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Bharat Heavy Electricals Ltd. V Anil Goel
In the case of Bharat Heavy Electrical Limited v. Anil Goel, NCLAT reiterated the duties and obligations of a Liquidator while auctioning the property of a Corporate Debtor.
Facts-
BHEL claiming to be a secured creditor, also claims that in Feb 2019 Visa power Ltd., a corporate debtor had issued Notice inviting tenders inviting bids for design, engineering, manufacturing, transportation, storage, erection, testing and commissioning of Thermal Power plant at Chattisgarh. Appellant got the tender and had supplied 26000 MT of material and plant and machinery to the respondents.But due to the unpaid bills, the work of the plant remained suspended.
In the meantime, the liquidator published Sale Notice advertisement of auction of assets of the Corporate Debtor, whose invoices were unpaid. The liquidator went on to sell the plant and machinery to Argawal Structure Mills Pvt. Ltd., While,BHEL gave several notices to the liquidator, he didn’t respond to any and failed to ensure safety of the materials supplied by the Appellant. Then BHEL filed case against the respondent in NCLT, Kolkata.
BHEL appealed before the NCLAT, being aggrieved by the order passed by the National Company Law Tribunal, Kolkata. BHEL challenged the approval given by the NCLT for the Auction Sale and removal of goods by the auction purchaser. BHEL also claimed to be a secured creditor of the corporate debtor, thus demanded for charge against assets i.e. plant and machinery supplied by it. BHEL also submitted that NCLT Kolkata even after finding out discrepancies in the Auction Sale not only upheld the auction sale but also hold the Auction purchaser a bonafide purchaser.
After hearing submissions, NCLAT held that the order passed by NCLT, Kolkata is not maintainable. It also said that the Auction sale was illegal, there was improper valuation, inconsistencies and contradictions in valuation, inconsistencies in the sale of plant and machinery. NCLAT noted that a liquidator has an obligation towards his corporate debtor to mitigate his future losses and he also has fiduciary responsibility.
But the NCLAT rejected the appeal of BHEL to be a secured creditor of the corporate debtor and hence rejected his contention for having charge over plant and machinery.
Directions given by NCLAT:-
The NCLAT has given directions to Station House Officer SHO, Bhupdevpur to Mr. Anil Goel(Liquidator) i.e. the liquidator to pursue the complaints and register them as FIR and investigate them. NCLAT also directed the liquidator to take record of stocks lying on the Project site. He is also directed to report the missing and damaged materials. It was also directed to return all the materials belonging to the appellant i.e. BHEL.
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