SUMAN K SHRIVASTAVA
Ranchi, Nov. 19: The National Company Law Appellate Tribunal (NCLAT), New Delhi has paved way for initiation of insolvency proceedings against Jharkhand Urja Sancharan Nigam Limited (JUSNL) and appointment of Insolvency Resolution Professional (IRP) who may replace the existing board of the company.
The order was delivered on November 18 by the Principal bench of the NCLAT comprising Member (Judicial) Justice Anant Bijay Singh, and Member (Technical) Ms Shreesha Merla, in an appeal filed by Ramjee Power Construction Company Limited, a Ranchi-based company.
The power company had knocked on the door of the NCLAT after the National Company Law Tribunal (NCLT), Kolkata bench rejected its petition which was filed for initiation of insolvency proceedings for non-payment of Rs 11 crore by JUSNL which had been unilaterally recovered in 2016 after being paid way back in 2010 in satisfaction of an arbitration award.
The power company’s counsel Pandey Neeraj Rai said that the NCLT, Kolkata had decided in its favour on other objections raised by the JUSNL against admission of the insolvency petition, except on the ground of limitation, “With NCLAT having set aside the order of the NCLT the only embargo is over and paved the way of initiating insolvency proceedings and appointment of an IRP who can take over the management of the JUSNL in place of its existing board of directors. The IRP will act towards letting JUSNL declare the JUSNL insolvent or saving it from insolvency,” he added.
The case, in a nutshell, is after a dispute arose between Ramjee Power and the JUSNL (earlier Jharkhand State Electricity Board) over the payment to be made for the transmission works in Santhal Pargana. The case was sent for arbitration which went in favour of the power company on 14.02. 2008. The JUSNL did not challenge the order and paid Rs 11 crore on 10.05.2008 to the company.
However, the JUSNL board decided to challenge the arbitral award on 11.01.2011 but not to make any recovery.
The final decision to make recovery was taken only on 29.01.2016 but was never conveyed to M/s Ramjee Power. The power company filed an RTI application and the file notings gave the knowledge about the fact that a Board decision was taken on 29.01.2016 and the amount to be deducted was mentioned as less Arbitration– Rs.11 Crores. The total payable sum has been calculated as Rs.2,47,16,999 after deducting Rs. 11 Crores.
Eventually, the challenge to the award was also got dismissed in 2018.
The power company was given a cheque for Rs.2,47,16,999 on 31.03.2016 and having no knowledge about the reason for less payment, it wrote several letters, but there was no response. It was only on account of the information received through RTI that the company came to know about the internal decisions
The Power company thereafter filed a case on NCLT, Kolkata, which rejected it on the ground of time limitation.
The NCLAT, however, overruled the NCLT in view of various judgements of the Supreme Court, particularly delivered in ‘Dena Bank (now Bank of Baroda) case
and asked it to proceed in accordance with law keeping in view the timelines under the Insolvency and Bankruptcy Code, 2016.
