellant, on failure of the Respondent, for non adherence to terms as per the signed facility agreement and keeping in view the RBI Guidelines, the Appellant declared the Respondent as NPA on 20.07.2020 i.e., due to non submission of stock statement by the Respondent for a continued period on 6 months as last stock statement was submitted by the Respondent for the month of December, 2019.
# 10. The Appellant vide letter dated 27.08.2020 issued a loan recall notice to the Respondent and vide letter dated 07.09.2020 the guarantee extended by the guarantors were also invoked.
# 11. The Appellant emphasised that despite several reminders and request to the Respondent, the Respondent did not honour the terms of facility agreement and the debt remained unpaid as on 31.08.2021 for Rs. 25,99,34,488/- .
# 12. The Appellant submitted that despite his best efforts, due to failure of the Respondent, he filed an application under Section 7 of the Code for initiating Corporate Insolvency Resolution Process (in short ‘CIRP’). However, the Adjudicating Authority vide its Impugned Order dated 13.06.2022, dismissed the application holding that there is no basis for determining the date of default as 28.02.2020 and further, opined that loan recall notice had been issued on 27.08.2020 which falls between the period covered under Section 10 A of the Code.
# 13. It is the argument of the Appellant that the Adjudicating Authority failed to consider the fact that the Respondent defaulted in repaying its monthly dues for the month of February, 2020, the period which much prior to period stipulated under Section 10A of the Code.
# 14. The Appellant elaborated that Section 10 A of the Code prescribed that no insolvency proceedings can ever be instituting against any entity whatsoever for default cause/ committed in the stipulated period therein. Thus, Section 10 A of the Code could be attracted only to default committed during this stipulated period and not for period prior to stipulated period.
# 15. It is the case of the Appellant that Section 10 A was introduced only to safeguard the interest of distress businesses effected by the Covid-19 pandemic and was not meant to give shelter and protection to habitual defaulters to evade their liabilities. The Appellant further elaborated that the Respondent committed the default for the first time in the month of February, 2020 and the default was continuing thereafter.
# 16. The Appellant submitted that that explanation given under Section 10A of the Code clarify that Section 10A shall not apply to any default committed before 25.03.2020 and since the default was committed by the Respondent in February, 2020, there was no scope whatsoever regarding applicability of Section 10A of the Code and therefore the Impugned Order is patently illegal.
# 17. The Appellant pointed out that the as per the Section 3(12) of the Code, default can be even for any part or instalment of the amount of debt which has become due and payable and not repaid. The Appellant submitted that the present case is squarely covered under the definition as provided in Section 3(12) of the Code.
# 18. The Appellant pleaded that in view of several judgment of Hon’ble Supreme court of India as well as this Appellate Tribunal, once conditions as stipulated under Section 7 of the Code, are fulfilled, the Adjudicating Authority ought to have admitted to application filed under Section 7 of the Code and cited the Judgment in this regard delivered in the case of Laxmi Pat Surana Vs. Union Bank of India [(2020) SCC Online SC 1187].
# 19. The Appellant pointed out that the Respondent relied upon the circulars issued by the Reserve Bank of India, imposing moratorium from 01.03.2020, which is a clear admission of the debt falling due before the period enshrined under Section 10 A of the Code and submitted that the Respondent cannot take the benefit of both the RBI circulars as well as Section 10 A of the Code.
# 20. The Appellant pointed out that the Circular issued by the RBI on 27.03.2020 was merely for the purpose of deferring the recovery of monies falling due between March 1, 2020 and May 31, 2020 and since the Respondent defaulted in making payment of interest due on 28.02.2020 in terms of value date as provided in the account statement of the Corporate Debtor, the same is not covered as per RBI Circular on this aspect.
# 21. The Appellant explained that in his banking system, the instalment become due on the last date of every month and is payable on the first day of the next month. As such the default occurred on 28.02.2020 and payable on 01.03.2020 and in this regard, the Appellant reiterated that RBI Circular is not applicable as the RBI Circular used the word ‘Due’ and clearly the instalment become due on 28.02.2020.
# 22. Concluding his remarks, the Appellant submitted that the Impugned Order is illegal and perverse and requested this Appellate Tribunal to set aside the Impugned Order and allow his appeal.
# 23. Per contra, the Respondent denied all the averments made by the Appellant treating these to be misleading, mischievous and devoid of any merit.
