Supreme Court IBC | Moratorium Under S 14 No Bar To Execute Decree Against Directors/Officers Of Corporate Debtor: Supreme Court Case Title: Ansal Crown Heights Flat Buyers Association (Regd.) vs. M/S. Ansal Crown Infrabuild Pvt. Ltd. & Ors. Citation: 2024 LiveLaw (SC) 63 The Supreme Court has held that the imposition of moratorium under Section 14 of the Insolvency...
Supreme Court
IBC | Moratorium Under S 14 No Bar To Execute Decree Against Directors/Officers Of Corporate Debtor: Supreme Court
Case Title: Ansal Crown Heights Flat Buyers Association (Regd.) vs. M/S. Ansal Crown Infrabuild Pvt. Ltd. & Ors.
Citation: 2024 LiveLaw (SC) 63
The Supreme Court has held that the imposition of moratorium under Section 14 of the Insolvency and Bankruptcy Code, 2016 (“IBC”) has no effect on the execution of a decree against the Directors or Officers of the Company (Corporate Debtor), which is undergoing Corporate Insolvency Resolution Process (“CIRP”) under IBC.
When the Company was admitted into CIRP, the National Consumer Disputes Redressal Commission (“NCDRC”) declined to permit execution of a decree against the Company and also its Directors/Officers. The Bench held that the protection of moratorium under Section 14 of IBC is only available to the Company and not to its Directors or Officers, thus the execution of decree can be done against them even during moratorium.
The Bench comprising Justice Abhay S. Oka and Justice Ujjal Bhuyan, has held, “Therefore, we are of the view that only because there is a moratorium under Section 14 of the IBC against the company, it cannot be said that no proceedings can be initiated against the opposite party Nos. 2 to 9(the respondent Nos. 2 to 9) for execution, provided that they are otherwise liable to abide by and comply with the order, which is passed against the company. The protection of the moratorium will not be available to the directors/officers of the company.”
IBC | Statutory Set Off Or Insolvency Set Off Inapplicable To Corporate Insolvency Resolution Process: Supreme Court
Case Title: Bharti Airtel Limited and Another vs. Vijaykumar V. Iyer and Others
Citation: 2024 LiveLaw (SC) 11
The Supreme Court has held statutory set off or insolvency set off is not applicable to Corporate Insolvency Resolution Process (“CIRP”) proceedings under the Insolvency and Bankruptcy Code, 2016 (“IBC”). Further, Regulation 29 of the Insolvency and Bankruptcy Board of India (Liquidation Process) Regulations, 2016 (“Liquidation Regulations”), which provides for mutual dealing and set off, does not apply to Part II of the IBC which deals with CIRP.
The principle of Set-off recognizes the right of a debtor to adjust the smaller claim owed to him against the larger claim payable to his creditor.
The Bench has also carved out two exceptions to the application of statutory or insolvency set off to CIRP proceedings. First being, when a party is entitled to contractual set-off, on the date which is effective before or on the date of commencement of CIRP. Secondly, in cases of 'equitable set-off' when the claim and counter claim in the form of set-off are linked and connected on account of one or more transactions that can be treated as one.
The Bench comprising Justice Sanjiv Khanna and Justice S.V.N. Bhatti, has observed that Section 30(2)(b) does not support the plea of insolvency set-off, since the provision deals with the amounts to be paid to creditors and not amount payable by creditors to Corporate Debtor. Further, the specific legislative mandate given in Chapter II Part II of IBC, the provisions of IBC relating to CIRP do not recognize the principle of insolvency set-off. “We would not extend it by implication, when the legislature has not accepted applicability of mutual set-off at the initial stage, that is, the Corporate Insolvency Resolution Process stage.”
IBC - Is Dissenting Financial Creditor Entitled To Minimum Value Of Security Interest? Supreme Court Refers To Larger Bench, Doubts Precedent
Case Title: DBS Bank Ltd Singapore vs. Ruchi Soya Industries Ltd and another
Citation: 2024 LiveLaw (SC) 6
The Supreme Court has referred to larger bench the issue whether a dissenting financial creditor is to be paid the minimum value of its security interest as per the Insolvency and the Bankruptcy Code 2016.
A bench comprising Justices Sanjiv Khanna and SVN Bhatti, in the case DBS Bank Ltd Singapore v. Ruchi Soya Industries Ltd and another, referred the following question :
Whether Section 30(2)(b)(ii) of the Insolvency and Bankruptcy Code, 20161, as amended in 2019, entitles the dissenting financial creditor to be paid the minimum value of its security interest?
The bench differed from the view expressed by a coordinate bench in the 2021 judgment in the case India Resurgence ARC Private Limited v. Amit Metaliks Limited & Another which held that a dissenting secured creditor cannot challenge an approved resolution plan contending that higher amount should have been paid to it based on the security interest held by it over the corporate debtor.
The bench in the instant case observed that there was a contradiction between India Resurgence ARC Private Ltd with the ratio decidendi of the decisions of the three-Judge Bench judgments in Committee of Creditors of Essar Steel India Limited v. Satish Kumar Gupta(2019) and Jaypee Kensington Boulevard Apartments Welfare Association vs. NBCC (India) Ltd(2021).
IBC | Inappropriate For NCLAT To Direct NCLT To Admit Petition Under Section 7 Without Evaluating Rival Contentions On Merits: Supreme Court
Case Title: Maneesh Pharmaceuticals Ltd v Export Import Bank of India and Ors.
Citation: 2023 LiveLaw (SC) 1073
The Supreme Court has set aside an order passed by the National Company Law Appellate Tribunal (“NCLAT”) whereby the National Company Law Tribunal (“NCLT”) was directed to admit a petition under Section 7 of Insolvency and Bankruptcy Code, 2016 (“IBC”).
The Bench comprising Chief Justice of India Dr. Dhananjaya Y Chandrachud, Justice J B Pardiwala and Justice Manoj Misra, has held that it was inappropriate for the NCLAT to direct the NCLT to admit the application under Section 7 of IBC straightaway without an evaluation of the rival contentions on merits. The Bench has directed the NCLT to determine whether the petition under Section 7 of IBC is liable to be admitted, after hearing the parties.
IBC | Resolution Plan Requires Closer Examination If Plan Envisages Use Of Asset Owned By Statutory Authority: Supreme Court
Case Title: Greater Noida Industrial Development Authority Versus Prabhjit Singh Soni & Anr.
Case No.: CIVIL APPEAL NOS.7590-7591 OF 2023
The Supreme Court bench comprising Chief Justice of India Dr. DY Chandrachud, Justice J.B. Pardiwala, and Justice Manoj Misra, has observed that ordinarily feasibility and viability of a resolution plan is best decided by the commercial wisdom of the Committee of Creditors (“CoC”), however, when the resolution plan envisages the use of asset/land not owned by the Corporate Debtor but by a third party, which is a statutory body, bound by its own rules and regulations having statutory flavor, then there has to be a closer examination of the plan's feasibility.
IBC | Claim Submitted With Proof Cannot Be Overlooked Merely Because It Was Submitted In Wrong Form: Supreme Court
Case Title: Greater Noida Industrial Development Authority Versus Prabhjit Singh Soni & Anr.
Case No.: Civil Appeal No(s).7590-7591/2023
The Supreme Court bench comprising Chief Justice of India Dr. DY Chandrachud and Justice JB Pardiwala and Justice Manoj Misra, has observed that the claim submitted by the Resolution Applicant (“RA”) under the Corporate Insolvency Resolution Process (“CIRP”) cannot be rejected/overlooked merely on the fact that the claim submitted appears to be in a different form other than the form in which the claim needs to be submitted.
The creditor submitted a claim to the Resolution Professional under Form C of Regulation 8 of CIRP Regulations 2016, as a financial creditor. The claim of the resolution applicant was rejected by the Committee of Creditors (“CoC”), National Company Law Tribunal (“NCLT”), and National Company Law Appellate Tribunal (“NCLAT”) on the note that the resolution applicant being Operational Creditor needs to submit their claim under Form B of Regulation 7 of CIRP Regulations 2016, as Operational Creditor.\
The Bench held, No doubt, the record indicates that the appellant was advised to submit its claim in Form B (meant for operational creditor) in place of Form C (meant of financial creditor). But, assuming the appellant did not heed the advice, once the claim was submitted with proof, it could not have been overlooked merely because it was in a different Form.”
When Does Debt Become Financial Debt & Operational Debt Under IBC? Supreme Court Explains
Case Title: Global Credit Capital Limited & Anr. Versus Sach Marketing Pvt. Ltd. & Anr.
Citation: 2024 LiveLaw (SC) 331
The Supreme Court bench comprising Justice Abhay S. Oka and Justice Pankaj Mithal, has held that debt would be treated as an operational debt only if the claim subject matter of the debt has some connection or co-relation with the 'service' rendered by the creditor to the debtor.
"Where one party owes a debt to another and when the creditor is claiming under a written agreement/ arrangement providing for rendering 'service', the debt is an operational debt only if the claim subject matter of the debt has some connection or co-relation with the 'service' subject matter of the transaction.", the Bench opined.
The Court summarized the conclusions as follows :
· There cannot be a debt within the meaning of sub- section (11) of section 5 of the IB Code unless there is a claim within the meaning of sub-section (6) of section 5 of thereof;
· The test to determine whether a debt is a financial debt within the meaning of sub-section (8) of section 5 is the existence of a debt along with interest, if any, which is disbursed against the consideration for the time value of money. The cases covered by categories (a) to (i) of sub-section (8) must satisfy the said test laid down by the earlier part of sub-section (8) of section 5;
· While deciding the issue of whether a debt is a financial debt or an operational debt arising out of a transaction covered by an agreement or arrangement in writing, it is necessary to ascertain what is the real nature of the transaction reflected in the writing; and
· Where one party owes a debt to another and when the creditor is claiming under a written agreement/ arrangement providing for rendering 'service', the debt is an operational debt only if the claim subject matter of the debt has some connection or co- relation with the 'service' subject matter of the transaction.
Process For IBC Offences To Be Issued By Sessions Court Despite Companies Act Amendment Vesting Jurisdiction On Judicial Magistrate: Supreme Court
Case Title: Insolvency And Bankruptcy Board Of India Versus Satyanarayan Bankatlal Malu & Ors.
Citation: 2024 LiveLaw (SC) 317
The Supreme Court bench comprising Justice BR Gavai and Justice Sandeep Mehta, while observing that the offences committed under the Insolvency and Bankruptcy Code, 2016 (“IBC”) would be tried by the Special Court established under Section 435 of the Companies Act, 2013 and the sessions judge would have the power to issue process against the accused, has upheld the issuance of process by the sessions judge to the accused.
The Court rejected the contention of the accused that the Sessions Judge wasn't empowered to issue process to the accused for the offences punishable up-to two years under the IBC but the judicial magistrate.
Reversing the High Court's decision, the Bench interpreted the scheme of Section 236(1) of IBC to hold that the power to try offences punishable under the IBC was vested in the special court by 'legislation by incorporation', meaning thereby the intention of the Parliament was clear to vest the power to issue summons upon the special court consisting of a person qualified to be a Sessions Judge or an Additional Sessions Judge. Thus, the subsequent amendments to the Section 435 of Companies Act, 2013 authorizing judicial magistrates to issue summons for offences punishable up to two years under the IBC would not have any effect on Section 236 of IBC.
IBC | Resolution Plan Approved By CoC Can't Be Withdrawn or Modified By Resolution Applicant: Supreme Court
Case Title: Deccan Value Investors L.P. & Anr. Versus Dinkar Venkatasubramanian & Anr.
Citation: 2024 LiveLaw (SC) 265
The Supreme Court has reiterated that once a resolution plan is approved by the Committee of Creditors (“CoC”) then it becomes impermissible for the resolution applicant to withdraw or modify the resolution plan.
The Bench Comprising Justices Sanjiv Khanna and Dipankar Datta referred to the Judgment of Ebix Singapore Private Limited v. Committee of Creditors of Educomp Solutions Limited and Another, where the Supreme Court elaborated and set out several reasons why the resolution applicant cannot be permitted to withdraw or modify the resolution plan after approval by the Committee of Creditors, and before an order under Section 31(1) of the Code is passed.
The court observed that due to the absence of any statutory provision in the Insolvency and Bankruptcy Code, it is impermissible for the resolution applicant to modify or withdraw the resolution plan after the plan was approved by the CoC.
“The effect of approval by the adjudicating authority under Section 31(1) of the Code makes the resolution plan binding on all stakeholders, even those who are not members of the Committee of Creditors. The scrutiny by the adjudicating authority for grant of approval in terms of Section 31(1), read with other provisions of the Code, is limited and restricted. It does not allow or permit the resolution applicant to unilaterally amend/modify or withdraw the resolution plan post approval by the Committee of Creditors.”, the court said.
Case Title: Ayush Agarwal vs Jaypee Infratech Ltd. & Ors.
Citation: Civil Appeal No. 5185/2024
The Supreme Court of India is set to determine whether the non-filing of a claim during the insolvency resolution process of a builder can result in the rejection of a homebuyer's claim for allotment of apartment.
The case surrounds the insolvency process of Jaypee Infratech Limited. Its resolution plan was approved by the National Company Law Tribunal and was subsequently challenged in the Appellate Tribunal. In the main appeal, several intervention applications were filed including the one filed by the present appellant, an allottee of unit in Kosmos. The same was supposed to be developed by Jaypee.
The Division Bench of Justices Sanjiv Khanna and Dipankar Datta, while issuing notice in the instant appeal, also added:
“We clarify that the issue of notice in the present appeal will not come in the way of execution/implementation of the resolution plan. Allotment of the unit to the appellant, if made, will be subject to the outcome of the present appeal and the right and claim of the appellant.”
Case Title: Manan Chopra and Ors vs Soni Realtors Pvt Ltd.
Citation: Civil Appeal No. 5452/2024
The Supreme Court of India (on May 06) issued notice to the Insolvency and Bankruptcy Board of India, inter-alia, on the requirement to obtain a certified copy of the order and attach the same with the appeal.
The Bench of Justices Sanjiv Khanna and Dipankar Datta has issued notice considering that there is “considerable ambiguity” in certain issues concerning the service of the orders passed by the National Company Law Tribunal, uploading of orders on the website, and the one mentioned above.
"We are also inclined to issue notice to the Insolvency and Bankruptcy Board of India, as there appears to be considerable ambiguity concerning service of the orders passed by the National Company Law Tribunal, uploading of orders on the website and also the requirement to obtain a certified copy of the order and enclose the same with the appeal."
In view of this, the Insolvency Board has been asked to examine whether the process requires any clarification, modification, or simplification.
Case Title: State Bank of India v. India Power Corporation Ltd
Citation: 2024 LiveLaw (SC) 766
The Supreme Court today (September 27) set aside an order of the National Company Law Appellate Tribunal (NCLAT) which refused to condone delay in filling an appeal because of the filling of a 'free copy' of the impugned order.
The bench of CJI DY Chandrachud and Justice Manoj Misra held that there was no difference between a free certified copy of the order and a certified copy which is obtained after paying cost under Rule 50 of the National Company Law Tribunal Rules 2016.
Stakeholders Consultation Committee's Advice Not Binding On Liquidator: Supreme Court
Case Title: V.S. Palanivel v. P. Sriram CS Liquidator etc, Civil Appeal Nos. 9059-9061 of 2022
Citation: 2024 LiveLaw (SC) 662
The Supreme Court clarified that the advice offered by the Stakeholders Consultation Committee (SCC) constituted in liquidation proceedings is not binding on the Liquidator.
Case Title: V.S. Palanivel v. P. Sriram CS Liquidator etc, Civil Appeal Nos. 9059-9061 of 2022
Citation : 2024 LiveLaw (SC) 662
The Supreme Court recently interpreted Rule 12 of Schedule 1 under Regulation 33 of the Insolvency and Bankruptcy Board of India (Liquidation Process) Regulations, 2016 as mandatory in character. Rule 12 relates to how assets of the Company (Corporate debtor) are to be sold by the Liquidator.
Case Title: V.S. Palanivel v. P. Sriram CS Liquidator etc, Civil Appeal Nos. 9059-9061 of 2022
Citation : 2024 LiveLaw (SC) 662
The Supreme Court recently refused to cancel an e-auction despite the Auction Purchaser making a glaring default in making a deposit of the balance sale consideration on grounds that the subject matter of the auction has been utilised and the appellant failed to approach the court on time.
A bench of Justices Hima Kohli and Ahsanuddin Amanullah noted: "Much water has flown under the bridge by now. The subject land has been utilized by the Auction Purchaser to build a 200-bed Mother and Child hospital which is operational. Huge amounts have been pumped into the project by the Auction Purchaser. The hospital is fully functional providing medical facilities to seven surrounding districts."
In contrast, it noted that the appellant who moved the court in appeal to cancel the auction has not been a vigilant litigation. It observed: "His conduct shows that he has dragged his feet at every stage. Records reveal that belated applications have been filed by him for seeking recall of the orders passed by the Adjudicating Authority granting extension of time to the Auction Purchaser. For reasons best known to him, it took 19 months for the appellant to prefer an appeal before the Tribunal against the order passed by the Adjudicating Authority, as provided for in the IBC. Furthermore, the appellant resisted handing over possession of the subject property to the respondents thereby causing more delay."
Case Title: BRS Ventures Investments Ltd. v. SREI Infrastructure Finance Ltd. & Anr.
The Supreme Court on July 23 held that a holding company is not the owner of its subsidiary's assets and thus, subsidiary assets cannot be included in the holding company's resolution plan.
A bench of Justice Abhay Oka and Justice Pankaj Mithal dismissed an appeal filed by a Successful Resolution Applicant of a Corporate Guarantor against NCLT's decision to admit Financial Creditor's application for recovery of balance amount from the Corporate Debtor.
The Corporate Debtor in this case was a subsidiary of the Corporate Guarantor.
“A holding company and its subsidiary are always distinct legal entities. The holding company would own shares of the subsidiary company. That does not make the holding company the owner of the subsidiary's assets...Therefore, the assets of the subsidiary company of the corporate debtor cannot be part of the resolution plan of the corporate debtor”, the court held.
Case Title: BRS Ventures Investments Ltd. Versus SREI Infrastructure Finance Ltd. & Anr.
Citation : 2024 LiveLaw (SC) 508
In a notable decision relating to the Insolvency & Bankruptcy Code of 2016, the Supreme Court held when that the insolvency resolution of a corporate guarantor will not prevent the creditor from initiating another insolvency process against the corporate debtor for the balance debt.
The Court clarified that the insolvency resolution of the corporate guarantor will not result in the discharge of the corporate debtor towards the remaining debt.
'IBC Prevails Over SEZ Act', Supreme Court Rejects Noida SEZ's Claim
Case Title: Noida Special Economic Zone Authority Vs. Manish Agarwal & Ors., CIVIL APPEAL NOS. 5918-5919 OF 2022
Citation : 2024 LiveLaw (SC) 858
The Supreme Court dismissed the Noida Special Economic Zone's (NSEZ) plea challenging the NCLAT's decision to approve a resolution plan that granted Rs. 50 Lacs against NSEZ's admitted claim of about Rs. 6 Crore.
The NCLAT reduced the claim amount, partly due to penalties related to the renewal of the sub-lease and transfer charges.
The bench comprising Justices Abhay S. Oka and Augustine George Masih ruled that the Insolvency and Bankruptcy Code (IBC) prevails over the SEZ Act due to Section 238 of IBC's overriding effect, rejecting NSEZ's argument for exemptions from such payments.
Supreme Court Orders Liquidation Of Jet Airways On Failure Of Resolution Plan
Case Details : STATE BANK OF INDIA AND ORS. Versus THE CONSORTIUM OF MR. MURARI LAL JALAN AND MR. FLORIAN FRITSCH AND ANR.| C.A. No. 5023-5024/2024 and Connected
Citation : 2024 LiveLaw (SC) 866
The Supreme Court invoked its extraordinary powers under Article 142 of the Constitution to order the liquidation of Jet Airways in view of the "peculiar and alarming" circumstance that the resolution plan has not been implemented for five years.
