# In the matter of Bhagat Ram Motor Ways Pvt. Ltd.

> NCLT judgment dated 2023-12-22. Citation: TCN-2023-NCLT-00073. The application was filed by State Bank of India under Section 60(5) of the Insolvency and…

- **Court:** NCLT
- **Order date:** 22 Dec 2023
- **Citation:** TCN-2023-NCLT-00073
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/bhagat-ram-motor-ways-pvt-ltd-ee1186af

## Summary

### Background

The application was filed by State Bank of India under Section 60(5) of the Insolvency and Bankruptcy Code, 2016, read with Rule 11 of the NCLT Rules, 2016, against the liquidator. The applicant sought a stay on the e-auction fixed for 26.12.2023 by the liquidator and requested that the liquidator be restrained from auctioning certain assets. The applicant contended that the assets in question do not constitute the liquidation estate and should not be auctioned before the disposal of IA No.451/2022 and 431/22, which were pending before the Adjudicating Authority.

## Facts

Bhagat Ram Motorways Pvt. Ltd. is the Corporate Debtor. State Bank of India, the applicant, filed an application seeking a stay on the e-auction of certain assets by the liquidator, Arvind Kumar. The applicant claimed that the assets (Workshop & showroom and Guest House) do not form part of the liquidation estate. The liquidator argued that the applicant, being a member of the SCC with a significant voting share, did not participate in the meeting where the auction decision was made. The liquidator also stated that the assets are in the name of the Corporate Debtor in the audited balance sheets and are part of the liquidation estate under Section 36(3)(a). IA No.431/22 filed by the liquidator and IA No.451/22 filed by the applicant were withdrawn before the order

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## Issues and analysis

### Issue 1: Whether the application filed by State Bank of India seeking a stay on the e-auction of certain …

**Ratio:** An application is not maintainable if it is premature and the applicant has not exhausted

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**Reasoning:** The court reasoned that the applicant, being a member of the SCC, should have addressed

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**Interpretation:** This interpretation emphasizes the importance of exhausting internal remedies

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**Application:** The court applied this principle to the facts by finding that the applicant's

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## Parties

- **Judges:** Harnam Singh…; L. N. G…
- **Appellants:** State Bank of…
- **Respondents:** Bhagat Ram…; Arvind Kumar,…
- **Advocates:** Pulkit…; Harsh…; +1 more

## Timeline

- **2023-12-21 — Withdrawal…**: IA No.431/22 filed by the liquidator and IA No.451/22 filed by the applicant were…
- **2023-12-22 — Order Del…**: The NCLT dismissed the application…

## 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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