ORDER

Per Coram

1. As the facts and question of law are common in both these applications, matter is heard together and common order is passed;

2. These Applications are filed under Section 65 and Section 60(5) of the IBC, 2016 by suspended board of directors of Koyenco Autos Private Limited, the Corporate Debtor under liquidation against the original Financial Creditor, BMW India Financial Services Private Limited and the liquidator of the Corporate Debtor seeking following reliefs: -

a. Pass appropriate order setting aside/recalling the order dated 06/10/2021 in CP (IB) No. 37 of 2020 freeing the Corporate Debtor from the rigors of CIRP b. Pass appropriate order declaring that CP (IB) No. 37 of 2020 has been initiated by Respondent No. 1 and/or Respondent No. 2 fraudulently and/or with malicious intent for purpose other than for the resolution of insolvency of the Corporate Debtor and further this Adjudicating Authority be pleased to pass appropriate order levying penalty as per Section 65 of the IB Code on the Respondent No. 1 and/or Respondent No. 2.

c. Pending admission, hearing, and final disposal of the present interlocutory Application, this Hon’ble Adjudicating Authority be pleased to:

(i)Pass order staying the CIRP proceedings and/or liquidation of the Corporate Debtor;

a. Direct the Respondent No. 1 Resolution Professional to accept the claim of the Financial Creditor BMW India Financial Services Limited at notional value of Rupee One being disputed claim in line with the judgment of the Hon’ble Supreme Court Essar Steel India Limited Through Authorized Signatory v. Satish Kumar Gupta and Other;”

The Brief facts of the case are as follows: -

IA (IBC)/187/KOB/2022 IN IBA/37/KOB/2020

3. The Koyenco Autos Private Limited, Corporate Debtor (hereinafter 06.10.2021 and is now under liquidation vide orders of this ‘CD’) was admitted into CIRP vide order of this Tribunal dated Tribunal. The section 65 application is filed on 07.07.2022 and section 60(5) application filed on 17.08.2022.

4. The applicant state that Platino Classic Motors(India) Private Limited, (R3/R3), another corporate debtor which is a group company of applicant promoters also under insolvency had a nonexclusive dealership right to sell BMW vehicles in Kerala as per Annexure A agreement dated 09.05.2008 which was renewed from time to time till end of 2018. It is stated that applicant through R3 performed the sale of vehicles exceptionally well and has won awards from BMW for best dealer in India. R3 initiated to expand its dealership through 2 new establishment in Trivandrum and Calicut from assurances from R2 and financial facility from R1. The establishment need to meet BMW specification and involved huge capital investment of 35 crore approx met by R3. It is stated that this investment needed atleast 7 years of business to recoup. R3 therefore entered into financial credit agreement with R1, i.e., Floorplan financing agreement dated 24.09.2010, Working capital credit facility agreement dated 30.11.2011, and spare part financing agreement dated 14.01.2015. It is stated that due to market condition and harsh internal policy of R2, the revenue deteriorated as evident from Annexure G produced.

5. It is stated that there was ‘territory’ specifically assigned as per sell or advertise vehicles/parts outside their territory. Any such dealership agreement and without R2’s consent no dealer could sale will be intrusion and their sale volume was to be reduced by such sale. It is stated that when sale reduced in Kerala in 2013-14, territory for an indirect tax advantage. It is stated that R3 informed R2 allowed outside territory dealers to do business in R3’s R2 of this infringement vide Annexure l emails decreased and no positive adjustment given to R3. and R3’s sale also

6. Applicant state that R3 has to keep BMW vehicles as display and demo cars and in stock as per dealership agreement. There was a deferred payment facility where R2 would defer payments for stock vehicles ta