The main legal point established in the judgment is the discretionary power of the Company Court to transfer winding up proceedings to the NCLT under Section 434(1)(c) of the Companies Act, 2013, and the recognition of the revocability of a winding up order. The judgment also emphasizes the overriding effect of the IBC over the Companies Act, 1956, and the need to explore options for resolution/revival of the company.

JUDGMENT :

Vipin Sanghi, J.

The instant appeal has been preferred in the name, and on behalf of the appellant company, by Mr. Naresh Kumar Aggarwal, who claims himself to be the Managing Director of the said appellant company, to assail the order dated 14.01.2019 passed by the Ld. Company Judge in Application - C.A. No. 1240/2018, in Co. Pet. No. 731/2016. By the impugned order, the Ld. Company Judge allowed the said Application preferred by respondent No.2 - SBI, and directed transfer of the Company Petition to the National Company Law Tribunal (NCLT). The Learned Company Judge revoked the order dated 27.08.2018 admitting the winding up petition and appointing the Official Liquidator as the provisional Liquidator.

2. Shyam Metalics & Energy Ltd., Respondent No.1, filed the aforesaid winding up petition under Sections 433(e) and 433(f) of the Companies Act, 1956 before the Ld. Company Judge, on the ground of appellant's inability to pay its debts. On 22.08.2016, notice of the winding up petition was duly served on the appellant. However, no representation was made in its behalf. The matter was adjourned to 7.11.2016. Thereafter, attempts were made to settle the issue before the Delhi High Court Mediation and Conciliation Centre. However, on 26.02.2018, the failure of mediation was reported to the Ld. Company Judge.

3. On 27.08.2018, the winding up petition was admitted and Official Liquidator (hereinafter "OL") was appointed in respect of the appellant company and he was directed to take over all the assets, books of accounts and records of the appellant company forthwith. The relevant extract of this Order reads as follows:

"5. In these circumstances, the petition is admitted and the Official Liquidator attached to this Court is appointed as the Liquidator. He is directed to take over all the assets, books of accounts and records of the respondent-company forthwith. The citations be published in the Delhi editions of the newspapers "Statesman" (English) and "Veer Arjun" (Hindi), as well as in the Delhi Gazette, at least 14 days prior to the next date of hearing. The cost of publication is to be borne by the petitioner who shall deposit a sum Rs.75,000/- with the Official Liquidator within 2 weeks, subject to any further amounts that may be called for by the liquidator for this purpose, if required. The Official Liquidator shall also endeavour to prepare a complete inventory of all the assets of the respondent-company when the same are taken over; and the premises in which they are kept shall be sealed by him. At the same time, he may also seek the assistance of a valuer to value all assets to facilitate the process of winding up. It will also be open to the Official Liquidator to seek police help in the discharge of his duties, if he considers it appropriate to do so. The Official Liquidator to take all further steps that may be necessary in this regard to protect the premises and assets of the respondent-company.

6. List on 09.01.2019." (emphasis supplied)

4. Thus, the Ld. Company Judge directed the O.L. to secure the assets/books of the appellant and to take a stock thereof. It also directed publication of the citation, to inform the creditors, contributories and all others concerned of their development. However, evidently because the winding up proceedings were still at an early stage, by the order dated 27.08.2018, the Ld. Company Judge did not direct liquidation of any of the assets of the appellant company.

5. During the pendency of the petition, but much before the passing of the winding up order on 27.08.2018, the Insolvency and Bankruptcy Code (hereinafter referred as IBC) was notified on 01.12.2016. Respondent No. 2 (SBI) - a secured creditor of the appellant company made an application under Section 7 of IBC before NCLT, seeking Corporate Insolvency Resolution Process (CIRP) vis-a-vis the appellant company.

6. While the winding up proceedings were still at the nascent stage - as taken note of hereinabove, respondent No. 2