# In the matter of Atlanti Spinning and Weaving Mills Limited vs. Dolly Investment Company Private Limited

> NCLAT judgment dated 2023-08-02. Citation: TCN-2023-NCLAT-00318. The case involves an appeal against an order passed by the National Company Law Tribunal…

- **Court:** NCLAT
- **Order date:** 2 Aug 2023
- **Citation:** TCN-2023-NCLAT-00318
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclat-new-delhi/atlanti-spinning-and-weaving-mills-limited-vs-dolly-investment-company-private-l-1bd11631

## Summary

### Background

The case involves an appeal against an order passed by the National Company Law Tribunal (NCLT), Hyderabad Bench, which dismissed an application filed by the Liquidator of Atlanti Spinning and Weaving Mills Limited (Corporate Debtor). The Liquidator sought to declare a Sale Deed dated 11/08/2008, executed by the Corporate Debtor in favor of Dolly Investment Company Private Limited (Respondent), as a fraudulent transaction under Section 66 of the Insolvency and Bankruptcy Code (IBC). The property in question is located in Goa. The NCLT dismissed the application, stating that the Liquidator failed to establish that the sale transaction was fraudulent.

## Facts

Atlanti Spinning and Weaving Mills Limited (Corporate Debtor) was undergoing liquidation. The Liquidator challenged a Sale Deed dated 11/08/2008, executed by the Corporate Debtor in favor of Dolly Investment Company Private Limited (Respondent), concerning property in Goa. The Liquidator alleged the sale was fraudulent under Section 66 of the IBC. The Sale Deed stated a consideration of Rs. 50,00,000/- paid in 1989. The Liquidator argued the Corporate Debtor and Respondent were related parties. The Liquidator claimed Mr. R.N. Yadav, who signed the Sale Deed, was not a valid director. The Liquidator pointed to a 20-year delay in executing the Sale Deed and alleged a letter dated 18/05/1989 was fabricated. The Respondent claimed the Sale Deed was valid, the consideration

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## Issues and analysis

### Issue 1: Whether the 'Adjudicating Authority' was justified in dismissing the Application preferred by the …

**Ratio:** A registered document is presumed to be validly executed, placing the burden of proof on

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**Reasoning:** The Tribunal considered the facts and circumstances, including the recitals in the Sale

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**Interpretation:** The principle that a registered document is presumed to be validly executed

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**Application:** In this case, the Liquidator failed to provide sufficient documentary evidence

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## Parties

- **Judges:** M. Venu…; Shreesha…; +1 more
- **Respondents:** Atlanti Spinning…; Dolly Investment…

## Timeline

- **1989-05-15 — Sale Agreeme…**: The Sale Agreement between the Corporate Debtor…
- **1989-09-06 — Bank of Barod…**: Bank of Baroda issued a letter stating that an amount of Rs. 37,50,000/- was received in…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 61 — Appeals and Appellate Authority](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-61)

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