# In the matter of Madhusala Drinks Private Limited I.A (IBC) No.69-KB-2021 In C.P. (IB) No. 932-KB-2018

> NCLT judgment dated 2022-07-18. Citation: TCN-2022-NCLT-04580. An application was filed under Section 66 of the Insolvency and Bankruptcy Code, 2016, read…

- **Court:** NCLT
- **Order date:** 18 Jul 2022
- **Citation:** TCN-2022-NCLT-04580
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-kolkata/madhusala-drinks-private-limited-ia-ibc-no69-kb-2021-in-cp-ib-no-932-kb-2018-0cf8759b

## Summary

### Background

An application was filed under Section 66 of the Insolvency and Bankruptcy Code, 2016, read with Rule 11 of the National Company Law Tribunal Rules, 2016, by the Resolution Professional appointed in the CIRP of M/s Madhusala Drinks Private Limited, seeking orders regarding fraudulent transactions.

## Facts

The Interlocutory Application(IBC)No. 69/KB/ 2021 has been filed by the Resolution Professional appointed in the CIRP of M/s Madhusala Drinks Private Limited.

The applicant contacted the erstwhile Directors of the Corporate Debtor and intimated them of the initiation of the CIRP and requested them to provide him necessary information and records of the Corporate Debtor.

The applicant informed the CoC that he had not received much information from the Corporate Debtor and the Corporate Debtor had provided him with a copy of FIR, which he had filed earlier, wherein it was stated that a theft has taken place in the factory.

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## Issues and analysis

### Issue 1: Whether the transactions carried out by the respondents are fraudulent in terms of Section 66 of …

**Ratio:** Section 66 of the IBC, 2016 defines fraudulent transactions and provides for orders to be

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**Reasoning:** The applicant presented evidence from the Transaction Audit Report and other documents

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**Interpretation:** The Adjudicating Authority interpreted Section 66 to allow for the reversal of

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**Application:** The Adjudicating Authority applied Section 66 to the facts of the case and

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## Parties

- **Judges:** RohitKa…; Harish Chander…
- **Appellants:** State Bank of…; Jitendra…
- **Respondents:** M/s Madhusala…; Sarbjit Singh…
- **Advocates:** Joy S…; Isshan…; +1 more

## Timeline

- **2015 — Suspension of Business…**: Corporate Debtor's business…
- **2015-12-31 — NPA Decla…**: The account of the Corporate Debtor with State Bank of India was declared an NPA…

## 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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