The Court set aside the NCLAT Order which allowed the cash-strapped Jet Airways' ownership transfer to the Successful Resolution Applicant (SRA) without complete payment in accordance with the resolution plan.
Case Details : STATE BANK OF INDIA AND ORS. Versus THE CONSORTIUM OF MR. MURARI LAL JALAN AND MR. FLORIAN FRITSCH AND ANR.| C.A. No. 5023-5024/2024 and Connected
Citation : 2024 LiveLaw (SC) 866
In the judgment ordering the liquidation of Jet Airways, the Supreme Court made several critical remarks against the abysmal functioning of the National Company Law Tribunals and the National Company Law Appellate Tribunal benches.
Slamming the "growing tendency" of the NCLT and NCLAT members to ignore the orders of the Supreme Court, the Court stated that only persons of impeccable integrity should be appointed as the Tribunal Members. There should be no political appointment, the Court categorically stated.
'Breaches Discipline Of Law Laid Down In IBC' : Supreme Court Disapproves Of HC Deferring CIRP Under Article 226
Case Title: CoC of KSK Mahanadi Power Company Ltd. v. Uttar Pradesh Power Corporation Ltd. and Ors.
Citation : 2024 LiveLaw (SC) 815
The Supreme Court recently took exception to the Telangana High Court ordering the deferring of the Corporate Insolvency Resolution Process in the exercise of powers under Article 226 of the Constitution.
The Bench of Chief Justice of India DY Chandrachud , Justice J.B. Pardiwala and Justice Manoj Misra, held that the High Court was not justified in deferring the Corporate Insolvency Resolution Process (CIRP) when the main relief sought in the writ petition uto consolidate the CIRP of two companies was refused.
Supreme Court Sets Aside NCLAT Order Which Closed Insolvency Process Against Byju's Based On Settlement With BCCI
Case Details : GLAS TRUST COMPANY LLC Vs BYJU RAVEENDRAN | Diary No. - 35406/2024
Citation : 2024 LiveLaw (SC) 826
The Supreme Court today (October 23) set aside the order of the National Company Law Appellate Tribunal which closed the insolvency proceedings against ed-tech company Byju's (Think and Learn Pvt Ltd) accepting a settlement between it and the Board of Control for Cricket in India (BCCI) for about Rs 158 crores.
The Court held that the NCLAT erred in allowing the withdrawal of the insolvency application by invoking its inherent powers under Rule 11 of the NCLAT Rules 2016. When there is a specific procedure provided for the withdrawal of insolvency applications, the NCLAT cannot invoke its inherent powers.
IBC | No Compulsion To Specify Names Of Creditors In Balance Sheet, General Entry Acknowledging Debt Sufficient To Initiate CIRP : Supreme Court
Case Title: VIDYASAGAR PRASAD VERSUS UCO BANK & ANR.
Citation : 2024 LiveLaw (SC) 825
Observing that there's no compulsion for the companies to specify the names of every secured/unsecured creditor in their balance sheet, the Supreme Court dismissed the plea of a corporate debtor's suspended director against the initiation of Corporate Insolvency Resolution Process (“CIRP”).
In other words, the bench comprising Justices PS Narasimha and Sandeep Mehta observed that when debt entries exist in the corporate debtor's balance sheet, the debtor could not deny its liability merely on the ground that there were no specific entries of the particular creditor in their balance sheet regarding the debt owed to that creditor.
Inherent Powers Under Rule 11 of NCLT Rules Cannot Be Used To Circumvent Procedure To Withdraw CIRP Under S.12A IBC & R. 30A: Supreme Court
Case Title : GLAS TRUST COMPANY LLC Vs BYJU RAVEENDRAN | Diary No. - 35406/2024
Citation : 2024 LiveLaw (SC) 826
The Supreme Court Bench led by CJI DY Chandrachud comprising Justices JB Pardiwala and Manoj Misra held that 'inherent powers' cannot be used to subvert legal provisions, which exhaustively provide for a procedure. To permit the NCLAT to circumvent this detailed procedure by invoking its inherent powers under Rule 11 would run contrary to the carefully crafted procedure for withdrawal. In the Impugned Judgement, the NCLAT does not provide any reasons for deviating from this procedure or the urgency to approve the settlement without following the procedure.
IBC | Financial Creditor Can Submit Claim Even If There Is No Default Of Debt : Supreme Court
Case Title : China Development Bank vs Doha Bank OPSC and others
Citation : 2024 LiveLaw (SC) 1029
The Supreme Court has observed a default is not necessary for a debt to become a financial debt under the Insolvency and Bankruptcy Code, 2016.
A bench comprising Justice Abhay S Oka and Justice Augustine George Masih held that under Section 5(7) of the IBC, any person to whom financial debt is owed becomes a Financial Creditor even if there is no default in payment of debt. "Therefore, for submitting the claim by a Financial Creditor, there is no requirement of actual default," the Court held.
HIGH COURTS
S.204 IBC | Provision Of Twin Tier Control By IBBI And IPA By Itself Doesn't Give Rise To Presumption Of Double Jeopardy: Madras High Court
Case Title: CA V Venkata Sivakumar v The Insolvency and Bankruptcy Board of India (IBBI) and Others
Citation: 2024 LiveLaw (Mad) 35
The Madras High Court while dismissing a challenge made to Section 204 of the Insolvency and Bankruptcy Code (IBC), which gives powers to the Insolvency Professional Agency (IPA) to monitor the conduct of the Insolvency professional, observed that merely because the provision gave powers to both the Insolvency Bankruptcy Board of India (IBBI) and the IPA, it would not become arbitrary or give a presumption of double jeopardy.
The bench of Chief Justice SV Gangapurwala and Justice Bharatha Chakravarthy observed that the conferment of powers to the IBBI and IPA by itself would not amount to conferring unbridled power as the regulation and bye-laws provided for checks and balances. Noting that there was no excessive power being granted, the court added that Section 204 of IBC was only an enabling provision and there was no constitutional infirmity in the provision.
Case Title: Purushottam Prabhakar Chavan Versus Deputy Commissioner of Sales Tax (GST)
Case No.: Writ Petition No. 3477 Of 2024
The Bombay High Court has held that lender bank registration with the Central Registry of Securitisation and Security Interest of India (CERSAI) has first priority over Deputy Commissioner of Sales Tax (GST) (DCST) against proceeds of enforcement under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (SARFAESI Act).
The bench of Justice B.P. Colabawalla and Justice Somasekhar Sundaresan observed that the Lender Bank had first priority in enforcement against the Walkeshwar Flat with effect from January 24, 2020, having been the first to register with CERSAI, which was done on January 2, 2020. The bench noted that Encore ARC, which conducted the auction on February 28, 2023, acquired the entitlement to priority from the lender bank along with the assignment of the loans to the borrowers with attendant security interests on March 21, 2020.
Case Title: M/s Kerala Chamber Of Commerce And Industry vs. Directorate of Enforcement
Case Number: CRL.MC No. 3605 of 2024
The Kerala High Court stated that prima facie, a Resolution Professional appointed under the Insolvency and Bankruptcy ('IB') Code for carrying the Corporate Insolvency Resolution Process ('CIRP') of the Company cannot be hauled up in a criminal proceeding initiated against the Company.
Winding Up Proceedings On Nascent Stage, To Be Transferred To NCLT: Delhi High Court
Case Title: Arabian Oilfield Suppliers & Services vs Greka Drilling (India) Limited
Case No.: CO.PET. 88/2016 & CO.APPL. 381/2016, CO.APPL. 382/2016, CO.APPL. 1514/2018
The Delhi High Court bench of Justice Dharmesh Sharma held that winding up proceedings pending before High Courts, which are at a nascent stage and have not progressed to an advanced stage, ought to be transferred to the NCLT.
NCLT Kochi Order “Preposterous” And “Untenable” Exceeding Jurisdiction In Declaring Tax Assessment Order Void: Kerala High Court
Case Title: Deputy Commissioner (Works Contract), Kerala State Goods and Services Tax Department vs. National Company Law Tribunal
Case No.: WP(C) No. 39185 of 2022
The Kerala High Court bench of Justice Dinesh Kumar Singh, has observed that an Order passed by the National Company Law Tribunal ('NCLT') Kochi Bench was 'preposterous' and 'untenable'.
NCLT Kochi had held an Assessment Order by Kerala Value Added Tax ('KVAT') Works Contract Authorities against Albana Engineering (India) Pvt. Ltd. (Respondent 2) to be void ab initio in violation of Section 14(1)(a) of IBC.
“The Company Law Tribunal has no power and authority under the IBC to declare an assessment order as void ab initio and non-est in law. Such an order only reflects the competence of the persons who are manning such an important Tribunal. The Order shows the lack of basic understanding of the law. Instead of considering the application by the 2nd respondent for permission to file an appeal against the assessment order, the National Company Law Tribunal, Kochi Bench, has assumed the jurisdiction of the Constitutional Court to declare the assessment order as void ab initio.”
Case Title: Amit Dineshchandra Patel vs. Reserve Bank of India
Citation: 2024 LiveLaw (Guj) 10
The Gujarat High Court bench comprising of Justice Sangeeta K. Vishen, has observed that the Lender Banks must provide a reasonable opportunity to the Borrower by furnishing a copy of Audit Reports and allowing him to submit a representation before classifying the account as fraud.
In 2021, the Corporate Debtor (Company) was admitted into a Corporate Insolvency Resolution Process ('CIRP') under Insolvency and Bankruptcy, Code, 2016. The Company's loan accounts were declared as fraud by the consortium banks.
Case Title: Shantanu Prakash vs State Bank Of India & Ors
Case No.: W.P.(C) 1730/2024, CM APPL. 7177/2024 & CM APPL. 11269/2024
The Delhi High Court bench of Justice Mini Pushkarna held that the concerned party must be provided with all requisite documents that form the basis of Show Cause Notices ('SCNs') by the banks. It held that this enables the party to submit a proper reply and address all allegations effectively. Without access to these underlying documents, the procedure of issuing an SCN and filing a response would be rendered meaningless.
Case Title: Sundaresh Bhat vs Insolvency And Bankruptcy Board of India
Case No.: W.P.(C) 14389/2022
The Delhi High Court bench of Justice Subramonium Prasad held that official liquidators must adhere to ethical principles and demonstrate an unwavering commitment to fairness to discharge their duties under the Insolvency and Bankruptcy Code.
Gujarat High Court Quashes Demand Notice And Assessment Order In Absence Of Any Claim Not Forming Part Of Resolution Plan
Case Title: Surya Exim Limited Thro Director Bhawani Singh Versus Union Of India & Ors.
Citation: 2024 Livelaw (Guj) 42; R/Special Civil Application No. 1195 Of 2023
The Gujarat High Court bench of comprising Justice Bhargav D. Karia and Justice Niral R. Mehta, has quashed the demand notice and assessment order passed by the Income Tax department against Corporate Debtor, in the absence of any claim not forming part of the resolution plan submitted by the Successful Resolution Applicant (“SRA”).
The NCLT approved the resolution plan of the SRA for the Corporate Debtor. Post approval, the Income Tax department raised demand notice and passed assessment orders against the Corporate Debtor. These tax demands did not exist prior to approval of SRA's resolution plan and hence no claim was submitted before the Resolution Professional in their respect. Accordingly, the demand notice has been quashed by the High Court.
Case Title: Union of India & Anr. vs Ramswarup Lohh Udyog & Ors
Case No: IA No. GA/2/2024
The Calcutta High Court bench of Justice Sugato Majumdar held that after the insolvency proceeding is over and the resolution plan is duly approved by the National Company Law Tribunal, the corporate entity starts with a clean slate on rejuvenation.
Case Title: Omkara Assets Reconstruction in the matter of ICICI Bank Limited vs Classic Diamonds (India) Limited
Case Number: Interim Application (L) No. 25210 of 2022 in Company Petition No. 317 of 2012
The Bombay High Court bench of Justice Abhay Ahuja held that as long as no irreversible actions, such as actual sales of immovable or movable properties, have occurred, the Company Court retains the discretion to transfer proceedings to the NCLT.
Case Title: Anurodh Mittal vs Rehat Trading Company
Case No.: Miscellaneous Criminal Case No. 17782 of 2024
The Madhya Pradesh High Court bench of Justice Gurpal Singh Ahluwalia has held that merely because of the initiation of proceedings under the Insolvency and Bankruptcy Code, 2016 the signatory of the cheque cannot escape from his liability under the Negotiable Instruments Act, 1881.
Case Title: National Sewing Thread Co. Ltd. vs Superintending Engineer, TANGEDCO and Anr.
Case No.: W.P. No.29845 of 2022 and WMP.No.29233 of 2022
The Madras High Court bench of Justice N. Seshasayee held that though the Adjudicating Authority may not substitute the commercial wisdom of the Committee of Creditors ('CoC'), however, it must exercise jurisdiction akin to revisional jurisdiction to assess the correctness of the actions taken by the CoC.
Case Title: National Sewing Thread Co. Ltd. vs Superintending Engineer, TANGEDCO and Anr.
Case No.: W.P. No.29845 of 2022 and WMP.No.29233 of 2022
The Madras High Court bench of Justice N. Seshasayee held that an MSME Corporate Debtor cannot exploit the Clean Slate Theory by withholding information, especially when its management, which remained in control, had a duty to disclose such information.
Case Title: M/s Reliance Infratel Limited & Anr. vs. State of Meghalaya & Ors.
Case No.: WP(C) No. 238 of 2023
The Meghalaya High Court has held that a State authority cannot compel a successful resolution applicant under Insolvency and Bankruptcy Code, 2016 (I&B Code) to pay past electricity dues, if the State authority has not made any claim in respect of its dues under approved resolution plan.
Case Title: National Sewing Thread Co. Ltd. vs Superintending Engineer, TANGEDCO and Anr.
Case No.: W.P. No.29845 of 2022 and WMP.No.29233 of 2022
The Madras High Court bench of Justice N. Seshasayee held that the Clean State Theory only protects the third party – Successful Resolution Applicant ('SRA') and not the suspended board of the Corporate Debtor from uncertainties of future claims.
Case Title: National Sewing Thread Co. Ltd. vs Superintending Engineer, TANGEDCO and Anr.
Case No.: W.P. No.29845 of 2022 and WMP.No.29233 of 2022
The Madras High Court bench of Justice N. Seshasayee urged the Parliament to assess and evaluate the working efficiency of the Insolvency and Bankruptcy Code, 2016 ('IBC') and questioned whether the Parliament has considered the general recovery percentage achieved from a successful corporate debtor resolution process.
Case Title: National Sewing Thread Co. Ltd. vs Superintending Engineer, TANGEDCO and Anr.
Case No.: W.P. No.29845 of 2022 and WMP.No.29233 of 2022
The Madras High Court comprising of Justice N. Seshasayee held that every claim by operational creditors involves a right to their property under Article 300A of the Constitution of India.
Case Title: Uphealth Holdings, INC. vs Dr. Syed Sabahat Azim & Ors.
Case No.: C.O. No. 241 of 2024
The Calcutta High Court single judge bench of Justice Shampa Sarkar held that without a comprehensive cross-border insolvency framework, Indian courts do not recognize or enforce moratorium orders from non-reciprocating countries, such as the U.S., and thus are not obligated to stay ongoing suits due to such foreign proceedings.
Madras High Court: The Successful Working Of IBC Rests On Diligence And Integrity Of IRP And RP
Case Title: National Sewing Thread Co. Ltd. vs Superintending Engineer, TANGEDCO and Anr.
Case No.: W.P. No.29845 of 2022 and WMP.No.29233 of 2022
The Madras High Court stressed and defined the role and responsibilities of the Interim Resolution Professional ('IRP') and Resolution Professional ('RP') to act fairly and transparently to secure the interests of all the stakeholders, particularly operational creditors.
The Telangana High Court bench of Justice Moushumi Bhattacharya and Justice Nagesh Bheemapaka has held that the determination of the title of the shares is within the domain of the Civil Court and not the NCLT/NCLAT. The bench held that Section 430 of the Companies Act comes into play only after the title to the shares is decided.
Case Title: Cherukuri Ramakrishna vs Sandhya Hotels Private Limited
Case No.: C.C.C.A. No.57 OF 2023
Case Title: National Sewing Thread Co. Ltd. vs Superintending Engineer, TANGEDCO and Anr.
Case No.: W.P. No.29845 of 2022 and WMP.No.29233 of 2022
The Madras High Court bench of Justice N. Seshasayee held that the Clean State Theory shall not apply to undisclosed creditors to protect them from the deliberate non-disclosure or silence of the suspended board of directors or negligence of Interim Resolution Professional ('IRP') or Resolution Professional ('RP') towards disclosing their claims.
Madras High Court: Clean State Theory Not Applicable To Undisclosed Creditors Left Out Due To Negligences Of IRP Or RP
Case Title: National Sewing Thread Co. Ltd. vs Superintending Engineer, TANGEDCO and Anr.
Case No.: W.P. No.29845 of 2022 and WMP.No.29233 of 2022
The Madras High Court bench of Justice N. Seshasayee held that the Clean State Theory shall not apply to undisclosed creditors to protect them from the deliberate non-disclosure or silence of the suspended board of directors or negligence of Interim Resolution Professional ('IRP') or Resolution Professional ('RP') towards disclosing their claims.
Negotiable Instruments Proceeding Under Section 138 Does Not Abate On Initiation Of Insolvency Proceeding: Himachal Pradesh High Court
Case Title: Tushar Sharma v. State Bank of India
Case Reference: Cr. MMO No. 924 of 2023
It was held that while section 14 of the IBC imposes a moratorium on all the proceedings against the corporate debtor once the corporate debtor is admitted into insolvency. However, this does not absolve the directors and signatories to the dishonoured cheque from their personal liability under section 138 of the Negotiable Instrument Act. The Supreme Court observed as under:
“52 Thus, where the proceedings under Section 138 of the NI Act had already commenced and during the pendency the plan is approved or the company gets dissolved, the directors and the other accused cannot escape from their liability by citing its dissolution. What is dissolved is only the company, not the personal penal liability of the accused covered under Section 141 of the NI Act. They will have to continue to face the prosecution in view of the law laid down in Aneeta Hada v. Godfather Travels & Tours (P) Ltd., (2012) 5 SCC 661. Where the company continues to remain even at the end of the resolution process, the only consequence is that the erstwhile directors can no longer represent it”.
Adjudicating Authority Decides Fairness And Reasonableness While Approving Resolution Plan, High Court Cannot- Delhi High Court
Case Title: Gateway Investment Management Services Ltd. v. Reserve Bank of India and Ors.
Citation: 2024 LiveLaw (Del) 1092
In a significant judgement, the Delhi High Court affirmed the commercial wisdom of the committee of creditors (CoC). The case was pertaining to rejection of the resolution plan proposed by the petitioner despite offering the highest bid in e-auction in a Corporate Insolvency resolution Plan (CIRP) of Helio Photo Voltaic Pvt. Ltd. (Corporate Debtor).
The court held as under:
“12 Thus, the resolution plan decided by the CoC shall be put up for consideration before the Adjudicating Authority, which forum alone shall finally decide whether the CoC has performed its fiduciary duty as per the legislative mandate of the IBC”.
Himachal Pradesh High Court Affirms Clean Slate Theory, Declares Tax Authorities' Charge Over Properties After Acquisition Plan Void And Illegal
Case Title: Su-Kam Power System Ltd. and Anr.v.State of Himachal Pradesh and Ors.
Case Reference: CWP No.422 of 2024
In an important judgment delivered by the Himachal Pradesh High Court, the claims and red entries of the state tax department over the properties of Su-Kam Power Systems Ltd.(Corporate Debtor) were quashed. The corporate debtor was sold as a going concern under the provisions of the Insolvency and Bankruptcy Code (IBC). The court held that once the company was acquired and resolution plan was approved, all prior claims including claims of the tax authorities are extinguished.
