Citation Codes

Equivalent Citations

citation codes

Case Number

IA - 265/2019

Disposition

dismissed

Advocates

JMVD & Co.

Judges

Hon'ble Justice M. Venugopal (Acting Chairperson) Hon'ble Dr. Ashok Kumar Mishra (Member (Technical)) Hon'ble Mr. Vijai Pratap Singh (Member (Technical))

Acts

Rule 11 of NCLAT Rules
Rule 11 ''Inherent Powers'' of National Company Law Appellate Rules, 2016
Rs.2173/-, MA No.677/2018 and Comp/1/2019 in CP/616/IB/CB/2018 (under Section 425 of the Companies Act, 2013)
fact, Rule 11 of NCLAT Rules, 2016
Rule 11 of the NCLAT Rules, 2016
Section 62 of the I&B Code, 2016.

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Smart Summary

Summary of Judicial Opinion: IA No.265/2019 in Company Appeal (AT)(Ins.) No.412/2019

Factual and Procedural Background

This opinion concerns IA No.265/2019 filed in Company Appeal (AT)(Insolvency) No.412/2019 by the Applicant/Appellant Agarwal Coal Corporation Pvt Ltd seeking to place on record allegations of "fraudulent acts" by the respondents and to invoke the Tribunal's inherent powers to recall the Tribunal's judgement dated 16.10.2019 in Company Appeal (AT)(Ins.) No.412/2019.

Procedurally, the Applicant's claim before the Resolution Professional was allowed only to the extent of Rs. 2,173 as against its asserted claim of Rs. 2,39,33,935. The Applicant had earlier filed MA No.677/2018 before the NCLT Chennai challenging the rejection of its claim; MA No.677/2018 was dismissed on 14.03.2019. The Applicant then filed Company Appeal (AT)(Ins.) No.412/2019 before this Appellate Tribunal, which was dismissed by judgment dated 16.10.2019. IA No.265/2019 seeks recall of that 16.10.2019 judgment and an opportunity for a fresh hearing, invoking Rule 11 (inherent powers) of the NCLAT Rules, 2016.

The Applicant's factual allegations in the IA include: (a) that the 1st respondent (Sun Paper Mill Ltd) manufactured "cooked up" debit notes and manipulated books of account; (b) that an independent chartered accountant's report and the Resolution Professional accepted a figure of Rs.2,173 without examining certain debit notes and letters; (c) that the suspended board of the corporate debtor illegitimately conducted board meetings during the CIRP, made appointments and accepted resignations, and mortgaged the corporate debtor's land and created a charge during the moratorium to obtain a substantial loan.

Legal Issues Presented

Whether this Appellate Tribunal may exercise its inherent power under Rule 11 of the NCLAT Rules, 2016 to "recall" or otherwise reopen its own judgment dated 16.10.2019.
Whether allegations of fraud in IA No.265/2019 can justify recalling or reviewing the Tribunal's earlier judgment (i.e., whether fraud vitiates the proceeding so as to permit recall).
Whether IA No.265/2019 is maintainable in law when the applicant has not availed the statutory remedy of appeal to the Hon'ble Supreme Court under Section 62 of the IBC against the 16.10.2019 judgment.

Arguments of the Parties

Applicant/Appellant's Arguments

The Applicant alleged that the respondents and the Resolution Professional relied on a flawed report of an independent Chartered Accountant that accepted only Rs.2,173 as payable, without examining the validity of three debit notes and a letter dated 06.07.2013.
The Applicant contended that the 1st respondent manipulated books of account, and that the alleged custom duty obligation reflected in the debit notes never appeared as a contingent liability in the audited financial statements filed with the Ministry of Corporate Affairs for 2013-2014 and subsequent annual filings.
The Applicant alleged that the CIRP was not properly conducted and that the suspended board continued to act during the moratorium—holding board meetings, accepting resignations, making appointments, mortgaging land and creating a charge in favour of a consortium of banks during CIRP—thereby committing fraud that vitiates the proceedings.
The Applicant prayed that this Tribunal exercise its inherent power under Rule 11 NCLAT Rules to recall its judgment dated 16.10.2019 and set the appeal down for a fresh hearing on merits.

