Punjab National Bank and others Vs. Unigreen Global Pvt Ltd [Company Petition No. IB-39(PB)/2017] - Synopsis
Team SoOLEGAL 17 May 2021
FACTS:
In this case, Punjab National Bank and others Vs. Unigreen Global Pvt Ltd [Company Petition No. IB-39(PB)/2017], the applicant/corporate debtor company initiated the Corporate Insolvency Resolution process by filing an application. It had furnished the information of the financial creditors and the operational creditors, as well as the list of immovable assets owned securities by the financial creditors banks, in accordance with the provisions of the Insolvency and Bankruptcy Code, 2016 (Code). The claimant served notice on the financial creditors as ordered by the Tribunal. The lead financial creditor bank objected to the proposal.

 DECISION OF THE COURT:
Taking into account the arguments of both parties, the Tribunal determined that if the instant petition by the Corporate Debtor is admitted, the admission will have a serious impact on the objectors, namely, the financial creditors, because any action that has resulted in physical possession of the secured assets will be automatically ‘stayed' for a period of at least six months, if not more, depending on the circumstances of the process, which seems to be the motivation for the applicant to approach this Tribunal under IBC, 2016 rather than putting into action the avowed objects for which IBC, 2016 was enacted. The Tribunal cannot be a party to such fraudulent conduct by the corporate debtor, and this is a straightforward case of misuse of the legal process, which should be discouraged at the outset. Taking into account the above, and because the corporate debtor did not come with clean hands, the Tribunal dismissed the petition and levied a penalty of Rs. 10 Lacs against costs as contemplated by Section 65 of the Code in order to prevent the parties from violating the Code's procedure.
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