The court rejected the argument that crown debt had priority over other debts. The court held as under:
“61 The plea of the respondents that the tax dues claimed by them will have priority as a “Crown Debt”, therefore, cannot be accepted, and their action in continuing the said red entry/charge on account of dues recoverable from erstwhile management of the Corporate Debtor under the Himachal Pradesh Value Added Tax Act, 2005, Himachal Pradesh Goods and Services Tax Act, 2017 and the CST Act, 1956, would be clearly illegal & arbitrary”.
Ruchi Soya (Patanjali) – Claim Not Included In Approved Resolution Plan Stand Extinguished : Karnataka High Court
Case Title: M/S Patanjali Foods Limited (Formerly Ruchi Soya Industries Limted) vs. Commissioner of Customs
Case No.: CSTA No. 4 of 2024
The Karnataka High Court division bench comprising Mr. Justice S.G. Pandit and Mr. Justice C.M. Poonacha has held that once a resolution plan is approved by the Adjudicating Authority under Section 31(1) of the Insolvency and Bankruptcy Code, 2016 (IBC), claims which are not included in the resolution plan are extinguished, and no further proceedings can be initiated against the corporate debtor in respect of such claims. The Court also clarified that Rule 22 of the Customs, Excise and Service Tax Appellate Tribunal (Procedure) Rules, 1982, which deals with abatement of appeal upon death, adjudication as insolvent or winding-up, does not apply when a resolution plan has been approved as the objective of a resolution plan is to continue the business of the company as “a going concern.”
All Claims Before Approval Of Resolution Plan Are Extinguished Once Plan Is Approved U/S 31 Of IBC: Orissa High Court
Case Title: Orissa Manganese & Minerals Ltd. v. State of Odisha and Ors.
Case Reference: W.P.(C) No. 1497 of 2024 with W.P. (C) No. 2304 of 2024 and W.P.(C) No. 2307 of 2024
The Orissa High Court Bench of Mr. Justice D.Dash and Mr. Justice V. Narasingh held that all liabilities of the corporate debtor prior to approval of resolution plan stand extinguished once the plan is approved under section 31 of the Insolvency and Bankruptcy Code (IBC). In this case, three writ petitions were filed against demand letters issued by the state (opposite parties) demanding statutory dues.
It was observed as under:
“No surprise claim should be flung on the Resolution Plan as the Resolution Plan provides the Corporate Debtor's business on a clean state to the successful Resolution Applicant. Further, the Resolution Applicant “should start with fresh slate on the basis of the Resolution Plan approved shunning its prior status as 'Corporate Debtor'.”
Bombay High Court Holds Redevelopment Rights of Society Not Part Of Moratorium Process; Issues Writ Of Mandamus For Redevelopment, Upholding Right to Shelter
Case Title: Kher Nagar Sukhsadan Co-operative Housing Society Ltd. v. State of Maharashtra & Ors.
Case Number: Writ Petition No. 3893 of 2024
The Bombay High Court division bench of Justices Kamal Khata and M.S. Sonak has held that if the developer fails to meet its obligations under the Development Agreement, such as paying transit rent and completing construction within the specified time frame, there is a complete failure of consideration, and no rights accrue to it. The court awarded a writ of mandamus for permissions and approvals for redevelopment. It observed that the uncertain outcome of a Corporate Insolvency Resolution Process (CIRP) shouldn't deprive individuals of their basic right to shelter.
Resolution Professional At S.94/95 Stage Cannot Decide On Maintainability Of Petition By Entering Into Merits: Karnataka High Court
Case Title: Buoyant Technology Constellations Pvt. Ltd. vs. Manyata Realty & Ors.
Case Reference: WRIT APPEAL NO.498 OF 2024 (GM-RES)
The Karnataka High Court Bench of Justice N.V. Anjaria and K.V. Aravind, held that the role of the Registrar while registering the application under Section 95 of the Insolvency and Bankruptcy Code (IBC) is not adjudicatory in nature and this duty of the Registrar, NCLT was in no way adjudicatory trapping. Application of judicial mind towards merits has no place in discharge of a ministerial or clerical function.
Bombay High Court Upholds Suspension Of Resolution Professional For Deficiency In Discharge Of Duties
Case Title: Vijendra Kumar Jain v. Insolvency & Bankruptcy Board of India (IBBI) & Anr.
Case Number: Writ Petition No. 12320 of 2024
The Bombay High Court bench of Justices A.S. Chandurkar and Rajesh S. Patil has upheld that the suspension order passed by the Disciplinary Committee of the Insolvency and Bankruptcy Board of India (IBBI) against the Resolution Professional (RP) for lack of due diligence in verifying the Resolution Plan and non-intimation of the claims of an operational creditor.
All Claims Prior To Approval Of Resolution Plan Stand Extinguished U/S 31 Of IBC: Bombay High Court
Case Title: Maha Mineral Mining and Benefication Private v. Gram Panchayat, Gowari
Case Reference: 2024:BHC-NAG:11478-DB
The Bombay High Court Bench of Justices Bharati Dangre and Abhay J Mantri held that once the petitioner has acquired the assets of the corporate debtor, the claims, if any, which were not raised, stand extinguished and the respondent cannot now seek to recover those claims from the petitioner, who acquired the assets of the corporate debtor through auction process under the IBC.
High Court
Initiating Tax Proceedings After CIRP Approval Violates Section 31 IBC: Bombay High Court
Case: Uttam Value Steels Ltd. Vs Assistant Commissioner of Income Tax, WRIT PETITION (L) NO. 9420 OF 2022
Recently, the Bombay High Court dealt with a writ petition filed by Uttam Value Steels Ltd. and Mr. Subodh Karmarkar, challenging several notices issued by the Income Tax Department under various provisions of the Income Tax Act, 1961. The dispute revolved around tax claims and proceedings initiated by the Income Tax authorities against Uttam Value Steels Ltd., despite the company having successfully undergone a Corporate Insolvency Resolution Process (CIRP) under the Insolvency and Bankruptcy Code, 2016 (IBC).
Case Title: Uttam Value Steels Ltd. versus Assistant Commissioner of Income Tax and Ors
Case Number: Writ Petition (L) No. 9420 OF 2022
Since upon the completion of Corporate Insolvency Resolution Process (CIRP), the Assessee has changed hands and commenced under a new ownership and management, the Bombay High Court held that tax proceedings pertain to period prior to the CIRP, and consequent to the approval of the resolution plan, the tax proceedings stand extinguished. The Division Bench of Justice G. S. Kulkarni and Justice Somasekhar Sundaresan observed that “provisions outlined in Section 31(1) of the Insolvency and Bankruptcy Code (IBC) stipulates that approval of resolution plan by the adjudicating authority is binding on Central Government and its agencies in respect of any statutory dues arising under any law for the time being in force, thus binding tax authorities and their enforcement actions”.
Case Title: M/S Bgr Energy Systems Ltd v. State of U.P. and Another [WRIT TAX No. - 1026 of 2024]
The Allahabad High Court has held that order Section 73 of the Goods and Service Tax Act, 2017 cannot be passed a company which is under the Corporate Insolvency Resolution Process (CIRP) under the Insolvency and Bankruptcy Code, 2016. Section 73 of the Goods and Service Tax Act, 2017 empowers a proper officer to initiate proceedings if he is satisfied that any tax has not been paid or short paid or erroneously refunded, or where input tax credit has been wrongly availed or utilised for any reason, other than the reason of fraud or any willfulmisstatement or suppression of facts to evade tax by any assesee.
Case Title: OCL Iron and Steel Limited vs Union of India
Citation: 2024 LiveLaw (Del) 862
The Delhi High Court single bench of Justice Sanjeev Narula held once a resolution plan is accepted, the stakeholders cannot impose penalties or claim dues from the Corporate Debtor based on past liabilities.
Asset Deposited By Corporate Debtor As Security Before CIRP Commencement Continues To Be Asset Of Corporate Debtor: Bombay High Court
Case Title: Siti Networks Ltd. vs. Rajiv Suri (INTERIM APPLICATION (LODG.) NO. 31055 OF 2024 IN APPEAL NO. 597 OF 2016 IN SUIT NO. 2295 OF 2002)
Citation: 2024 LiveLaw (Bom) 600
The Bombay High Court bench of Justices B.P. Colabawalla and Somasekhar Sundaresan has held that monies or any other asset deposited by a corporate debtor in court prior to commencement of CIRP by way of security would continue to be the asset of the corporate debtor.
The court observed that the moratorium on the enforcement of a claim for execution of a decree has commenced, and upon failure of the CIRP, the asset would form part of the liquidation estate. As stated in Byju, the asset is intended to be distributed to creditors in proportion to what is owed to them, and one creditor cannot gain an advantage over the others by being paid out, particularly outside of the CIRP or liquidation.
Case Title: Harsh Mehta Versus Securities and Exchange Board of India and Ors.
Case Number: WRIT PETITION NO. 4844 OF 2024
The Bombay High Court bench of Justices M.S.Sonak and Jitendra Jain has held that Delisting Regulations framed by the SEBI would not be applicable to the delisting of shares of the company in pursuance of the approval of a Resolution Plan under section 31 of the code.
NCLAT
Scheme Of Compromise Decided In Absence Of Shareholder Who Submitted It, NCLAT Chennai Directs Re-Consideration In Presence Of The Shareholder
Case Title: Sanjeev Mitla vs Mr. Madhusudhan Rao Gonugunta & Anr.
Case No.: Company Appeal (AT) (CH) (Ins) No. 387 of 2023
The National Company Law Appellate Tribunal (“NCLAT”), Chennai Bench, comprising of Justice Rakesh Kumar Jain (Judicial Member) and Ms. Shreesha Merla (Technical Member), has directed the Liquidator to convene a meeting of the Stakeholders Consultation Committee (SCC) to re-consider the compromise scheme submitted by a shareholder, in the presence of such shareholder.
A shareholder of the Corporate Debtor had submitted a compromise scheme under Section 230 of the Companies Act, 2013 to the Liquidator. The Liquidator placed the Scheme before the Stakeholders Consultation Committee in absence of the shareholder and the same was rejected. The shareholder submitted that it could not persuade the SCC in respect of the Scheme due to his absence.
Case Title: IDBI Bank Ltd. and Ors. v. Mr. Sumit Binani, RP of KSK Mahanadi Power Company Ltd.
Case No.: Company Appeal (AT) (CH) (INS.) No. 385 / 2023
The National Company Law Appellate Tribunal ('NCLAT'), Chennai Bench, comprising of Justice Rakesh Kumar Jain (Judicial Member) and Ms. Shreesha Merla (Technical Member), has held that the Resolution Professional is empowered under Section 25(1) of IBC to reject the proposal of Committee of Creditors ('CoC') for renewal of Bank Guarantees provided by the Corporate Debtor.
NCLAT New Delhi: Liquidator Is Entitled To His Fee Under S. 34 Of IBC And Regulation 4 Of Liquidation Regulations And Cost Under Regulation 2B Of Liquidation Regulations
Case Title: CA Jai Narayan Gupta (Liquidator of Barcle Enterprises Limited) vs. Radhasiriya Properties Pvt. Ltd.
Case No.: Company Appeal (AT) (Insolvency) No.1473 of 2023
The National Company Law Appellate Tribunal ('NCLAT'), New Delhi Bench, comprising Justice Ashok Bhushan (Chairperson) and Barun Mitra (Technical Member), has held that the Liquidator is entitled to his fee under Section 34 of IBC and Regulation 4 of Insolvency and Bankruptcy Board of India (Liquidation Process) Regulations, 2016 and Cost under Regulation 2B of Liquidation Regulations.
NCLAT Delhi: Once CIRP Has Stayed, Resolution Professional Can't Be Directed To Hand Over The Charge Of Corporate Debtor To Ex-Management
Case Title: Mr. Mukesh Kumar Jain vs. Navin Kumar Upadhyay & Anr
Case No.: Company Appeal (AT) (Insolvency) No. 930-931 of 2023
The National Company Law Appellate Tribunal ('NCLAT'), New Delhi Bench comprising of Justice Ashok Bhushan (Chairperson) and Mr. Barun Mitra (Technical Member), has held that Resolution Professional cannot be directed to hand over the charge of Corporate Debtor to the Ex-management, once CIRP has stayed.
The Bench opined that handing over the charge of the Corporate Debtor to Ex-management can be dangerous and the same is prone to misuse the assets and the assets shall be diminished, which may adversely affect the creditors of the Corporate Debtor in case of stay of the CIRP.
Resolution Professional Can't Question COC Decision Of Replacement: NCLAT Delhi
Case title: Partha Sarathy Sarkar v Specified Undertaking of Unit Trust of India Ltd (SUUTI) & Ors.
Case No.: Company Appeal (AT) (Insolvency) No. 1340 of 2023
The National Company Law Appellate Tribunal (“NCLAT”), New Delhi Bench, comprising of Justice Ashok Bhushan (Chairperson) and Shri Barun Mitra (Technical Member), has held that when the Committee of Creditors (CoC) passes a resolution to replace the Resolution Professional, then it is not open for the Resolution Professional to question the reasons for its replacement and ask NCLT to adjudicate upon the reasons which persuaded the CoC to pass the resolution.
NCLAT Delhi: Corporate Debtor Can't Be Absolved From Liability Just Because Insurance Claim Received By Operational Creditor
Case Title: Mr. Milan Aggarwal vs. Saudi Basic Industries Corporation and Anr.
Case No.: Company Appeal (AT) (Insolvency) No.231 of 2023
The National Company Law Appellate Tribunal ('NCLAT'), New Delhi, comprising Justice Ashok Bhushan (Chairperson) and Mr. Barun Mitra (Technical Member), has held that the Corporate Debtor cannot be absolved from its liability to discharge its Operational debt by the Insurance Company's payment to the Operational Creditor of its claim and the same cannot be a ground to reject the Corporate Insolvency Resolution Process ('CIRP') application under Section 9 of IBC.
NCLAT Delhi: Non-Stamping Of Agreement Doesn't Render CIRP As Non-Maintainable When Other Material To Prove Default Of Debt Exists
Case Title: Hiren Meghji Bharani vs. Shankheshwar Properties Pvt. Ltd. through its Resolution Professional and Anr.
Case No.: Company Appeal (AT) (Insolvency) No.446 of 2023
The National Company Law Appellate Tribunal ('NCLAT'), New Delhi, comprising Justice Ashok Bhushan (Chairperson), Shri Barun Mitra (Technical Member) and Shri Arun Baroka (Technical Member), has held that the non-stamping of document does not render the Corporate Insolvency Resolution Process ('CIRP') petition filed to be non-maintainable when there exists other material on record to prove existence of default in the payment of debt.
NCLAT New Delhi: When CoC Hasn't Confirmed Appointment Of IRP, IRP Can Be Replaced By CoC U/S 22 Of IBC
Case Title: Kairav Anil Trivedi, IRP of Parenteral Drugs India Ltd. v. State Bank of India (Erstwhile CoC) & Anr.
Case No.: Company Appeal (AT) (Insolvency) No. 1439 & 1440 of 2023
The National Company Law Appellate Tribunal ('NCLAT'), New Delhi, comprising Justice Ashok Bhushan (Chairperson), Shri Barun Mitra (Technical Member), and Shri Arun Baroka (Technical Member), has held that when the Committee of Creditors ('CoC') has not confirmed the appointment of Interim Resolution Professional ('IRP'), the IRP can be replaced by the CoC under Section 22 of IBC.
NCLAT Chennai: Goods Not In Possession Of The Port, Claim By Port Can't Be Treated As Secured Creditor Under IBC
Case Title: V O Chidambaranar Port Authority vs. Shri Rajesh Chillale, RP of IndBharath Power Gencom Ltd.
Case No.: Company Appeal (AT) (CH) (Ins) No. 412 of 2023
The National Company Law Appellate Tribunal ('NCLAT'), Chennai, comprising Justice Rakesh Kumar Jain (Judicial Member) and Ms. Shreesha Merla (Technical Member), has held that there is no actual lien to invoke Section 171 of the Indian Contract Act, 1872 when the goods are not in possession of the Port Authority and the claim of the Port cannot be treated as a Secured Creditor for distribution of liquidation assets under Sec. 53 of IBC.
Case title: In Style Fashion v Aditya Birla Fashion and Retail Limited
Case No.: Company Appeal (AT)(Insolvency) No. 1679 of 2023
The National Company Law Appellate Tribunal (“NCLAT”), Principal Bench, comprising of Justice Ashok Bhushan (Chairperson), Shri Barun Mitra (Technical Member) and Shri Arun Baroka (Technical Member), has declined to initiate insolvency proceedings against Aditya Birla Fashion and Retail Limited under Section 9 of IBC, on the premise that there is pre-existing dispute between Parties which cannot be investigated upon by NCLT or NCLAT.
Aditya Birla Fashion and Retail Limited is a part of Aditya Birla Group of companies and runs the Pantaloons showrooms.
Successful Auction Purchaser To Pay All Dues For Availing A New Electricity Connection, Except For The Arrears Of Pre-CIRP Period: NCLAT Delhi
Case Title: Paschimanchal Vidyut Vitran Nigam Ltd. v HSA Traders & Ors.
Case No.: Company Appeal (AT) (Insolvency) No.527 of 2023
The National Company Law Appellate Tribunal (“NCLAT”), New Delhi Bench, comprising of Justice Ashok Bhushan (Chairperson) and Shri Barun Mitra (Technical Member),
has held that the Successful Auction Purchaser in the liquidation of Corporate Debtor shall be liable to pay all dues for availing a new electricity connection, apart from the pre-CIRP electricity dues.
NCLAT Delhi: Optionally Convertible Debentures Constitute 'Financial Debt' U/s 5(8)(c) Of IBC
Case Title: Santosh Kumar vs. ASK Trusteeship Services Pvt. Ltd.
Case No.: Company Appeal (AT) (Insolvency) No.1575 of 2023
The National Company Law Appellate Tribunal ('NCLAT') New Delhi Bench, comprising Justice Ashok Bhushan (Chairperson), Mr. Barun Mitra (Technical Member), has held that the Optionally Convertible Debentures are Financial Debt within the meaning of Section 5(8)(c) of IBC.
When Number Of Allottees Disputed, NCLT To Decide S.7(1) Compliance Prior To Admission: NCLAT Delhi
Case title: Parikshit Madanmohan Sharma v M.S. Gopikrishnan & Ors.
Case No.: Company Appeal (AT) (Insolvency) No. 206 of 2023
The National Company Law Appellate Tribunal (“NCLAT”), New Delhi Bench, comprising of Justice Rakesh Kumar Jain (Judicial Member) and Shri Naresh Salecha (Technical Member), has held that when the total number of allottees in a real estate project is disputed, then the NCLT should first decide whether the Section 7 petition has been filed by minimum number of allottees prescribed under second proviso to Section 7(1) of IBC or not.
The Bench has set aside a NCLT order whereby insolvency proceedings were initiated against a real estate developer company, without deciding the issue pertaining to compliance of Section 7(1) of IBC.
NCLAT Delhi Terminates Insolvency Proceedings Against Asian Hotels (West) Ltd., Accepts Settlement Proposal By Promoters
Case Title: Sandeep Gupta v JM Financial Asset Reconstruction Company Ltd. & Anr.
Case No.: Company Appeal (AT) (Ins.) No. 1192 & 1193 of 2022
The National Company Law Appellate Tribunal (“NCLAT”), New Delhi Bench, comprising of Justice Ashok Bhushan (Chairperson) and Shri Barun Mitra (Technical Member), has terminated Corporate Insolvency Resolution Process (“CIRP”) of Asian Hotels (West) Ltd., which was initiated by NCLT in September 2022. The Bench has accepted the Settlement Proposal submitted by Promoters and Suspended Directors of Asian Hotels (West), wherein 100% dues of Financial Creditors along with interest and 100% dues of the Operational Creditor, Government dues and dues of employees with entire CIRP cost has been proposed to be paid.
The Asian Hotels (West) Ltd. owns the five-star hotels namely Hotel Hyatt Regency Mumbai and JW Marriott, New Delhi Aerocity (through its subsidiary).
NCLAT Chennai: CoC's Commercial Wisdom Includes Approval Of Resolution Plan Below Liquidation Value
Case Title: Mr. Ramesh Kesavan vs. CA Jasin Jose, RP SD Pharmacy Pvt. Ltd.
