The corporate debtor had taken a loan from a bank to complete a real estate project. Due to default in payment, an RP was appointed, who ordered the bank to freeze all the bank accounts of the appellant, who was a third party developer, and deny him of any access.
The NCLT Chennai had partly accepted the appellant’s point of view, but ordered the release 50% of the amount available in the bank accounts of the appellant without delving into the question of law as to whether the RP could order for freezing of such accounts, who was a third party developer appointed by the corporate debtor.
On appeal before the NCLAT, counsel for the appellant argued that the RP had issued a letter ordering the freezing of its bank accounts under the mistaken impression that the accounts in question belonged to the corporate debtor. It was also argued that the RP does not have any authority to freeze the bank accounts of the appellant.
Source: Barandbench
