# In the matter of Virgo Marine Shipyards  I.A. 1047-2020
 In C.P. 1600-I&B-MB-2019

> NCLT judgment dated 2021-11-26. Citation: TCN-2021-NCLT-00398. The case involves an application (I.A. 1047/2020) filed in C.P. 1600/I&B/MB/2019 under Section…

- **Court:** NCLT
- **Order date:** 26 Nov 2021
- **Citation:** TCN-2021-NCLT-00398
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/virgo-marine-shipyards-ia-1047-2020-in-cp-1600-ib-mb-2019-163fb6b6

## Summary

### Background

The case involves an application (I.A. 1047/2020) filed in C.P. 1600/I&B/MB/2019 under Section 60(5) of the Insolvency and Bankruptcy Code, 2016, by Mohanlal Ayyapan Pillai, the Founder and Suspended Managing Director of Virgo Marine Shipyards. The application seeks several reliefs, including holding the sale of a vessel (MV. VM Hopper Barge H-107) from Respondent No. 2 (Nagpur Nagrik Sahkari Bank Ltd.) to Respondent No. 3 (Vyankatesh Engineers & Contractors Pvt. Ltd.) as violative of the moratorium imposed under Section 14 of the IBC, and as a preferential, undervalued, and fraudulent transaction. The applicant also seeks directions to restore the vessel to the corporate applicant's assets and confirm the appointment of the Interim Resolution Professional (IRP).

## Facts

Mohanlal Ayyapan Pillai, the Founder and Suspended Managing Director of Virgo Marine Shipyards, filed an application seeking to challenge the sale of a vessel, MV. VM Hopper Barge H-107. Nagpur Nagrik Sahkari Bank Ltd. (Respondent No. 2) had advanced credit facilities to Virgo Marine Shipyards, secured by the vessel. Due to defaults in repayment, the loan account was declared an NPA, and the bank initiated SARFAESI proceedings, including taking possession of the vessel and attempting to sell it through public auctions. Vyankatesh Engineers & Contractors Pvt. Ltd. (Respondent No. 3) purchased the vessel in an auction. The sale was confirmed on 02.12.2019, and Respondent No. 2 received 25% sale consideration from Respondent No. 3 on the same date. The admission order

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## Issues and analysis

### Issue 1: Whether the Applicant has locus …

**Ratio:** The code does not provide for filing any application by the Member of the Suspended Board

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**Reasoning:** The NCLT reasoned that the application was filed by the Ex-Managing Director of the

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**Interpretation:** The interpretation is that once the CIRP is initiated and an IRP is appointed,

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**Application:** Since the application was filed by the ex-Managing Director and not by the IRP

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## Parties

- **Judges:** H.V. Subb…; Chandra Bha…
- **Appellants:** Mohanlal Ayyapan…
- **Respondents:** Virgo Marine…

## Timeline

- **2018-05-25 — Credit Facilities…**: Nagpur Nagrik Sahkari Bank Ltd. advanced credit facilities of Rs. 1,50,00,000/- to the…
- **2018-06-30 — Loan Account Declared…**: The Loan Account of the Corporate Debtor was declared as Non-Performing Asset (NPA) by…

## 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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