RP Justified in Refusing to Hand Over Wind Turbine Generators as Appellant-OC Failed to Make Payment of Dues Lying with CD | SC

Case Details: Vish Wind Infrastrukture LLP v. Shailen Shah, Resolution Professional of Wind World (India) Ltd. - [2024] 169 taxmann.com 347 (SC)

Judiciary and Counsel Details

• Abhay S. OKA & Augustine George Masih, JJ.
• A.M. Singhvi, Sr. Adv., Alok Dhir, Ms Maneesha Dhir, Sachin Gupta, Ms Varsha Banerjee, Kanishk Khetan & Ms Mahima Ahuja, Advs., Karan Batura, AOR, for the Appellant.

Facts of the Case

In the instant case, the appellant-operational creditor had entered into an agreement with the corporate debtor for the supply of Wind Turbine Generators (WTGs). The corporate debtor supplied WTGs for which payments were made by the appellant.

Meanwhile, the CIRP was initiated against the corporate debtor and, the appellant had filed its claim of Rs. 132 crores, claiming it to be an advance payment made to the corporate debtor for the supply of WTGs. The claim of the appellant was admitted in the CIRP.

Later, the appellant made a request to RP to supply WTGs in terms of the agreement. The RP rejected the said request on the ground that the appellant owed an amount along with an interest to the corporate debtor and, the appellant’s claim had already been admitted in the CIRP.

The appellant had filed an application before the NCLT seeking a direction for RP to adhere to the terms of agreement and supply immediately WTGs. However, the NCLT vide order rejected the said application. The appellant then challenged the said order before the NCLAT.

NCLAT Held

The NCLAT vide the impugned order rejected the said application on the ground that the corporate debtor had not received dues from the appellant for which arbitration proceedings were pending. Thus, the decision taken by RP not to handover WTGs was as per the wisdom of RP, who was to run the corporate debtor as a going concern.

The NCLAT further held that RP’s decision to refuse the handover of 26 WTGs lying with the corporate debtor was a decision that RP was entitled to take as per the scheme of the Code, which decision could not be said to be contrary to any provisions of the Code or in breach of any right of the appellant.

The Supreme Court held that the appeal filed by the appellant against the order of the NCLAT was to be dismissed.

List of Cases Reviewed

• Vish Wind Infrastructure LLP v. Shailen Shah [2024] 169 taxmann.com 131 (NCLAT -New Delhi) (para 3) affirmed