Pixtronics Global Technologies Private Limited vs M.S.Viswanathan

Court: National Company Law Appellate Tribunal
Case type: Company Appeal(AT)(Ins)
Decided on: 01-04-2026

<div> NATIONAL COMPANY LAW APPELLATE TRIBUNAL AT CHENNAI (APPELLATE JURISDICTION) Company Appeal (AT) (CH) (Ins) No. 465/2024 In the matter of: PIXTRONIC GLOBAL TECHNOLOGIES PVT. LTD. (Successful E-Auction Purchaser of M/s. Gemini Communication Ltd.) Having Registered Office at: No. 28/3A, Ground Floor, Ranga Road Lane, Mylapore Chennai – 600004. …APPELLANT V MR. M.S. VISWANATHAN (Liquidator of M/s. Gemini Communication Ltd.) Having office at: Plot No.22, Vallalar Street, Nilamangai Nagar, Adambakkam, Chennai- 600088. ...RESPONDENT Present : For Appellant : Ms. Theyjusvini S, Advocate for Mr. G. Kalyan Jhabakh, Advocate For Respondent : Mr. V. Manivannan, Advocate O R D E R (Hybrid Mode) [ORAL JUDGMENT: Justice Ashok Bhushan, (Chairperson)] 01.04.2026: Heard Ld. Counsel for the Appellant and Ld. Counsel appearing for the Liquidator as well as the Liquidator who too is appearing in person. This appeal has been filed being aggrieved as against an order dated 24.10.2024, passed by Ld. NCLT Division Bench Court-I Chennai in IA(IBC)/327(CHE)2024. Comp App (AT) (CH) (Ins) No. 465/2024 Page 1 of 6 2. The Appellant before us is a Successful Auction Purchaser who became the Successful Bidder in the process of sale of CD as a going concern. The sale certificate has already been issued in that regard in favour of the Appellant on 15.10.2021. The Appellant filed an IA(IBC)/327(CHE)2024, in which the following prayers were made by the Appellant: "In light of the above, the Applicant respectfully prays for the following reliefs: i. Direct the Respondent to remit all funds diverted to the Liquidation account post-accepting the initial 10% + 15% after the e-Auction. ii. Instruct the Respondent to credit the sale proceeds of Rs. 60,00,000/- from the e-auction dated 10.03.2023 to the Applicant, in accordance with the sale certificate issued to the Applicant. iii. Order the Respondent to transfer the proceeds of mutual funds amounting to Rs. 4,39,771/- to the Applicant. iv. Mandate the Respondent to facilitate the transfer of Rs.26,00,000/- lying in the bank accounts of the Corporate Debtor to the Applicant. v. Enforce the handover of the operation of the bank accounts and necessary signatory changes to the Applicant." 3. Upon hearing of the application, Appellant prayed that he did not press prayers 1 & 2, accordingly the Ld. Adjudicating Authority recording the said prayers had dismissed the application qua prayer 1 & 2, as not been pressed. The Ld. Adjudicating Authority, after considering the submissions with regards to other prayers, took the view that relief as prayed in for 3 & 4 cannot be granted. Appellant is aggrieved by the said order has come up in this company appeal. Comp App (AT) (CH) (Ins) No. 465/2024 Page 2 of 6 4. Ld. Counsel for the Appellant has raised two submissions before us. Ld. Counsel for the Appellant submitted that he has consented to, that balance amount, which is available with the Corporate Debtor, can be utilised for the purposes of payment of gratuity of some workers/workmen, which has not yet been paid. Ld. Counsel for the Appellant has referred to an affidavit filed in this appeal dated 14.11.2025. It is submitted and as pleaded in the affidavit too, that Appellant has given "No-Objection" for clarification of the bank balance of the Corporate Debtor towards the discharge of gratuity due to the erstwhile employees of the Corporate Debtor. 5. Ld. Counsel for the Appellant secondly submits that, there was an ongoing arbitration proceeding between the Corporate Debtor and the BSNL, and it was provided in the e-auction notice / sale notice, that amount received from proceeding of BSNL shall go only to the Creditors, and none of the said amount shall be received by the Appellant. The Appellants grievances is that when Appellant is not receiving any amount out of arbitration proceeding of BSNL, the balance amount of the Corporate Debtor need not to be utilized towards the funding litigation of the arbitration. 