Page 127 - IBC Orders us 7-CA Mukesh Mohan

Order Passed Under Sec 7
Hon’ble NCLT Principal Bench

10. Rule 4 of the Insolvency and Bankruptcy (Application to Adjudicating Authority) Rules, 2016 is

applicable in this case. The said rule reads as under:

Application of financial creditor

(1)--------

(2)--------

(3) "The applicant shall dispatch forthwith, a copy of the application filed with the Adjudicating
Authority, by registered post or speed post to the registered office of the corporate debtor."

(4) ----------

11. The National Company Law Appellate Tribunal in its Order dated 15.05.2017 in Company
Appeal (AT) (Insolvency) No. 1 and 2 of 2017 in the case of Innoventive Industries Ltd. Vs. ICICI Bank
& Ors. has discussed in detail the issue as to whether it is mandatory for the Adjudicating Authority to

follow the principles of natural justice while passing an Order under Insolvency and Bankruptcy Code,
2016. The Hon'ble Appellate Tribunal has referred to the judgment of Hon'ble Calcutta High Court dated

7th April, 2017 in the Writ Petition No. 7144(W) of 2017 assailing the vires of Section 7 of the Code,
2016 and the relevant rules under the Insolvency and Bankruptcy (Application to the Adjudicating
Authority, 2016) in the case of "Sree Metaliks Limited & Ann." After quoting extensively from this

judgment and discussing the same, the Hon'ble Appellate Tribunal has stated that "we are of the view and
hold that the Adjudicating Authority is bound to issue a limited notice to the corporate debtor before

admitting a case for ascertainment of existence of default based on material submitted by the corporate
debtor and to find out whether the application is complete and or there is any other defect required to be
removed. Adherence to Principles of natural justice would not mean that in every situation the
adjudicating authority is required to afford reasonable opportunity of hearing to the Corporate debtor

before passing the order."

12. In the instant case, while a copy of the petition has not been served at the registered address of the

Corporate Debtor, the same has been served on a Director of the Corporate Debtor. This Director,
Shrimati Harjas Kaur Anand (DIN 00442543) has vide letter dated 3rd July, 2017 acknowledged receipt

of the application in Form-1 against Mariners Buildcon India Ltd. (Corporate Debtor) for initiation of
Corporate Insolvency Resolution Process. This letter further goes on to state as follows:-

"Please note, we are currently in financial distress on account of default in payment by our
customers. We are trying our best to ensure recoveries from our customers, however, it

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