# 24. The Respondent submitted that the Impugned Order has been passed by the Adjudicating Authority after carefully scrutinising the submissions of both the parties and based on legal position, which protects the case of the Respondent regarding alleged default.
# 25. The Respondent refuted the allegations of the Appellant that the Respondent failed to adhere to the facility agreement and further refuted that the cash credit amount started showing delay in interest service.
# 26. The Respondent submitted that he was regular in servicing the credit facility and denied that interest for the month of February, 2020 was not paid till date or there was any default on this account.
# 27. It is the case of the Respondent that the original Appellant/ Yes Bank wrongly declared the Respondent as NPA on 20.07.2020 without following rules and regulations of the RBI. The Respondent submitted that the Appellant classified the Corporate Debtor as NPA due to non submission of stock statement and not on account of default in payment of any interest.
# 28. The Respondent pointed out that the Appellant issued a loan recall notice on 27.08.2020 regarding the entire credit facilities and calling upon the Respondent to pay the alleged debt, which falls within the prohibition period as laid down under Section 10A of the Code i.e., after 25.03.2020.
# 29. It is the case of the Respondent that the Appellant could not have initiated any application under section 7 of the Code as per the legal mandate provided by Section 10A of the Code.
# 30. The Respondent submitted that facilities were extended up to July 2020 and the Appellant in their letter dated 20.12.2019 did not stipulate any timelines for repayment of loan by the Respondent and without taking any further action of settling the matter amicably and as per law, the Original Appellant all of a sudden classified the account of the as NPA.
# 31. The Respondent reiterated that there is no basis for determining the date of default as 28.02.2020 and only relevant date was loan recall notice issued on 27.08.2020 which falls in the period as satisfied under Section 10 A of the Code.
# 32. The Respondent pointed out that the alleged default occurred during the prohibited period between 25.03.2020 and 31.03.2021 for which no action under Section 7 of the Code could have been taken in terms of provision of Section 10 A of the Code.
# 33. Concluding his arguments, the Respondent requested this Appellate tribunal to dismiss the appeal.
Findings
# 34. We note that Section 10 A of the Code was introduced by amendment Act of 2020 dated 05.06.2020 with the purpose to support the business and industry who were adversely affected due to covid 19 pandemic. Section 10 A of the Code provides temporary suspensions on initiation of CIRP, which was provided initially for six months with the provision to be extended from time to time as notified.
# 35. We note that proviso to Section 10 A clearly mentions that “no application shall ever be filed” for initiation of CIRP of “for the said default occurring during the said period”, which signifies that the Parliament clearly envisaged to bar initiation of any application for CIRP, in respect of default which has occurred on or after 25.03.2020 for a period as notified from time to time.
# 36. We also note that the explanation to Section 10 A (quoted above under definition) has been introduced to remove any doubt and clarified the statutory provisions shall not apply to any default occurred before 25.03.2020. Thus, reading the proviso and the explanation, it is obvious that no protection was intended or may available for any default committed prior to 25.03.2020, however the default committed after 25.03.2020, till stipulated period were given complete immunity against the CIRP proceedings.
# 37. We also note that Hon’ble Supreme Court of India has issued a suo-moto order in Suo Moto Writ Petition (c) No. 3 of 2020 vide order dated 10.01.2022, which reads as under:-
1. In March, 2020, this Court took Suo Motu cognizance of the difficulties that might be faced by the litigants in filing petitions/ applications/suits/ appeals/ all other quasi proceedings within the period of limitation prescribed under the general law of limitation or under any special laws (both Central and/or State) due to the outbreak of the COVID-19 pandemic.
5 (iv) It is further clarified that the period from 15.03.2020 till 28.02.2022 shall also stand excluded in computing the periods prescribed under Sections 23 (4) and 29A of the Arbitration and Conciliation Act, 1996, Section 12A of the Commercial Courts Act, 2015 and provisos (b) and (c) of Section 138 of the Negotiable Instruments Act, 1881 and any other laws, which prescribe period(s) of limitation for instituting proceedings, outer limits (within which the court or tribunal can condone delay) and termination of proceedings.”
(Emphasis Supplied)
# 38. We note that the Section 10 A of the Code, by nature, is preventive and prohibitory and begins with non obstante clause i.e., “notwithstanding anything contained in Section 7,9 and 10” and therefore, places complete embargo for initiation of CIRP under these Sections for the period beginning with 25.03.2020 till stipulated period. However, explanation clarify the position that Section 10 A is not meant to be applicable or embargo for initiation of CIRP for default occurred prior to 25.03.2020.
