# In the matter of Directorate of Economic Offences Vs. Binay Kumar Singhania & Ors and Ors. CA (AT) (Ins) No. 935 of 2020

> NCLAT judgment dated 2021-05-04. Citation: TCN-2021-NCLAT-00269. The Directorate of Economic Offences, Government of West Bengal (DEO, WB) filed an appeal…

- **Court:** NCLAT
- **Order date:** 4 May 2021
- **Citation:** TCN-2021-NCLAT-00269
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclat-new-delhi/directorate-of-economic-offences-vs-binay-kumar-singhania-ors-and-ors-ca-1d35a618

## Summary

### Background

The Directorate of Economic Offences, Government of West Bengal (DEO, WB) filed an appeal against the order dated 19.02.2020 passed by the Adjudicating Authority (National Company Law Tribunal, Kolkata Bench, Kolkata) in CP (IB) No. 93/KB/2018. The Adjudicating Authority allowed Respondent No. 1's Application CA(IB) 1741/KB/2018 under Sections 33 (5), 60 (5) (c) and 238 of the Insolvency and Bankruptcy Code, 2016 (IBC), directing the Appellant to de-attach all properties attached vide notice dated 16.04.2018 and restore possession to Respondent No. 1 (Liquidator). The appeal contests the de-attachment order, arguing that the properties are under the custody of the Designated Court of Economic Offence and that Section 14 of the IBC does not override Section 3 of the

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## Facts

M/s Bengal Polypete, an Operational Creditor (Respondent No. 2), initiated Corporate Insolvency Resolution Process (CIRP) against M/s Pincon Spirits Ltd. Corporate Debtor (Respondent No. 3) under Section 9 of the IBC. The application was admitted on 19.07.2018. Binay Kumar Singhania (Respondent No. 1) was appointed as the Interim Resolution Professional (IRP) and later as the Resolution Professional (RP) and subsequently as Liquidator. The Directorate of Economic Offences, Government of West Bengal (DEO, WB), had attached the properties of Pincon Spirits Ltd. due to allegations of fraudulent transactions and receiving deposits from the public. A First Information Report (FIR) was registered, and a charge sheet was filed against 41 accused persons under various sections

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## Issues and analysis

### Issue 1: Whether the property of a Corporate Debtor who is not a financial establishment as defined under …

**Ratio:** Under Section 5(1)(d) of the WBPIDFE Act, the State Government can attach the property of

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**Reasoning:** The court reasoned that the WBPIDFE Act allows for the attachment of properties acquired

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**Interpretation:** The WBPIDFE Act is interpreted to allow for the attachment of properties

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**Application:** In this case, the properties of Pincon Spirits Ltd. were attached based on the

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## Parties

- **Judges:** Jarat Kuma…; KanthiNar…
- **Appellants:** Directorate of…
- **Respondents:** Pincon Spirits…; Binay Kumar…

## Timeline

- **2017-02-19 — FIR Regis…**: First Information Report (FIR) was registered against the Directors and other officials…
- **2018-01-31 — Charge Shee…**: DEO, WB filed Charge Sheet No. 08/18 under Sections 406, 409, 420 and 120B of the IPC and…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 9 — Application for initiation of corporate insolvency…](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-9)

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