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2026 Supreme(Online)(NCLT) 389
NATIONAL COMPANY LAW TRIBUNAL
Umesh Kumar Shukla, Technical Member, Kishore Vemulapalli, Judicial Member
Srinivas Rao Gudla – Appellant
Versus
Akkineni Satish – Respondent
IA(IBC)/124/2025 in IA(IBC)/325/2024 in CP(IB)/21/9/AMR/2020|IA(IBC)/325/2024|IA(IBC)/344/2022
For the Appellants/Petitioners: Shaik Gouse, Srinivasa Rao Gudla
For the Respondents: Sarvani Desiraju, Shreya Singhal
Preferential transfers to related parties proven for antecedent debts upheld under Section 43 with restitution orders; unauthorised diversions to sister entities by principal contractor held fraudulent under Section 66, imposing personal contributions to liquidation estate.
Headnote:(A) Insolvency and Bankruptcy Code, 2016 - Sections 43, 44, 66 - Preferential transactions - Liquidator's application under Sections 43 and 66 - Transfers to related parties within two years preceding insolvency commencement date examined using structured framework from Supreme Court judgment - Transaction to father of designated partner (Rs.15 lakhs) held preferential but no order passed as not impleaded; transfer to designated partner (Rs.51 lakhs) as loan repayment held preferential, ordered restitution; transfer to sister LLP (Rs.15 lakhs) not preferential due to lack of proof of antecedent debt. (Paras 15-25)
(B) Insolvency and Bankruptcy Code, 2016 - Section 66 - Fraudulent trading - Diversion of Rs.5.48 crore payable to corporate debtor by principal contractor to sister LLP (Rs.5.28 crore) and designated partner (Rs.20 lakhs) at instructions of suspended partners, post sub-contract execution and despite termination notice, without authorisation in cooperation agreement - Held carried with intent to defraud creditors; related parties directed to contribute amounts jointly and severally to liquidation estate. (Paras 26-35)
Facts of the case:
Corporate debtor under liquidation; liquidator filed interlocutory application alleging preferential transfers totalling Rs.81 lakhs under Section 43 and fraudulent diversion of Rs.5.48 crore under Section 66 by suspended designated partners, sister LLP, and principal contractor (under CIRP). Transactions identified via audit for period two years prior to insolvency commencement; notices issued, counters filed by some respondents denying intent, limitation, and maintainability; non-respondents proceeded ex-parte after substituted service and bailable warrants.
Findings of Court:
Preferential transactions partly upheld against one designated partner (Rs.51 lakhs); Rs.15 lakhs to father preferential but no relief; Rs.15 lakhs to sister LLP not preferential. Fraudulent transactions under Section 66 upheld; designated partners and sister LLP directed to contribute Rs.5.48 crore total to liquidation estate within 30 days; liquidator to recover with coercive measures.
Issues: Whether specified transfers qualify as preferential under Section 43(2) and (4); whether diversions by principal contractor to related parties constitute fraudulent trading under Section 66(1) with intent to defraud creditors.
Ratio Decidendi: Preferential transaction requires transfer of property for antecedent debt benefiting related party within relevant time, putting recipient in superior position to Section 53 distribution, not in ordinary course (applying six-step RP analysis); Section 66(1) applies to knowing participation in business with intent to defraud creditors, inferred from unauthorised diversions to related parties post-contract issues and non-response.
Result: IA partly allowed.
