Point of Law: Legal position emanating from decisions leaves no room for doubt that adjudicating authority is vested with discretion and is legally bound to consider all relevant aspects, including the financial health and viability of the corporate debtor, while taking a decision on the application filed by financial creditor.

JUDGMENT :

V.G. ARUN, J.

1. The petitioner Company is conducting an Agricultural Theme Park in Ayamkudi in Kottayam District. For the purpose of its business, the company had availed loans from the 9th respondent. Thus, an amount of Rs. 4 Crores was taken as loan in the year 2015, Rs. 8 Crores in 2016 and Rs. 2 Crores in 2017. From the sanctioned amount, the 9th respondent adjusted Rs. 4 Crores towards interest. During the initial period, the loans were repaid on a regular basis, but with the spread of Covid-19 pandemic, resultant lockdown and related issues, the business suffered huge setback and it became impossible for the Company to remit the instalments on time. Without heeding to the Company’s request for granting time to augment its business, the 9th respondent initiated SARFAESI proceedings and took symbolic possession of the immovable property given as security for the loans. Petitioner challenged the proceedings before the Debts Recovery Tribunal by filing Securitisation Application No. 174 of 2019 and the DRT granted a stay on 21.05.2019, subject to remittance of a portion of the amount. While so, the 9th respondent filed Ext.P7 application before the National Company Law Tribunal under Section 7 of the Insolvency and Bankruptcy Code, 2016 [IBC] r/w Rule 4 of the Insolvency and Bankruptcy (Application to Adjudicating Authority) Rules, 2016. This writ petition is filed seeking a declaration that Section 7 of the IBC and the Form appended thereto are unconstitutional. The challenge is on the premise that no power is conferred on the ‘adjudicating authority’ to adjudicate on any issues on the filing of an application Under section 7 by a financial creditor, and the adjudicating authority is under statutory compulsion to appoint a Resolution Professional. While admitting the writ petition, this Court granted an interim order staying all further proceedings pursuant to Ext.P7.

2. Advocate Jolly John, learned Counsel appearing for the 9th respondent, urged that the question of maintainability of the writ petition should be heard immediately since the interim order is causing extreme prejudice to his client. It is contended that, as per order dated 25.01.2018 in SLP (C) No. 1740 of 2018 [Shivam Water Treaters Pvt. Ltd. vs. Union of India Others] 2018 SCC Online SC 3708, the Honourable Supreme Court has requested the High Courts not to enter into the debate pertaining to the validity of the Insolvency and Bankruptcy Code, 2016 or the Constitutional validity of the National Company Law Tribunal. Further, all issues mooted in the writ petition are settled by the decisions of the Apex Court in Swiss Ribbons (P) Ltd. vs. Union of India, (2019) 4 SCC 17.

3. Advocate George Poonthottam, learned Senior Counsel appearing for the petitioner, put forth the following contentions:

The very objective of IBC is to ensure revival and continuation of the corporate debtor. The petitioner Company is the world’s first agricultural theme park spread across 30 Acres of land. The park has more than 4800 species of plants including 700 species of trees, 900 species of flowering plants, 1900 species of medicinal and aromatic plants and 180 varieties of vegetables. Trees and plants associated with Christian and Hindu religious beliefs are showcased in the biodiversity park developed over a period of 20 years. There is a bird sanctuary with different species of local and migratory birds. The park also has an animal husbandry wing with cows, goats, rabbits and ducks. The biodiversity park has acquired international standards due to the untiring efforts of the Managing Director and his love for nature. Each plant and tree was grown over the years under his personal care and attention. After extensive pilgrimages through the whole of South India, an exact replica of the traditional serpent grove (sarpakkavu) has been developed in the park. Therefore, unlike other companies, the petitioner company cannot survive if its conduct is entrusted to strangers. Unfo