First Respondent's Contentions (Sun Paper Mill Ltd)

The First Respondent submitted that the main appeal (Comp App (AT)(Ins.) No.412/2019) was dismissed on 16.10.2019 and that the order had attained finality.
It contended that the claim before the Resolution Professional was correctly allowed only to the extent of Rs.2,173 after evaluation of auditors' report and that earlier proceedings (MA No.677/2018 and Comp/1/2019 under Section 425 of the Companies Act) had been dismissed by the Adjudicating Authority on 14.03.2019.
The First Respondent emphasized that the IBC proceedings culminated in approval of a resolution plan, that the corporate debtor continued as a going concern, and that the Applicant was re-agitating matters already considered; it also relied on authority upholding the doctrine of functus officio in IBC context.
The First Respondent argued IA No.265/2019 is not maintainable in law or on facts and that invoking "inherent powers" to achieve review/recall is not permissible.

Second Respondent's Contentions (Resolution Professional)

The Second Respondent contended that IA No.265/2019 is in substance a review petition, which is not maintainable before the Tribunal.
It submitted that allegations against the Resolution Professional had been earlier dismissed by the IBBI and that the Applicant had not appealed to the Supreme Court against the 16.10.2019 judgment, indicating forum shopping and ulterior motives; it sought dismissal with exemplary costs.

Table of Precedents Cited

Precedent	Rule or Principle Cited For	Application by the Court
Innoventive Industries Ltd. v. ICICI Bank, (2018) 1 SCC 407	At the stage of admission under Section 9, the Adjudicating Authority must see whether the record is complete and there is a 'debt' and 'default'; detailed verification is for later stages.	The Tribunal quoted this authority to explain the standard applied at the Section 9 admission stage and why the Adjudicating Authority is not required to delve into detailed verification when admitting a claim.
Lily Thomas v. Union of India, AIR 2000 SC 1650	The power of review is a creature of statute and is not an inherent power.	The court relied on this decision to support the proposition that review cannot be invoked as an inherent power and that review requires statutory backing.
Jiura Oraon v. The State of Jharkhand, 2014 (3) JCR 100 (Jhar)	Re-appraisal of materials/evidence in review is impermissible.	The Tribunal used this authority to emphasise that review proceedings should not involve rehearing or re-appraising evidence, distinguishing review from appeal.
Sharada Bai v. Padamlal, 2003 A.I.H.C. 1756 (Andhra Pradesh)	Review is not a vehicle to reopen contentions already decided in the main proceedings.	The Tribunal cited this case to underline that errors in the main decision are not to be corrected by permitting re-agitation through review-like petitions.
Patel Narshi Thakershi v. Pradyumansinghji Arjunsinghji, AIR 1970 SC 1273	The power of review is not an inherent power.	The Tribunal relied on this Supreme Court authority to reinforce that inherent powers cannot be used to perform acts that review statutes permit, i.e., review must have statutory basis.
K.N. Rajkumar v. V. Nagarajan & Ors, (15.09.2021) MANU/SC/0648/2021	Applicability of the doctrine of functus officio to IBC proceedings (as referenced by the First Respondent).	The First Respondent relied on this Supreme Court decision in its submissions; the Tribunal recorded this reliance while noting the finality and conclusiveness of the earlier Appellate Tribunal judgment.

