# In the matter of Moka Technology Services Limited (Kavitha Surana) MA-24-IB-2018 In TCP-81-(IB)-2017

> NCLT judgment dated 2018-08-16. Citation: TCN-2018-NCLT-00935. The case involves an application (MA/24/IB/2018) filed in TCP/81/2017 by the Joint Commissioner…

- **Court:** NCLT
- **Order date:** 16 Aug 2018
- **Citation:** TCN-2018-NCLT-00935
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/moka-technology-services-limited-kavitha-surana-ma-24-ib-2018-in-tcp-81-ib-2017-0ec1dd83

## Summary

### Background

The case involves an application (MA/24/IB/2018) filed in TCP/81/2017 by the Joint Commissioner (ST), Chennai, against Ms. Kavitha Surana, the erstwhile Resolution Professional for M/s. Moka Technology Services Limited, concerning the diversion of funds from the Corporate Debtor's account after the initiation of the Corporate Insolvency Resolution Process (CIRP). The CIRP was initiated on 21.07.2017 based on an application by the Operational Creditor, M/s. Wep Solutions India Limited, under Section 9 of the Insolvency and Bankruptcy Code, 2016. The application seeks to quash transactions where Rs. 70,00,000 and Rs. 2,30,000 were transferred out of the Corporate Debtor's account during the moratorium period.

## Facts

On 21.07.2017, Corporate Insolvency Resolution Process (CIRP) was initiated against M/s. Moka Technology Services Limited based on an application by the Operational Creditor, M/s. Wep Solutions India Limited. During the moratorium, Rs. 70,00,000 was transferred on 18.08.2017, and Rs. 2,30,000 was transferred on 24.08.2017 by Ms. Kumudha Aravamudha, the suspended Director of the Corporate Debtor, to the bank account of MTM Fnfra Systems Ltd. Rs.72,56,900 was refunded to the Corporate Debtor's bank account. Rs.70,00,000 was diverted to M/s. MTM Infra System, where Ms. Kumuda Aravamudha Iyengar is the sole proprietrix. Rs.2,30,000 was also diverted to the same bank account. Ms. Kumuda Aravamudha Iyengar was directed to appear before the bench on 04.07.2018, but she did

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## Issues and analysis

### Issue 1: Whether the transfer of funds from the Corporate Debtor's account after the initiation of CIRP …

**Ratio:** Section 68 of the I&B Code, 2016, prohibits officers of the corporate debtor from

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**Reasoning:** The court reasoned that the diversion of Rs. 72,30,000 from the Corporate Debtor's

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**Interpretation:** Section 68 aims to prevent the dissipation of assets of the corporate debtor

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**Application:** The court applied the ratio to the facts, noting that Ms. Iyengar, as a

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## Parties

- **Judges:** CH. MOHD SHARIEF…
- **Appellants:** Joint Commissioner…
- **Respondents:** MOKA TECHNOLOGY…; Kavitha S…

## Timeline

- **2017-07-21 — CIRP Init…**: Corporate Insolvency Resolution Process (CIRP) initiated against M/s. Moka Technology…
- **2017-08-18 — Fund Tran…**: Rs. 70,00,000 transferred out of…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 60(5) — Adjudicating Authority for corporate persons](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-60)

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