# 39. In this regard, we would like to refer to the judgment of the Hon’ble Supreme Court of India passed in Ramesh Kymal vs. M/s Siemens Gamesa Renewable power Pvt. Ltd. [Civil Appeal No. 4050 of 2020] para 24, 26 and 27.
“24 We have already clarified that the correct interpretation of Section 10A cannot be merely based on the language of the provision; rather it must take into account the object of the Ordinance and the extraordinary circumstances in which it was promulgated. It must be noted, however, that the retrospective bar on the filing of applications for the commencement of CIRP during the stipulated period does not extinguish the debt owed by the corporate debtor or the right of creditors to recover it.
26 The date of the initiation of the CIRP is the date on which a financial creditor, operational creditor or corporate applicant makes an application to the adjudicating authority for initiating the process. On the other hand, the insolvency commencement date is the date of the admission of the application. This distinction is also evident from the provisions of sub-section (6) of Section 7, sub-section (6) of Section 9 and sub-section (5) of Section 10. Section 7 deals with the initiation of the CIRP by a financial creditor; Section 8 provides for the insolvency resolution by an operational creditor; Section 9 provides for the application for initiation of the CIRP by an operational creditor; and Section 10 provides for the initiation of the CIRP by a corporate applicant, NCLAT has explained the difference between the initiation of the CIRP and its commencement succinctly, when it observed:
“13. Reading the two definition clauses in juxtaposition, it emerges that while the first viz. ‘initiation date’ is referable to filing of application by the eligible applicant, the later viz. ‘commencement date’ refers to passing of order of admission of application by the Adjudicating Authority. The ‘initiation date’ ascribes a role to the eligible applicant whereas the ‘commencement date rests upon exercise of power vested in the Adjudicating Authority. Adopting this interpretation would leave no scope for initiation of CIRP of a Corporate Debtor at the instance of eligible applicant in respect of Default arising on or after 25th March, 2020 as the provision engrafted in Section 10A clearly bars filing of such application by the eligible applicant for initiation of CIRP of Corporate Debtor in respect of such default. The bar created is retrospective as the cut-off date has been fixed as 25th March, 2020 while the newly inserted Section 10A introduced through the Ordinance has come into effect on 5th June, 2020. The object of the legislation has been to suspend operation of Sections 7, 9 & 10 in respect of defaults arising on or after 25th March, 2020 i.e. the date on which Nationwide lockdown was enforced disrupting normal business operations and impacting the economy globally. Indeed, the explanation removes the doubt by clarifying that such bar shall not operate in respect of any default committed prior to 25th March, 2020.”
27 We are in agreement with the view which has been taken by the NCLAT for the reasons which have been set out earlier in the course of this judgment. We affirm the conclusion of the NCLAT. The appeal is accordingly dismissed. There shall be no order as to costs.” (Emphasis Supplied)
# 40. From above it become clear that the bar on the filing of application for the commencement of CIRP during stipulated period does not extinguish the debt owed by the Corporate Debtor and creditors/ lenders may continue to exercise their rights to pursue their legal remedies under Section 7,9 and 10.
# 41. We note that loan recall notice was sent to the Respondent on 27.08.2020 which is obviously after beginning of the stipulated period of 25.03.2020.
# 42. The moot question in the present appeal would be to determine when actually the default took place and whether this was covered under Section 10A of the Code.
# 43. In this regard, we would like to take into consideration part (IV) of the application filed by the Appellant before the Adjudicating Authority.
# 44. From above is seen that in particular of financial debt, amount claimed is Rs. 25,99,34,488.25/- as on 06.09.2021 and date of default mentioned as 28.02.2020 along with date of NPA as 20.07.2020.
# 45. From part IV we also note that vide letter dated 20.12.2019, the Appellant asked the Respondent to comply with the requirement mentioned in the facility agreement. It is further noted that part IV mentioned that on 28.02.2020, the Corporate Debtor failed to make repayment and hence default took place. Part IV also states that as per RBI Guidelines, the Corporate Debtor was declared as NPA on 20.07.2020 and loan recall notice was issued on 27.08.2020. It is also mentioned that despite several reminder, the Corporate Debtor failed to comply the terms of facility agreement and therefore the Appellant filed an application under section 7 of the Code.
