If the Appellant has not given any clarity or reason as to why transactions were made, the benefit of the exception that is carved out in Section 43(3)(a) of IBC cannot be provided to the Appellant – Ashique Ponnamparambath Vs. Vibin Vincent, Liquidator of Koyenco Autos – NCLAT Chennai
Hon’ble NCLAT held that:
(i) A plain reading of sub-section (2) of section 43 makes it clear that if the transfer of a property or an interest of the corporate debtor is made for the benefit of a creditor or a surety or a guarantor, such transaction would be ‘preferential transaction’, if it puts such creditor or surety or guarantor in a beneficial position and if such transactions are made within the ‘relevant period’.
(ii) In the absence of any reason provided by the Appellant as to why such transfers were made in his favour from the account of the corporate debtor, it would be a safe and logical conclusion that he considers that the corporate debtor owed him these amounts. Therefore, in accordance with clause (a) of sub-section (2) of section 43, such transactions are clearly ‘preferential transactions’.
(iii) Further, the exception that is carved out in clause (a) of sub-section (3) of section 43 that if the transfer is made in the ‘ordinary course of business’ of the corporate debtor, such transactions would be considered outside the ambit of ‘preferential transactions’. The Appellant in his reply before the Adjudicating Authority has not given any clarity or reason as to why such transactions were made and therefore, the benefit of this exception of the transactions having been made in the ‘ordinary course of business’ cannot be provided to the Appellant.
