ORDER

Per- Coram

1. It is an application filed by Anuj Bajpai, RP of Topworth Tollways (Ujjain) Private Limited under section 66 read with section 25(j) of the Insolvency and Bankruptcy Code, 2016 against Surendra Lodha, Suspended Director of Corporate Debtor and Shree Balaji Tradelinks, Partnership Firm for seeking following reliefs:

i.) Direct the Respondent no. 2 to make such contributions to the account of the Corporate debtor aggregating to sum of Rs. 1.78 Crores as stated in this Application with regard to the financial benefit fraudulently derived by the Respondent no. 2 which falls within the ambit of provisions of section 66 of the Code;

ii.) Pass appropriate directions/orders in terms of Section 67, of the code including for recovery/restoration of legitimate amounts due to the Corporate Debtor;

iii.) Issue orders that recovery, if any, made pursuant to this Application, shall form part of the liquidation estate as per section 36 of the Code and shall be exclusive right of the CoC/stakeholders of the Corporate Debtor.

iv.) Impose such fine under section 71, 72 and 73 of the Code upon the Respondent No 2 as this Hon’ble Tribunal may deem fit.

Facts of the IA

2. On perusal of the Application, it reveals that during the course of CIRP, transaction auditor viz. BDO India LLP was appointed to undertake the transaction audit of the books of the Corporate debtor for the period from 10.10.2018 to 09.10.2020. The Transaction Auditors filed their Forensic Audit Report in July 2021. Considering the findings of the Transaction Audit Report, the Applicant submits that the transactions so identified are covered under the provisions of section 66 of the Code. The Applicant submits that there are certain transactions which have been entered into with a clear intent to defraud the creditors and to siphon off the money from the Corporate Debtor.

The Applicant submits that based on the financial records and information available with him it is clear that the Respondent No 2 has managed to siphon off an amount of Rs. 75 Lakhs from the Corporate Debtor which was against the interests of the stakeholders of the Corporate Debtor and such transactions squarely fall under the provisions of section 66 of the Code. The Applicant submits that a tripartite agreement was signed between Corporate debtor (Party A), Rajmal Goercha and Sons (Party B) and Shri Balaji Tradelinks/Respondent no.2 (Party C) on 08.10.2019. The relevant contents of the said Tripartite Agreement is provided hereunder:

Party A confirms that it will pay an amount to the extent of Rs. 75,00,000/- to party C on behalf of Party B against the work order no. TTUPL/18-19/005 dated 27.03.2019.

Based on discussions and mutual consent of Party A, Party B and party C, all parties to this agreement confirm the following:

A sum to the extent of Rs. 75,00,000/- will be paid by Party A to party C on behalf of Party B, all parties to pass necessary accounting entries in their books of accounts based on this confirmation letter.

The Applicant submits that this is a clear case of fraudulent transaction where the document itself states that the dues of Respondent no. 2 was towards another partnership firm (Party B in the said Triparty Agreement- Rajmal Gorecha & sons) where Respondent no. 1 is also a partner while the amounts have been withdrawn from the Corporate Debtor which itself have been declared as NPA and was under financial turmoil and struggling to service its own debt. The Applicant also submits that overall Respondent no. 2 has received an amount of Rs. 1.78 Crores (including Rs. 75 Lakhs). There are no business Transactions between the Corporate Debtor and Respondent no. 2 nor any justifications for making such exorbitant payments to Respondent no. 2. Under such circumstances, the Applicant has filed the present application for seeking appropriate orders against the Respondents.

Reply filed by the Respondents

3. In response to this, the Respondents have filed a detail separate reply and have subm