Case No.: Company Appeal (AT)(CH)(Ins.) No. 422 of 2023
The National Company Law Appellate Tribunal ('NCLAT') Chennai Bench, comprising Justice Rakesh Kumar Jain (Judicial Member) and Ms. Shreesha Merla (Technical Member), has held that the approval of the Resolution Plan below the Liquidation value is within the commercial wisdom of the Committee of Creditors ('CoC') as the IBC does not expressly bar that the Resolution Plan value should be over and above the Liquidation value.
NCLAT Delhi: CIRP Against Financial Service Provider Is Not Maintainable Under IBC
Case Title: Globe Capital Market Ltd. vs. Narayan Securities Ltd.
Case No.: Company Appeal (AT) (Insolvency) No.32 of 2024 & I.A No. 62 of 2024
The National Company Law Appellate Tribunal ('NCLAT'), New Delhi Bench, comprising Justice Ashok Bhushan (Chairperson), Mr. Barun Mitra (Technical Member), and Mr. Arun Baroka (Technical Member), has held that a Corporate Insolvency Resolution Process ('CIRP') application against the Financial Service Provider is not maintainable under IBC.
NCLAT Delhi: Ex-Promoter, Who Resigned Before CIRP Commencement, Is Eligible To Submit Resolution Plan
Case Title: Vishram Narayan Panchpor RP of Blue Frog Media Pvt. Ltd. vs. Committee of Creditors (Blue Frog Media Pvt. Ltd.) and Anr.
Case No.: Company Appeal (AT) (Insolvency) No. 1489 of 2023
The National Company Law Appellate Tribunal ('NCLAT') New Delhi Bench, comprising Justice Ashok Bhushan (Chairperson) and Mr. Barun Mitra (Technical Member), has held that an Ex-Promoter/Director who resigned from Corporate Debtor before initiation of Corporate Insolvency Resolution Process ('CIRP') under Section 10 of IBC is eligible to submit a Resolution Plan under Section 29A of IBC.
Bank Files Claim After 738 Days Of Delay And Post Approval Of Resolution Plan, NCLAT Delhi Upholds Rejection Of Claim
Case title: Kotak Mahindra Bank Ltd. v Sandeep Goel RP for Sarvottam Realcon Pvt Ltd.
Case No.: Company Appeal (AT) (Insolvency) No. 140 of 2024
The National Company Law Appellate Tribunal (“NCLAT”), Principal Bench, comprising of Justice Ashok Bhushan (Chairperson), Shri Barun Mitra (Technical Member) and Shri Arun Baroka (Technical Member), has upheld the rejection of a claim submitted by Kotak Mahindra Bank Ltd., which was submitted to the Resolution Professional after delay of 738 days and post approval of resolution plan for the Corporate Debtor.
NCLAT Delhi: Security Of Refund Of Advance Amount Can't Change Nature Of Transaction Into Financial Debt
Case Title: Sainik Industries Pvt. Ltd. vs. Ritesh Raghunath Mahajan, RP, Indian Sugar Manufacturing Company Ltd.
Case No.: Company Appeal (AT) (Insolvency) No. 1614 of 2023
The National Company Law Appellate Tribunal ('NCLAT') New Delhi Bench, comprising Justice Ashok Bhushan (Chairperson), Mr. Barun Mitra (Technical Member), and Mr. Arun Baroka (Technical Member), has held that the Security of refund of the advance amount cannot change the nature of transaction into financial debt.
Resolution Applicant Who Participated In The Process Has Locus To Object The Application For Approval Of Resolution Plan: NCLAT Delhi
Case title: PRIO S.A. v Mr. Pravin R. Navandar & Ors.
Case No.: Company Appeal (AT) (Insolvency) No.1650 of 2023
The National Company Law Appellate Tribunal (“NCLAT”), Principal Bench, comprising of Justice Ashok Bhushan (Chairperson), Shri Barun Mitra (Technical Member) and Shri Arun Baroka (Technical Member), has held that a resolution applicant who has participated in the process, has locus to object the application filed by Resolution Professional under Section 30(6) of IBC for approval of resolution plan submitted by another resolution applicant.
NCLAT Refuses Stay On Jaiprakash Associates' Insolvency Proceedings
Case Title: Sunil Kumar Sharma vs ICICI Bank Ltd & Anr
Case No.: Company Appeal (AT)(Insolvency) No.1158-1162 of 2024
The National Company Law Appellate Tribunal (NCLAT) has declined to grant a stay on the National Company Law Tribunal's (NCLT) order admitting Jaiprakash Associates Limited (JAL) into the insolvency resolution process. The Allahabad bench NCLT held that the restructuring proposals and the financial health of JAL were insufficient reasons to delay insolvency proceedings. In 2017, JAL was listed among the 26 major loan defaulters by the Reserve Bank of India, making it a prime candidate for bankruptcy proceedings. Other entities within the Jaypee Group, such as Jaypee Cement Corporation and Jaypee Infratech, are also undergoing insolvency proceedings.
Acceptance Of Partial Payments Doesn't Negate Default Or Legitimacy Of Insolvency Proceedings: NCLAT
Case Title: Mr. Jayesh Dani vs SREI Equipment Finance Ltd. and Anr
Case No.: Company Appeal (AT) (Insolvency) No. 161 of 2024
The National Company Law Appellate Tribunal, Principal Bench of Justice Ashok Bhushan (Chairperson), Barun Mitra (Technical Member), and Arun Baroka (Technical Member) held that the acceptance of partial payments does not negate the default or the legitimacy of the insolvency proceedings.
Case Title: Yamuna Expressway Industrial Development Authority vs. Monitoring Committee of Jaypee Infratech Ltd. Through Anuj Jain, Secretary & Ors.
Case No.: Company Appeal (AT) (Insolvency) No.493 of 2023 & I.A. No. 3017, 3703 of 2023 & 2535, 2548, 2660, 2669 of 2024
The National Company Appellate Tribunal ('NCLAT) Delhi bench, comprising Justice Ashok Bhushan (Chairperson) and Barun Mitra (Technical Member) held that Suraksha Realty must pay ₹1,334.31 crore to YEIDA over the next four years. This payment is intended to enable YEIDA to increase land compensation for farmers. This is the obligation which stems from a concession agreement between Jaypee and YEIDA.
NCLAT Delhi: Ex-Director Is Ineligible To Submit Resolution Plan For MSME CD Being Wilful Defaulter
Case Title: Namdev Hindurao Patil vs. Virendra Kumar Jain, Liquidator, Warana Dairy and Agro Industries Ltd. and Ors.
Case No.: Comp. App. (AT) (Ins) No. 858 of 2023 & I.A. No. 2925 of 2024
The National Company Law Appellate Tribunal ('NCLAT') Delhi, comprising Justice Rakesh Kumar Jain (Judicial Member), Mr. Naresh Salecha (Technical Member), and Mr. Indevar Pandey (Technical Member) held that an ex-director is ineligible to submit a resolution plan for the resolution of Micro, Small, and Medium Enterprises ('MSME') Corporate Debtor based on his declaration as a wilful defaulter at the date of submitting the Resolution Plan.
Case Title: Pooja Mehra vs. Nilesh Sharma and Ors.
Case No.: Company Appeal (AT) (Insolvency) No. 1511 of 2023
The National Company Law Appellate Tribunal ('NCLAT') Delhi, comprising Justice Ashok Bhushan (Chairperson) and Mr. Arun Baroka (Technical Member) held that the belated claims by creditors cannot be considered given the time-bound nature of Insolvency and Bankruptcy Code, 2016 ('IBC') proceedings.
Case Title: Sarda Energy and Minerals Limited vs. Ashish Arjunkumar Rathi & Ors.
Case No.: Company Appeal (AT) (Insolvency) No. 1395 – 1397 of 2023
The National Company Law Appellate Tribunal ('NCLAT') Delhi, comprising Justice Ashok Bhushan (Chairperson) and Mr. Arun Baroka (Technical Member) sets aside an order on violation of natural justice holding that the Adjudicating Authority (NCLT Mumbai) has no right to substitute its own assumption over the commercial wisdom of Committee of Creditors (CoC).
NCLAT Seeks Google's Response On Appeals Against Play Store Billing Policy
Case Title: People Interactive India Pvt. Ltd. vs. Competition Commission of India & Ors.
Case No.: Competition App. (AT) No. 7 of 2024
The National Company Law Appellate Tribunal (NCLAT), New Delhi bench of Justice Yogesh Khanna (Judicial Member) and Ajai Das Mehrotra (Technical Member) admitted appeals filed by several prominent entities, including Kuku FM, Shaadi.com, Indian Broadcasting and Digital Foundation (IBDF), and People Interactive India Pvt. Ltd. This move follows their dissatisfaction with the Competition Commission of India's (CCI) decision to deny interim relief from complying with Google's contentious billing policies.
NCLAT Delhi Upholds Dismissal Of Plea To Initiate Proceedings Under Section 340 Of CrPC Against Allottees For Allegedly Filing False Affidavits
Case title: M/s Mist Direct Sales Pvt. Ltd. v Mr. Nitin Batra & Ors.
Case No.: Company Appeal (AT) (Insolvency) No. 96 of 2024
The National Company Law Appellate Tribunal (“NCLAT”), Principal Bench, comprising of Justice Ashok Bhushan (Chairperson), Shri Barun Mitra (Technical Member) and Shri Arun Baroka (Technical Member), has upheld the rejection of an application seeking initiation of proceedings under Section 340 r/w Section 195 of the Criminal Procedure Code, 1973 (“CrPC”) against Allottees, for allegedly filing false affidavits before NCLT in Section 7 of IBC proceedings.
Proceedings under Section 340 of CrPC can be initiated when a person intentionally gives a false statement or fabricated false evidence at any stage of the judicial proceedings. The Appellant alleged that the Section 7 petition was not filed by 100 'valid' allottees as required under Section 7(1) of IBC and the affidavits filed by Allottees were false and fabricated. The NCLT held that it cannot decide on the issue of forged affidavits and declined to initiate proceedings under Section 340 of CrPC.
Case Title: Nimai Gautam Shah, Resolution Professional of Sintex Plastics Technology Ltd. vs. RBL Bank Ltd.
Case No.: Company Appeal (AT) (Insolvency) No.82 of 2024
The National Company Law Appellate Tribunal ('NCLAT') New Delhi, comprising Justice Ashok Bhushan (Chairperson), Mr. Barun Mitra (Technical Member), and Mr. Arun Baroka (Technical Member) held that the Adjudicating Authority ought to have granted an exclusion/extension of time when the Resolution Plan received in the process was required to be considered to fulfill the object of the IBC.
Section 9 Petition Not Served Upon Corporate Debtor, NCLAT Delhi Sets Aside NCLT Order Initiating CIRP
Case title: Satish Kumar Sethi v Varsha & Anr.
Case No.: Company Appeal (AT) (Insolvency) No. 217 of 2024
The National Company Law Appellate Tribunal (“NCLAT”), Principal Bench, comprising of Justice Ashok Bhushan (Chairperson), Shri Barun Mitra (Technical Member) and Shri Arun Baroka (Technical Member), has set aside an NCLT order whereby a petition under Section 9 of IBC was admitted and CIRP was initiated without serving a copy of petition to the Corporate Debtor.
The Bench has directed that the petition under Section 9 of IBC be revived before the NCLT for fresh consideration and the Corporate Debtor has been granted time to file a Reply.
NCLAT Delhi: Payment By Third Party For Corporate Debtor For Raw Material Or Working Capital Is “Financial Debt”
Case Title: Mr. Rajeev Kumar Jain vs. Uno Minda Ltd. and Anr.
Case No.: Company Appeal (AT) (Insolvency) No. 947 of 2022
The National Company Law Appellate Tribunal ('NCLAT') New Delhi, comprising Justice Ashok Bhushan (Chairperson) and Mr. Naresh Salecha (Technical Member), has held that the payment of raw material made by a third party at the instructions of Corporate Debtor or financial assistance towards working capital constitutes 'Financial Debt' under IBC.
Department Of State Tax Submits Claim Post Approval Of Resolution Plan By CoC, NCLAT Delhi Upholds Rejection Of Claim
Case title: Department of State Tax v Dar Media Pvt. Ltd. & Anr.
Case No.: Company Appeal (AT) (Insolvency) No. 73 of 2024
The National Company Law Appellate Tribunal (“NCLAT”), Principal Bench, comprising of Justice Ashok Bhushan (Chairperson), Shri Barun Mitra (Technical Member) and Shri Arun Baroka (Technical Member), has held that a claim submitted post approval of resolution plan by the Committee of Creditors (“CoC”) is not liable to be admitted. Accordingly, the Bench has upheld the rejection of claim of Department of State Tax, which was submitted post approval of resolution plan by CoC.
NCLAT Delhi Sets Aside NCLT Order Permitting Suspended Director To Enter Settlement During Pendency Of Plan Approval Application
Case title: Nehru Place Hotels and Real Estates Private Limited V Sanjeev Mahajan & Ors.
Case No.: Company Appeal (AT) (Insolvency) No. 1715-1716 of 2023
The National Company Law Appellate Tribunal (“NCLAT”), Principal Bench, comprising of Justice Ashok Bhushan (Chairperson), Shri Barun Mitra (Technical Member) and Shri Arun Baroka (Technical Member), has set aside a direction given by the NCLT, whereby the Suspended Director was given opportunity to enter settlement during the pendency of application filed by Resolution Professional for approval of Resolution Plan. The Bench has held that since the application for approval of resolution plan is pending for over a year, the NCLT ought to have decided the same.
On 08.01.2023, the Committee of Creditors (CoC) approved the Resolution Plan submitted by Resolution Applicant with 100% vote share and rejected the Settlement Proposal submitted by Suspended Director of Corporate Debtor with 100% vote share. Accordingly, the Resolution Professional filed an application seeking approval of Resolution plan. The Suspended Director also filed an application seeking consideration of its revised settlement proposal.
The NCLT granted another opportunity to Suspended Director to enter settlement with CoC and kept the application for approval of resolution plan in abeyance.
NCLAT Delhi: Definition Of Financial Debt U/S 5(8) Does Not Provide Disbursal To Be Made To Corporate Debtor Only
Case Title: Mr. Rajeev Kumar Jain vs. Uno Minda Ltd. and Anr.
Case No.: Company Appeal (AT) (Insolvency) No. 947 of 2022
The National Company Law Appellate Tribunal ('NCLAT') New Delhi, comprising Justice Ashok Bhushan (Chairperson) and Mr. Naresh Salecha (Technical Member) held that the definition of Financial Debt under Section 5(8) of IBC does not use the expression that disbursal should be made to the Corporate Debtor only.
NCLAT Delhi: NCLT Has Jurisdiction To Decide The Issue Of Trademark U/S 60(5)(c) Of IBC
Case Title: Gloster Cables Ltd. vs. Fort Gloster Industries Ltd. and Ors.
Case No.: Comp. App (AT) (Ins) No. 1343 of 2019
The National Company Law Appellate Tribunal ('NCLAT') New Delhi, comprising Mr. Justice Rakesh Kumar Jain (Judicial Member) and Mr. Naresh Salecha (Technical Member) held that NCLT has the jurisdiction to decide the whether Trademark forms part of the assets of the Corporate Debtor under Section 60(5)(c) of IBC.
NCLAT Delhi: Liquidator Can Pursue Writ Petition On Behalf Of Corporate Debtor When NCLT Has Allowed Liquidator To Prosecute As Per Sec. 33(5) Of IBC
Case Title: CA Rajeev Bansal Liquidator of Isolux Corsan India Engineering & Construction Pvt. Ltd.
Case No.: Company Appeal (AT) (Insolvency) No. 1653 of 2023
The National Company Law Appellate Tribunal ('NCLAT') Delhi, comprising Mr. Justice Ashok Bhushan (Chairperson), Mr. Barun Mitra (Technical Member), and Mr. Arun Baroka (Technical Member) held that the Liquidator can pursue a Writ Petition on behalf of the Corporate Debtor when the Adjudicating Authority has allowed the Liquidator to prosecute on behalf of the Corporate Debtor as per Section 33(5) of IBC.
Case Title: Mukund Rajhans (Suspended Director of Topaki Media Private Limited) vs. Rajasthan Patrika Private Limited & Anr.
Case No.: Company Appeal (AT) (Ins.) No. 1398 of 2023
The National Company Law Appellate Tribunal ('NCLAT') Delhi, comprising Justice Ashok Bhushan (Chairperson), Mr. Barun Mitra (Technical Member), and Mr. Arun Baroka (Technical Member) held that the Corporate Debtor cannot escape liability by contending that it is merely an agent and by taking recourse under Section 230 of the Indian Contract Act, 1872.
Case Title: Mukund Rajhans (Suspended Director of Topaki Media Private Limited) vs. Rajasthan Patrika Private Limited & Anr.
Case No.: Company Appeal (AT) (Ins.) No. 1398 of 2023
The National Company Law Appellate Tribunal ('NCLAT') Delhi, comprising Justice Ashok Bhushan (Chairperson), Mr. Barun Mitra (Technical Member), and Mr. Arun Baroka (Technical Member) held that documentary evidence including postal receipt mentioning the registered address of the Corporate Debtor confirms the issuance of a Demand Notice under Section 8 of Insolvency and Bankruptcy Code (IBC).
Case Title: Premjayanti Enterprises Pvt. Ltd. vs. Shivam Water Treaters Pvt. Ltd.
Case No.: Comp. App. (AT) (Ins) No. 124 of 2023
The National Company Law Appellate Tribunal ('NCLAT') Delhi, comprising Justice Rakesh Kumar Jain (Judicial Member), Mr. Naresh Salecha (Technical Member), and Mr. Indevar Pandey (Technical Member) evokes the Doctrine of 'Approbrate and Reprobrate' imposing a cost of Rs. 1 Lakh with allowing appropriate proceedings under the provisions of the Contempt of Court Act.
Case Title: Milind Kashiram Jadhav vs State Bank of India
Case No.: Comp. App. (AT) (Ins) No. 1589 of 2023
The National Company Law Appellate Tribunal ('NCLAT') Delhi, comprising Justice Ashok Bhushan (Chairperson), Mr. Barun Mitra (Technical Member), and Mr. Arun Baroka (Technical Member) held that part payments between the Non-Performing Asset (“NPA”) classification and loan recall notice cannot mean that loan recall notice shall constitute the relevant date of default under the IBC. Further, partial payments on the part of the Corporate Debtor cannot absolve it from default status.
Case Title: Namdev Hindurao Patil vs. Virendra Kumar Jain, Liquidator, Warana Dairy and Agro Industries Ltd. and Ors.
Case No.: Comp. App. (AT) (Ins) No. 858 of 2023 & I.A. No. 2925 of 2024
The National Company Law Appellate Tribunal ('NCLAT') Delhi, comprising Justice Rakesh Kumar Jain (Judicial Member), Mr. Naresh Salecha (Technical Member), and Mr. Indevar Pandey (Technical Member) held that the relevant date to determine the ineligibility to submit a Resolution Plan is on the date on which the Resolution Plan was first submitted by the Resolution Applicant.
Besides Section 27, RP Can Be Replaced On A Finding Given By NCLT Over His Conduct Or Any Proven Fact: NCLAT Delhi
Case title: Katra Realtors Pvt. Ltd. v Mr. Rajesh Ramnani, RP of Ansal Urban Condominiums Pvt. Ltd. & Anr.
Case No.: Company Appeal (AT) (Insolvency) No. 382 of 2024.
The National Company Law Appellate Tribunal (“NCLAT”), Principal Bench, comprising of Justice Ashok Bhushan (Chairperson), Shri Barun Mitra (Technical Member) and Shri Indevar Pandey (Technical Member), has held that an application filed for replacement of Resolution Professional, which is not filed under Section 27 of IBC, can be entertained when NCLT has given a finding on the conduct of Resolution Professional or in presence of any proven fact.
The NCLAT upheld the rejection of an application filed by a minority shareholder of the Corporate Debtor seeking replacement of Resolution Professional over mere allegations.
