# In the matter of Shivam Water Treaters Pvt. Ltd. C.P. No.(IB)1882(MB)-2018

> NCLT judgment dated 2019-02-18. Citation: TCN-2019-NCLT-04797. The case involves a corporate insolvency resolution process (CIRP) initiated under Section 7 of…

- **Court:** NCLT
- **Order date:** 18 Feb 2019
- **Citation:** TCN-2019-NCLT-04797
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/shivam-water-treaters-pvt-ltd-cp-noib1882mb-2018-011c17c7

## Summary

### Background

The case involves a corporate insolvency resolution process (CIRP) initiated under Section 7 of the Insolvency and Bankruptcy Code, 2016. The Resolution Professional (RP) faced obstruction in taking control of the Corporate Debtor, Shivam Water Treaters Pvt Ltd. The ex-directors, Mr. Gaurav Dave and his son Mr. Vishal Dave, allegedly did not cooperate with the RP, refused to hand over property possession, and obstructed access to the Corporate Debtor's premises. The Ahmedabad Municipal Corporation (AMC) sealed the Corporate Debtor's office for non-payment of municipal taxes, even after the moratorium was imposed under Section 14 of the IBC.

## Facts

The Resolution Professional (RP) was appointed for Shivam Water Treaters Pvt Ltd under the Insolvency and Bankruptcy Code, 2016. The RP visited the Corporate Debtor's site with police assistance but was obstructed by Mr. Vishal Dave, the son/Business Head of the Ex-director Mr. Gaurav Dave, who claimed the site identified by the RP was not the Corporate Debtor's. Mr. Vishal Dave refused to provide title documents when requested. The RP's team member, Mr. Choudhary, had previously visited the site with Mr. Gaurav Dave. The RP discovered a broken gate locked from inside. The Ahmedabad Municipal Corporation (AMC) sealed the Corporate Debtor's corporate office for non-payment of municipal taxes after the moratorium was imposed under Section 14 of the IBC. The notice and

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## Issues and analysis

### Issue 1: Whether the ex-directors of the Corporate Debtor, Mr. Gaurav Dave and Mr. Vishal Dave, are in …

**Ratio:** Section 70 of the IBC outlines the duties of officers of the corporate debtor to disclose

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**Reasoning:** The court noted that the ex-directors had not complied with the directions of the Court,

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**Interpretation:** Section 70 of the IBC imposes a duty on the officers of the corporate debtor to

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**Application:** The court applied Section 70 to the facts of the case, finding that the

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## Parties

- **Judges:** V. P. S…; RavikumarDu…
- **Appellants:** Asset Reconstructi…
- **Respondents:** Shivam Water…

## Timeline

- **2018-10-15 — Moratorium…**: Moratorium order passed…
- **2018-10-26 — NCLAT Dire…**: Directions of Hon'ble NCLAT to RP to ensure…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 7 — Initiation of corporate insolvency resolution…](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-7)

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