# In the matter of Simtel Trading Corporation Private Limited

> NCLT judgment dated 2024-04-25. Citation: TCN-2024-NCLT-01584. The case involves an application filed by the Resolution Professional of Simtel Trading…

- **Court:** NCLT
- **Order date:** 25 Apr 2024
- **Citation:** TCN-2024-NCLT-01584
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/simtel-trading-corporation-private-limited-4571853d

## Summary

### Background

The case involves an application filed by the Resolution Professional of Simtel Trading Corporation Private Limited under Section 66 of the Insolvency and Bankruptcy Code (IBC), 2016, alleging fraudulent transactions by the respondents. The application seeks to declare that the respondents carried out the business of the corporate debtor with the intention to defraud its creditors and seeks directions for the respondents to pay specific sums to the corporate debtor's bank account, representing profits created through various means, including the purchase and sale of assets, sale of land, write-offs, and fraudulent transfer of funds. The applicant claims that the suspended management has been uncooperative in providing relevant information, hindering the CIRP process. A

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## Facts

Simtel Trading Corporation Private Limited is undergoing Corporate Insolvency Resolution Process (CIRP) initiated by Tata Capital Financial Services Pvt Ltd, a Financial Creditor, under Section 7 of the IBC. Mr. Vikky Dang is the Resolution Professional. The Resolution Professional filed an application under Section 66 of the IBC alleging fraudulent transactions by the Respondents. The application claims that the Respondents carried out the business of the Corporate Debtor with the intention to defraud its creditors. The alleged fraudulent transactions include the sale of property at an undervalued price to M/s Central Associates (Proprietary concern of former director Mr. Bobby Abraham), write-offs of fixed assets, and fraudulent transfer of funds to the directors of

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## Issues and analysis

### Issue 1: Whether the Respondents carried out the business of the Corporate Debtor with the intention to …

**Ratio:** Section 66 of the IBC, 2016, allows for action against individuals who have knowingly

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**Reasoning:** The Tribunal reasoned that the applicant failed to provide sufficient evidence to prove

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**Interpretation:** Section 66 requires a clear demonstration of fraudulent intent and cannot be

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**Application:** In this case, the Tribunal found that the applicant's allegations were not

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## Parties

- **Judges:** Shyam Babu…; T Krishna…
- **Appellants:** Vikky…
- **Respondents:** M/s. Simtel…; Rajesh…

## Timeline

- **2022-01-01 — CP(IB)/34/KOB/2022…**: Application for Corporate Insolvency Resolution Process filed by Tata Capital Financial…
- **2022-12-01 — Appointment of Interim…**: The Applicant was appointed as the…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 66 — Fraudulent trading or wrongful trading](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-66)

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