# In the matter of Jaipur Metals & Electricals Ltd.

> NCLT judgment dated 2023-04-12. Citation: TCN-2023-NCLT-03850. The case involves an application (IA No. 616/JPR/2022) filed by Jaipur Development Authority…

- **Court:** NCLT
- **Order date:** 12 Apr 2023
- **Citation:** TCN-2023-NCLT-03850
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/jaipur-metals-electricals-ltd-a3a5c6bb

## Summary

### Background

The case involves an application (IA No. 616/JPR/2022) filed by Jaipur Development Authority (JDA) seeking to be impleaded as a party respondent in IA No. 99/JPR/2019, which was filed by the Resolution Professional (RP) seeking handover of assets of the Corporate Debtor, Jaipur Metals & Electricals Limited. The JDA claims ownership of the land (Khasra No. 3) on which the Corporate Debtor is situated, arguing that the RP should not take control of assets not owned by the Corporate Debtor. The Corporate Debtor's account became a non-performing asset in 1997, leading to BIFR proceedings and a winding-up opinion. Alchemist Asset Reconstruction Company Ltd. initiated CIRP under Section 7 of the IBC based on a debt of Rs. 356 crores. The High Court had previously stayed

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## Facts

Jaipur Metals & Electricals Limited (Corporate Debtor) faced insolvency proceedings initiated by Alchemist Asset Reconstruction Company Ltd. The Jaipur Development Authority (JDA) claimed ownership of the land (Khasra No. 3) where the Corporate Debtor is situated, asserting that the Resolution Professional (RP) cannot take control of assets not owned by the Corporate Debtor. The JDA filed an application (IA No. 616/JPR/2022) to be impleaded as a party in the RP's application (IA No. 99/JPR/2019) seeking handover of assets. The RP argued that the land was sold to the Corporate Debtor in 1953 and that the JDA's claim is based on mutation records, which do not confer ownership. The Corporate Debtor's account became a non-performing asset in 1997, leading to BIFR

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## Issues and analysis

### Issue 1: Whether the Jaipur Development Authority is a necessary party to be impleaded in an application …

**Ratio:** Section 19 of the IBC mandates cooperation from the Corporate Debtor's personnel,

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**Reasoning:** The court reasoned that the Jaipur Development Authority (JDA) is neither the personnel

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**Interpretation:** Section 19 of the IBC is interpreted to apply to individuals directly

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**Application:** Since the JDA is not directly related to the Corporate Debtor's management or

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## Parties

- **Judges:** Deep Chandr…; Prasanta Kumar…
- **Appellants:** Jaipur Development…
- **Respondents:** Jaipur Metals &…; ArunavaS…

## Timeline

- **1943-08-30 — Incorporation of Jaipur Metals Industries…**: Jaipur Metals & Electricals Limited (JMEL), previously known as Jaipur Metals Industries…
- **1953-06-12 — Execution of S…**: Sale deeds were executed by His Highness The Raj Pramukh of Rajasthan and the Jaipur…

## 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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