# 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-00319. 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-00319
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclat-new-delhi/atlanti-spinning-and-weaving-mills-limited-vs-dolly-investment-company-private-l-d909b0f5

## 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 Sale Deed pertained to immovable property 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 immovable property in Goa. The liquidator alleged that the Sale Deed was fraudulent under Section 66 of the IBC. The Sale Deed stated that the Respondent had paid Rs. 50,00,000/- to the Corporate Debtor in 1989 for the property. The liquidator argued that the Sale Deed was executed without a valid party, that there was an inordinate delay in execution, and that the consideration was inadequate. The liquidator also claimed that the Corporate Debtor and Respondent were related parties. The Respondent contended that the

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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 carries a presumption of validity is a

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**Application:** In this case, the Tribunal applied the principle that a registered Sale Deed is

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## Parties

- **Judges:** M. Venu…; Shreesha…; +1 more
- **Respondents:** Atlanti Spinning…; Dolly Investment…
- **Advocates:** V.V. Siva…; P.H. Arvindh…; +1 more

## Timeline

- **1989-05-15 — Sale Agreeme…**: The Sale Agreement between the Corporate Debtor…
- **1989-09-06 — Bank Lette…**: Bank of Baroda issued a letter confirming a payment of Rs. 37,50,000/- towards the…

## 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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