The National Company Law Tribunal in the case Indian Bank (Erstwhile Allahabad Bank) v Nimitaya Hotel & Resorts Pvt.
Ltd, the New Delhi bench comprising of Judicial Member, Shri Bachu Venkat Balaram Das and the Technical Member, Shri L.N. Gupta observed while adjudicating an application filed and has imposed a cost of Rs. 1 Lakh upon the Suspended Director of Corporate Debtor i.e., the applicant for instituting multiple proceedings seeking same reliefs and wasting of precious judicial time.
Background of the Case:
The Financial Creditor, Indian Bank (Erstwhile Allahabad Bank) had filled a plea under Section 7 of the Insolvency and Bankruptcy Act, 2016, wherein seeking initiation of Corporate Insolvency Resolution Process against the Corporate Debtor, Nimitaya Hotel & Resorts Pvt. Ltd. A CIRP has been initiated against the Corporate Debtor on December 24, 2021 by the Adjudicating Authority.
The Applicant/ Suspended Director, Mr. Sanjeev Mahajan who being a suspended director of Corporate Debtor, had submitted that the Settlement Proposal and was permitted to participate in the Committee of Creditors meetings, further, it has been alleged by the Suspended Director that the Plea has been filed of by the Financial Creditor over malicious intent.
An application filed by the Suspending Director before the Adjudicating Authority under Section 65 of IBC, wherein seeking, Firstly, the Imposition of cost on the Financial Creditor for an amount of Rs. 1 Crore. Secondly, the Direction to the CoC to re-consider the settlement proposal of the Applicant and Thirdly, Direction given to the CoC and the Resolution Professional of Corporate Debtor to keep the CIRP and finalization of Resolution Plan in abeyance till the application is disposed off.
A Similar application was filed by the Suspended Director with verbatim prayers. The application was dismissed by the Adjudicating Authority, the court observed that the Tribunal would not intervene in the decision making of the CoC.
NCLT Decision
The bench observed that that the said application is preferred during the pendency of I.A. No. 2611 of 2022, wherein seeking verbatim reliefs.
It has been held by the bench that same reliefs cannot be sought in two parallel Applications against that of the same party.
However, the bench barred the application by the doctrine of Res Sub-Judice. Since, the applications have resulted in multiplicity of proceedings and in the wastage of precious judicial time, such practices are discouraged by this court.
Accordingly, the court dismissed the application with a cost of Rs. 1,00,000/- (one lakh) only to be deposited by the Applicant within 15 days herein in the Prime Minister’s Relief Fund, the receipt of which shall be filed with the NCLT
Registry.
Further, the bench imposed a cost of Rs. 1 Lakh upon the Applicant for instituting multiple proceedings wherin seeking same relief and the same amounts to wasting of precious judicial time. The bench dismissed the application.
The post NCLT Delhi: Imposed Cost Of Rs. 1 Lakh On Suspended Director appeared first on The Daily Guardian.