# 46. From above, it is further seen that the Appellant claimed date of default as 28.02.2020 which is prior to stipulated date of 25.03.2020 under Section 10 A of the Code, however, the loan recall notice dated 27.08.2020 and the date of NPA is 20.07.2020, both these dates are after the stipulated date of 25.03.2020 as per Section 10 A of the Code.
# 47. We note from the Written Submissions of the Appellant filed vide Diary No. 82066 dated 10.04.2024 that instalment became due on the last date of every month and was payable on the first date of next month.
(Emphasis Supplied)
Thus, it is the case of the Appellant that payment is due on the last date of month but payable on 1st date of following months.
# 48. At this stage, we would like to refer to the relevant portion of Section 7(1) which reads as under :-
“7. Initiation of corporate insolvency resolution process by financial creditor.
(1) A financial creditor either by itself or jointly with 2 [other financial creditors, or any other person on behalf of the financial creditor, as may be notified by the Central Government] may file an application for initiating corporate insolvency resolution process against a corporate debtor before the Adjudicating Authority when a default has occurred. ***” (Emphasis Supplied)
Section 7(1) stipulates that the Financial Creditors may file an application under Section 7 for initiating CIRP against the Corporate Debtor before the Adjudicating Authority when a ‘Default’ has occurred. Thus, the crucial word is ‘Default’. Hence we note that the definition of default as given in Section 3 (12) reads as under :-
“3. Definitions.
(12) “default” means non-payment of debt when whole or any part or instalment of the amount of debt has become due and payable and is not paid by the debtor or the corporate debtor, as the case may be;” (Emphasis Supplied)
# 49. Thus default takes place when any part or instalment of debt has became “Due and Payable” and not ‘paid’. We consciously note that word is “Due and Payable” and not ‘Due’ or ‘Due or Payable’. This signifies that both events should have happened to establish default.
# 50. In the present appeal, the Appellant fairly stated that due occurred on the last date of February, 2020 but was payable on 01.03.2020. Hence, strictly speaking the date of default can not be 28.02.2020 as claimed by the Appellant in Part IV and at best could be as 01.03.2020 i.e., when it became payable.
# 51. Unless the debtor commits default, CIRP against him cannot be initiated under the Code. The words “Due and Payable” used in definition of “default” in section 3 (12) means that the default debt must be subsisting debt. The terms ‘default’ is defined in Section 3(12) of the Code in very wide terms as non-payment of a ‘debt’ once it becomes due and payable, which includes nonpayment of even part thereof or an installment. A creditor is not only required to establish the existence of a debt but is also required to prove that the corporate debtor has defaulted in payment of the debt and if he fails to establish the same, the CIRP cannot be initiated by the Adjudicating Authority. In other words, the mere fact of a ‘debt’ being due and payable is not adequate to justify the initiation of CIRP at the instance of the creditor, unless the ‘default’ on the part of the Debtor is established.
# 52. We note that RBI vide its Circular No. RBI/2019-20/186 dated 27.03.2020 permitted moratorium of three months on payment of all installments between 01.03.2020 to 31.05.2020, and reads as under :-
# 53. At this juncture, we will also like to refer to Facility Agreement dated 27.03.2017 :-
From above, it is clear that ‘Interest Dates’ is shown as ‘monthly’ but no’ particular date has been specified and the Appellant has pleaded that it become due on last date of month but payable on 1st of the following month.
We also note that “statement of stock” is to be submitted on monthly basis as part of the financial covenant, but no where it is indicated that submission of stock statement by the Respondent to the Appellant is condition precedent or breach of which result into default of debt.
# 54. We observe that as per the Code, it is for the Adjudicating Authority to satisfy himself at the stage of admission of application under Section 7 of the Code that default has occurred w.r.t. the debt was due and payable, which remains unpaid, then the Adjudicating Authority is required to admit such application. The word to pay such money in praesenti i.e., such debt is due for payment in praesenti or is payable at present i.e., relevant date.
# 55. We would also like to refer to the accounts statement maintained by the Original Appellant in respect of the Respondent. The statement begins from 01.03.2017 and the relevant pages of the statement are reproduced as under :-
The Appellant during pleadings tried to highlight the balance figures mentioned against the transaction date for December 2019/ value date of 30.11.2019 emphasising that the balance amount exceeding the cash credit limit of Rs. 20 Cores. We have already noted that the date of default has been indicated as 28.02.2020 and as per the statement of accounts on 28.02.2020 the outstanding balance shown in statement was Rs. 19,99,98,214.94/- which is lower than the cash credit limit of Rs. 20 Crores.