Case: Pankaj Mehta VS M/s. Ansal Hi-tech Township Limited
Citation: Comp. App (AT) (INS) No. 248 / 2023
The National Company Law Appellate Tribunal (NCLAT) New Delhi, comprising Justice M. Venugopal (Judicial Member) and Mr. Arun Baroka (Technical Member), has rejected an application filed by homebuyers under Section 7 of IBC seeking initiation of Corporate Insolvency Resolution Process (CIRP) against the Ansal Hi-Tech Township.
The Homebuyers had purchased flats in the Sushant Metropolis Township project being developed by Ansal Hi-Tech Township in NOIDA.
NCLAT held that homebuyers are from numerous different projects, and they have not established their case as creditors of a class concerning any particular project registered with RERA to fulfil the requirement of 10% or 100 homebuyers, as stipulated under Section 7(1) of IBC.
NCLAT Delhi: New Resolution Applicants Aren't Entitled To Participate In CIRP And Submit Resolution Plan To NCLT Without Issuance Of Fresh Form G
Case Title: Ashdan Properties Pvt. Ltd. vs. Mamta Binani (RP of Rolta India Ltd.) and Ors.
Case No.: Company Appeal (AT) (Insolvency) No. 464 of 2024
Barun Mitra (Technical Member), and Mr. Arun Baroka (Technical Member), has held that new Resolution Applicants are not entitled to submit applications to the Adjudicating Authority to participate in the Corporate Insolvency Resolution Process ('CIRP') and submit a Resolution Plan, when a fresh Form G hasn't been issued under Regulation 36A (1) of the IBBI (Insolvency Resolution Process for Corporate Persons) Regulations, 2016 (“CIRP Regulations 2016”).
NCLAT Delhi: RP Can Always Ask For Additional Information From Creditors To Substantiate The Claim And Exercise Due Diligence
Case Title: Mr. Umesh Kumar vs. Mr. Narendra Kumar Sharma, IRP of Indirapuram Habitat Centre Pvt. Ltd.
Case No.: Company Appeal (AT) (Insolvency) No. 100 of 2024
The National Company Law Appellate Tribunal ('NCLAT'), New Delhi, comprising Justice Ashok Bhushan (Chairperson), Mr. Barun Mitra (Technical Member), and Mr. Arun Baroka (Technical Member), has held the Resolution Professional can always ask for additional information from creditors to substantiate the claim and exercise due diligence.
NCLAT Delhi: Interveners Do Not Have The Right To Seek Relief For Themselves Before The Adjudicating Authority
Case Title: Jaiprakash Associates Ltd. vs. Jaypee Infratech Ltd. and Ors.
Case No.: Company Appeal (AT) (Insolvency) No. 548 of 2023 & I.A. No. 2643, 3702 of 2023
The National Company Law Appellate Tribunal ('NCLAT') Delhi, comprising Justice Ashok Bhushan (Chairperson) and Mr. Barun Mitra (Technical Member) held that the interveners in a case do not have the right to seek relief for themselves before the Adjudicating Authority.
The NCLAT observed that interveners are expected to either support the challenged order or the appellant. The individuals who submit their claims to the Insolvency Resolution Professional and whose claims are documented have the complete right to approach the Successful Resolution Applicant or the Monitoring and Implementation Committee. They are entitled to pursue their entitlements according to the provisions outlined in the Resolution Plan.
NCLAT Delhi: Examining The Validity Of Any Contractual Agreement Is Beyond The Scope Of Powers Of RP
Case Title: Mr. Umesh Kumar vs. Mr. Narendra Kumar Sharma, IRP of Indirapuram Habitat Centre Pvt. Ltd.
Case No.: Company Appeal (AT) (Insolvency) No. 100 of 2024
The National Company Law Appellate Tribunal ('NCLAT') Delhi, comprising Justice Ashok Bhushan (Chairperson), Mr. Barun Mitra (Technical Member), and Mr. Arun Baroka (Technical Member) held the examining the validity/sustainability of any contractual agreement including its formatting, etc lies outside the purview of the charter of duties and responsibilities of the Resolution Professional ('RP').
Case title: Gupta Textiles v Darshan Patel & Ors.
Case No.: Company Appeal (AT) (Insolvency) No. 408 of 2024
The National Company Law Appellate Tribunal (“NCLAT”), Principal Bench, comprising of Justice Ashok Bhushan (Chairperson), Shri Barun Mitra (Technical Member) and Shri Arun Baroka (Technical Member), has held that amount payable under resolution plan to Operational Creditors in terms of Section 30(2)(b) of IBC, can only be by way of cash and not partly paid Redeemable Preference Shares or equity.
NCLAT Chennai Stays Insolvency proceedings Against Charter Aircraft Service Provider 'Deccan Charters'
Case title: Sanjay Saihgal v Krone Finstock Private Limited & Anr.
Case No.: Company Appeal (AT) (CH) (Ins) No.123/2024
The National Company Law Appellate Tribunal (“NCLAT”), Chennai Bench, comprising of Justice M. Venugopal (Judicial Member), Justice Sharad Kumar Sharma (Judicial Member) and Jatindranath Swain (Technical Member), has stayed the insolvency proceedings initiated against Deccan Charters Pvt. Ltd. by the NCLT, till the next date of hearing i.e. 26.04.2024.
Deccan Charters is a Bengaluru based company which operates chartered helicopters and fixed wing aircrafts and also provides services such as aircraft maintenance, aircraft management and aviation training.
'Free Of Cost' Copy Of Order Sent By NCLT Registry Is Not A 'Certified Copy' For The Purpose Of Filing Appeal: NCLAT Chennai
Case title: Munagala Roja Harsha Vardhini v Vardhansmart Private Limited
Case No.: Company Appeal (AT) (CH) (Ins) No.23/2024
The National Company Law Appellate Tribunal (“NCLAT”), Chennai Bench, comprising of Justice M. Venugopal (Judicial Member), Justice Sharad Kumar Sharma (Judicial Member) and Shri Jatindranath Swain (Technical Member), has held that the 'free of cost' certified copy of final order sent by NCLT registry in compliance of NCLT Rules is not a 'certified copy' of the order for the purpose of filing appeal before NCLAT.
Rule 22(2) of the NCLAT Rules, 2016 provides that every appeal shall be accompanied by a certified copy of the impugned order. It was observed that the Appellant's obligation to apply for a certified copy of the order to be challenged by paying requisite fees cannot be dispensed with.
Delay In Issuance Of Sale Certificate Due To Restraint Order By NCLT, Auction Purchaser Not Entitled To Interest On Sale Consideration: NCLAT Delhi
Case title: Gokul Agro Resources Ltd. v Mr. Supriyo Kumar Chaudhuri
Case No.: Company Appeal (AT) (Insolvency) No. 1070 of 2023
The National Company Law Appellate Tribunal (“NCLAT”), Principal Bench, comprising of Justice Ashok Bhushan (Chairperson) and Shri Barun Mitra (Technical Member), has held an Auction Purchaser cannot claim interest on sale consideration from the Liquidator for delayed issuance of Sale Certificate, if the delay has occurred due to a restraint order passed by NCLT.
Allottee Obligated To Comply With Threshold Under Section 7(1) Of IBC Even After RERA Passes An Order In Its Favour: NCLAT Delhi
Case title: Shri Rahul Gyanchandani & Ors. v Parsvnath Landmark Developers Pvt. Ltd.
Case No.: Company Appeal (AT) (Insolvency) No. 309 of 2024
The National Company Law Appellate Tribunal (“NCLAT”), Principal Bench, comprising of Justice Ashok Bhushan (Chairperson), Shri Barun Mitra (Technical Member) and Shri Arun Baroka (Technical Member), has held that the status of an 'allottee' would not convert into a 'decree holder' for the purpose of IBC, merely because RERA Authority has passed an order in its favour directing the Builder/Corporate Debtor to refund the entire amount.
The second proviso to Section 7(1) of IBC states that, “Provided further that for financial creditors who are allottees under a real estate project, an application for initiating corporate insolvency resolution process against the corporate debtor shall be filed jointly by not less than one hundred of such allottees under the same real estate project or not less than ten per cent. of the total number of such allottees under the same real estate project, whichever is less..”
The Allottee, even after procuring a favourable order from RERA, is obligated to meet the threshold given under second proviso to Section 7(1) for filing a petition under Section 7 of IBC.
“The Appellant cannot be said to go out of the definition of 'allottees' merely because they have an order in their favour by RERA and the Appellants' submission that they should be treated in a different category, i.e., category of 'Decree Holder' and are not required to comply with Section 7, sub-section (1), 2nd Proviso cannot be accepted. The Appellants even after order of the RERA, directing for refund by the Corporate Debtor, continued to be allottees and they have filed Section 7 Application as Financial Creditor of the Corporate Debtor. They are mandatorily required to comply with Section 7, sub-section (1), 2nd Proviso.”
Case Title: R.B. Singh and Anr. vs. Rashmi Cement Ltd. and Anr.
Case No.: Company Appeal (AT) (Insolvency) No. 1187 of 2023
The National Company Law Appellate Tribunal ('NCLAT') Delhi, comprising Justice Ashok Bhushan (Chairperson), Mr. Barun Mitra (Technical Member), and Mr. Arun Baroka (Technical Member) held that if no Goods and Services Tax (“GST”) refund/ Input Tax Credit (“ITC”) claim has been included in the Demand Notice under Section 8 of Insolvency and Bankruptcy Code, 2016 (“IBC”) or in Form 5 by the Operational Creditor, the same cannot become a ground of default on which Corporate Insolvency Resolution Process (“CIRP”) under IBC can be initiated.
Case Title: Partha Sarathy Sarkar vs Union of India & Ors.
Case No.: Company Appeal (AT) (Insolvency) No.576 of 2024
The National Company Law Appellate Tribunal, Delhi Bench, comprising Shri Justice Ashok Bhushan (Chairperson), Shri Barun Mitra and Shri Arun Baroka (Technical Members), in Partha Sarathy Sarkar vs Union of India & Ors. has held that the decision taken by New Resolution Professional cannot be objected by the Erstwhile Resolution Professional after replacement who is now proceeding with the CIRP.
Case Title: Ashok Dattatray Atre and Ors. vs. State Bank of India and Ors.
Case No.: Company Appeal (AT) (Insolvency) Nos. 221 and 222 of 2024
The National Company Law Appellate Tribunal ('NCLAT') Delhi, comprising Justice Ashok Bhushan (Chairperson) and Mr. Arun Baroka (Technical Member) held that the Adjudicating Authority can extend payment timelines under the Resolution Plan without the express concurrence of the Committee of Creditors ('CoC').
When Claims And Counter Claims Are Involved, Liquidator Cannot Decide The Same: NCLAT Chennai
Case Title: M/s. FLSmidth Private Limited vs Lanco Infratech Ltd
Case No.: TA (AT) No.207/2021 (CA (AT) (Ins) No.1353/2019)
The National Company Law Appellate Tribunal ('NCLAT') Chennai Bench, comprising Shri Justice Venugopal M. (Judicial Member) and Shri Jatindranath Swain (Technical Member), while adjudicating an application under Section 61 of Insolvency and Bankruptcy Code, 2016 (“IBC, 2016”) in M/s. FLSmidth Private Limited vs Lanco Infratech Ltd. has held that when claim and counter-claims are involved Liquidator cannot decide the same.
Case Title: Sanam Fashion & Design Exchange Ltd. vs. Ktex Nonwovens Pvt. Ltd.
Case No.: Company Appeal (AT) (Ins.) No. 1234 of 2023
The National Company Law Appellate Tribunal ('NCLAT') Delhi, comprising Justice Rakesh Kumar Jain (Judicial Member), Mr. Naresh Salecha (Technical Member), and Mr. Indevar Pandey (Technical Member) held that the dispute between the parties regarding contractual conditions relating to place of delivery and obligation of parties for transport of goods is a “pre-existing dispute” under the Insolvency and Bankruptcy Code, 2016 (“IBC”).
NCLAT Delhi: Extension Of Time In Payment Is Not Modification Of Resolution Plan
Case Title: Ashok Dattatray Atre and Ors. vs. State Bank of India and Ors.
Case No.: Company Appeal (AT) (Insolvency) Nos. 221 and 222 of 2024
The National Company Law Appellate Tribunal ('NCLAT') Delhi, comprising Justice Ashok Bhushan (Chairperson) and Mr. Arun Baroka (Technical Member) held that an extension of time in payment is not a modification of the Resolution Plan.
Case Title: Ashok Tiwari vs. DBS Bank India (Ltd.) and Anr.
Case No.: Company Appeal (AT) (Insolvency) No. 195 of 2024
The National Company Law Appellate Tribunal ('NCLAT') Delhi, comprising Justice Ashok Bhushan (Chairperson), Mr. Barun Mitra (Technical Member), and Mr. Arun Baroka (Technical Member) held that Rule 49 of NCLT Rules, 2016 gives ample jurisdiction to the Adjudicating Authority to proceed for ex parte as the corporate debtor does not appear. “Appearance” as contemplated under Rule 49(1) is an appearance by the corporate debtor or by an authorized representative.
File No. 10/36/2018-NCLAT
The Registrar of the National Company Law Appellate Tribunal (“NCLAT”) has issued a notice dated 27.05.2024, intimating that NCLAT, Principal Bench, New Delhi, the Registry shall function during the period of Annual Summer Vacation from 03.06.2024 to 30.06.2024.
Case Title: Mr. Devarajan Raman Liquidator of Kotak Urja Pvt. Ltd. vs. Principal Commissioner Income Tax and Ors.
Case No.: Company Appeal (AT) (Insolvency) No. 977 of 2023
The National Company Law Appellate Tribunal ('NCLAT') Delhi, comprising Justice Ashok Bhushan (Chairperson), Mr. Barun Mitra (Technical Member), and Mr. Arun Baroka (Technical Member) held that the set-off/adjustment of demand with refund by Income Tax Department during the intervening period when the Corporate Insolvency Resolution Process ('CIRP') timeline period has expired but before passing of Liquidation Order under Section 33 of Insolvency and Bankruptcy Code, 2016 ('IBC') amounts to violation of moratorium under Section 14 of the IBC.
Case Title: Mr. Sanjay Kumar vs Gannon Dunkerley & Co Ltd and Anr
Case No.: Company Appeal (AT) (Insolvency) No.1210 of 2023
The National Company Law Appellate Tribunal Principal Bench of Justice Yogesh Khanna and Ajai Das Mehrotra held that the adjudicating authority cannot venture into the appreciation of the merit of pre-existing dispute and embark upon the adjudication of rival contentions of parties.
NCLAT: Assignment Agreement By Corporate Debtor, Malafide Exercise To Prolong CIRP
Case Title: Peanence Commercial Private Limited and Anr vs Mamta Binani
Case Number: Company Appeal (AT) (Insolvency) No. 905 of 2024
The National Company Law Appellate Tribunal, Principal Bench, New Delhi of Justice Ashok Bhushan (Chairperson), Barun Mitra (Technicial Member) and Arun Baroka (Technical Member) has upheld a decision of NCLT, Mumbai and held Assignment Agreement initiated by the Corporate Debtor was a deliberate strategy intended to introduce obstacles and prolong the Corporate Insolvency Resolution Process (CIRP).
NCLAT Dismisses Appeal Raised By Byju's Investors Against Alleged Violation Of NCLT Directives
Case Title: MIH Edtech Investments and Ors. vs Think and Learn Pvt Ltd
Case No.: Company Appeal (AT) (CH) No.24/2024 (IA No.420/2024) (IA No.422/2024) (IA No.421/2024)
The National Company Law Appellate Tribunal Chennai bench comprising Justice Sharad Kumar Sharma and Jatindranath Swain (Technical Member) dismissed the appeals brought by four investors since the Adjudicating Authority has not made any final decision on any significant rights against the investors and instead has merely requested them to file an affidavit to support their claims regarding the alleged violation of its directives.
Case Title: Oriental Carbon & Chemicals Ltd vs OCCL Ltd
Case No.: Company Appeal (AT) No. 144 of 2024
The National Company Law Appellate Tribunal, Principal Bench of Justice Yogesh Khanna (Judicial Member) and Ajai Das Mehrotra (Technical Member) held that if the Company Court finds no violation of any law and the proposed scheme is not objectionable or against public policy, then the NCLT lacks jurisdiction to question the commercial judgment of those who approved it.
Case Title: Commissioner of State Tax Department vs Ramchandra Dallaram Chaudhary (Liquidator)
Case No.: Company Appeal (AT) (Ins) No. 34 of 2024 & I.A. No. 105, 106, 990 of 2024
The National Company Law Appellate Tribunal Delhi, comprising Mr. Justice Rakesh Kumar Jain (Judicial Member), Mr. Naresh Salecha (Technical Member), and Mr. Indevar Pandey (Technical Member) held that the claims of Tax Assessment Orders passed during the moratorium under Sections 14 & 33(5) of Insolvency and Bankruptcy Code, 2016 can be considered as Unsecured Operational Debt.
Case Title: Royal India Corporation Ltd. vs Mr. Nandkishor Vishnupant Deshpande, RP of Royal Refinery Pvt. Ltd. and Ors.
Case No.: Company Appeal (AT) (Ins) No. 137 of 2021
The National Company Law Appellate Tribunal Delhi comprising Justice Rakesh Kumar Jain (Judicial Member) and Mr. Ajai Das Mehrotra (Technical Member) held that proceedings under Section 66 of Insolvency and Bankruptcy Code, 2016 (“IBC”) for fraudulent or wrongful trading can be initiated against third parties.
Case Title: Chintan Jhunjhunwala vs Avani Towers Private Limited & Ors
Case No.: Company Appeal (AT) (Insolvency) No. 769 of 2024
The National Company Law Appellate Tribunal, Principal Bench, New Delhi comprising Shri Justice Ashok Bhushan (Judicial Member) and Shri Barun Mitra and Shri Arun Baroka (Technical Members) held that Refundable Security Deposit carrying interest in development agreement constitutes under Section 5(8) of IBC since the development agreement has the effect of a commercial transaction.
No Provision In IBC Mandates Treatment Of Unrelated Party At Par With Related Party: NCLAT New Delhi
Case Title: West Coast Paper Mills Ltd. vs Bijay Murmuria & Ors.
Case No. Company Appeal (AT) (Ins.) No. 1272 of 2019
The National Company Law Appellate Tribunal, Principal Bench, New Delhi, comprising Justice Rakesh Kumar Jain (Judicial Member), Shri Naresh Salecha and Shri Indevar Pandey (Technical Members), held that there is no provision of IBC, which mandates that the related party should be paid in parity with unrelated party. It was held that the Committee of Creditors and Adjudicating Authority were well within their rights not to treat a related party unsecured creditor on par with secured financial creditors.
Case Title: Grand Developers Pvt. Ltd. vs. Nitin Batra & Ors.
Case Number: Company Appeal (AT) (Insolvency) No. 899 of 2024 & I.A. No. 3250 of 2024
The National Company Law Appellate Tribunal ('NCLAT') Delhi, comprising Mr. Justice Ashok Kumar Bhushan (Chairperson), Mr. Barun Mitra (Technical Member), and Mr. Arun Baroka (Technical Member) held that the pendency of a scheme involving the corporate debtor under Section 230 of the Companies Act, 2013 cannot be a ground to deny the admission of a Corporate Insolvency Resolution Process ('CIRP') application under Section 7 of Insolvency and Bankruptcy Code, 2016 ('IBC') against such corporate debtor.
Case Title: Shrenik Ashokbhai Morakhia vs. Reliance Asset Reconstruction Company Ltd. and Anr.
Case Number: Company Appeal (AT) (Insolvency) No. 719 of 2024
The National Company Law Appellate Tribunal ('NCLAT') Delhi bench, comprising Mr. Justice Ashok Bhushan (Chairperson) and Mr. Arun Baroka (Technical Member) held that Section 95(1) of Insolvency and Bankruptcy, Code, 2016 ('IBC') allows creditors to initiate insolvency process against a Personal Guarantor through a Resolution Professional ('RP'). It held that such an application cannot be questioned to be defective on the ground that the application was signed by the Resolution Professional rather than an authorized officer.