| Table of Content |
|---|
| 1. fraudulent diversions to r-6 llp totaling rs.5.48 crores. (Para 2) |
| 2. respondents deny preferential/fraudulent transactions. (Para 5 , 6 , 7) |
| 3. r-7 denies liability as third-party under cirp. (Para 8) |
| 4. framework for section 43 preferential transactions. (Para 16 , 17 , 18 , 19) |
| 5. rs.15 lakhs to r-4's father is preferential. (Para 22) |
| 6. rs.51 lakhs to r-5 is preferential; repayment ordered. (Para 23 , 24) |
| 7. rs.15 lakhs to r-6 llp not preferential. (Para 25) |
| 8. section 66 requires intent to defraud creditors. (Para 27 , 28) |
| 9. diversion to r-6 llp fraudulent under section 66. (Para 30 , 31 , 32) |
| 10. contributions ordered from r-1, r-2, r-5, r-6. (Para 33 , 34 , 35 , 36 , 37) |
HON’BLE SHRI UMESH KUMAR SHUKLA, MEMBER (TECHNICAL)
PRESENT:
For the Applicant : Mr. Shaik Gouse, PCS along with Mr. Srinivas Rao Gudla (Liquidator in person)
For Respondent No. 7 : Ms. Sarvani Desiraju and Ms. Shreya Singhal, Advocates [ORDER]
[PER: BENCH]
This Interlocutory Application bearing no. IA(IBC)/124/2025 (hereinafter referred to as the “IA 124/2025”) has been filed, vide Diary No.759 dated 25.04.2025, by Mr. Srinivas Rao Gudla, the Liquidator of AGRS Projects LLP (hereinafter referred to as the “Applicant” or “Liquidator”), under Sections 43, 66, 69, 60(5) and 236 of the Insolvency and Bankruptcy Code, 2016 (hereinafter referred to as the “IBC” or “Code”) read with Rule 11 of the National Company Law Tribunal Rules, 2016 (hereinafter referred to as the “NCLT Rules”) against Akkineni Satish (hereinafter referred to as the “Respondent No. 1” or the “R-1”), Mrs. Akkineni Nagasri (hereinafter referred to as the “Respondent No. 2” or the “R-2”), Mr. Mogleeshwara Naidu Rankipalli, (hereinafter referred to as the “Respondent No. 3” or the “R-3”), Mrs. Janhavi Babu Bheemaneni (hereinafter referred to as the “Respondent No. 4 or the “R-4”), Mr. Sriramineni Chandraprakash (hereinafter referred to as the “Respondent No. 5” or the “R-5”), M/s Akkineni Projects LLP (hereinafter referred to as the “Respondent No. 6” or the “R-6 LLP”), M/s Gayatri Projects Limited (Under CIRP) (hereinafter referred to as the “Respondent No. 7” or the “R-7 Company”), seeking the following reliefs:
a. To Pass an Order directing the R-1 to R-5 to make contribution of Rs.81 lakhs together with an interest of appropriate rate from the due date to till the disposal of this application in regard to the transactions covered under Section 43 of the Code to the liquidation estate of the Corporate Debtor;
b. Pass an Order directing the R-1 to R-5 and R-6 LLP to make contribution of Rs.5.48 Crore to the liquidation estate of the Corporate Debtor, together with an interest of appropriate rate from the due date to till the disposal of the IA 124/2025, for fraudulently diverting the amounts of the Corporate Debtor to R-6 LLP, and to direct the R-7 Company to furnish the details of any other amounts payable to the Corporate Debtor and which were transferred to the account of the R-6 LLP;
c. Pass such other Order(s) as may be deem fit and reasonable and necessary in the facts and circumstances of the present case.
FACTS OF THE CASE:
2. The facts, as stated by the Applicant in the IA, are summarized below:
(i) The Applicant is the Liquidator of AGRS Projects LLP (hereinafter referred to as the “Corporate Debtor”), who was registered under the Limited Liability Partnership Act, 2008, bearing LLPIN No. AAL-5103, which was incorporated on 26.11.2017, having its registered office at Flat No. 501, RR Pramodha Apartments, RR Colony, Near New Collectorate, Reddy Gunta Check Post, Chittoor-517002, Andhra Pradesh.
(ii) The details of the Respondents are as below:
(a) The R-1 to R-5 are the Suspended Designated Partners of the Corporate Debtor.
(b) The R-6 LLP was incorporated on 01.02.2018 with its registered office situated at F. No-104, Hallmark KSN Residency, Shilpa Park, Kondapur, Ranga Reddy, Hyderabad=500032, Telangana, and related party to the Corporate Debtor, as the R-1 and R-2 are its Designat
