Sufficient cause must be shown for restoration of dismissed applications, and prior merits should not influence the restoration decision.

JUDGMENT

ASHOK BHUSHAN, J.

These two Appeal(s) have been filed by the Personal Guarantor of the Corporate Debtor, challenging the orders dated 01.05.2024 and 22.05.2024 passed by National Company Law Tribunal, Chandigarh Bench, Chandigarh. By order dated 01.05.2024, Application filed by the Appellant under Section 94 of the Insolvency and Bankruptcy Code, 2016 (hereinafter referred to as the “IBC”) has been dismissed for non prosecution and by order dated 22.05.2024, Restoration Application (IBC)/11(CH)/2024 filed to restore the Company Petition has been dismissed. Aggrieved by both the above orders, these two Appeal(s) have been filed.

2. Brief facts of the case necessary to be noticed for deciding the Appeal(s) are:

(i) An Application under Section 94 of the IBC being CP (IB)No.89/Chd/Pb/2024 was filed by the Appellant on 27.02.2024 and physical copy of the Application was filed on 28.02.2024. The Application was first listed on 17.04.2024, however the same was adjourned on account of members of the Bar abstaining and the matter was posted on 01.05.2024.

(ii) On 30.04.2024, at 08:00 PM, an email was sent by learned Counsel for the Appellant Shri Karan Gaba to the Registrar, requesting an adjournment due to personal difficulty. On 01.05.2024, the Application was called in the Court and since, no one appeared on behalf of the Applicant, the Application was dismissed for non-prosecution. On 01.05.2024, itself in the afternoon at 12:40 PM, learned Counsel for the Appellant appeared in the Court, by which time, the Application was already dismissed for non-prosecution. The Appellant was advised to file a Restoration Application. On 01.05.2024 itself, an Application for restoration was filed by the Counsel for the Appellant, where it was stated there being bereavement in the close family of the Counsel, the Counsel for the Appellant could not appear on 01.05.2024.

(iii) The Application was taken up on 08.05.2024 by the Adjudicating Authority, on which date, learned Counsel for the Appellant as well as learned Counsel for Union Bank of India (Financial Creditor) were present. The Financial Creditor appeared and prayed for time to file reply, the same was granted and the matter was adjourned to 30.05.2024.

(iv) The Union Bank of India has already initiated proceedings under Section 13 , sub-section (2) of the SARFAESI Act, 2002 and e-auction notices were issued for the secured assets and 24.05.2024 was the date fixed for physical possession. The Appellant filed an application for preponement of the scheduled hearing, which was adjourned to 30.05.2024. The Application was taken up by the Adjudicating Authority on 14.05.2024, on which date Union Bank of India was granted time to file its reply. On 20.05.2024, the matter was fixed at 12:30 PM. and after hearing the parties order was reserved. The order dated 22.05.2024 was passed rejecting the Restoration Application.

(v) Aggrieved by the order dated 22.05.2024, these Appeal(s) have been filed.

3. We have heard Shri Anand Chhibbar, learned Senior Counsel and Shri Abhijeet Sinha, learned Senior Counsel appearing for the Appellant; Shri PBA Srinivasan and Mr. Yash Pal Gupta, learned Counsel has appeared for the Union Bank of India.

4. The learned Senior Counsel appearing for the Appellant, challenging the order submits that on the date when Application was listed before the Adjudicating Authority on 01.05.2024, effectively was the first date of hearing and on which date Counsel for the Appellant Shri Karan Gaba, could not appear on account of bereavement in close family member, with regard to which he has sent an email on previous evening of 30.04.2024 at 08:00 PM. He submits that Restoration Application was filed on same day, when Counsel returned and went