# 56. However, on the transaction date of 01.03.2020/ value date of 29.02.2020 as per statement of accounts, the interest was capitalised of Rs. 27,93,039/- and the outstanding balance became Rs. 20,27,91,254.42/-. It is the case of the Appellant that although on 28.02.2020 amount was due but it was payable on 01.03.2020 and hence, the default took place accordingly.
# 57. We have already noted earlier from the submissions of the Appellant is that the instalment became due on 01.03.2020 and the RBI Circular dated 27.03.2020 moratorium was permitted for instalment between 01.03.2020 to 31.05.2020, and this moratorium period and was later enhanced from 01.06.2020 to 31.08.2020 vide RBI/2019-20/244 Circular dated 23.05.2020.
# 58. We have already noted the content of Part IV of the application mention the date of default as 28.02.2020 and date of NPA as 20.07.2020 and further mentioned that loan was recalled vide letter dated 27.08.2020.
# 59. We would like to take into account the loan recall notice dated 27.08.2020 mentioned by the Appellant in Part IV of the application which reads as under :-
# 60. From Part 3 of the above loan recall notice, it is seen that it has been alleged that the Respondent did not honour the terms and conditions of the agreement and neglected to submit the ‘stock statement’ to the bank, which was pending since January, 2020 resulting in accounts of borrowers being declared as NPA on 20.07.2020 in accordance with the RBI Guidelines.
It further stated that in these circumstances bank has become entitled to recall the facilities and declare the facility as due and payable and accordingly the bank called upon the Respondent to pay the bank the outstanding amount under the facility together with the interest etc., within seven days from the date of receipt of the notice.
Thus, the reason mentioned in the loan recall notice and resultant converting the account of the Respondent as NPA, was non submission of stock statement and not of default of the amount as noted from the above quoted letter.
# 61. A stock statement is actually a business statement that provides information to the bankers on the value and quality of stock related transactions. Perhaps these are required since bank sometimes give loan with specific margin and company need to maintain stock with the value of the margin.
# 62. However, as per the relevant definitions of the Code, which we have discussed in earlier part, the default is required to take place with reference to debt which is outstanding and become payable. Normally a loan recall notice mentions all the details including reasons for default and is a formal communication from the lender requesting the borrower for repayment of outstanding loan balance.
# 63. In the background of above details, we note that the alleged date of default has bee mentioned as 28.02.20220 ( it should have been 29.02.2020 being leap year) as the Appellant mentioned that the instalment become due on the last date of the month and to be payable on 01.03.2020 and as per RBI Circular dated 27.03.2020, the moratorium started from 01.03.2020 for three months which was further extended for further three months. Thus the Respondent was covered under RBI guidelines and the default could not have been taken as 28.02.2020 or even on 01.03.2020 due to RBI Guidelines and subsequently due to Section 10 A of the Code w.e.f. 25.03.2020.
# 64. We have already seen that as per Part IV the date of NPA was 20.07.2020 and the date of loan recall notice was 27.08.2020 and as such both the dates falls within the stipulated period as provided under Section 10A of the Code dated 25.03.2020.
# 65. Arguments of the Appellant that the Corporate Debtor is not entitled to take protection of the RBI letter dated 27.03.2020 r/w 23.05.2020 in addition to Section 10A of the Code, is not convincing and cannot be accepted. The intentions of the letters of RBI as well as the introduction of Section 10A through amendment Act of 2020 was to protect the business from the financial distress adversely affected due to Covid 19 Pandemic and not to push such Corporate Debtor into Insolvency & Liquidation.
# 66. The Appellant, therefore, was not entitled to initiate the CIRP in the given background of the facts as well as various RBI guidelines and the provisions of Section 10 A of the Code.
# 67. Based on above analysis and considering all legal and factual issue raised by the Appellant, we are unable to accept any of his pleas and the appeal, therefore, deserves to be rejected. However, the Appellant shall have all the legal recourse and remedies as available in the law, if he choose to avail, to recover his money from the Respondent . We also note that IBC is meant for sustaining the Corporate Debtor to the extent possible and not to unnecessary send the Corporate Debtor into CIRP or liquidation.
# 68. In fine the Appeal fails and stand dismissed. No Costs. Interlocutory Application(s), if any, are Closed.
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