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2025 Supreme(Online)(NCLT) 4778
NATIONAL COMPANY LAW TRIBUNAL
Shri Prabhat Kumar Sushil Mahadeorao Kochey, Hon’ble Member (Technical), Hon’ble Member (Judicial),
Mr. Pulkit Gupta, Resolution Professional of Sharon Bio-Medicine Limited – Appellant
Versus
Ms. Savita Satish Gowda Managing Director, Sharon Bio-Medicine Limited – Respondent
C.P.(IB) No. 246/MB/2017 | CP (IB) 246 OF 2017
For the Appellants/Petitioners: Adv. Rohan Agarwal a/w Adv. Anush Mathka, Adv. Ananya Bajpai and Adv. Deevanshu Jaswani
For the Respondents: Adv. Prashansa Agarwal (R1 to R3), Adv. Rohit Gupta a/w Adv. P.V. Narendran (R4 to R6 and R9)
The court emphasized that transactions without consideration can be declared void under Section 66 of the Insolvency Code, holding directors liable for failing to protect creditors' interests.
Headnote:(A) Insolvency & Bankruptcy Code, 2016 - Section 66 - Corporate Debtor's fraudulent transactions - Interlocutory application filed seeking declaration of transactions as fraudulent and to reverse them - Tribunal found that transfer of parking rights from Corporate Debtor to another company was done with fraudulent intent to keep assets from creditors - The application was also contested on grounds of delay and lack of standing - Tribunal emphasized that any contracts or transfer lacking consideration are voidable under Section 66 - The corporate debtor's management was held liable - Original allocation of parking spaces reaffirmed with direction for restoration. (Paras 1-43)
(B) Corporate Management - Responsibilities of directors concerning company assets - Directors must act in the interest of creditors, and failure to ensure assets remain with the debtor can result in personal liability. (Paras 15, 41)
Facts of the case:
The application involves the Resolution Professional alleging that certain transactions involved the misappropriation of parking spaces belonging to the Corporate Debtor, which were transferred to another related company without proper consideration to defraud creditors.
Findings of Court:
The court found the transactions to have been conducted to defraud the Corporate Debtor's creditors and ordered restoration of the parking spaces to the Corporate Debtor while also holding directors liable for their actions during these transactions.
Issues: The primary issues include whether the transactions were fraudulent as defined under Section 66, the extent of delay in filing the application, and the role of directors in managing the corporate debtor’s assets.
Ratio Decidendi: The court determined that fraudulent transactions, regardless of subsequent claims of proper conduct, violate the mandates set forth in the Insolvency Code, establishing that directors could be held liable for allowing fraudulent transactions to occur at the expense of creditors.
Result: The application was partly allowed, with the court directing restoration of parking spaces to the Corporate Debtor and imposing liabilities on the involved directors.
| Table of Content |
|---|
| 1. interlocutory application initiation and relevant parties. (Para 1 , 2 , 3) |
| 2. details of agreements and parking space allotments. (Para 4 , 5 , 6) |
| 3. allegations of fraudulent transactions and defenses raised. (Para 8 , 9) |
| 4. contentions against the application based on delay and procedural grounds. (Para 10 , 11 , 12) |
| 5. legal relationships between parties and fraudulent intent considerations. (Para 13 , 20) |
| 6. application of law in context of fraudulent trading. (Para 14 , 33) |
| 7. description of court's interpretation of relevant legal provisions. (Para 15 , 34) |
| 8. analysis of evidence and application of burden of proof. (Para 16 , 19) |
| 9. court's authority in resolving fraudulent trading situations. (Para 41 , 42) |
ORDER
1. This Interlocutory Application IA 4033 of 2023 in C.P. (IB) 246 of 2017 has been filed on 25.8.2023 by Mr. Pulkit Gupta, Resolution Professional of Sharon BioMedicine Limited (“Corporate Debtor”) in the Corporate Insolvency Resolution Process of Corporate Debtor in terms of Section 66 of Insolvency & Bankruptcy Code, 2016 (“Code”) seeking following relief :
i. Declare that the transactions undertaken by Enki Life Science Ltd. (formerly known as Sharon Bio Tech Limited) in collusion with Respondent Nos. 1- 3 (common directors of the Corporate Debtor and Enki Life Science Ltd.) in relation to Satra Plaza and the said parking premises as set out in the application have been carried out with fraudulent intent, as provided in Section 66 of IBC, and be reversed;
ii. The alleged letter dated February 7, 2012 purportedly issued by the Developer in favour of Sharon Bio-Tech Limited and as set out in the Application be set aside;
iii. The erstwhile management of the Corporate Debtor be directed to produce the original Allotment Letters dated January 31, 2012 issued by the Developer to the Corporate Debtor qua the said parking premises;
iv. The Management Committee, Satra Plaza Co- operative Society Ltd. be directed to hand over the parking sticker and parking premises allotted to the Corporate Debtor; and
v. Pending the hearing of the present Application, this Hon'ble Tribunal be pleased to restrain the Respondent Nos. 1-8 from alienation and/or disposing off the parking premise bearing Nos. 157- 176 at Satra Plaza.
vi. direct Enki Life Science Limited to handover the possession of parking spaces to the Corporate Debtor;
vii. in the event prayer ‘f’ is granted, direct Respondent No. 7 to take all steps necessary to give effect to the allotment vide allotment letter dated January 31, 2012 issued to the Corporate Debtor.
2. This Tribunal admitted the captioned an application filed u/s 7 of the Code commencing CIRP in case of Corporate Debtor. In the CIRP process, the Resolution Plan submitted by Peter Beck and Peter Vermoegensverwaltung Ltd. (“Peter Beck”) was approved by this Tribunal vide order dated 28.2.2018, however, the said Resolution Plan could not be implemented within the specified timelines and the CIRP was re-initiated in terms of an order dated 3.6.2022 passed by this Tribunal pursuant to an Order dated 28.2.2022 passed by Hon’ble Supreme Court granting a liberty to do so in an appeal before it. Thereafter, in the fresh CIRP, this Tribunal approved the resolution plan submitted by Innova Captab Limited (“Resolution Plan”) vide order dated 17.5.2023. The Schedule 2, Clause 11 of the said approved Plan provides that “in the event any transaction is avoided / set aside by the NCLT in terms of Sections 43, 45, 47, 49, 50 or 66 of the IBC and any amount is received by the Resolution Professional in furtherance thereof, such sums shall be for the benefit of the Secured Assenting Financial Creditors and shall be a passthrough amount to the Secured Assenting Financial Creditors”. Consequently, the State bank of India, one of secured assenting financial creditor, was brought on record as Applicant in place of original applicant Resolution Professional.
3. Respondent No. 1 to 3 i.e. Ms. Savita Satish Gowda, Mr.
