Writer’s Business: NCLAT Suspends Penalty on Writer Business Services by NCLT in Cox & Kings RP Plea

The National Company Law Appeals Tribunal (NCLAT) suspended the order of the National Company Law Court (NCLT) imposing a fine of Rs 20 lakh on Writer Business Services Pvt Ltd.

The sanction was imposed for refusing to provide case management and case recovery services to the resolution professional (PR) of Cox & Kings Ltd. Subsequently, Writer Business Services approached the appeals court to challenge the order of Mumbai NCLT.

“Until the next date, we maintain the fine of Rs 20 lakhs imposed on the appellant (Writer Business) as well as the order to reimburse the payments to the resolution professional,” said the main bench led by the Judge Ashok Bhushan, Judge Jarat Kumar Jain and Technical Member Dr Alok Srivastava on November 23.

The appeals court also ordered the Cox & Kings RP to file its response within two weeks and released the case for a new hearing on January 10.

Earlier, on October 29, the court fined Writer Business Rs 20 lakh and ordered the company to continue providing services to the bankrupt travel agency in accordance with the agreement.

In this case, the PR of the travel company approached the court with the complaint that Writer Business Services had blocked access to the case management service by refusing to provide the list of companies and the information of the Cox & Kings who are stored by it.

The court observed in its order that the refusal of the respondent (the writer) to provide his file recovery services to the PR is a total violation of Article 14 of the Code (IBC).

Under Article 14 (2A) of the IBC, when a business is subject to a Corporate Insolvency Resolution (CIRP) process, the provision of goods or services essential to protect and preserve the value debtor business as a business must not be terminated, suspended or interrupted during the moratorium period.

Email queries to Writer Corporation and Ashutosh Agarwala, RP of Cox & Kings Ltd went unanswered until the time of publication.

“Only part of the order to the extent of a penalty and the reimbursement of the amount received has been suspended, however, the instructions to provide services against the service provider will continue,” said Ashish Pyasi, partner of the firm. of lawyers Dhir & Dhir. Associates. “If the appeal court finds that the order is incorrect, it can set aside or vary the order made by the court. ”

In October 2019, NCLT admitted a plea filed by Rattan India Finance to initiate insolvency proceedings against Cox & Kings for default on a loan of Rs 30 crore. The company owes more than Rs 7,422 crore to its financial and operational creditors.

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