Case Title: Avil Menezes Liquidator of Sunil Hitech and Engineers Ltd. vs. Abdul Qudduskhan and Anr.
Case Number: Company Appeal (AT) (Insolvency) No. 263 of 2024
The National Company Law Appellate Tribunal ('NCLAT') Delhi, comprising Mr. Justice Ashok Bhushan (Judicial Member) and Mr. Arun Baroka (Technical Member) laid down the criteria to determine whether a cost incurred by a Resolution Professional ('RP') during the Corporate Insolvency Resolution Process ('CIRP') qualifies as CIRP cost under Section 5(13)(c) of Insolvency and Bankruptcy Code, 2016 ('IBC') read with IBBI (Insolvency Resolution Process for Corporate Persons) Regulations, 2016 ('CIRP Regulations') Regulation 31.
Voting For Section 12A Proposal To Be Computed As Per Proviso To Section 25A(3A) R/w Section 25A(3) Of IBC: NCLAT Delhi
Case title: Vijay Saini v Shri Devender Singh & Ors
Case No.: Comp. App. (AT) (Ins.) No. 1194 of 2023
The National Company Law Appellate Tribunal (“NCLAT”), Principal Bench, comprising of Justice Ashok Bhushan (Chairperson) and Shri Barun Mitra (Technical Member), has held that for computing voting with regard to proposal under Section 12A of IBC, the voting has to be computed as per proviso to Section 25A(3A) read with Section 25A(3) of IBC. It has been further clarified that a proposal under Section 12A which statutorily requires 90% votes for approval, would not stand approved if majority (more than 50%) homebuyers/financial creditors vote in favour of it. The threshold of 90% votes must be met for approval of proposal.
Section 25A(3) of IBC provides that when the Authorised Representative represents several financial creditors, then he shall cast his vote for each financial creditor according to the instructions received from each financial creditor, to the extent of his voting share.
The Proviso to Section 25A(3A) of IBC states that when voting takes place in respect of proposal under Section 12A, then the Authorised Representative of Financial Creditor shall cast his vote in accordance with Section 25A(3).
“When the statute i.e. Section 12A provides 90% voting for approval of Section 12A proposal, 90% of the voting share of the creditor in class have to be taken into consideration. Since voting by each homebuyers who represented creditor in class has to be computed as per his voting share and adding all vote shares of the creditor in class with any other Financial Creditor if it is at least up to 90% only then 12A proposal is held to be passed”, the Bench held.
Case Title: Jaiprakash Associates Ltd. vs. Jaypee Infratech Ltd. and Ors.
Case No.: Company Appeal (AT) (Insolvency) No. 548 of 2023
The National Company Law Appellate Tribunal ('NCLAT') Delhi, comprising Justice Ashok Bhushan (Chairperson) and Mr. Barun Mitra (Technical Member), has held that treatment of the Income Tax Department's dues in the Resolution Plan as 'Operational Creditor' is not violative of Section 30(2) of IBC.
NCLT Can't Direct CoC To Consider Suspended Management's Settlement Proposal, Without Opportunity To SRA: NCLAT Delhi
Case title: One City Infrastructure Pvt. Ltd. v Pratham Expofab Private Limited & Ors.
Case No.: Company Appeal (AT) (Insolvency) No.287 of 2024
The National Company Law Appellate Tribunal (“NCLAT”), Principal Bench, comprising of Justice Ashok Bhushan (Chairperson), Shri Barun Mitra (Technical Member) and Shri Arun Baroka (Technical Member), has held that the NCLT cannot direct the CoC to consider settlement proposal of Suspended Management of Corporate Debtor, without granting an opportunity to be heard to the Successful Resolution Applicant (SRA).
During the pendency of plan approval application before NCLT, the Suspended Management filed an application seeking consideration of their settlement proposal by Committee of Creditors (“CoC”). The NCLT did not accord any opportunity to SRA to file its response to the application and directed the CoC to consider the settlement proposal vis-à-vis the resolution plan. The NCLAT has set aside the NCLT order.
NCLAT Delhi: Non-Grant Of Reliefs And Concessions By NCLT Does Not Have Any Adverse Effect On The Validity Of The Resolution Plan And Is Not Violative Of The Law
Case Title: Jaiprakash Associates Ltd. vs. Jaypee Infratech Ltd. and Ors.
Case No.: Company Appeal (AT) (Insolvency) No. 548 of 2023
The National Company Law Appellate Tribunal ('NCLAT') Delhi, comprising Justice Ashok Bhushan (Chairperson) and Mr. Barun Mitra (Technical Member) held that non-grant of any reliefs and concessions by NCLT does not have any adverse effect on the validity of the Resolution Plan and is not a violation of the law. The Bench emphasized that the Successful Resolution Applicant is obligated to implement the Resolution Plan, irrespective of whether specific reliefs and concessions are granted or not. It rejected the argument that the non-approval of certain reliefs and concessions within the Resolution Plan, the Resolution Plan cannot be approved and should be sent back to the CoC.
NCLAT Delhi: Personal And Corporate Guarantors Have No Right Of Subrogation After Approval Of Resolution Plan
Case Title: Jaiprakash Associates Ltd. vs. Jaypee Infratech Ltd. and Ors.
Case No.: Company Appeal (AT) (Insolvency) No. 548 of 2023 & I.A. No. 2643, 3702 of 2023
The National Company Law Appellate Tribunal ('NCLAT') Delhi, comprising Justice Ashok Bhushan (Chairperson) and Mr. Barun Mitra (Technical Member) held that the personal guarantors and corporate guarantors have no right of subrogation after the approval of the Resolution Plan under IBC.
NCLAT Delhi: Section 29A(C) Disqualifies Those Managing And Controlling Corporate Debtor Who Failed To Clear Debts
Case Title: Navayuga Engineering Company Ltd. vs. Mr. Umesh Garg RP of Athena Demwe Power Ltd. and Ors.
Case No.: Company Appeal (AT) (Insolvency) No. 783 of 2023
The National Company Law Appellate Tribunal ('NCLAT') New Delhi, comprising Mr. Justice Ashok Bhushan (Chairperson) and Mr. Barun Mitra (Technical Member), has held that Section 29A(c) of IBC disqualifies not only those in management and control of the Corporate Debtor when its account was declared Non-Performing Asset ('NPA') but also those in management and control of the Corporate Debtor in close proximity of time before the Resolution Plan was submitted, who failed to clear the debts of the Corporate Debtor.
NCLAT Delhi: Resolution Professional Is An Aggrieved Person If NCLT Overturns His Decision
Case Title: Devendra Singh Vs. Homebuyers of Sidhartha Buildhome Pvt. Ltd. & Ors.
Case No.: Company Appeal (AT) (Ins.) No. 791 of 2023
The National Company Law Appellate Tribunal (“NCLAT”), Principal Bench, comprising of Justice Ashok Bhushan (Chairperson) and Shri Barun Mitra (Technical Member), held that the Resolution Professional is an aggrieved party when the decision of the National Company Law Tribunal (“NCLT”) directly overturns his decision.
Whether The Vote Of Each Homebuyer Is Required During The Voting On CIRP Withdrawal Resolutions? NCLAT Clarifies S 12A of IBC
Case Title: Vijay Saini vs Devender Singh & Ors.
Case No.: Company Appeal (AT) (Ins.) No. 1194, 791 & 982 of 2023
The National Company Law Appellate Tribunal (“NCLAT”), Principal Bench, comprising of Justice Ashok Bhushan (Chairperson) and Shri Barun Mitra (Technical Member), held that for voting on Corporate Insolvency Resolution Process (CIRP) withdrawals under Section 12A of IBC, the vote of each homebuyer must be counted individually, rather than as a collective class of financial creditors.
Section 12A stipulates statutory provisions governing “withdrawal of application admitted under section 7, 9 or 10”. It states, “The Adjudicating Authority may allow the withdrawal of application admitted under section 7 or section 9 or section 10, on an application made by the applicant with the approval of ninety per cent. voting share of the committee of creditors, in such manner as may be specified.”
NCLAT Delhi: Trademark Hypothecated For Higher Amount And Assignment For Lower Amount Can't Be Sole Criteria To Treat It As 'Undervalued Transaction'
Case Title: Gloster Cables Ltd. vs. Fort Gloster Industries Ltd. and Ors.
Case No.: Comp. App (AT) (Ins) No. 1343 of 2019
The National Company Law Appellate Tribunal ('NCLAT') New Delhi, comprising Mr. Justice Rakesh Kumar Jain (Judicial Member) and Mr. Naresh Salecha (Technical Member) held that the mere fact that the trademark was hypothecated for a higher amount and subsequently assigned for a lower amount would not be the sole criteria for deeming it an undervalued transaction.
MoU And Ledger Extract Are Insufficient Proof For Admitting Of Financial Debt Claim: NCLAT Delhi
Case title: D S Kulkarni & Associates v Manoj Kumar Aggarwal
Case No.: Company Appeal (AT) (Insolvency) No.923 of 2023
The National Company Law Appellate Tribunal (“NCLAT”), Principal Bench, comprising of Justice Ashok Bhushan (Chairperson) and Shri Arun Baroka (Technical Member), has held that Memorandum of Understanding (“MoU”) and extract of Ledger of the Corporate Debtor are insufficient proof for acceptance of a claim as financial debt.
One of the creditors of the Corporate Debtor submitted its claim before the Resolution Professional claiming itself to be a Financial Creditor at par with Homebuyers. To substantiate the claim, the creditor submitted an MoU and Ledger extract of the Corporate Debtor as proof. The Resolution Professional rejected the claim citing that financial debt claim cannot be admitted merely upon MoU and Ledger extract and the decision was upheld by the NCLT and NCLAT.
RP Best Person To Decide What Part Of Corporate Debtor's Business Is To Be Carried Out: NCLAT Delhi
Case title: Amit Tyagi v Indirapuram Habitat Centre Pvt. Ltd.
Case No.: Company Appeal (AT) (Insolvency) No.272 of 2024
The National Company Law Appellate Tribunal (“NCLAT”), Principal Bench, comprising of Justice Ashok Bhushan (Chairperson), Shri Barun Mitra (Technical Member) and Shri Arun Baroka (Technical Member), has held that the Resolution Professional who is running the Corporate Debtor's business, is the best person to decide as to what part of the business can be carried out. Further, the allottees of a real estate project developed by the Corporate Debtor cannot demand execution of conveyance deed as a matter of right.
Case Title: Jaiprakash Associates Ltd. vs Jaypee Infratech Ltd. and Others
Case No.: Company Appeal (AT) (Insolvency) No. 548
The National Company Law Appellate Tribunal (“NCLAT”), Principal Bench, comprising of Justice Ashok Bhushan (Chairperson) and Shri Barun Mitra (Technical Member), upheld a Resolution Plan which outlined provisions for the completion of approximately 96 residential towers that had remained under construction since 2011 by Jaypee Infratech Limited (JIL). The homebuyers' plea revolved around the delay in the implementation of the Resolution Plan and their earnest desire to acquire possession of their units.
Suraksha Realty Limited submitted its Resolution Plan, which was subsequently approved by the Committee of Creditors (CoC). However, objections were filed by Jaiprakash Associates Limited (“JAL”), the holding company of JIL and Manoj Gaur, the erstwhile Managing Director of JIL, against Suraksha Realty's Resolution Plan, in NCLT. The NCLT had approved Suraksha Realty's Resolution Plan, leading to the filing of appeals by JAL and Manoj Gaur in NCLAT. Now NCLAT has upheld the plan submitted by Suraksha Realty Limited.
NCLAT Delhi: Advance Paid By A Speculative Buyer In Real Estate Doesn't Fall Under Financial Debt Under IBC
Case Title: Naman Infradevelopers Pvt. Ltd. vs. Metcalfe Properties Pvt. Ltd.
Case No.: Company Appeal (AT)(INS) No.74 of 2024
The National Company Law Appellate Tribunal ('NCLAT') New Delhi, comprising Mr. Justice Ashok Bhushan (Chairperson), Mr. Justice Yogesh Khanna (Judicial Member), and Mr. Barun Mitra (Technical Member) held that the advance paid by a speculative buyer in Real Estate does not fall within the purview of Section 5(8) of IBC.
The Bench concluded that the Appellant cannot be given the status of 'Financial Creditor' as he is a speculative investor who has filed the CIRP application only for recovery of its money with profit and interest and not for the financial well-being of the Corporate Debtor.
Question Of Value Can't Be Raised Post Approval Of Resolution Plan By CoC: NCLAT Delhi
Case title: Committee of Creditors v Anil Tayal
Case No.: Company Appeal (AT) (Ins.) No.1633 of 2023
The National Company Law Appellate Tribunal (“NCLAT”), Principal Bench, comprising of Justice Ashok Bhushan (Chairperson) and Shri Barun Mitra (Technical Member), has upheld an order passed by NCLT herein it was held that the question of valuation of assets cannot be raised after the resolution plan has been approved by the Committee of Creditors (“CoC”).
Issue Of Whether Input Tax Has Been Taken In Excess Can't Be Dealt With In Section 9 Proceedings Under IBC: NCLAT Delhi
Case title: Zaara Enterprises Venture Pvt. Ltd. v Dhanraaj Agencies Pvt. Ltd.
Case No.: Company Appeal (AT) (Insolvency) No. 356 of 2024
The National Company Law Appellate Tribunal (“NCLAT”), Principal Bench, comprising of Justice Ashok Bhushan (Chairperson), Shri Barun Mitra (Technical Member) and Shri Arun Baroka (Technical Member), has held that the issue whether the Corporate Debtor has claimed input tax in excess on a GST invoice raised by the Operational Creditor cannot be decided in proceedings under Section 9 of the Insolvency and Bankruptcy Code, 2016 (“IBC”).
Once Resolution Plan Is Approved By CoC And NCLT, SRA Can't Seek Its Substitution With Another Resolution Applicant: NCLAT Delhi
Case title: UV Asset Reconstruction Company Ltd. & Anr. v Aircel Ltd. Through Its Monitoring Committee
Case No.: Company Appeal (AT) (Ins.) No. 333 of 2024
The National Company Law Appellate Tribunal (“NCLAT”), Principal Bench, comprising of Justice Ashok Bhushan (Chairperson), Shri Barun Mitra (Technical Member) and Shri Arun Baroka (Technical Member), has held that after approval of a resolution plan by the Committee of Creditors (“CoC”) and NCLT, the Successful Resolution Applicant (“SRA”) cannot be substituted with another entity/resolution applicant.
The SRA is an Asset Reconstruction Company and the plan submitted by it was approved by the CoC and NCLT. Thereafter, the Reserve Bank of India (“RBI”) issued a circular intimating that Asset Reconstruction Companies cannot be Resolution Applicant unless they have achieved certain net worth. Since the SRA had not achieved the net worth as required by RBI, the SRA filed an application before NCLT seeking its substitution with another resolution applicant, owing to its subsequent ineligibility to be a resolution applicant as per RBI norms. The NCLT rejected the application and NCLAT has upheld the rejection.
NCLAT Delhi: CIRP U/s 7 Of IBC Can Be Initiated Against An Auction Purchaser In Proceedings Under SARFAESI Act, 2002
Case Title: Anjani Kumar Prashar (Suspended Director of Grandstar Realty Pvt. Limited) vs. Manab Datta & Ors.
Case No.: Company Appeal (AT) (Insolvency) No.1366 of 2023
The National Company Law Appellate Tribunal ('NCLAT') New Delhi, comprising Justice Ashok Bhushan (Chairperson) and Mr. Barun Mitra (Technical Member) held that Corporate Insolvency Resolution Process ('CIRP') can be initiated under Section 7 of IBC against an Auction Purchaser in proceedings under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 ('SARFAESI Act').
The NCLAT highlighted that financial debt can be incurred through various means, including assignment or transfers, as explicitly defined. In instances where amalgamation or demerger occurs under the Companies Act, 2013, resulting in the transfer or vesting of assets and liabilities to the amalgamated or transferee company, the transferee company cannot evade the obligations set forth in the insolvency code by claiming that disbursements were not directly made to it. Since the Corporate Debtor acquired the project under the SARFAESI Act, it cannot circumvent the provisions of the IBC and deprive the homebuyers of their rights. Given the existence of a financial debt, the filing of the application by the allottees under Section 7 cannot be faulted on this basis.
Once Resolution Plan Is Approved By CoC And NCLT, SRA Can't Seek Its Substitution With Another Resolution Applicant: NCLAT Delhi
Case title: UV Asset Reconstruction Company Ltd. & Anr. v Aircel Ltd. Through Its Monitoring Committee
Case No.: Company Appeal (AT) (Ins.) No. 333 of 2024
The National Company Law Appellate Tribunal (“NCLAT”), Principal Bench, comprising of Justice Ashok Bhushan (Chairperson), Shri Barun Mitra (Technical Member) and Shri Arun Baroka (Technical Member), has held that after approval of a resolution plan by the Committee of Creditors (“CoC”) and NCLT, the Successful Resolution Applicant (“SRA”) cannot be substituted with another entity/resolution applicant.
The SRA is an Asset Reconstruction Company and the plan submitted by it was approved by the CoC and NCLT. Thereafter, the Reserve Bank of India (“RBI”) issued a circular intimating that Asset Reconstruction Companies cannot be Resolution Applicant unless they have achieved certain net worth. Since the SRA had not achieved the net worth as required by RBI, the SRA filed an application before NCLT seeking its substitution with another resolution applicant, owing to its subsequent ineligibility to be a resolution applicant as per RBI norms. The NCLT rejected the application and NCLAT has upheld the rejection.
When Order Passed In Presence Of Both Parties' Counsels, Limitation To File Appeal Commences From Date Of Order: NCLAT Delhi
Case title: Supreme Construction Developers Pvt. Ltd. v Puranik Builders Ltd.
Case No.: Company Appeal (AT) (Insolvency) No. 215 of 2024.
The National Company Law Appellate Tribunal (“NCLAT”), Principal Bench, comprising of Justice Ashok Bhushan (Chairperson), Justice Yogesh Khanna (Judicial Member) and Shri Barun Mitra (Technical Member), has held that when an order is passed in presence of counsels of both the parties, then the parties cannot claim that they were unaware of the order. Accordingly, the limitation to file appeal before NCLAT would commence from the date of order, and not the date of upload of order on NCLT website.
Section 12(2) of the Limitation Act, 1963 states that while computing limitation for filing an appeal, review or revision, the date on which the judgment was pronounced and the time taken to obtain copy of the judgment shall be excluded.
The Bench opined that when NCLT passes an order, the party is obligated to apply for certified copy to seek benefit of Section 12 of Limitation Act. Since the Appellant applied for certified copy after 30 days of passing of order, the Bench declined to exclude the period from computation of limitation.
Tribunal Not Empowered To Hear Case Afresh Under Recall Jurisdiction: NCLAT Chennai
Case title: Adv. (CA) V. Venkata Sivakumar v Hari S. Hari Karthik & Ors.
Case No.: Comp. App (AT) (CH) (INS) No. 8 / 2022
The National Company Law Appellate Tribunal (“NCLAT”), Chennai Bench, comprising of Justice M. Venugopal (Judicial Member) and Justice Sharad Kumar Sharma (Judicial Member) and Shri Jatindranath Swain (Technical Member), has held that the Tribunal cannot hear a case de-novo while adjudicating an application filed for recall of an order. The Bench has dismissed a review application filed by an Applicant seeking recall of an NCLAT order. The Bench has held that the meaning of 'recall' cannot be expanded to be read as a synonym for 'review'.
“At this juncture, this Tribunal, aptly points out that the Power to Recall of an Order or Judgment of a Tribunal, can be exercised by it only, if any procedural error, committed, in pronouncing the earlier Order or Judgment. In addition, the Power to Recall an Order / Judgment, earlier passed by this Tribunal, is not the power to Re-hear the case De-novo, to find out any Apparent error, in the Order / Judgment, which is in the ambit of a Review of a Judgment, to examine the Judicial Propriety or any Apparent Error, committed, by the Court / Tribunal, which is not the case made out in the instant Review Application, which is sought to be read as Recall, by the Petitioner/Erstwhile Liquidator.”
