Allowed

Bank of India v. M/S Sri Balaji Forest Products Pvt. Ltd. & Ors.

DRT4 Oct 2023MA/5/2023

Case brief

AI extract

What is this about?

Application for recalling an order dismissing an Original Application dismissed for non-prosecution due to absence of the Bank during the insolvency moratorium period. The Tribunal acknowledged the moratorium effects and pending Supreme Court challenge to IBC sections. The Bank sought restoration and set-aside of the dismissal order to align with the moratorium provisions and pending higher court

What did the court decide?

Original Application OA/101/2018 dismissed on 17/04/2023 set aside and restored with a direction to await orders from the Hon'ble Supreme Court and NCLT Kolkata.

Bank of India versus M/S Sri Balaji Forest Products Pvt… — Insolvency and Bankruptcy | DRT (2023)

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Order Sheet (continuation)

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Case No. MA/ IA /1010/202	5/2023 3 BANK OF INDIA Vs. M/S SRI BALAJI FOREST PRODUCTS	Office action wit
Date of the Order	Order with Signature	date and dated Signature of Parties when necessary
04/10/2023	Ld. Advocate Ms. Anindita Das appeared for the Misc Applicant. Ld. Advocate Ms. S. Mitra appeared for the Respondents. Heard the ld. Counsel for the parties on MA/5/2023 on 10/07/2023 with IA/1010/2023 for restoration of OA/101/2018 which was dismissed on 17/04/2023. Misc. Applicant has filed this MA for recalling the order dated 17/04/2023. The Applicant Bank has contended that this is high value matter. The Applicant Bank has filed this Section 19 Application for certificate of Rs. 1,17,21,60,628.61 against the OPs who are the Defendants in the OA. The erstwhile conducting Advocate was not present on 17/04/2023 for which this OA was dismissed for non-prosecution by order dated 17/04/2023. It is further contended by the Ld. Advocate for the Bank that during the proceedings one of the Creditor Bank i.e. State Bank of India initiated CIRP proceedings against one of the Defendants i.e., Ram Prakash Pandey who is Defendant no. 2 and there is order of moratorium by Hon’ble N.C.L.T., Kolkata Bench. Ld. Advocate for the Bank has filed order of the Hon’ble

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Rina S.

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NCLT, Kolkata Bench wherein the Hon’ble NCLT,Kolkata has referred to the decision of the Hon’ble Court in Writ Petition (Civil) No. 478/2022( Gaurav Garg vs. Union of India & ors.) alongwith similar other writ petition in which Hon’ble Supreme Court has recorded that issues involving in this Writ Petition questioning validity of Sections 95(1),96(1), 97(5),99(1), 99(2),99(4), 99(5),(99(6) and 100 of the IBC Code ,2016 and directed the petitioner not to transfer, alienate encumber or dispose of any of his assets or legal rights or beneficial interest therein; and the Resolution Professional shall not proceed with filing of the report. Hon’ble Supreme Court further directed the Respondents personal guarantor not to transfer, alienate encumber or dispose of any of his assets or legal rights or beneficial interest therein. The matter pertains to validity of Sections 95(1),96(1), 97(5),99(1), 99(2),99(4), 99(5),(99(6) and 100 of the IBC Code ,2016 which is pending before the Hon’ble Supreme Court. Ld. Advocate for the OPs filed their objection to the Application filed by the Applicant Bank and Applicant has filed supplementary affidavit enclosing the order of the Hon’ble N.C.L.T, Kolkata and Hon’ble Supreme Court. OPs filed order of the Hon’ble N.C.L.T, Kolkata wherein it is observed that proceedings has been

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Rina S.

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initiated by State Bank of India against Ram Prakash Pandey who is Defendant no. 2 in this OA in which Resolution Professional of the Corporate Debtor has been appointed by the Hon’ble N.C.L.T, Kolkata and there is an order of moratorium u/s 14 of the IBC. The matter was heard on 10/07/2023 and order has been reserved. The Applicant Bank has filed application to set aside the order within 30 days which has disputed by the OPs that there is CIRP proceedings against the Corporate Debtor i.e. Shri Ram Prakash Pandey who is Defendant no. 2, Shri Sree Prakash Pandey,Respondent No. 5 , Shri Murli Dhar Pandey Pandey, Respondent No. 7 and other Defendants and there is a moratorium. During the period of moratorium OA/101/2018 was dismissed for non prosecution due to non appearance of the Applicant Bank. Section 14 Sub Clause (1A) of the IBC 2016 speaks that during the period of moratorium no institution of suits or continuation of pending suits or proceedings against the corporate debtor including execution of any judgment, decree or order in any court of law, tribunal, arbitration panel or other authority shall proceed. But inspite of declaration of moratorium by the Hon’ble NCLT the OA/101/2018 was on Board for hearing on

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Rina S.

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17/04/2023 and on that date due to absence of the Applicant Bank, the OA was dismissed for non-prosecution. The order dated 17/04/2023 is against the moratorium passed by the Hon’ble NCLT,Kolkata. Hence, the said order is liable to be set aside. It is ordered as follows:

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1. MA/5/2023 is allowed on contest against respondents.

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2) Order dated 17/04/2023 passed by this Tribunal in OA/101/2018 is set aside.

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3) It is ordered that there shall be no continuation of proceedings in OA/101/2018 in view of the moratorium against the Defendants.

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4) It is also further recorded that the v alidity of Sections 95(1),96(1), 97(5),99(1), 99(2),99(4), 99(5),(99(6) and 100 of the IBC Code ,2016 is under consideration before the Hon’ble Supreme Court for which there shall not be further continuation of proceeding against even corporate guarantors in this case.

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5) OA/101/2018 be restored and list the matter on 24/11/2023 only for awaiting order of the H on’ble Supreme Court as well as order of the Hon’ble NCLT,Kolkata.

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Rina S.

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(Ambuja Mohan Das) Presiding Officer

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Rina S.

Bank of India v. M/S Sri Balaji Forest Products Pvt. Ltd. & Ors.

Case brief

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What did the court decide?

Bank of India v. M/S Sri Balaji Forest Products Pvt. Ltd. & Ors.

Case brief

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