# In the matter of Man Tubinox Ltd. IA 1235-2020 in C.P.(IB)-4348-(MB)-2018

> NCLT judgment dated 2021-10-06. Citation: TCN-2021-NCLT-00822. The case involves an application filed by the Resolution Professional (RP) of Man Tubinox Ltd…

- **Court:** NCLT
- **Order date:** 6 Oct 2021
- **Citation:** TCN-2021-NCLT-00822
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/man-tubinox-ltd-ia-1235-2020-in-cpib-4348-mb-2018-0d612dc5

## Summary

### Background

The case involves an application filed by the Resolution Professional (RP) of Man Tubinox Ltd under Section 14(1)(b) r/w Section 66 of the Insolvency and Bankruptcy Code (IBC), 2016, seeking the reversal of a transaction deemed illegal. The transaction involved the transfer of the Corporate Debtor's property to the Respondents, M/s Man Tubinox Ltd, during the moratorium period. The petition's admission was heard on 29.03.2019, reserved for orders, and subsequently pronounced on 12.06.2019, leading to the appointment of an Interim Resolution Professional (IRP). The RP's application highlights that the Corporate Debtor held lease rights over a significant area in Madhya Pradesh, obtained from Madhya Pradesh Audyogik Kendra Vikas Nigam (MPAKVN). A sub-lease deed was

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## Facts

The Resolution Professional (RP) of Man Tubinox Ltd filed an application under Section 14(1)(b) r/w Section 66 of the IBC, 2016, seeking the reversal of a transaction. The Corporate Debtor, Man Tubinox Ltd, held lease rights over an area of 61629.44 sq. mtrs in Madhya Pradesh, obtained from MPAKVN, with the lease expiring on 21.06.2045. The Corporate Debtor entered into a Sub-Lease Deed dated 01.04.2019 with Maan Tubes Ltd, assigning 25,261.25 sq. mtrs of the leasehold right. The RP contended that this sub-lease was executed with mala fide intentions to deprive creditors of the asset. Maan Tubes Ltd is considered a 'related party' because one of its directors, Mr. Jagdish Ishwar Manik, is also a Director/Promoter of the Corporate Debtor. The original lease deed between

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## Issues and analysis

### Issue 1: Whether the sub-lease deed executed by the Corporate Debtor with Maan Tubes Ltd during the …

**Ratio:** Section 66 of the IBC addresses fraudulent trading or wrongful trading, stating that if

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**Reasoning:** The court reasoned that the sub-lease was executed with the intent to defraud creditors,

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**Interpretation:** Section 66 is interpreted to prevent actions taken by the corporate debtor or

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**Application:** The court applied Section 66 to the facts by finding that the sub-lease was a

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## Parties

- **Judges:** H.V. Subb…; Chandra Bha…
- **Appellants:** Vikas Prakash…
- **Respondents:** Man Tubin…; Vinod Ku…

## Timeline

- **2019-03-29 — Hearing of P…**: Admission of the Petition was…
- **2019-04-01 — Sub-Lease…**: The Sub-lease was signed on a…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 14(1) — Moratorium](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-14)

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