Court's Reasoning and Analysis

The Tribunal undertook a legal analysis that proceeded in distinct steps:

Meaning and Limits of "Review": The Tribunal explained the dictionary meaning of "review" but emphasised that the power of review is statutory in nature and cannot be equated with an inherent power. It cited Lily Thomas and Patel Narshi to assert that review is not an inherent power and cited Jiura Oraon and Sharada Bai to stress that re-appraisal of evidence or rehearing is impermissible in review proceedings.
Substance of IA No.265/2019: The Tribunal observed that, despite the application being titled as one for "recall", the substance of IA No.265/2019 was to seek a review or rehearing of matters already decided by the Tribunal in the 16.10.2019 judgment. The Tribunal held that this is impermissible where no statutory review power exists under the NCLAT Rules.
Rule 11 (Inherent Powers) Consideration: The Tribunal considered Rule 11 of the NCLAT Rules (which preserves inherent powers) but held that Rule 11 is not a substantive source of power to perform an act which the law prohibits. In other words, the Tribunal cannot exercise inherent powers to do what the statute or rules do not permit—specifically, it cannot convert Rule 11 into a provision authorising review/recall where no statutory review mechanism exists.
Finality and Alternative Remedy: The Tribunal noted that the Applicant had not availed of the statutory remedy of appeal to the Supreme Court under Section 62 of the IBC against the 16.10.2019 judgment. The Tribunal observed that the 16.10.2019 judgment had become final, conclusive and binding in the absence of such an appeal, and thus could not be reopened by this application.
Appropriate Forum: The Tribunal concluded that the appropriate remedy for the Applicant, if the Applicant wished to challenge the 16.10.2019 judgment, was to approach the Hon'ble Supreme Court of India, rather than seek recall/review before the Tribunal via inherent powers.

Holding and Implications

Holding: The Tribunal's final decision was to dismiss IA No.265/2019. The core ruling is emphasised below.

DISMISSED

Implications and consequences:

The IA seeking recall (in effect a review) of the Tribunal's judgment dated 16.10.2019 is not maintainable before the Tribunal and is devoid of merits; it is therefore dismissed.
No order as to costs was made.
As a direct consequence, the Tribunal's earlier judgment dated 16.10.2019 remains final, conclusive and binding between the parties unless overturned by a competent authority (for example, the Hon'ble Supreme Court under the statutory appeal route), which the Applicant had not pursued.
The opinion does not purport to create any new precedent beyond applying established principles that (a) review is statutory and not inherent, (b) review cannot re-appraise evidence, and (c) the Tribunal cannot use inherent powers to do what the statute forbids. The Tribunal explicitly directed the Applicant to approach the Supreme Court if it so desired.

Decision delivered by: Justice M. Venugopal (Acting Chairperson), Mr. V.P. Singh (Member Technical), Dr. Ashok Kumar Mishra (Member Technical) on 25th October, 2021.

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Agarwal Coal Corporation Private Limited v. Sun Paper Mill Limited & Anr.

IA No.265/2019 in Company Appeal(AT)(Insolvency) No.412/2019 1

NATIONAL COMPANY LAW APPELLATE TRIBUNAL, PRINCIPAL BENCH

NEW DELHI

I.A. No.265/2019 in Company Appeal (AT)(Ins.) No.412/2019 [Application filed by the Applicant/Appellant to Recall the judgment dated 16.10.2019 passed by the National Company Law Appellate Tribunal, New Delhi in Company Appeal (AT)(Ins.) No.412/2019] In the matter of :

Agarwal Coal Corporation Pvt Ltd.

Regd. Office:

Matra Kripa, Chameli Park Near Goyal Nagar,

Indore,

Madhya Pradesh - 452001. Applicant/Appellant

Vs.

Sun Paper Mill Ltd.

Regd. Address At:

Survey No.-11/6, Ratnapuri,

2^nd Street, Koyambedu,

Chennai,

Tamil Nadu - 600107. Respondent No. 1

Mrs. J. Karthiga

Resolution Professional

Sun Paper Mill Ltd.

