Dyna Roof Private Ltd. And Anr. Vs Purshottam Gaggar and 4 Ors. (Gauhati High Court)
A further issue is raised is that the application made by the R1-RP before the NCLT was under section 60(5) of the IBC of 2016. Section 60(5) of the IBC of 2016 is extracted below:-
“Notwithstanding anything to the contrary contained in any other law for the time being in force, the National Company Law Tribunal shall have jurisdiction to entertain or dispose of-
(a) any application or proceeding by or against the corporate debtor or corporate person;
(b) any claim made by or against the corporate debtor or corporate person including claims by or against any of its subsidiaries situated in India; and
(c) any question of priorities or any question of law or facts, arising out of or in relation to the insolvency resolution or liquidation proceedings of the corporate debtor or corporate person under this Code.”
A reading of section 60(5) makes it discernible that it is a provision with a non-obstante clause that ‘notwithstanding anything contrary contained in any other law’ gives a jurisdiction to the NCLT to entertain or dispose of any application or proceeding by or against the corporate debtor or corporate person; any claim made by or against the corporate debtor or corporate person including claims by or against any of its subsidiaries situated in India; or any question of priorities or any question of law or facts, arising out of or in relation to the insolvency resolution or liquidation proceedings of the corporate debtor or corporate person under this Code. The non-obstante clause providing for ‘notwithstanding anything to the contrary contained in any other law for the time being in force’, would have to be understood to be notwithstanding any provisions in any other law and not understand it to be notwithstanding also the provisions of the other provisions of the IBC of 2016 itself.
A non-obstante clause providing for ‘notwithstanding anything to the contrary contained in any other law for the time being in force’ has been interpreted by the Supreme Court in P. Virudhachalam and others –vs-Management of Lotus Mills and another, reported in (1998) 1 SCC 650. In P. Virudhachalam and others (supra), the Supreme Court was interpreting the provisions of Section 25-J of the Industrial Disputes Act, …. which amongst others, provided as extracted:-
“25-J Effect of laws inconsistent with this Chapter (1) the provisions of this Chapter shall have effect notwithstanding anything inconsistent therewith contained in any other law including standing orders made under the Industrial Employment (Standing Orders) Act, 1946 (20 of 1946).”
In respect of the expression ‘notwithstanding anything inconsistent therewith contained in any other law’, a submission was made that any other law as provided in section 25-J(1) would also include even the provisions of the Industrial Disputes Act itself. The Supreme Court expressed its view that it would be difficult to agree to such a proposition by further providing that the section nowhere provides that the provision of the Chapter concerned shall have effect notwithstanding anything inconsistent contained in any other chapter of the Industrial Disputes Act as well as any other law. The relevant provision of the judgment of the Supreme Court is extracted:-
“The submission of learned counsel for the appellants in this connection was to the effect that ‘any other law’ as provided in Section 25-J(1) would include even the Industrial Disputes Act, specially the provisions contained that the provision of Chapter V-A shall have effect notwithstanding anything inconsistent contained in any other chapter of the Industrial Disputes Act as well as in any other law.”
Accordingly, section 60(5) of the IBC of 2016 would now have to be understood that an application under section 60 (5) to be maintainable notwithstanding anything contained in any other law would not also mean notwithstanding anything contained in the other provisions of the IBC of 2016 itself, but any other law other than the IBC of 2016. From such point of view when there is a specific provision on the question of maintainability of a claim for subsequent extension under the first proviso to section 12, we are of the view that the provisions of section 60(5) cannot be invoked to take advantage of the non-obstante clause to make an application for subsequent extension maintainable in spite of the specific bar on its maintainability provided in the first proviso to section 12.
From such point of view also, the order impugned dated 25.08.2022 having been passed in an application made under section 60(5) would have to be understood to be not maintainable under the law and as such the resultant order thereof would also be unsustainable.
FULL TEXT OF THE JUDGMENT/ORDER OF GAUHATI HIGH COURT
Heard Dr. Ashok Saraf learned senior counsel for the petitioners. Also heard Mr. K N Choudhury learned senior counsel and Mr. S Chamaria learned counsel for the respondent no. 1, who is the Resolution Professional representing the Corporate Debtor, RSH Agro Products Limited and Mr. S Dutta learned counsel for the respondent no. 2 Punjab National Bank, Mr. M Sarma learned counsel for the respondent no. 3 HDFC Bank. None appears for the respondent no. 4 IIFL Finance Limited and proforma respondent no. 5 Kamal Kumar Harlalka.
2. The petitioner no. 1 namely Dyna Roof Private Limited is a private limited company having its registered office at 10th Mile at Mawsmai Village in the Ribhoi district of Meghalaya and is represented by its Director Saurabh Agarwal, whereas the petitioner no. 2 Rohin Kumar Hansaria is the proprietor of a firm namely Steel Sales Corporation having its office at S J Road at Athgaon in Guwahati. Both the petitioners are unsecured financial creditors of the Corporate Debtor RSH Agro Products Limited.
3. At the instance of the Corporate Debtor RSH Agro Products Limited, an insolvency proceeding was initiated under Section 10 of the Insolvency and Bankruptcy Code, 2016 (in short IBC of 2016) before the National Company Law Tribunal (in short NCLT) at Guwahati, resulting in the registration C.P.(IB) No. 18/GB/2021, on the following grounds, as indicated in paragraph 5 of the writ petition :
