I.A. For PUFE Transactions V3
I.A. For PUFE Transactions V3
I.A. For PUFE Transactions V3
HYDERABAD BENCH
I.A. NO. OF 2023
IN
C.P. (IB) 269/9/HDB/2018
BETWEEN:
MONITORING COMMITTEE THROUGH
STATE BANK OF INDIA
SAM Branch, Secunderabad, H No.5-9-76,2nd
Floor, Prabhat Towers, Opp. Amaravathi LHO,
Chapel Road, Gunfoundry, HYDERABAD-
500001
…Applicant
AND
MR. GHANSHYAM SURAJBALI KUMRI
(Director - powers suspended) Apex Drugs
Limited, 210, 2nd Floor, Ram’s Enclave,
Erragadda, Hyderabad – 500018, Telangana.
…Respondent No. 1
MR. SANDEEP KUMAR VERMA
(Director - powers suspended) Apex Drugs
Limited, 210, 2nd Floor, Ram’s Enclave,
Erragadda, Hyderabad – 500018, Telangana.
…Respondent No. 2
APPLICATION FILED BY THE APPLICANT UNDER SECTION 60 (5) OF THE
INSOLVENCY AND BANKRUPTCY CODE, 2016 R/W SECTION 66, 67 AND 69 OF
THE INSOLVENCY AND BANKRUPTCY CODE, 2016.
Filed on:
Filed by:
Counsels for the Applicant
JURIS PRIME LAW SERVICES
V V S N RAJU
A V P REDDY
PRAVEEN JAIN
SRIKANTH RATHI
ABHAY TRIPATHI
AISHWARYA N.
ADVOCATES
Office at Plot No. 33, J K Enclave, Rao and Raju Colony, Near Lucid Diagnostics, Road
no 2,
Banjara Hills, Hyderabad- 500034
Ph: - 9866446467; Email: raju@jurisprime.com
DATE:
PLACE:
through State Bank of India having its office at SAM Branch, Secunderabad, H No.
5-9-76, 2nd Floor, Prabhat Towers, Opp. Amaravathi LHO, Chapel Road,
The Respondent No. 1 i.e., Mr. Ghanshyam Surajbali Kumar is the suspended
director of the Apex Drugs Limited (Corporate Debtor) having its registered office
The Respondent No. 2 i.e., Mr. Sandeep Kumar Verma Kumar is the suspended
director of the Apex Drugs Limited (Corporate Debtor) having its registered office
III. JURISDICTION
The present Interlocutory Application is being preferred under Company
Application bearing C.P. (IB) No. 269/9/HDB/2018 which was filed under Section
9 of the IB Code, 2016. It is submitted that as the said Company Petition was filed
before this Hon’ble Tribunal, hence, this Hon’ble Tribunal has the Jurisdiction to try
IV. LIMITATION
The Applicant submits that the present I.A. is not battled by the provisions of the
Limitation Act or any other provisions of law and is well within the period of
limitation.
1. It is submitted that M/s Zheijang Tongxiang Foreign Trade (Group) Co. initiated
CIRP proceedings against the Corporate Debtor under Section 9 of the IB Code,
2016 and the same was admitted by the Hon’ble Tribunal vide Order dated
06.09.2018 and the Hon’ble Tribunal appointed Mr. Maligi Madhusudhana Reddy
2. It is submitted that in the 2 nd CoC meeting the said Interim Resolution Professional
was replaced by Mr. Kapil Dev Taneja as the Resolution Professional and the
Hon’ble Tribunal vide order dated 26.11.2018 along with the confirmation letter of
IBBI dated 10.12.2018 confirmed the appointment of Mr. Kapil Dev Taneja as the
RP.