Srinivas, Old No. 1052, New No. 1, 41^st Street, Korattur, Chennai,

Tamil Nadu - 600080. Respondent No. 2

Present:

For Appellant: Mr.V.N. Dubey, Mr. Amit Dubey and Mr Rohit Dubey, Advocates and Mr. Alam Khan, PCS

For Respondent: Mr. E. Om Prakash, Sr. Advocate with Ms Madhusmita Bora and Mr. G. Ashokpathy, Advocates for R1.

Ms Pratishtha Vij, Advocate for R2(IRP).

O R D E R

(Virtual Mode) Background:

The 'Applicant/Appellant'' has preferred the instant 'I.A. No.265/ 2019' in 'Comp. App. (AT)(Ins) No.412/2019' seeking to place on record the

Company Appeal(AT)(Insolvency) No.412/2019 2 submissions relating to the ''fraudulent acts'' of the ''Respondents'' and prays for an exercise of an ''inherent power'' by this Tribunal in allowing the ''Application''.

2. Earlier, this Tribunal, in its Judgement dated 16.10.2019 in Comp. App. (AT)(Ins) No.412/2019 (filed by the Appellant/Operational Creditor) at paragraph 10 and 11 had observed the following:-

"10. The only question arises for consideration is as to how Section 9 application was admitted if the amount is found to be Rs.2173 which is much less than Rupees One Lakh.

11. In this regard we may only mention that at the stage of admission of application under Section 9, the Adjudicating Authority is required to notice whether the record is complete and there is a 'debt' and 'default' as per decision of the Hon'ble Supreme Court in 'Innoventive Industries Ltd. v. ICICI Bank; (2018) 1 SCC 407). Even if the claim amount is disputed and is more than Rupees One Lakh, it is to be admitted, the Adjudicating Authority is not required to go into the details of verification of the claim which is required to be made by the 'Resolution Professional' and

Company Appeal(AT)(Insolvency) No.412/2019 3 therefore, even if some record shows that claim amount is Rupees One Lakh, it is always open to the 'Resolution Professional' to collate the claim."

and had not interfered with the impugned order dated 14.03.2021 passed by the Adjudicating Authority (National Company Law Tribunal, Division Bench, Chennai) and dismissed the 'Appeal' without costs.

Applicant/Appellant's submissions:

3. According to the Learned Counsel for the Applicant/Appellant the Respondents had submitted before this Tribunal that the claim amount of the Applicant was verified by the 2^ndRespondent, based on the 'Report' of one independent Chartered Accountant and on record, the said ''Report'' was also placed. In fact, the said Report provides that all the invoices relating to the year 2013-2014 were paid and a sum of Rs. 2173/- was outstanding. Besides this, the said 'Report' mentioned that the 1^stRespondent had withheld the payment for the invoices of the year 2012-2013 and for which alleged three 'Debit Notes' No.126, 127 and 128 were issued. However, the independent 'Chartered Accountant' had not examined the validity of the aforesaid three 'Debit Notes' and the purported letter dated 06.07.2013.

4. The stand of the Applicant/Appellant is that in order to play 'Fraud' for securing favourable order had submitted the cooked up, frivolous 'Debit Notes'. As a matter of fact, the Applicant at all forum had explained the fraud played by the 1^stRespondent (including to the 2^ndRespondent). But the 2^nd

Company Appeal(AT)(Insolvency) No.412/2019 4 Respondent had not listened to the submissions of the 'Applicant', but accepted the erroneous 'Report' of the 'Chartered Accountant'.

5. The Learned Counsel for the Applicant points out that the 1^st Respondent was engaged in manipulation of 'Books of Accounts' by means of fraudulent practices. Apart from this, the alleged custom duty obligation based on which alleged ''Debit Notes'' were purportedly issued was never reported even as the contingent liability in the 'Audited Financial Accounts' of the 1^stRespondent furnished to the ''Ministry of Corporate Affairs'' for the year 2013-2014 or even thereafter till the last 'Annual Report' available on 'MCA Portal'.

