Madras Excessive Courtroom dismisses ED’s 18-year-old enchantment in opposition to quashing of insolvency discover issued to Dhinakaran in 2001
The Madras Excessive Courtroom on Friday dismissed an enchantment most well-liked by Enforcement Directorate in 2005 difficult a 2002 order of a single decide who had quashed an insolvency discover issued to Amma Makkal Munnetra Kazhagam (AMMK) chief T.T.V. Dhinakaran for not having paid penalty imposed in a International Trade Regulation Act (FERA) case.
A Division Bench of Justices R. Subramanian and R. Kalaimathi dismissed the unique facet enchantment, pending for final 18 years, on the technical floor that the insolvency discover issued on March 1, 2001 underneath Part 9 (2) of the Presidency Cities Insolvency Act of 1909 was not legitimate since on that date the decree or order in opposition to Mr. Dhinakaran had not grow to be closing.
After the pronouncement of the decision, when Extra Solicitor Common AR.L. Sundaresan and ED Particular Public Prosecutor Rajnish Pathiyil requested whether or not the ED might subject a recent discover now because the proceedings had grow to be closing, the senior decide within the Bench said that it goes with out saying because the courtroom had interfered with the 2001 discover on a restricted floor.
Justice Subramanian instructed the attorneys that his Bench had framed 5 questions for willpower within the enchantment. They have been: Whether or not the phrases ‘creditor, debt and debtor’ as outlined underneath Sections 2(a) and a pair of(b) of the Presidency Cities Insolvency Act needs to be given a restricted typical which means or not.
Whether or not the time period ‘decree or order’ showing in Part 9(2) of the 1909 Act would imply solely a decree or order of a civil courtroom or would come with any order for fee of cash handed after an adjudicatory course of? Whether or not the appliance filed by Mr. Dhinakaran, underneath Part 9(5), to put aside the insolvency discover on the grounds talked about in it’s maintainable?
Whether or not the ED is competent to provoke proceedings in insolvency for failure in fee of the penalty imposed? and whether or not Part 9(2) might be invoked earlier than the decree or order turning into closing? Answering the primary two questions collectively, the Bench held that the phrases ‘debt, debtor and creditor’ have been able to a wider which means and due to this fact an utility in insolvency was maintainable for non fee of penalty too.
Equally, answering the third and fifth questions collectively, the Bench stated, an utility underneath Part 9(5) might be filed solely on the grounds talked about within the authorized provision and never on different grounds.
The Bench didn’t reply the fourth query and left it open in view of the solutions given by it to the opposite 4 questions.
