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SUPREME COURT OF INDIA
UDAY UMESH LALIT, K.M. JOSEPH, JJ.
SANDEEP KHAITAN, RESOLUTION PROFESSIONAL FOR NATIONAL PLYWOOD INDUSTRIES LTD. - APPELLANT
VERSUS
JSVM PLYWOOD INDUSTRIES LTD. & ANR. - RESPONDENT
CRIMINAL APPEAL NO.447 OF 2021 (Arising out of SLP (CRL.) No. 1549 of 2021)
Decided on : 22-04-2021
Insolvency and Bankruptcy Code, 2016 – Sections 14 and 17 – Criminal Procedure Code, 1973 – Section 482 – Illegal transactions – Appellant was appointed as Interim Resolution Professional – With declaration of moratorium prohibitions as enacted in Section 14 came into force – Assets of company would include amounts lying to credit in bank accounts – Well after order under Section 14 was passed, a sum of Rs. 32.50 lakhs has been remitted into account of Respondent No.1 company – Provisions of IBC contemplate resolution of insolvency if possible, in first instance and should it not be possible, winding up of Corporate Debtor – Role of insolvency professional is neatly carved out – Power under Section 482 may not be available to Court to countenance breach of a statuary provision – Having regard to orders passed by NCLT admitting application, under Section 7, and also ordering of moratorium under Section 14 of IBC and orders which have been passed by Tribunal otherwise, impugned order of High Court resulting in Respondent No. 1 being allowed to operate account without making good amount of Rs 32.50 lakhs to be placed in account of Corporate Debtor cannot be sustained – Respondent No.1 allowed to operate its account subject to it to first remitting into account of Corporate Debtor, amount of Rs 32.50 lakhs which stood paid to it by management of Corporate Debtor – Assets of Corporate Debtor shall be managed strictly in terms of provisions of IBC – Appellant as RP will bear in mind provision of Section 14 (2A) and object of IBC – This Order shall not be taken as pronouncement on issues arising from FIR including petition pending under Section 482 of Cr.P.C. – Judgment will not stand in way of Respondent No.1 pursuing its claim with regard to its entitlement to a sum of Rs.32.50 lakhs and any other sum from Corporate Debtor or any other person in appropriate forum and in accordance with law. (Paras 16, 18, 24 and 25)
Facts of the case:
Present appeal is directed against order dated 04.02.2021 passed by High Court of Guwahati. In the impugned order, the High Court has allowed an interlocutory application filed by the Respondent No. 1 to allow it to operate its bank account maintained with ICICI Bank Bhubaneswar and to unfreeze the bank account of its creditors over which the lien has been created and the accounts frozen pursuant to the lodging of an FIR by the appellant before us. It was made subject to conditions. Genesis of the impugned order is FIR lodged against Appellant and arose from the payment effected into the account of Respondent No.1 in a sum of Rs. 32.50 lakhs.
Findings of Court:
High Court appears to have, in passing the impugned order, which is an interim order for that matter, overlooked the salutary limits on its power under Section 482. The power under Section 482 may not be available to the Court to countenance the breach of a statuary provision. The words ‘to secure the ends of justice’ in Section 482 cannot mean to overlook the undermining of a statutory dictate, which in this case is the provisions of Section 14, and Section 17 of the IBC.
Result : Appeal allowed.
JUDGMENT :
K.M. JOSEPH, J.
Leave granted.
1. The appeal is directed against order dated 04.02.2021 passed by the Hon’ble High Court of Guwahati. In the impugned order, the High Court has allowed an interlocutory application filed by the Respondent No. 1 to allow it to operate its bank account maintained with the ICICI Bank Bhubaneswar and to unfreeze the bank account of its creditors over which the lien has been created and the accounts frozen pursuant to the lodging of an FIR by the appellant before us. It was made subject to conditions.
2. An application under Section 7 of the Insolvency and Bankruptcy Code, 2016, hereinafter referred to as the IBC was admitted on 26.08.2019 against one National Plywood Industries Limited (NPIL). The Appellant was appointed as the Interim Resolution Professional. A moratorium also came to be passed by the very same order within the meaning of Section 14 of the IBC. The Appellant came to be appointed as the Resolution Professional by an order dated 08.11.2019. In the meantime, the Respondent No.1 claiming to be an operational creditor lay the claim for the amounts due to it from the Corporate Debtor before the Appellant vide communication dated 22.11.2019. It would appear that the former Managing Director of the Corporate Debtor challenged the order of the NCLT, Guwahati, admitting the application under Section 7. The NCLAT by order dated 24.11.2019 dismissed the appeal interalia holding that the application under Section 7 was not barred by limitation. Civil Appeal No. 9142 of 2019 filed by the former Managing Director of the Corporate Debtor came to be however allowed by this Court by an order dated 20.01.2020. The NCLT was directed to consider the matter in accordance with law. It would appear that on 28.01.2020 interlocutory application 7 of 2020 filed by the former Managing Director of the Corporate Debtor seeking an injunction restraining the Respondents therein from interfering in the operation of the Corporate Debtor and to disperse the cost of the CIRP was disposed of interalia as follows: -
ii. In view of the above submissions of the respondents, this Tribunal expects that the respondents would maintain status-quo in respect of the IRP proceedings. As the main company petition was remanded back to the Hon’ble NCLAT for fresh disposal in accordance with law, this Tribunal is of the considered opinion that the petitioner has to approach the Hon’ble NCLAT for any further directions in the above matter and accordingly above application stands disposed of with the above observations. Even otherwise, the order of admission of the company petition has not attained finality and, therefore, no interim orders as prayed for needs to be passed today.
iii. In the result, IA No. 07 of 2020 is disposed of with the above observations.”
Thereafter there is order dated 20.03.2020 passed which we will advert to.
3. It is the case of the Appellant that the former Managing Director of the Corporate Debtor in conspiracy with the Respondent No.1 engaged in an illegal transaction to the tune of Rs. 32.50 lakhs without authority from the Appellant and in violation of Section 14 of the IBC. It is his complaint that initially, the Managing Director made a transaction of Rs. 500. Thereafter, he proceeded by virtue of 4 consecutive transactions to transfer a sum of Rs. 32.50 lakhs to the Respondent No. 1. It is also complaint of the Appellant that the former Managing Director proceeded to transfer another sum of Rs. 3.29 lakhs from another account and the amount was transferred to his close associate.
4. On 23.04.2020, the Appellant filed a cyber complaint. This was followed on the same date by filing an app
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