'Hard To Believe Corporate Debtor Who Invested ₹5.5 Crore Was Unaware Of CIRP': NCLAT Refuses To Expunge Adverse Remarks Against Suspended Directors

The National Company Law Appellate Tribunal (NCLAT) New Delhi bench of Justice Rakesh Kumar Jain (Judicial Member), Justice Mohd. Faiz Alam Khan (Judicial Member) and Mr. Naresh Salecha (Technical Member) has held that strong observations made against the suspended directors of the Corporate Debtor, while passing an order of dissolution due to their non-cooperation in providing requisite statutory records to the Resolution Professional or the Liquidator and their continuous non-appearance before the Tribunal despite being served on the e-mails and at the postal address in the MCA date base cannot be expunged. The present Appeal has been filed under section 61 of the Insolvency and Bankruptcy Code, 2016 (IBC) against an order passed by the National Company Law Tribunal (NCLT) New Delhi wherein certain observations were made against the Appellants. The Appellants submitted that the Appellants were neither involved in day to day affairs or management or operations of the Corporate Debtor nor they have ever received any communication regarding the CIRP process and as such there could not be any non-cooperation from their end, as observed by the learned Tribunal. It was further submitted that no notice of the meeting of the CoC was ever issued to the Appellants and it appears that the emails and communications were only sent by the IRP to Mr. Gagan Shukla/Promoter Director of the CD and no communication was ever received by the Appellants regarding on going CIRP of the CD. Per contra, the Respondent submitted that all communications were sent to the Appellants on their emails provided by them in the MCA data base and also available on Master Data with a specific direction to them to handover the books of accounts of the CD and other requisite information and documents, however, no response was received from any of the Suspended Directors The Tribunal noted that the Liquidator/IRP/RP duly served all the processes to the Appellants and other suspended directors of the Corporate Debtor through e-mails and postal addresses listed in the MCA database. Notably, these directors attended the CoC meetings and appeared before the Tribunal in pursuance of these communications. Therefore, the plea that they were not served with the processes of the Tribunal is untenable. It further observed that despite investing Rs. 5.5 crore in the corporate debtor, it is hard to believe that the Appellants were unaware of the commencement of the CIRP and liquidation. The records show that on a complaint filed by the RP, criminal prosecution was launched against the Appellants and the present appeal is aimed at building a defence in that case. Therefore, the Adjudicating Authority cannot be faulted for passing an order of dissolution and recording conduct of the Appellants such as non-cooperation with the RP/IRP, not providing statutory records and ignoring notes and warrants. Accordingly, the present appeal was dismissed. Case Title:Bimal Kumar Jejani and Ors. Versus M/s Star Mineral Resources Pvt. Ltd. and Ors. Case Number:Company Appeal (AT) (Insolvency) No. 224 of 2024 Judgment Date: 06/08/2025 For Appellant : Ms. Sakshi Tikmany & Mr. Akshat Gupta Advocates. For Respondent : Mr. Naresh Kumar Bansal & Ms. Kritika Bansal, Advocates. Click Here To Download Order/Judgement

'Hard To Believe Corporate Debtor Who Invested ₹5.5 Crore Was Unaware Of CIRP': NCLAT Refuses To Expunge Adverse Remarks Against Suspended Directors

Mohd Malik Chauhan

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'Hard To Believe Corporate Debtor Who Invested ₹5.5 Crore Was Unaware Of CIRP': NCLAT Refuses To Expunge Adverse Remarks Against Suspended Directors

Mohd Malik Chauhan

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