# In the matter of Priknit Retails Limited

> NCLT judgment dated 2024-01-12. Citation: TCN-2024-NCLT-03075. The case involves two applications, IA Nos. 464/2020 and 855/2020, filed by the suspended…

- **Court:** NCLT
- **Order date:** 12 Jan 2024
- **Citation:** TCN-2024-NCLT-03075
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/priknit-retails-limited-a8d0ee15

## Summary

### Background

The case involves two applications, IA Nos. 464/2020 and 855/2020, filed by the suspended director of Priknit Retails Limited against the liquidator, Sanjay Kumar Aggarwal. The applications allege that the liquidator failed to disclose that his wife was an employee of the State Bank of India (SBI), the financial creditor, creating a conflict of interest. The applicant also alleges that the liquidator was proceeded against by SBI as a willful defaulter and that the CBI lodged an FIR against him. The applications seek action against the liquidator for making false statements and misleading statements, and directions for him to refund all fees/expenses to the creditors received by him through the present liquidation.

## Facts

Priknit Retails Limited is undergoing liquidation. Mr. Vijay Kumar Ghai, the suspended director of Priknit Retails Limited, filed IA Nos. 464/2020 and 855/2020 against Sanjay Kumar Aggarwal, the liquidator. Ghai alleged that Aggarwal failed to disclose that his wife was an employee of the State Bank of India (SBI), the financial creditor of Priknit Retails, creating a conflict of interest. Ghai also alleged that SBI had initiated proceedings against Aggarwal as a willful defaulter and that the CBI had lodged an FIR against him. Aggarwal denied these allegations, stating that his wife's position at SBI did not influence the CIRP and that SBI had exonerated him. He also claimed that the FIR lodged by the CBI was against another individual with a similar name. SBI

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## Issues and analysis

### Issue 1: Whether the Liquidator's failure to disclose his wife's employment with the Financial Creditor, …

**Ratio:** An Insolvency Professional must not conceal any material information or knowingly make a

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**Reasoning:** The court gave credence to the explanation of the bank that though the Liquidator's wife

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**Interpretation:** The interpretation of the regulation focuses on whether the relationship

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**Application:** In this case, the court found that the liquidator's wife's position at SBI was

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## Parties

- **Judges:** Harnam Singh…; SUBRATA KUM…
- **Appellants:** Vijay Kuma…
- **Respondents:** Priknit Retails…; Sanjay Kumar…

## Timeline

- **2016-08-30 — Notice of Wilful…**: State Bank of India issued a notice of wilful…
- **2019-06-30 — SBI Lodge…**: SBI lodged a separate FIR against the…

## 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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