Mr. Surender Modi Suspended Director of J.R. Modi Associates Ltd. Vs. Kaliber Associates Private Ltd. - (NATIONAL COMPANY LAW APPELLATE TRIBUNAL) (27 May 2022)

Equal chance should be given to the parties to contest the litigation before the Court

MANU/NL/0364/2022

Insolvency

The precise grievance of the Appellant (Corporate Debtor) is that, they had filed their Reply on 12th August, 2021 within the time provided by the Tribunal with an advance copy to the Appellant and also paid the cost but some how the Reply was not attached with the main file.

The issue involved in this case, is as to whether, the Appellant (Corporate Debtor) contesting the application filed under Section 7 of the Insolvency and Bankruptcy Code, 2016 (IBC) should be given one more opportunity to present its case before the Tribunal after setting aside ex-parte proceedings?

It is well known that, the proceedings under Section 7 of the IBC has serious repercussions and it is also well known that equal chance should be given to the parties to contest the litigation before the Court. The Appellant herein had actually filed the Reply and paid the cost to the Respondent herein who had accepted the same. But the said Reply could not be made part of the paper book. It is also noted that the Appellant could not appear before the Tribunal on the adjourned date and the Tribunal recorded that the Reply was not filed or uploaded, therefore, the Appellant herein was proceeded against ex-parte and the order was reserved. As soon as, it came to the notice of the Appellant that the order has been reserved, an application was moved seeking a direction to set aside the ex-parte proceedings but unfortunately again they could not appear on 21st February, 2022 and the application was dismissed for want of prosecution.

However, the fact of the matter is that the said order was duly complied with by the Appellant by filing their reply in the Registry of the Tribunal and paying the cost, determined by the Tribunal, to the Respondent, which was admittedly received. It is apparent from the order that, the receipt of the cost has not been brought to the notice of Tribunal otherwise, the Tribunal would have presumed that if the cost is paid then the Reply must have been filed.

In present circumstances, the order is not in accordance with the factual position available on record and therefore, the same deserves to be set aside. Once the order is set aside by which the Appellant was proceeded against ex- parte, the order also deserves to be set aside.

The matter is remanded back to the Adjudicating Authority, NCLT, New Delhi to decide case afresh taking into consideration the Reply filed by the Appellant on 12th August, 2021 and decide the matter as expeditiously as possible. Appeals allowed.

Tags : EX-PARTE PROCEEDINGS REPLY FILING OF