Under Section 19(2) of IBC, Adjudicating Authority cannot direct Suspended Board to contribute to Corporate Debtor to the extent the money is not paid by Sundry Debtors of Corporate Debtor – Mr. Mahesh Sureka RP Vs. Minesh Prints Ltd. and others – NCLT Mumbai Bench
January 8, 2024
The Resolution Professional is seeking directions for cooperation from the Sundry Debtors and the Suspended Directors in realisation of debts owed by the Sundry Debtors to the Corporate Debtor for goods sold to them prior in time. NCLT Mumbai Bench holds that such directions are not permissible under section 19(2) and this Bench cannot direct them to co-operate. Had this Application been filed in terms of Section 66 of the Code meeting the conditions precedent provided therein, this Bench could have assumed jurisdiction to consider the prayer of the Application, if such prayer would otherwise be permissible under that Section. The RP has lien over such Goods as “Unpaid Seller” in terms of Provisions contained in Section 47 of Sale of Goods Act, 1930. Accordingly, no specific direction is necessary from NCLT for Sunday Debtors.