6. It is represented on behalf of the Applicant that the independent 'Chartered Accountant' and the 2^ndRespondent had ignored the aforesaid 'Annual Financial Statements' of the 1^stRespondent available with Ministry of Corporate Affairs. Apart from this, the Applicant/Appellant has suspicion that the ''CIRP'' in the matter was never conducted in actual and the 2^nd Respondent had only attempted to create an illusion, thereby playing fraud. Added further, notwithstanding the moratorium imposed by the Adjudicating Authority on 15.11.2017 under the I&B Code, the Suspended Board had mortgaged the Assets of the 1^stRespondent/Company and created ''Charge'' in favour of the ''Consortium of Banks'' consisting of one Bank of Maharashtra

(2) Allahabad Bank and (3) Union Bank of India (Charge ID No.100191948) created on 26.8.2018 (coming under the strict moratorium period and during 'CIRP') in order to obtain the loan of Rs.1,01,05,00,000/-.

Company Appeal(AT)(Insolvency) No.412/2019 5

7. The Learned Counsel for the Applicant/Appellant submits that the Suspended Board of Directors of the 1^stRespondent/Company in violation of law held a Board Meeting on 15.06.2018 at the Registered Office of the 1^st Respondent/Company and resolved for mortgaging the land of Respondent No.1 admeasuring 10.10 acres situated at Aralvaimozi, Nagercoil on NH- 4TB (Chennai Nagercoil Highway), Kanyakumari Registration District, Thovalai Taluk, Thovalai Sub-registrar's Saragam, Aralvaimozhi Village, Tamil Nadu. Indeed, the 2^ndRespondent had not objected to the conduct of ''Suspended Board of Directors' and passing of such 'Resolution'.

8. The plea of the Applicant is that one of the Directors of the ''Suspended Board of Directors'' of the 1^stRespondent/Company pursuant to the aforesaid Resolution dated 15.06.2018 of the ''Suspended Board of Directors'' had executed the Mortgage Deed dated 28.06.2018 for mortgaging the said land of 1^stRespondent.

9. The core contention advanced on behalf of the Applicant/Appellant is that the Suspended Board of Directors of 1^stRespondent/Company had continued to hold the Management of the affairs of the Company and carried out its functions and decision making process, during the course of CIRP and illegally took each and every decision during CIRP in regard to the 1^st Respondent/Company and executed them.

10. Further, on behalf of the Applicant, it is brought to the notice of this 'Tribunal' that Mr. Pratik Mahendra Mewada, Company Secretary of the 1^st Respondent/Company had addressed his resignation letter dated 30.04.2018

Company Appeal(AT)(Insolvency) No.412/2019 6 to the Suspended Board of Directors of the 1^stRespondent/Company, and pursuant to that, the Suspended Board of Directors had conducted an illegal Board Meeting dated 30.04.2018 had considered and allowed the same. Moreover, Mr. Chandrahas Moolya, Member of the Suspended Board of Directors had signed the appointment letter dated 01.06.2018, for the appointment of Ms Kalpana Jhalani as Company Secretary of the 1^st Respondent/Company in pursuance to the illegal Board Resolution passed by the Suspended Board of Directors in their illegal Meeting held on 28.05.2018.

11. The Learned Counsel for the Applicant proceeds to point out that Ms. Kalpana Jhalani had addressed the resignation letter dated 30.08.2018 to the Suspended Board of Directors of the 1^stRespondent/Company and pursuant to this, the Suspended Board of Directors held an illegal Board Meeting on 30.08.2018, considered and allowed the same. Apart from that, Mr. Vaithyalingam Anbalagan, Member, of the Suspended Board of Directors of 1^stRespondent/Company filed Form No.DIR-11 at the MCA Portal on 03.08.2018 together with his resignation letter dated 28.07.2018 addressed to the Suspended Board of Directors of 1^stRespondent/Company.

