The Supreme Court enforced the consent terms, revoked the insolvency orders, and revived the corporate debtor.
The Supreme Court Full Bench, consisting of Justice Sanjiv Khanna, Justice Sanjay Karol, and Justice Sanjay Kumar, exercised its power under Article 142 of the Constitution to accept the consent terms between the parties, thereby revoking the liquidation and Corporate Insolvency Resolution Process orders, reviving the corporate debtor, and allowing for the protection of claims through potential legal actions, while binding the parties to the consent terms.
In the matter of I.A. No. 143116/2024 for impleadment, the Supreme Court granted the application, allowing the intervention. I.A. No. 143115/2024 had been filed by Amit Ahirrao, who was the erstwhile director of the corporate debtor, M/s. Virtue Infra and Entertainment Private Limited. This application contained the consent terms agreed upon between Amit Ahirrao and respondent No.2, Sakharam Tambolkar, a financial creditor who had initiated the proceedings under the Insolvency and Bankruptcy Code, 2016 (IBC). Sakharam Tambolkar was also the former father-in-law of Amit Ahirrao. The consent terms were also endorsed by Maithilee Tambolkar, the appellant’s ex-wife and a financial creditor, as well as by Sanjeev Autoparts Mfrs. Pvt. Ltd., an operational creditor.
M/s. A.M. Patel Infrastructure Pvt. Ltd. filed an application for intervention/impleadment and objections to the consent terms. It was acknowledged at the Bar that M/s. A.M. Patel Infrastructure Pvt. Ltd. claimed to be an operational creditor, although its claim had not been accepted by the liquidator and was pending adjudication. Additionally, an application under Section 66 of the IBC for the avoidance of transactions had been filed, which was also pending adjudication.
Given the consent terms, the Court decided to exercise its powers under Article 142 of the Constitution of India and took the consent terms on record. Consequently, the order of liquidation and the order initiating the Corporate Insolvency Resolution Process were deemed withdrawn and recalled. M/s. Virtue Infra and Entertainment Private Limited was thus revived, and the proceedings before the National Company Law Tribunal were considered disposed of.
To protect the claim of M/s. A.M. Patel Infrastructure Pvt. Ltd., the Court permitted it to initiate proceedings as per the law, including under the IBC, after issuing appropriate notice. The Court made it clear that it had not adjudicated any disputes between M/s. A.M. Patel Infrastructure Pvt. Ltd. and M/s. Virtue Infra and Entertainment Private Limited. All parties were to be bound by the consent terms, and in case of any violation, the parties could seek the Court’s intervention for recall of the order. The appeal was thus disposed of, and any pending applications, including those seeking intervention, were also disposed of.
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