3. It is submitted that the RP in discharge of its duties perused the books of accounts
of the CD and found that certain transactions of irregular nature were carried out
by the CD before the commencement of the CIRP. It is submitted that for carrying
out audit in order to facilitate the Applicant to report such transactions to the
4. It is submitted that in the 8th CoC Meeting held on 07.05.2019, the members of the
CoC changed the transaction auditor from M/s J. Singh & Associates to M/s Ganta
and Associates for determining the transactions under section 66 of the IB Code,
2016. It is submitted that the Transaction Auditor submitted the transaction audit
report on 29.05.2019 and the same was placed before the CoC by the RP in the 10 th
CoC Meeting held on 31.05.2019 and the transactions carried out by the CD were
held as preferential, undervalued and fraudulent. The CoC directed the RP to file
a) During the Financial Year 2015-2016, CD has written off assets worth Rs. 140,
b) During the Financial Years 2016-2017 and 2017-2018 it was reported that the
assets were written off worth Rs. 5,03, 24, 200/- (short term loans and
advances) and Rs. 11, 70, 829/- (cash and bank balances) respectively.
c) It is also observed that the stock reports which has been written off were not
debtors (receivables) and their ageing, but from total receivable figure they
e) It is also noted that the book of accounts of the CD have not reconciled with the
Bank Accounts and some bank accounts are not supported with the bank
statements to review the transaction under the scope of audit. The CD’s books
of receivables are not maintained and the list is not available with the auditor
who has prepared the financial based on the available book of accounts.
such transactions, as carried out by the Corporate Debtor, have been identified as
fraudulent. The said transactions appear to have been entered with an intent to
transaction, the applicability of look back period does not arise. It is submitted that
therefore the RP filed I.A. No. 531 of 2019 in the instant Company Petition against
Section 66 of the IB Code, 2016. It is submitted that Section 25(2)Q) read with
Section 66,67 and 69 read with Section 60(5) of the IBC, 2016 provides for
during the CIRP or liquidation process, it is found that any business of the
Corporate Debtor has been caried on with an intent to defraud creditors of the
Corporate Debtor or for any fraudulent purpose, this Hon'ble Tribunal may, on an
application pass an order that any person who were knowingly parties for
carrying on such business, shall be liable to make such contributions to the assets
7. It is submitted that the RP in I.A. No. 531 of 2019, prayed before the Ld.
8. It is submitted that the Hon’ble Tribunal vide Order dated 08.09.2021 in I.A. No.
531 of 2019 held that as per the Transaction Audit Report the financial year 2015-
2016, the corporate debtor has written off assets worth Rs. 140,65,13,323/- which
resulted the corporate debtor in huge loss and the same was continued in the
following financial years, i.e., 2016-2017 and 2017-2018, which reported the written
off of the assets to the tune of Rs. 5,03,24,300/- only to defraud the creditors. The
Hon’ble Tribunal held that the Corporate Debtor indulged inwritten off in the
financial year 2015-2016 to the tune of 95% of the assets and further the books of
account/records of the Corporate Debtor in respect of the assets written off was
also not maintained. It was also recorded that no worthwhile record was
maintained by the Corporate Debtor to prove that those transactions were genuine
transactions. The Hon’ble Tribunal in para 14 of the Order dated 08.09.2021 held
that that the written off done by the Respondents during the relevant period is for
9. It is submitted that the Hon’ble Tribunal vide corrigendum dated 17.09.2021 under
Rule 154(1) of the NCLT Rules, 2016, held that in respect of para 14 of order dated
that an amount of more than Rs. 145 Crores appears to be siphoned off by the
Respondents but during submission the learned counsel for the Resolution
noted that an amount of more than Rs- 145 Crores appears to be siphoned off, we
5,14,95,129/-." It is submitted that the Counsel for the RP during the hearing of I.A.
No. 531 of 2019 never made any such submission before the Hon’ble Tribunal as
dated 01.10.2021 before the Hon’ble Tribunal wherein he submitted that he prayed
for the whole amount, i.e., Rs. 145,80,08,452 to be contributed by the Respondents
10. It is submitted that the Hon’ble Tribunal vide additional corrigendum order dated
07.10.2021 held that it has no hesitation in accepting the claim made by the
Resolution Professional that the written off done by the Respondents during the
relevant period is fraudulent and it is for defrauding the creditors of the corporate
debtor. It also held that although it is contended by the Counsel for the Resolution
Professional that an amount of more than Rs. 145 Crores appears to be siphoned