12. The pivotal submission made on behalf of the Applicant/Appellant is that 'Fraud' vitiates the 'entire judicial proceedings' and that if such fraudulent acts of the Respondents are permitted and the order dated 16.10.2019 passed by this Appellate Tribunal is not recalled and if the 'Appeal' is not set for 'Hearing' it will cause a huge irreparable loss not only to the Applicant but also to the whole structure established through the I&B Code.

Company Appeal(AT)(Insolvency) No.412/2019 7

13. The Learned Counsel for the Applicant/Appellant while rounding up prays for allowing of IA No.265/2019 in Comp App (AT)(Ins) No.412/2019, by this Appellate Tribunal, in exercise of its inherent power, to recall the judgment dated 16.10.2019 passed by this 'Tribunal' in Comp App (AT)(Ins) No.412/2019 and to set down the 'Appeal' for fair 'Hearing' on merits.

First Respondent's Contentions:

14. The Learned Counsel for the 1^stRespondent submits that the main Comp App (AT)(Ins) No.412/2019 on the file of National Company Law Appellate Tribunal, New Delhi was disposed of on 16.10.2019 whereby and where under the 'Appeal' was dismissed and the same had attained finality, without there being no further proceedings against the order dated

16.10.2019.

15. The Learned Counsel for the 1^stRespondent contends that the Appellant/Applicant's original claim before the Resolution Professional was allowed only to an extent of Rs.2173/-, as against the false claim of Rs.2,39,33,935/-. In reality, the Applicant/Appellant had preferred an MA No. 677/2018 on the file of the National Company Law Tribunal, Chennai against the said rejection of its claim and the said MA No.677/2018 was dismissed on 14.03.2019, against which Comp App (AT)(Ins) No.412/2019 was filed by the Appellant/Applicant and the same came to be dismissed on 16.10.2019, resting on the reason that the Applicant's claim of Rs.2,39,33,935/- was not related to the period of transaction between November, 2013 to February, 2014, and on other grounds, affirmed after

Company Appeal(AT)(Insolvency) No.412/2019 8 going through the 'Auditors' Report that Rs. 2173/- was alone payable to the Applicant/Appellant.

16. The Learned Counsel for the First Respondent points out that the 'IBC proceedings' had culminated in an 'Approval of the Resolution Plan' and the same was complied with. Further, throughout the proceedings, the Corporate Debtor was maintained as a 'going concern' and the acts as a 'going concern' are alleged as fraudulent by way of re-agitation.

17. The Learned Counsel for the 1^stRespondent refers to the decision of the Hon'ble Supreme Court in K.N. Rajkumar Vs V. Nagarajan and Ors (15.09.2021) reported in MANU/SC/0648/2021 wherein the applicability of the 'Doctrine of Functus Officio' to the IBC proceedings was upheld.

18. The Learned Counsel for the 1^stRespondent points out that after the claim of the Applicant/Appellant was admitted to an extent of Rs.2173/-, MA No.677/2018 and Comp/1/2019 in CP/616/IB/CB/2018 (under Section 425 of the Companies Act, 2013) were filed. In fact, Comp/1/2019 was preferred by the Applicant as regards the purported fraud/contempt which was dismissed by the Adjudicating Authority on 14.3.2019, which had become final.

19. The Learned Counsel for the 1^stRespondent submits that IA No. 265/2021 in Comp App (AT)((Ins) No.412/2019 filed by the Applicant/Appellant is not maintainable either in 'Law' or on 'Facts' and' that the Applicant/Appellant falls back upon the 'inherent powers' of the 'Appellate Tribunal'.

Company Appeal(AT)(Insolvency) No.412/2019 9

Second Respondent's Pleas

20. The Learned Counsel for the 2^ndRespondent contends that IA No.265/2019 filed by the Applicant/Appellant is indeed a ''Review Applicant'' which is not maintainable ex facie before this 'Tribunal'. Also that, the allegations projected in the Application against the 2^ndRespondent were earlier dismissed by IBBI.

