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7. It is also submitted that the said pledge agreement gives right to the Appellant as a pledge to undertake the sale of shares as per clause 10 upon event of default having occurred. It is submitted that both the share pledge agreements of 2014 and 2016 are identical and part of one transaction, rather than different and/or unconnected transactions/transfer. On 17.01.2017 the Adjudicating Authority has admitted the petition and appointed IRP and on 08.12.2017 the Adjudicating Authority has admitted to liquidation. As per Section 25(2) (j) and Regulation 39(2) of IBBI (Corporate Insolvency Resolution Process) Regulation 2016, RP have a duty to report such transactions to the CoC and to file applications to set them aside during CIRP period and suddenly now it becomes preferential transaction, this is an afterthought. The shares of Innoventive America's INC (Respondent No.2 herein) was the only asset/security which was unencumbered and free from tall charges that's Company Appeal (AT) (Ins) No. 102- 104 of 2021 why to secured Appellants debt, and to raise funds, CD created pledge as there was no other unencumbered security available with CD and business operation had shut down in 2014 only. The Appellant had been providing support the CD since June 2014 to keep the operations of CD running and also to ensure that interest of around 1200 workers employed by the CD is safeguarded and the continuation of the debtor as a going concern for the benefit of creditors and non-creditor third parties.

8. It is also submitted by Ld. Counsel for the Appellant that if this transactions or pledge agreement will be considered as preferential transaction then all the loan/pledge agreement where appellant has granted its guarantee or provided security for the CD's loan shall be considered as preferential transaction and if that happens then CD need to pay more money to Appellant.

9. It is also stated that the Appellant is of the view that while impounding the documents, the Adjudicating Authority went beyond the scope of Section 43 and the power conferred upon it by the provision for the above rea- sons. If this trend is set forth, then it would directly hamper the future proceedings and set a precedent which might allow the Ld. Adjudicating Authority to divulge into issues which do not materially hamper the case, in turn negating the legislative intent behind the Code. This transaction has already been taken place in June 2014 which is before the Company Appeal (AT) (Ins) No. 102- 104 of 2021 commencement of Code. Section 43 is notified as on December 15, 2016. The Appellant was not aware that this transaction will be considered as preferential transaction otherwise would it have not granted any financial assistance to corporate debtor or would have stopped to continue supporting corporate debtor (distressed business) during the time when the Appellant's support was most required. Vide letter dated 04.01.2018, the Appellant informed the Liquidator that it was invoking the pledge as per Agreement. On 05.01.2018, the Appellant filed Form-D as Financial Creditor with the Liquidator an amount of Rs. 32,14,86,020/- as principal and Rs. 48,71,938/- as interest. It is however submitted that in all fairness, the Appellant could not bring on record that earlier pledge agreement dated 10.06.2014 with the Form D since all the records of the CD were under the control of the Liquidator. On 22.03.2018, the Liquidator preferred an application under Section 43 and 44 R/w Section 60(5) of the Code being MA No. 353 of 2018 in CP(IB) 01/NCLT/MB/2016 seeking to declare the share pledge agreement dated 25.11.2016 as preferential transaction and thereby to release the impugned pledge. The Appellant filed its Reply on 20.08.2018 bringing on record the earlier pledge agreement dated 10.04.2016. The Liquidator filed his Rejoinder to the Appellant's reply on 10.09.2018 before the Adjudicating Authority. The Appellant filed detailed written submissions before the Adjudicating Company Appeal (AT) (Ins) No. 102- 104 of 2021 Authority on 18.02.2020. The Appellant has subsequently filed an interim application no. 2444/2020 in CP(IB) No. 01/NCLT/MB/2016 seeking recall of the impugned order dated 29.10.2020 before Adjudicating Authority That subsequently, the company appeal (AT) (Ins.) No. 1132- 1133 filed by the Appellant before this Appellate Tribunal against the impugned order dated 29.10.2020 was listed and heard on 04.01.2021 vide which this Appellate Tribunal dismissed the said company appeal as withdrawn with liberty to assail the impugned order along with the order passed in Recall Application, if adverse to Appellant. Further, the said recall application was listed before the Ld. Adjudicating Authority on 06.01.2021 which was heard and dismissed in limine. Hence, being aggrieved, the Appellant is filing the present Appeal to challenge the impugned orders dated 29.10.2020 and 06.01.2021.

18. It is stated by ld. Counsel for the Respondent that the Appellant has also submitted in its Appeal that there is "no element of dishonesty or unfairness in the present transaction". As held by Anuj Jain case, the question of intention is not relevant for the purpose of determining whether a transaction is a preferential transaction under Section 43 of the Code. Section 43 of the Code is in stark contrast to Section 531 of the Companies Act 1956 which contained provisions regarding 'fraudulent preference'. Section 53(1) entailed element of fraud and hence, the question of intention was material thereunder. On the contrary, Section 43 of the Code creates a deeming provision wherein, once the ingredients of Section 43 are satisfied, it is deemed that a preference is given, irrespective of whether the transaction was in fact intended or even Company Appeal (AT) (Ins) No. 102- 104 of 2021 anticipated to be so. In view of the above, any reference to the erstwhile regime under the Companies Act, 1956, provisions of the Indian Contract Act, 1872 and principles governing Chapter XI proceedings in USA is wholly misplaced and irrelevant and do not support the case of IVL/Appellant. Notably, no other surrounding circumstances and/ or documents have been shown or produced, which may support the valid execution of either the Impugned 2016 Pledge Agreement or the Alleged 2014 Pledge Agreement. Neither of the pledge agreements are supported by -

H. Now coming to the main issue, it is apparently very much clear that all the companies (Innoventive Ventures Limited, Innoventive Industries Limited and Innoventive America Inc.) involved in this case are related Company Appeal (AT) (Ins) No. 102- 104 of 2021 party as also Promoter of the CD and Chairman & MD of Innoventive Ventures Limited - Mr. Chandu Chavan.

I. Incidentally, impugned pledged largely satisfied all ingredients of Section 43 of the Code. The impugned order dated 29.10.2020 although passed by two separate orders but in concurring orders both the Ld. Members arrived at the conclusion that the impugned pledge is a preferential transaction covered under Section 43 of the Code. The approach of the Appellant to give the colour of pledge as in the ordinary course of business is no longer res integra as per the law laid down under the Code. (2020) 8 SCC 401 - Anuj Jain, IRP for Jaypee Infratech Limited Vs. Axis Bank and Anr. Para 28.6 as stated supra. J. This Pledge Agreement even of 2016 only reflects that the IVL/Appellant does not hold merit for the impugned pledge created during the ordinary course of business. Circumstantial evidence also suggests that there is no another pledge agreement dated 10.06.2014. Even the 2016 pledge agreement does not have backing a board resolution or registration which is a requirement for a listed company. No approval of RBI is available for 2016 pledge agreement. Hence, the Adjudicating Authority has rightly held in the impugned order dated 29.10.2020 that it is a preferential transaction covered under section 43 of the Code. Company Appeal (AT) (Ins) No. 102- 104 of 2021 K. Hence, we are constrained to uphold the impugned order dated 29.10.2020 & 06.01.2021 and so also with the order of 07.11.2020 of the Adjudicating Authority.