Erstwhile Liquidator Can't Seek Recall Of An Order In His Personal Capacity After Being Replaced By Another Liquidator: NCLAT Chennai
Case Title: Adv. (CA) V. Venkata Sivakumar v Hari S. Hari Karthik & Ors.
Case No.: Comp. App (AT) (CH) (INS) No. 8 / 2022
The National Company Law Appellate Tribunal (“NCLAT”), Chennai Bench, comprising of Justice M. Venugopal (Judicial Member) and Justice Sharad Kumar Sharma (Judicial Member) and Shri Jatindranath Swain (Technical Member), has held that a Liquidator, after being replaced with another liquidator, cannot seek recall of an order in his personal capacity. If the erstwhile liquidator is aggrieved by an order passed by NCLAT then the remedy would lie in appeal under Section 62 of IBC.
The erstwhile Liquidator had filed an appeal before the NCLAT. In the meanwhile, the erstwhile Liquidator was replaced with new Liquidator, who withdrew the appeal before the NCLAT. The Erstwhile Liquidator filed a review application before NCLAT seeking recall of the order whereby appeal was withdrawn. The NCLAT dismissed the review application citing that the erstwhile Liquidator has no locus standi to file such application or question the decision taken by New Liquidator in his official capacity.
NCLAT Delhi; IBC Does Not Provide Any Scope For Dissatisfied Homebuyers In Minority To Override Majority Decision Of COC
Case - Mr. Girish Nalavade Vs. Bhrugesh Amin and Ors.
Citation - Company Appeal (AT) (Insolvency) No. 1542 of 2023
The National Company Law Appellate Tribunal (NCLAT) New Delhi, comprising Justice Ashok Bhushan (Chairperson) and Mr. Barun Mitra (Technical Member), has held that the IBC does not provide any scope for dissatisfied homebuyers in the minority to override the majority decision taken by the Committee of Creditors (COC).
NCLAT Upholds Liquidator's Discretion To Reject Claims Based On Post-Liquidation Arbitral Awards
Case Title: SBS Holdings, Inc. vs. Mohan Lal Jain
Case Number: Company Appeal (AT) (Insolvency) No. 624 of 2024
The National Company Law Appellate Tribunal (NCLAT) bench, comprising Justice Ashok Bhushan (Chairperson) and Arun Baroka (Technical Member), has held that a Liquidator has the authority under Section 33(5) of the Insolvency and Bankruptcy Code, to decide to reject a claim that is made after the Liquidation Commencement Date. The Tribunal noted that the scheme of Regulations 12 and 16 of the IBBI (Liquidation Process) Regulations 2016 clearly contemplate that a claim cannot be admitted after the liquidation commencement date.
Case Title: Uttarakhand Power Corporation Ltd. vs. M/s Shirdi Industries Ltd. & Anr.
Case Number: Company Appeal (AT) (Insolvency) No. 799 of 2024 with Company Appeal (AT) (Insolvency) No. 803 of 2024 with Company Appeal (AT) (Insolvency) No. 832 of 2024
The National Company Law Appellate Tribunal (NCLAT) bench comprising Justice Ashok Bhushan (Chairperson) and Barun Mitra, Member (Technical) has held that pre-CIRP dues of the Corporate Debtor must be settled in accordance with the approved resolution plan, and any voluntary payments made by the Corporate Debtor after the commencement of CIRP must be appropriated towards CIRP dues. The Tribunal observed insisting on a different manner of payment than what is specified in the resolution plan, would amount to an infraction of the resolution plan and cannot be countenanced.
NCLAT Affirms 'Nil' Payment To Operational Creditors In Resolution Plan
Case Title: Sai Balaji Facility vs. CA Ramchandra Dallaram Choudhary, RP for Adico Forge Pvt. Ltd. & Ors.
Case Number: Company Appeal (AT) (Insolvency) No. 1642 of 2024
The National Company Law Appellate Tribunal, New Delhi bench, presided by Justice Ashok Bhushan, upheld the Resolution plan, which proposed NIL payment to the operational creditors in the event of Liquidation, reiterating its decision in Rajat Metaal Polychem Pvt. Ltd. vs. Mr. Neeraj Bhatia and Anr., which held that no exception can be taken to such Plans, which provide payment to Operational Creditor in accordance with Section 30(2)(b) of the Insolvency and Bankruptcy Code, 2016.
NCLAT: Operational Creditor Can't Claim Priority Over Unsecured Financial Creditor In Liquidation
Case Title: Times Innovative Media Limited vs Pawan Aggarwal (Liquidator) & Anr.
Case Number: Company Appeal (AT) (Insolvency) No.1139 of 2024
The National Company Law Appellate Tribunal bench, comprising Justice Ashok Bhushan (Chairperson) and Arun Baroka (Technical Member) held that under Section 53(1) of the Insolvency and Bankruptcy Code (IBC), unsecured financial creditors have priority in the waterfall mechanism over operational creditors in the distribution of a corporate debtor's liquidation estate. The tribunal reiterated that there is no distinction between related-party unsecured financial creditors and other unsecured financial creditors.
Case Title: Noida Power Company Limited vs Mr. Gaurav Katiyar Case Number:
Company Appeal (AT) (Insolvency) No. 1209 of 2024 with Company Appeal (AT) (Insolvency) No. 1210 of 2024
The National Company Law Appellate Tribunal (NCLAT), Delhi bench comprising Justice Ashok Bhushan, Chairperson, Barun Mitra (Technical Member) and Arun Baroka, Technical Member has directed the Resolution Professional to pay outstanding electricity dues incurred by the Corporate Debtor during the moratorium period. The Tribunal observed that the protection under Section 14(1) of the Insolvency and Bankruptcy Code (IBC) is subject to no defaults in payment of current dues as provided under the explanation of the provision.
Case Title: Kapil Katyal vs HDFC Securities Ltd. & Ors.
Case Number: Company Appeal (AT) No. 301 of 2024 & I.A. No. 6474 of 2024
The National Company Law Appellate Tribunal (NCLAT), New Delhi bench, comprising Justice Yogesh Khanna (Judicial Member) and Mr. Ajai Das Mehrotra (Technical Member) has reiterated that failure to apply for a certified copy of the impugned order within the prescribed limitation period renders the appeal time-barred.
NCLAT Dismisses Samrat Restaurant's CIRP Plea: Section 10A Bars Insolvency For COVID-19 Era Defaults
Case Title: Samrat Restaurant v. Brewcrafts Microbrewing Pvt. Ltd.
Case Reference: Company Appeal (AT) (Insolvency) No. 1409 of 2024 & I.A. No. 5117 of 2024
The National Company Law Appellate Tribunal (NCLAT), New Delhi dismissed the insolvency application filed under section 9 of the Insolvency and Bankruptcy Code (IBC) by Samrat Restaurant (Operational Creditor) against Brewcrafts Microbrewing Pvt. Ltd. (Corporate Debtor). The application was dismissed on the ground that a substantial portion of the debt arose during the period of section 10A.
Case Title: Ms Kalpana Jain vs Universal Oil Seals Mfg Co Pvt Ltd and ors
Case Number: COMPANY APPEAL (AT) NO. 196/2024
The National Company Law Appellate Tribunal Principal Bench, New Delhi of Justice Yogesh Khanna (Judicial Member) and Ajai Das Mehrotra (Technical Member) has held that the power of recall does not grant the NCLAT the authority to rehear a case in order to identify any apparent error in the judgment, as that falls within the scope of a review.
The bench held that the power of recall can only be exercised when a procedural error has been made in delivering the original judgment.
Case Title: N.V. Aluminium Cast Pvt. Ltd. vs APL Metals Ltd
Case Number: Company Appeal (AT) (Insolvency) No. 568 of 2024
The National Company Law Appellate Tribunal Principal Bench, New Delhi of Justice Ashok Bhushan (Chairperson), Barun Mitra (Technical Member) and Arun Baroka (Technical Member) has held that invoices deemed bogus by the Income Tax Department in assessment orders cannot be relied upon to initiate insolvency proceedings against a Corporate Debtor.
Case Title: M/s Agarwal Foundries Private Limited vs POSCO E&C India Private Limited
Case Number: Company Appeal (AT) (Insolvency) No. 1492 of 2024
The National Company Law Appellate Tribunal Principal Bench, New Delhi bench of Justice Ashok Bhushan (Chairperson), Barun Mitra (Technical Member) and Arun Baroka (Technical Member) has held that filing a Section 9 application for the sole purpose of recovering money, rather than resolving insolvency, constitutes an abuse of the IBC's provisions and is strongly disapproved.
The bench held that:
“We need to be mindful that no stakeholder takes any undue benefit of the provisions of the IBC. Interestingly, we find that the Appellant has been filing multiple Section 9 applications either against the Respondent or against the Empathy. The first Demand Notice under Section 8 of IBC was issued to the Respondent on 27.07.2017. The Appellant sent another notice on 11.10.2017 and followed it up with Section 9 application which was however withdrawn on 08.06.2018. Thereafter, the Appellant sent another Demand Notice on 17.07.2018 to Empathy and filed a Section 9 application against them which too was withdrawn on 15.10.2018. Subsequently on 24.10.2018, the Appellant sent a fresh Demand Notice to Empathy which was followed by a Section 9 application filed on 11.02.2019. This shows the malafide motive of the Appellant to keep the Section 9 pot boiling so as to arm-twist the Respondent which was otherwise a solvent company to illegally extort monies from them. Thus, the Section 9 application was not filed for the purpose of insolvency resolution but for recovery of money owed to them by Empathy fromthe Respondent. Such behaviour on the part of the Appellant amounts to misuse of the provisions of the IBC and is strongly deprecated.”
NCLAT Declares Sale Agreement Not A Financial Debt, Dismisses Insolvency Petition
Case Title: Sandeep Mittal vs. M / s ASREC (India) Ltd. & Ors.
Case Number: Company Appeal (AT) (Insolvency) No. 37 & 573 of 2024
The NCLAT Principal Bench, New Delhi, comprising Justice Ashok Bhushan (Chairperson), Barun Mitra (Member, Technical), and Arun Baroka (Member, Technical), has held that a sale consideration in the sale agreement did not constitute a “financial debt” under Section 5(8) of the Insolvency and Bankruptcy Code, 2016 (IBC).
Operational Creditors Getting Zero Payouts, Hands Of Courts Are Tied, Observed NCLAT, Delhi
Case: Rajat Metaal Polychem Pvt. Ltd. Vs. Mr. Neeraj Bhatia RP Vinayak Rathi Steels Rolling Mills Pvt. Ltd. and Anr.
Case Number: Company Appeal (AT) (Insolvency) No. 1063 of 2022
Recently the NCLAT, New Delhi in its judgement to the case of Rajat Metaal Polychem Pvt. Ltd. Vs. Mr. Neeraj Bhatia RP Vinayak Rathi Steels Rolling Mills Pvt. Ltd. and Anr. stated that during the Resolution Process, the operational creditors are denied any payment when the amount that is payable to them in the event of the Insolvency Process is nil. The courts are not able to assist them unless the legislation tends to come in aid of the operational creditors
Case Title: M/s Agarwal Foundries Private Limited vs. Posco E&C India Pvt. Ltd.
Case Number: Company Appeal (AT) (Insolvency) No. 1492 of 2024
The National Company Law Appellate Tribunal (NCLAT) bench comprising Justice Ashok Bhushan (Chairperson), Barun Mitra (Technical Member), and Arun Baroka (Technical Member) has held that the repeated filings of Section 9 applications and withdrawals indicate an attempt to misuse the provisions of the Insolvency and Bankruptcy Code (IBC) to “arm-twist” the Respondent, a solvent company to illegally extort monies rather than pursuing genuine insolvency resolution.
Case Title: Brijesh Haridas Nagar Co-op. Hsg Soc. Ltd. vs VAS Infrastructure Ltd. & Anr.
Case Number: Comp. App. (AT) (Ins) No. 1201 of 2024 & I.A. No. 4295, 4296, 4297, 4298 of 2024
The National Company Law Appellate Tribunal Principal Bench, New Delhi bench of Justice Rakesh Kumar Jain (Judicial Member) and Indevar Pandey (Technical Member) has held that under the Insolvency and Bankruptcy Code (IBC), the limitation period for filing an appeal must be calculated from the date of pronouncement of the order. The bench held that a party involved in the proceedings, particularly as an intervenor, is presumed to have knowledge of the case and the order passed. Therefore, such a party cannot claim ignorance of the order as a reason for delay in filing an appeal.
Failure To Provide Time To Cure Defect In Section 9 Application Violates Procedural Mandate: NCLAT
Case: Shiv Glitz Hotels and Resorts LLP v. Oravel Stays Ltd., Company Appeal (AT) (Insolvency) No.577 of 2024
NCLAT Delhi recently set aside an order passed by the National Company Law Tribunal (NCLT), Ahmedabad, in the case of Shiv Glitz Hotels and Resorts LLP v. Oravel Stays Ltd., where the NCLT had dismissed a Section 9 application under the Insolvency and Bankruptcy Code (IBC), 2016, without merits. The appeal was filed by Shiv Glitz Hotels and Resorts LLP, an operational creditor, after the NCLT failed to provide an opportunity to rectify the defects in the application, as required by the IBC.
Case Title: Office Beanz Pvt. Ltd. vs ------
Case Number: Company Appeal (AT) (Insolvency) No. 1725 of 2024 & I.A. No. 6238, 6305 of 2024
The National Company Law Appellate Tribunal Principal Bench, New Delhi bench of Justice Ashok Bhushan (Chairperson), Barun Mitra (Technical Member) and Arun Baroka (Technical Member) has held that primary purpose of Section 10A of the IBC was to provide relief to corporate debtors who defaulted during the period specified in the section. It held that although the debt itself is not extinguished, Section 10A specifically bars applications under Sections 7, 8, and 10. Further, the bench held this prohibition remains effective even after the period covered by Section 10A has expired, meaning that no applications can be filed for defaults that occurred during this period.
Section 10A prohibits the filing of applications for the initiation of corporate insolvency resolution process (CIRP) under Sections 7, 9, and 10 of the IBC for any default arising on or after March 25, 2020.
No Inherent Right To Withdraw Section 9 IBC Application And Refile: NCLAT New Delhi
Case Title: Florex Tiles vs M/s. Greenstone Granite Pvt. Ltd.
Case Number: Company Appeal (AT) (Insolvency) No.1487 of 2024
The National Company Law Appellate Tribunal, Principal Bench, New Delhi bench of Justice Ashok Bhushan (Chairperson), Barun Mitra (Technical Member) and Arun Baroka (Technical Member) has held that in proceedings under the Insolvency and Bankruptcy Code (IBC), an Applicant does not have an inherent right to withdraw an application filed under Section 9 at any stage and subsequently request the liberty to file a new application.
Case Title: Wind World (India) Limited vs Indian Renewable Energy Development Agency Limited and anr
Case No: Company Appeal (AT) (Insolvency) No.175 of 2023
The National Company Law Appellate Tribunal Principal Bench, New Delhi of Justice Ashok Bhushan (Chairperson) and Barun Mitra (Technical Member) has held that there is no violation of Section 14(1)(d) of the Insolvency and Bankruptcy Code (IBC) in the auction of assets or facilities of a subsidiary company if the assets were handed over to the Corporate Debtor for operation and maintenance under the SARFAESI Act.
Section 14(1)(d) prohibits any recovery action or enforcement of security interests by creditors, landlords, or lessors if the assets are in the possession or occupation of the corporate debtor
Case Title: Sanjeev Mahajan vs Indian Bank and Others
Case No.: Company Appeal (AT) (Insolvency) No. 1440 of 2024
The National Company Law Appellate Tribunal, New Delhi division bench of Justice Ashok Bhushan (Chairperson) and Barun Mitra (Technical Member) held that once a Resolution Plan is approved by the Committee of Creditors (CoC) and the Corporate Insolvency Resolution Process (CIRP) is concluded, the submission of new settlement proposals is not permissible. The CoC's decision, particularly when taken with unanimous consent, is final and cannot be challenged unless it is arbitrary.
Dispute Regarding GST Dues Not A Bar To Section 9 IBC Proceedings: NCLAT
Case Title: Gulshan Kumar Ahuja vs. Monika Garg Sole Proprietor Aggarwal
Case Number: Company Appeal (AT) (Insolvency) No. 1202 of 2024
The NCLAT Bench of Justice Rakesh Kumar Jain, Member (Judicial) and Arun Baroka, Member (Technical) has held that the dispute regarding payment of GST dues is not a “pre-existing dispute” between the parties that would preclude the initiation of Corporate Insolvency Resolution Process (CIRP) under Section 9 of the Insolvency & Bankruptcy Code, 2016 (IBC).
Case Title: Indiabulls Asset Reconstruction Company Ltd vs Pawan Kapoor
Case Number: COMPANY APPEAL (AT)(Insolvency) No.192/2021
The National Company Law Appellate Tribunal Principal Bench, New Delhi of Justice Yogesh Khanna (Judicial Member) and Ajai Das Mehrotra (Technical Member) has held that once the interim moratorium is in effect due to insolvency proceedings against a personal guarantor under the IBC, 2016, the bank is prohibited from continuing any further actions under the SARFAESI Act regarding the property mortgaged by the personal guarantor.
Section 12A Application Not Permitted During Liquidation Period: NCLAT Principal Bench
Case Title: Asha Chopra and ors vs M/s. Hind Motors India Limited and ors
Case Number: Company Appeal (AT) (Insolvency) No. 1425 – 1428 of 2024 & I.A. No. 5180 – 5183 of 2024
The National Company Law Appellate Tribunal Principal Bench, New Delhi of Justice Ashok Bhushan (Chairperson), Barun Mitra (Technicial Member) and Arun Baroka (Technicial Member) has held that an application under Section 12A of the IBC is not permitted during the liquidation period. Section 12A allows for the withdrawal of an insolvency application with the approval of ninety percent of the Committee of Creditors (CoC).
The bench noted that Section 12A is designed to facilitate the withdrawal of an application during the Corporate Insolvency Resolution Process (CIRP) before the insolvency resolution or liquidation proceedings have begun. Once the liquidation process commences, it held that the Committee of Creditors, which is instrumental in approving such withdrawals, ceases to exist in its original capacity.
The bench held that: “In view of the clear Statutory Scheme as delineated by 12A, Section 33 and Regulation 2B of the Liquidation Regulation, we are of the view that during Liquidation period, an Application under Section 12A is not permissible.”
Computation Of Limitation Must Be From Date Of E-Filing Of Appeal: NCLAT Principle Bench
Case Title: Innovators Cleantech Pvt. Ltd. Vs Pasari Multi Projects Pvt. Ltd.
Case Number: Interlocutory Application Nos. 1622 & 1623 of 2024
The National Company Law Appellate Tribunal, Principal Bench, New Delhi of Justice Ashok Bhushan (Chairperson) and Barun Mitra (Technical Member) has held that the computation of limitation for NCLAT purposes must be from the date of e-filing the appeal.
Case Title: M/s Agroha Paper Industries Private Limited vs Bank of Maharashtra
Case Number: Company Appeal (AT) (Insolvency) No. 1342 of 2023
The National Company Law Appellate Tribunal Principal Bench New Delhi of Justice Ashok Bhushan (Chairperson) and Barun Mitra (Technical Member) held that the protective provisions of Section 10 of the IBC should not be exploited or abused by the Corporate Debtor to gain an unfair advantage.
The bench noted that the SARFAESI proceedings initiated by the bank begun well before the filing of the Section 10 application by the Corporate Debtor. Thus, it noted that the application under Section 10 was a tactical maneuver rather than a genuine effort for insolvency resolution.
Case Title: Jaldhara Properties and Trading Pvt. Ltd vs Sudal Industries Ltd. & Anr.