21. The Learned Counsel for the 2^ndRespondent submits that the Applicant/Appellant has not preferred any Appeal before the Hon'ble Supreme Court of India as against the order dated 16.10.2019 passed by this Tribunal in Comp App (AT)(Ins) No.412/2019 whereby, the Appeal was dismissed and that the Applicant is indulging in 'Forum Shopping' and litigating with an 'ulterior motive' and prays for the dismissal of the Application with exemplary costs.

Assessment

22. The Applicant/Appellant in IA No.265/2019 in Comp App (AT)(Ins) No.412/2019, has prayed for an exercise of inherent powers by this 'Tribunal' and to recall (Simpliciter) of the order dated 16.10.2019 pass by this Tribunal in Comp App (AT)(Ins) No.412/2019, on the ground of 'Fraud' played by the Respondents. Apart from this, a relief is sought for by the ''Applicant'' for setting down the Appeal for 'Hearing' on its merits, after allowing of the ''Application''.

23. It comes to be known that the Applicant/Appellant in IA No. 265/2019 Comp App (AT)(Ins) No.412/2019 on the file of this 'Tribunal' has sought (a)

Company Appeal(AT)(Insolvency) No.412/2019 10 the relief to place on record the submissions pertaining to the fraudulent acts of the Respondents, besides other reliefs as mentioned Supra.

24. The Applicant/Appellant has preferred IA No.265/2019 in Comp App (AT)(Ins) No.412/2019 seeking necessary reliefs as referred to earlier obviously under Rule 11 ''Inherent Powers'' of National Company Law Appellate Rules, 2016 (although the relevant Rule was not mentioned by the Applicant/Appellant at the time of filing of the Application). In this connection, it is useful to refer to Rule 11 of NCLAT Rules which runs to the following effect:-

"11. Inherent powers- Nothing in these rules shall be deemed to limit or otherwise affect the inherent powers of the Appellate Tribunal to make such orders or give such directions as may be necessary in meeting the ends of justice or to prevent above of the process of the Appellate Tribunal."

Ambit of Review:

25. It is to be noted, the dictionary meaning of the term 'Review' is the act of looking, offer something again with a view to correction or improvement as the case may be. It must be borne in mind that the ''Power of Review'' is a creature of Statute and it is not an 'inherent power' as per decision of the Hon'ble Supreme Court in Lily Thomas V. Union of India reported in AIR 2000 Supreme Court Page 1650 at Special Page 1652. In fact, "Review" is not an 'Appeal' in disguise. In "Review" re-appraisal of materials is

Company Appeal(AT)(Insolvency) No.412/2019 11 impermissible as per decision in Jiura Oraon V. The State of Jharkhand, 2014 (3)JCR 100 (Jhar).

26. Resting upon 'Review' the ''Tribunal'' would not rehear the parties on 'Facts' and 'Law. No wonder, a re-appraisal of evidence on record for unearthing an error will amount to an exercise of 'Appellate Jurisdiction"

which is not permitted in Law. A ''Review'' is not to be sought for a 'Fresh Hearing' or 'Arguments' or 'Correction of an erroneous view' taken earlier. To put it precisely, the contentions raised and determined in main proceedings are not to be reopened/re-agitated under the garb of ''Review Petition'' as per decision Sharada Bai V. Padamlal, 2003 All India High Court Cases 1756 (1757) (Andhra Pradesh). Also for correcting an erroneous decision, "Review"

will not lie, as opined by this "'Tribunal''. Further, the Hon'ble Supreme Court in Patel Narshi Thakershi vs. Pradyumansinghji Arjunsinghji reported in

AIR 1970 Supreme Court 1273 had observed and held that 'power of Review' is not an 'inherent power'.

Power to Recall

27. It is the well laid down proposition of law that 'in the absence of any power of 'Review' or 'Recall' vested with the 'Adjudicating Authority' - 'Appellate Authority', an order/ judgment passed by it cannot be either Reviewed or Recall as opined by this Tribunal.

