NCLAT rejects Interlocutory Application by a fresh applicant on the ground of non-maintainability

A Division Bench of the Hon’ble National Company Law Appellate Tribunal, New Delhi comprising Justice Anant Bijay Singh, Member (Judicial) and Ms. Shreesha Merla, Member (Technical) dismissed an Interlocutory Application seeking to get the possession of the land in question, on the grounds of non-maintainability. A brief background of this case, the issues involved and the order pronounced by the National Company Law Appellate Tribunal (NCLAT) have been discussed below. [REED 2021 NCLAT Del 06519]

Background

The present dispute arose when the Company Appeal (AT) (Insolvency) No. 1496 of 2019 was initially filed by Mr. Durga Prasad Agarwal (Corporate Debtor). However, a few months later he expired and the case was preferred by his legal heirs through I.A. no 2910 of 2020 after intimating the tribunal and with no objection from the respondents.

On 3 March 2021 the NCLAT, New Delhi passed a judgment whereby it set aside the impugned order dated 21 November 2019 passed by NCLT, Kolkata and dismissed the appeal under section 7 filed by the Limtex Tea and Industries Ltd. (Financial Creditor). The Corporate debtor was released from all the rigours of CIRP and the actions taken by the Interim Resolution Professional (IRP), Resolution Professional (RP) and Committee of Creditors (CoC) were declared void, and the RP/IRP was directed to hand over the assets of the corporate debtor to its directors immediately. The matter was remitted back to the adjudicating authority to decide the fees payable to the IRP/RP, to be borne by the financial creditor.

Analysis

The instant I.A. No. 966 of 2021 has been filed by applicant State Bank of India under rule 11 read with rule 31 of the NCLAT Rules, 2016. Rule 11 provides the appellate tribunal with the powers to make such orders or give directions as may be necessary to meet the ends of justice and prevent the abuse of the process of appellate tribunal. Whereas rule 31 provides the provisions regarding the interlocutory application. The applicant prays the appellate tribunal to hold that the land in question is not covered in the directions given in the judgment dated 3 March 2021. The applicant also prayed for a direction ordering Resolution Professional to hand over the possession to the applicant bank and maintain the status quo with regard to property mentioned in paragraph 2 till the disposal of the present application.

Conclusion

From the perusal of the record and the judgment delivered by the Tribunal, the Appellate Authority clarified that the appellants were neither a party in the application before NCLT, Kolkata and neither did they file intervention application before NCLT, Kolkata nor this tribunal (NCLAT, Delhi). However, for the first time, they have come before the tribunal through an interlocutory application which cannot be permitted. Accordingly, in view of the foregoing reasons, the I.A. No. 966 of 2021 under rule 11 and was dismissed on the grounds of non-maintainability.