# In the matter of Union of India Through Serious Fraud Investigation Office (SFIO) Vs. Maharashtra Tourism Development Corporation & Anr. CA(AT)(Ins)No. 964 of 2019

> NCLAT judgment dated 2019-12-02. Citation: TCN-2019-NCLAT-00070. The Union of India filed appeals against orders passed by the Adjudicating Authority,…

- **Court:** NCLAT
- **Order date:** 2 Dec 2019
- **Citation:** TCN-2019-NCLAT-00070
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclat-new-delhi/union-of-india-through-serious-fraud-investigation-office-sfio-vs-maharashtra-to-6e96dba0

## Summary

### Background

The Union of India filed appeals against orders passed by the Adjudicating Authority, Principal Bench, New Delhi, in two applications filed by the Resolution Professional (now Liquidator). These applications concerned investigations into the affairs of Luxury Train Pvt. Ltd. and Zynke Exports Pvt. Ltd., both Corporate Debtors. The Adjudicating Authority directed the Serious Fraud Investigation Office (SFIO) to investigate the siphoning of funds, which was noticed by the Adjudicating Authority in its earlier orders.

## Facts

The Union of India, through the Serious Fraud Investigation Office (SFIO), appealed against orders passed by the Adjudicating Authority concerning Luxury Train Pvt. Ltd. and Zynke Exports Pvt. Ltd. The Adjudicating Authority had directed the SFIO to investigate the siphoning of funds from these companies. The Resolution Professional (now Liquidator) initiated the investigation. The Union of India contended that the Adjudicating Authority lacked the jurisdiction to direct such an investigation, as this power rests with the Central Government under Section 212 of the Companies Act, 2013. The Liquidator argued that the corporate insolvency resolution process had not fully disclosed all details and assets, potentially violating Section 70 of the I&B Code. The appeals

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## Issues and analysis

### Issue 1: Whether the Adjudicating Authority has jurisdiction to direct the SFIO to investigate the fraud or …

**Ratio:** Section 212 of the Companies Act, 2013, outlines the circumstances under which the

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**Reasoning:** The Appellate Tribunal reasoned that Section 212 of the Companies Act, 2013, does not

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**Interpretation:** The interpretation of Section 212 and 213 clarifies the division of powers

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**Application:** The Appellate Tribunal applied these principles by holding that the

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## Parties

- **Judges:** S.J. Mukhop…; Bansi Lal…; +1 more
- **Appellants:** Union of…
- **Respondents:** Luxury Train Pvt.…; Maharashtra…

## Timeline

- **2019-07-24 — Orders Passed by…**: The Adjudicating Authority passed orders in two different applications filed by the…
- **2019-07-26 — Orders Passed by…**: The Adjudicating Authority passed orders in two different applications filed by the…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 70 — Punishment for misconduct in course of corporate…](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-70)

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