6. The Ld. Counsel for the Liquidator submitted that, as on date Liquidator has received the claims for six erstwhile employees towards gratuity, which was highly barred by time. It is submitted that said claim was not admitted by Liquidator, and the workers were advised to approach the Ld. NCLT for Comp App (AT) (CH) (Ins) No. 465/2024 Page 3 of 6 acceptance of their claims. It is submitted that in view of the above, as on date, no gratuity dues are balance which are required to be paid or discharged by the Liquidator. 7. Coming to the reply to the second submission, it is submitted that CD was proceeding with prosecuting the arbitration proceeding, and the said amount of the Corporate Debtor was being utilized and hence, there cannot be any embargo from utilizing the amount of Corporate Debtor for prosecuting the arbitration proceeding of BSNL. We have considered the submission of the Ld. Counsel or the Parties and perusal. 8. Insofar as the first submission of the Appellant regarding utilisation of the balance amount with the Corporate Debtor for payment of gratuity, the Appellant in paragraph 3 of his affidavit filed on 14.11.2025 in this appeal, pleads as follows: " 3 . During the pendency of the instant Appeal, the Respondent-Liquidator informed the Appellant that the erstwhile employees of the Corporate Debtor had certain Gratuity claims and on humanitarian grounds, wanted the claims of the workers settled by utilizing the funds available, part of which is the subject matter of the appeal. It was on this basis and on the understanding that the funds would be used for payment of Gratuity claims due to the erstwhile employees of the Corporate Debtor that the Liquidator had sought for a No-Objection from the Appellant for utilization of the bank balance of the Corporate Debtor towards the discharge of gratuity due to the erstwhile employees of the said Corporate Debtor." Comp App (AT) (CH) (Ins) No. 465/2024 Page 4 of 6 9. We have noticed the submission of the Ld. Counsel for the Liquidator that, no claim within time was received by the erstwhile employees towards the gratuity, and the claim which were received is belated, and it is only NCLT who can direct the belated claim to be accepted. The Liquidator has no jurisdiction to accept the claim beyond the time. 10. In view of the aforesaid, we are of the view that ends of justice would be served in providing that, because the Appellant has given its no objection that the amount if required to be discharged towards payment of any gratuity amount to the erstwhile worker, the said amount would be utilised for the said purpose in the event the claims are accepted. However, if the claims of gratuity are not accepted the amount towards that need to be given to the Appellant. Insofar as above the impugned order need to be modified to this extent. 11. Coming to the second submission of the Appellant, Ld. Counsel for the Appellant has referred to the sale notice Clause 6, which is as follows: 6. Subsequent to the completion of the Arbitration proceedings between the Corporate Debtor and the BSNL or from any other proceedings and in case any proceeds received from the arbitration award or from any other known or unknown litigations, subsequent to the declaration of the successful bidder of the LOTI, shall be distributed / assigned to creditors of the corporate debtor as per IBC 2016. 12. When we look into the above Clause 6, it is clear that, the any amount which is received from the BSNL proceeding are required to be distributed / assigned to Comp App (AT) (CH) (Ins) No. 465/2024 Page 5 of 6 Creditors of the Corporate Debtor. Thus, the amount received out of proceedings when is being dealt under the liquidation proceeding, we are of the view that the Stakeholder Consultation Committee / Liquidator is not deprived nor prohibited from utilising any amount for the purposes of prosecuting the said proceeding. Thus, the second submission of the Appellant cannot be accepted. 13. In view of above, we are of the view that the order impugned requires modification only to the extent that, in the event the claim of the Erstwhile Employees toward gratuity is admitted the said pending amount can be discharged, failing which, in an event the claim is not admitted the said amount need to be permitted to be utilised by the Appellant, with the aforesaid modification, the company appeal is disposed. [Justice Ashok Bhushan] (Chairperson) [Justice Sharad Kumar Sharma] Member (Judicial) [Jatindranath Swain] Member (Technical) SN/MS/AK Comp App (AT) (CH) (Ins) No. 465/2024 Page 6 of 6 </div>