Case Note & Summary
The appeal was filed by an operational creditor of the corporate debtor, Jigsaw Solutions, challenging an order of the Adjudicating Authority dated 04.12.2024 regarding the rejection of its claim and the direction to expedite liquidation proceedings. The appellant's claim of Rs. 2,12,87,760/- was rejected by the liquidator, leading to the filing of IA No. 965/2022, which remained pending. Additionally, the appellant had previously sought a forensic audit through IA No. 193/2021, which resulted in a transaction audit revealing approximately Rs. 63 crores in potentially fraudulent transactions. The liquidator initiated five interlocutory applications under Section 66 of the Insolvency and Bankruptcy Code, 2016 (IBC) in 2023, which were rejected by the National Company Law Tribunal (NCLT). The liquidator faced challenges in obtaining information from suspended directors, leading to insufficient material for a forensic audit. The Adjudicating Authority's order did not dissolve the company but required the liquidator to expedite the liquidation process and file for dissolution. The court emphasized the need for the Adjudicating Authority to resolve the pending applications before any dissolution application is entertained. The appeal was disposed of with these directions.
Headnote
A) Insolvency Law - Operational Creditor's Claim - Rejection of Claim - Insolvency and Bankruptcy Code, 2016, Section 66 - The appellant, an operational creditor, challenged the rejection of its claim of Rs. 2,12,87,760/- by the liquidator, which is pending before the Adjudicating Authority. The court directed the Adjudicating Authority to expedite the hearing on the pending applications before considering dissolution of the corporate debtor. Held that the appeal was disposed of with directions (Paras 2-5).
Issue of Consideration
Whether the rejection of the operational creditor's claim and the direction to expedite liquidation proceedings were justified.
Final Decision
The appeal was disposed of with directions for the Adjudicating Authority to expedite the hearing on IA No. 965/2022 and IA No. 1939/2024 before considering any application for dissolution of the corporate debtor.
Law Points
- Operational creditor
- liquidation proceedings
- forensic audit
- rejection of claim
- IBC provisions
