Listing fee dues cannot be recovered under operational debt: NCLAT while dismissing BSE petition

New Delhi: Dues on the itemizing charges in opposition to an organization are ‘regulatory dues’ in nature and can’t be recovered beneath ‘operational debt’ via insolvency proceedings, mentioned the Nationwide Firm Regulation Appellate Tribunal (NCLAT) whereas dismissing an enchantment by inventory change BSE. Itemizing charges comes beneath the ambit of ‘regulatory dues’, which markets regulator Sebi is entitled to recuperate, and the defaulting firm being an entity registered beneath Sebi is beneath an obligation to comply with the laws prescribed by the regulator for the restoration of its dues, noticed the NCLAT.

“The dues so mentioned are usually not ‘operational dues’ however ‘regulatory dues’. The Insolvency Regulation Committee means that regulatory dues are to not be recovered beneath ‘operational debt’,” noticed a two-member NCLAT bench comprising Justice Anant Bijay Singh and Shreesha Merla.

The NCLAT additionally upheld the order handed by the Nationwide Firm Regulation Tribunal (NCLT) on December 31, 2020, which had dismissed the plea of the BSE to provoke insolvency proceedings in opposition to KCCL Plastic Ltd.

“We now have rigorously examined the pleadings of the case and got here to the conclusion that no interference is required within the impugned order. Therefore, the impugned order dated December 31, 2020, handed by NCLT, Ahmedabad Bench is hereby affirmed. The Enchantment is dismissed,” mentioned the NCLAT.

The securities of Ahmedabad-based KCCL Plastic Ltd have been listed on the buying and selling platform offered by the BSE on October 27, 1993, and as per the itemizing settlement, it needed to pay an annual itemizing charges (ALF) on or earlier than April 30 yearly.

Based on BSE, KCCL Plastic made funds of the ALF until the monetary yr 2013-14 after that it did not make any fee.

The BSE has raised a number of invoices of ALF with arrears and KCCL Plastic willfully uncared for to remit, the bourses submitted.

A requirement notice of Rs 10.66 lakh dated March 15, 2019, was dispatched and the respondent refused to acknowledge such service. The Demand Notices that have been despatched to addresses have been returned undelivered bearing finish, it added.

Following this, the BSE filed a petition earlier than the NCLT beneath Part 9 of the Insolvency and Chapter Code claiming an operational debt.

It claimed that ALF constitutes a steady reason behind motion and is intrinsically linked to the companies enabled and offered by the BSE and repeatedly availed by KCCL Plastic until 2019 regardless of such defaults.

Nevertheless, the NCLT has rejected the BSE’s petition on technical grounds. It mentioned the plea filed by the BSE was barred because it has filed after the limitation interval of three years. The debt failed due April 1, 2015, it had mentioned.

Furthermore, the NCLT had additionally noticed that within the settlement between the events, a number of the pages/ locations are discovered clean and no remarks are given to that impact.

Nevertheless, the settlement incorporates the preliminary of the events solely on the final web page and not one of the pages of the settlement incorporates the signature of the events and it additionally discovered that the settlement was entered between ‘Kosha Cubidor Containers Ltd’ with the Inventory Trade of Bombay.

“Nevertheless, there isn’t any seal and signature for and on behalf of the Inventory Trade of Bombay. Admittedly, the title of ‘Kosha Cubidor Containers Ltd’ modified to KCCL Plastic Ltd., however to that impact, no settlement has been entered by the petitioner with that of KCCL Plastic Ltd,” the NCLT had mentioned.

The NCLAT additionally consented with the findings of NCLT and mentioned, “We’re of the thought-about view that the adjudicating authority (NCLT) has rightly come to the conclusion that the settlement so filed can’t be relied upon, as the identical will not be a legitimate settlement within the eye of the legislation.”