28. As far as the present case is concerned, it is to be pointed out pertinently that the Applicant/Appellant filed MA No.677/2018 on the file of the National Company Law Tribunal, Chennai against the rejection of it claim. As a matter of fact, before the Resolution Professional the

Company Appeal(AT)(Insolvency) No.412/2019 12 Appellant/Applicant's claim was permitted to a sum of Rs.2173/- as against the claim of Rs.2,39,33,935/- and that the said MA No.677/2018 came to be dismissed on 14.03.2019, as against the said dismissal order, Comp App (AT)(Ins) No.412/2019 was preferred by the Appellant before this Tribunal, which resulted in dismissal on 16.10.2019.

29. It is not in dispute that as against the judgment dated 16.10.2019 in Comp App (AT)(Ins) No.412/2019 (in the matter of Agarwal Coal Corporation Pvt Ltd V Sun Paper Ltd & Anr) passed by this ''Appellate Tribunal'' dismissing the Appeal, the Applicant/Appellant has not preferred an ''Appeal'' to the Hon'ble Supreme Court of India as per Section 62 of the I&B Code, 2016. Therefore, it is crystalline and clear that the judgment dated 16.10.2019 passed by this Tribunal in Comp. Appl. (AT)(Ins) No.412/2019 between the parties inter se has become 'conclusive', 'final' and 'binding'.

30. A mere reading of the contents of IA No.265/2021 in Comp App. (AT)(Ins) 412/2019 indicates latently and patently that although in the preamble it is mentioned as ''Recall Application'' yet it is only an ''Application'' praying for ''Review'' of the Order dated 16.10.2019 passed in Comp App (AT)(Ins) No.412/2019 by this Tribunal, in stricto sense of the term.

31. It cannot be gainsaid that there is no express provision for ''Review'' under the National Company Law Appellate Tribunal Rules, 2016. Moreover, the Applicant/Appellant cannot fall back upon Rule 11 of the NCLAT Rules, 2016 which provides for "inherent powers''. In fact, Rule 11 of NCLAT Rules, 2016 is not a substantive Rule which showers any power or jurisdiction upon

Company Appeal(AT)(Insolvency) No.412/2019 13 the ''Tribunal''. Undoubtedly, the 'Tribunal'' has no power to perform an act which is prohibited by Law.

32. In view of the upshot, this Tribunal taking note of the prime fact that the Applicant/Appellant has sought for "recalling" the judgement dated 16.10.2019 passed by this Appellate Tribunal in Comp App (AT)(Ins) No.412/2019 etc., which is impermissible in Law and that this 'Tribunal' is of the earnest opinion that the appropriate course of action open to the Applicant / Appellant is to approach the Hon'ble Supreme Court of India as against the judgement in Comp App (AT)(Ins) No.412/2019 dated 16.10.2019 passed by this "Tribunal" if it so desires/advised. Looking at from that perspective, the I.A. No.265/2019 in Comp App (AT)(Ins) No.412/2019 is devoid of merits and it fails.

Conclusion:

In fine, the IA No.265/2019 in Comp App (AT)(Ins) No.412/2019 is dismissed. No order as to costs.

[Justice M. Venugopal] Acting Chairperson [Mr. V.P. Singh] Member (Technical) [Dr. Ashok Kumar Mishra] Member (Technical) 25^th October, 2021

Shashi

Agarwal Coal Corporation Private Limited v. Sun Paper Mill Limited & Anr.

Summary of Judicial Opinion: IA No.265/2019 in Company Appeal (AT)(Ins.) No.412/2019

Factual and Procedural Background

Legal Issues Presented

Arguments of the Parties

Applicant/Appellant's Arguments

First Respondent's Contentions (Sun Paper Mill Ltd)

Second Respondent's Contentions (Resolution Professional)

Table of Precedents Cited

Court's Reasoning and Analysis

Holding and Implications

Agarwal Coal Corporation Private Limited v. Sun Paper Mill Limited & Anr.

Comments