Case Number: Company Appeal (AT) (Ins) No. 707 of 2023 with Company Appeal (AT) (Ins) No. 1420 of 2023
The National Company Law Appellate Tribunal, Principal Bench, New Delhi of Justice Rakesh Kumar Jain (Judicial Member), Naresh Salecha (Technical Member) and Indevar Pandey (Technical Member) has held that if an application under Sections 7, 9, or 10 of the Insolvency and Bankruptcy Code was already in process before 2021 Amendment Act came into force, then the amendments in Section 11A would not affect the priority of the proceedings.
Case Title: IIFL Home Finance Ltd. vs. Shiv Nandan Sharma, Resolution Professional Saha Infratech Pvt. Ltd.
Case No.: Company Appeal (AT) (Insolvency) No. 856 of 2024
The National Company Law Appellate Tribunal ('NCLAT') Delhi, comprising Justice Rakesh Kumar Jain (Judicial Member), Mr. Naresh Salecha, and Mr. Indevar Pandey (Technical Members) held that lending institutions providing loans to homebuyers do not qualify as 'Financial Creditors' under Insolvency and Bankruptcy, Code 2016 ('IBC').
Case Title: Rita Malhotra & Anr. vs. Orris Infrastructure Pvt. Ltd.
Case No.: Company Appeal (AT) (Insolvency) No. 484 of 2024
The National Company Law Appellate Tribunal (“NCLAT”) New Delhi bench comprising Justice Ashok Bhushan (Chairperson), Mr. Barun Mitra, and Mr. Arun Baroka (Technical Members) held that assured returns class of creditors who are allotted commercial space/unit constitutes an 'allottee' under Real Estate (Regulation and Development) Act, 2016 (“RERA”) and Insolvency and Bankruptcy Code, 2016 (“IBC”).
Case Title: Iskon Infra Engineering Private Limited vs. Central Bank of India
Case No.: Company Appeal (AT) (Insolvency) No. 323 of 2024 & I.A. No. 1080 of 2024
The National Company Law Appellate Tribunal ('NCLAT') Delhi bench, comprising Mr. Justice Ashok Bhushan (Chairperson) and Mr. Barun Mitra (Technical Member) held that a Corporate Guarantor cannot be absolved from its liability only due to non-invocation of guarantee.
Case Title: Swan Energy Ltd. vs Chandan Prakash Jain and Ors.
Case No.: Company Appeal (AT) (Insolvency) No. 313 of 2024
The National Company Law Appellate Tribunal (NCLAT), Delhi bench of Justice Ashok Bhushan (Chairperson) and Mr Barun Mitra (Technical Member) held that a resolution applicant, who did not take part in the CIRP process from the beginning and was not included in the list of prospective resolution applicants, cannot be suddenly substituted as a resolution applicant to implement the plan of the Corporate Debtor.
Case Title: Jet Aircraft Maintenance Engineers Welfare Association Versus Mr. Ashish Chhawchharia
Case No.: Company Appeal (AT) (Insolvency) No.1705 of 2023 & I.A. No. 6137 of 2023
The National Company Law Appellate Tribunal (Appellete Tribunal) Delhi, comprising Mr. Justice Ashok Bhushan (Chairperson) and Mr. Barun Mitra (Technical Member), held that the Resolution Professional is not personally liable for the lump sum payments made to the 103 employees who were part of the Asset Preservation Team (APT) responsible for preserving and managing the operations of Jet Airways.
The Appellate Tribunal dismissed the appeal of the Jet Aircraft Maintenance Engineers Welfare Association, which sought payment for all workmen and employees of Jet Airways, against whom the Corporate Insolvency Resolution Process (CIRP) proceedings were initiated on June 20, 2019.
Case Title: Sanskriti Allottee Welfare Association (Reg.) & others Versus Gaurav Katiyar & anr
Case No.: Company Appeal (AT) (Insolvency) No. 878 of 2023
While upholding the Resolution Professional (RP) decision to increase the maintenance charges for homebuyers of the Corporate Debtor to cover electricity bills and dues, the National Company Law Appellate Tribunal (Appellant Tribunal) Delhi, comprising Justice Ashok Bhushan (Chairperson), Mr. Barun Mitra (Technical Member), and Mr. Arun Baroka (Technical Member), held that electricity, being an essential service, must continue during the Corporate Insolvency Resolution Process (CIRP) period.
With approval from the Committee of Creditors (CoC), the RP raised the electricity rate from ₹7 per unit to ₹8.91 per unit for homebuyers who received possession of their flats in the Sanskriti Project of the Corporate Debtor.
NCLAT: Resolution Professional Can Only Entertain Claims Due As Of CIRP Commencement Date
Case Title: Gujarat Urja Vikas Nigam Limited vs. Mr. Udayraj Patwardhan
Case Number: Comp. App. (AT) (Ins.) No. 1183 of 2024
The National Company Law Appellate Tribunal (NCLAT), Principal Bench, New Delhi, comprising Mr. Justice Rakesh Kumar Jain (Judicial Member), Mr. Naresh Salecha (Technical Member) and Mr. Indevar Pandey (Technical Member) has held that any claims arising after the commencement of the Corporate Insolvency Resolution Process (CIRP) cannot be entertained by the Resolution Professional (RP).
The Tribunal held that:
“There is a clear law that Resolution Professional can only entertain claims due and filed w.r.t. CIRP commencement date and not due to subsequent event, for which claimant might have other legal remedy.”
Co-Borrower Shares Similar And Equal Responsibility Under Loan Agreement: NCLAT New Delhi
Case Title: Amit Narang v. Aditya Birla Finance Ltd. and Anr.
Case Reference: Company Appeal (AT) (Insolvency) No. 684 of 2024
The National Company Law Appellate Tribunal (NCLAT) Principal Bench, New Delhi comprising Mr. Justice Ashok Bhushan (Chairperson), Mr. Barun Mitra (Technical Member) and Mr. Arun Baroka (Technical Member) in an important judgment observed that initiation of Corporate Insolvency Resolution Process (CIRP) against a co-borrower is allowed under the Insolvency and Bankruptcy Code (IBC). In the present case, an appeal was filed by a suspended director of Narang Developers Pvt. Ltd. (NDPL) against decision of the National Company Law Tribunal (NCLT) Mumbai which admitted the NDPL into insolvency on an application filed by Aditya Birla Finance Ltd. (Financial Creditor) under section 7 of the IBC.
The NCLAT further observed that:
“The obligation of the Co-Borrower is co-extensive and coterminous with that of the Primary Borrower and hence a right or cause of action becomes available to the financial creditor to proceed against the primary borrower, as well as the Co-Borrower in equal measure in case they commit default in repayment of the amount of debt”.
Adjudicating Authority Can Extend Time Limit Of PPIRP Beyond 120 Days: NCLAT New Delhi
Case Title: Mr. Vikash Gautamchand Jain RP of Kethos Tiles Pvt. Ltd.
Case Reference: Company Appeal (AT) (Insolvency) No. 1173 of 2024 & I.A. No. 4190, 4191 of 2024 with Company Appeal (AT) (Insolvency) No. 1323 of 2024
The National Company Law Appellate Tribunal (NCLAT), Principal Bench, New Delhi, comprising Mr. Justice Ashok Bhushan (Chairperson) and Mr. Barun Mitra (Technical Member), held that expiration of 120 days does not lead to automatic termination of Pre Packaged Insolvency Resolution Process (PPIRP) if sufficient cause is shown. In this case, PPIRP of the corporate debtor was initiated by M/s. Kethos Tiles Pvt. Ltd., an MSME, under section 54C of the Insolvency and Bankruptcy Code (IBC) and the National Company Law Tribunal (NCLT) had terminated the PPIRP when time period within which the entire process had to be completed, expired.
Resolution Applicants Can't Revise Offers Post Approval, CoC's 'Commercial Wisdom' Can't Be Faulted: NCLAT
Case Title: Vantage Point Asset Management Pte. vs. Ashish Arjunkumar Rathi & Anr.
Case Numbers: Company Appeal (AT) (Insolvency) No. 1619 & 1620 of 2024 with Company Appeal (AT) (Insolvency) No. 1621 & 1622 of 2024 with Company Appeal (AT) (Insolvency) No. 1696 & 1697 of 2024
The National Company Law Appellate Tribunal (NCLAT), Principal Bench, New Delhi comprising Justice Ashok Bhushan (Chairperson), Barun Mitra (Technical Member), and Arun Baroka (Technical Member) has observed that the 'commercial wisdom' of the Committee of Creditors (CoC), which did not approve a Resolution Plan, which had given the highest money, cannot be questioned. The Tribunal went on to observe that after approval of the Resolution Plan, no Resolution Applicant is entitled to raise its off
It noted clause 4.1.8 which stated, “the CoC is under no obligation to any of the Resolution Applicants … to approve a Resolution Plan which has scored the highest as per the Evaluation Criteria and any Resolution Plan shall be approved solely on the basis of the CoC's commercial wisdom.”
Assignee Stepping Into Shoes Of Assignor, Borrower Or Guarantor Cannot Challenge Such Assignment: NCLAT New Delhi
Case Title: Mr. Paresh Parekh v. Alchemist Asset Reconstruction Co. Ltd. and Anr.
Case Reference: Company Appeal (AT) (Insolvency) No. 1204 of 2024 with Company Appeal (AT) (Insolvency) No. 1205 of 2024
The National Company Law Appellate Tribunal (NCLAT), Principal Bench, New Delhi, comprising Mr. Justice Ashok Bhushan (Chairperson), Mr. Barun Mitra (Technical Member) and Mr. Arun Baroka (Technical Member), held that personal guarantee can be invoked even if a put option has not been exercised. The Tribunal dismissed an appeal filed by Paresh Parekh and Manish Patel (personal guarantors) against an order passed by the NCLT in which insolvency proceedings under section 95 of the Insolvency and Bankruptcy Code.
The NCLAT further observed that SARFAESI Act allows the debt to be assigned to the Assets Reconstruction Companies and once the debt is assigned, assignee steps into the shoes of an original lender. Additionally, the deed of guarantee contained a clause to assign the debt itself therefore the arguments of the appellant cannot be accepted.
NCLAT Chennai Upholds Creditors Right To File For Bankruptcy Beyond Threshold Timeline U/S 118 Of IBC
Case Title: Tummala Sri Ganesh Vs. State Bank of India and Anr
Case Number: Company Appeal (AT) (CH) (Ins) No.315/2024
Recently, the NCLAT Chennai dismissed appeals filed by Tummala Sri Ganesh and other applicants. In this case, the issue was with respect to applicants who had furnished personal guarantees for the debt liabilities of Chadalvada Infratech Limited. The principal borrower had defaulted on the repayment of debt and CIRP was invoked in pursuance to which NCLT approved a repayment plan. However, the appellants, without completing the repayment process, made the RP file a report under Section 118 of IBC.
NCLAT held that Section 118 of the Insolvency and Bankruptcy Code provides that where an insolvency resolution plan contemplated under the IBC is not filed within the threshold timeline, its mere existence lapses even before the lapse of its natural duration; at which point the right of the creditor to file bankruptcy proceedings vests.
Limitation U/S 61 Of IBC Is To Be Calculated From Date Of E-Filing, Rules Prevalent When Application Is Considered To Be Applied: NCLAT New Delhi
Case Title: Shree Ganapati Power and Transformers. v. Vijeta Projects and Infrastructure Ltd. and Ors
Case Reference: Company Appeal (AT) (Ins.) No. 811 of 2022 & I.A. No. 5695 of 2023
The National Company Law Appellate Tribunal (NCLAT), Principal Bench, New Delhi, comprising Mr. Justice Rakesh Kumar Jain (Judicial Member), Mr. Naresh Salecha (Technical Member) and Mr. Indevar Pandey (Technical Member), held that the period of limitation for appeal should be counted from the date of e-filing and not from the physical presentation. The tribunal condoned the delay of 3 days in filing the appeal as sufficient cause was shown and it was in accordance with the Standard Operating Procedure.
Obtaining Prior NOC From Stock Exchanges/SEBI Not Mandatory Before Submitting Scheme Of Arrangement For Company In Liquidation: NCLAT New Delhi
Case Title: Nikhil Jain and Ors.v. Anil Goel (Liquidator) and Anr.
Case Reference: Company Appeal (AT) No. 148 of 2024
The National Company Law Appellate Tribunal (NCLAT), Principal Bench, New Delhi, comprising Mr. Justice Yogesh Khanna (Judicial Member) and Shri Ajai Das Mehrotra (Technical Member), observed that it is not mandatory to obtain No Objection Certificate (NOC) before submitting a scheme of arrangement to revive a company in liquidation under Insolvency and Bankruptcy Code (IBC) before the National Company Law Tribunal (NCLT) under section 230 of the Companies Act.
Thus, under the Companies Act, there is no requirement for prior NOC from the stock exchanges or SEBI before the Scheme is filed before the Ld. NCLT, and the requirement is only to give notice to the stock exchanges and SEBI once the Scheme is filed with the Ld. NCLT for calling/dispensing with meetings of creditors and members, which has been duly complied with by the Liquidator / Applicant of the Scheme”.
Successful Resolution Applicant Entitled Benefit Of Protection U/S 32A IBC To Lift ED's Attachment Over Corporate Debtor's Assets: NCLAT New Delhi
Case Title: Vantage Point Asset Pte. Ltd.v.Gaurav Misra (RP)
Case Reference: Company Appeal (AT) (Insolvency) No. 1495 of 2024
The National Company Law Appellate Tribunal (NCLAT), Principal Bench, New Delhi, comprising Mr. Justice Ashok Bhushan (Chairperson), Mr. Barun Mitra (Technical Member) and Mr. Arun Baroka (Technical Member), in a crucial judgment observed that the benefit of section 32A of the Insolvency and Bankruptcy Code (IBC) will be extended to the new management of the Alchemist Infra Reality Ltd.(corporate debtor) after the approval of resolution plan. In this case, the tribunal ordered to lift the proper
The Hon'ble Supreme Court has clearly held that Section 32-A has been engrafted in the legislation, which is a legislative scheme and if legislature thought that immunity be granted to the Corporate Debtor or its property, it hardly furnishes a ground for this Court to interfere. The extinguishment of the criminal liability of the Corporate Debtor is apparently important to the new management to make a clean break with the past and start on a clean slate”.
“Clean Slate" Principle Does Not Extend To Liabilities On Date Of E-Auction Sale Of Corporate Debtor As 'Going Concern': NCLAT
Case Name: Shantech International Pvt. Ltd. vs. Devendra Singh
Case No: Company Appeal (AT) (Insolvency) No. 1520 of 2024
The National Company Law Appellate Tribunal (NCLAT), Principal Bench, New Delhi bench comprising Justice Ashok Bhushan (Chairperson), Barun Mitra (Technical member) and Arun Baroka (Technical member) has held that when the claim itself are on the liquidation commencement date in the liquidation process, the argument that extinguishment of claims and liabilities should be granted till the date of sale by e-auction is not in accord with the statutory scheme as delineated by IBBI (Liquidation Process) Regulations, 2016.
[IBC] Pendency Of Civil Suit Doesn't Preclude Admission Of S. 7 Application When Debt & Default Are Proven: NCLAT
Case Title: Navin Chandra Mishra (Suspended Director of CMR Lifesciences Pvt. Ltd.) vs. Nand Kishore Palaha & Ors.
Case Number: Company Appeal (AT) (Insolvency) No. 1851 of 2024
The National Company Law Appellate Tribunal (NCLAT), Principal Bench, New Delhi comprising Justice Ashok Bhushan (Chairperson), Barun Mitra (Member Technical), Arun Baroka (Member Technical) has held that the pendency of the Civil Suit is no reason for not proceeding to admit the Section 7 Application when the debt and default are proved.
NCLAT Rejects Condonation Of Delay Application Due To Non-Compliance With Limitation Period U/S 61 Of IBC
Case Title: Southern Power Distribution Company of Telangana Ltd. Vs. Kalvakolanu Murali Krishna Prasad RP for Vaksh Steels Pvt. Ltd. and Ors
Case Number: Company Appeal (AT) (CH) (Ins) No.177 /2021(IA Nos. 360 & 362 / 2021)
The National Company Law Appellate Tribunal (NCLAT), Chennai, comprising of Justice Sharad Kumar Sharma, Member (Judicial) and Shri Jatindranath Swain (Technical Member), dismissed an appeal under Section 61 of the Insolvency and Bankruptcy Code (IBC). The appeal was filed by the Southern Power Distribution Company of Telangana Ltd. against Kalvakolanu Murali Krishna Prasad (Resolution Professional for Vaksh Steels Pvt. Ltd.,). The NCLAT observed that the appellant cannot file an application for condonation of delay as it was duly aware of the proceedings well before the expiration of the time and as a result not acting within the prescribed time-period does not allow it to file for condonation of delay.
Case Title: Neon Laboratories Ltd. v. Mayank Shah and Anr.
Case Reference: Comp. App. (AT) (Ins) No. 1622 of 2023 & I.A. No. 5860, 5861 and 5862 of 2023
The National Company Law Appellate Tribunal (NCLAT), Principal Bench, New Delhi, comprising Mr. Justice Rakesh Kumar Jain (Judicial Member) and Mr. Indevar Pandey (Technical Member), held that petition under section 95 of the Insolvency and Bankruptcy Code (IBC) cannot be maintained if it is filed merely to scuttle the proceedings already initiated under section 9 of the Arbitration and Conciliation Act. In this case, an appeal was filed against the decision of the NCLT wherein a petition under section 95 of the Insolvency and Bankruptcy Code (IBC) was dismissed.
Set Off / Counter Claim Can Be Allowed At CIRP Admission Stage U/S 9 Of IBC: NCLAT New Delhi
Case Title: Khushbu Dye Chem Pvt. Ltd. v. Chemical Suppliers India Pvt. Ltd.
Case Reference: Company Appeal (AT) (Insolvency) No. 664 of 2024
The National Company Law Appellate Tribunal (NCLAT), Principal Bench, New Delhi, comprising Mr. Justice Ashok Bhushan (Chairperson), Mr. Barun Mitra (Technical Member) and Mr. Arun Baroka (Technical Member), held that set off/Counter Claim can be claimed at the Corporate Insolvency Resolution Process (CIRP) admission stage. In this case, an appeal was filed against the decision of the NCLT wherein the petition under section 9 of the Insolvency and Bankruptcy Code (IBC) was dismissed.
Look-Back Period Can't Be Extended Beyond 2-Yr Limit U/S 43(4) Of IBC For Related-Party Transactions: NCLAT
Case Title: Sidharth Bharatbhushan Jain & Ors. vs. State Bank of India & Ors.
Case Number: COMPANY APPEAL (AT)(INS) NO. 242 OF 2024
The National Company Law Appellate Tribunal, Principal Bench, New Delhi comprising Justice Yogesh Khanna (Judicial Member) and Mr. Ajai Das Mehrotra (Technical Member) has held that section 43 of the Insolvency and Bankruptcy Code (IBC) does not allow the extension of the look-back period beyond 2 years for related-party transactions.
Application U/S 65 Of IBC Can Be Considered Even Before Admission Of Insolvency Petition: NCLAT New Delhi
Case Title: Devashree Developers Pvt. Ltd. and Ors. v. Aravali Cylinders Pvt. Ltd.
Case Reference: Comp. App. (AT) (Ins) No. 1406 of 2023 & I.A. No. 5032 of 2023 with Comp. App. (AT) (Ins) No. 1430 of 2023 & I.A. No. 5118, 5119 of 2023
The National Company Law Appellate Tribunal (NCLAT), Principal Bench, New Delhi, comprising Mr. Justice Rakesh Kumar Jain (Judicial Member), Mr. Naresh Salecha (Technical Member) and Mr. Indevar Pandey (Technical Member), held that an application under section 65 of the Insolvency and Bankruptcy Code (IBC) can be considered even before formal admission of the Corporate Insolvency Resolution Process (CIRP) petitions.
Unilateral Entries In Financial Records By Corporate Debtor To Make Counter Claim Cannot Be Considered: NCLAT New Delhi
Case Title: Mr. Kailash Motilal Kakrania and Anr. v. Apurva Oil and Industries Pvt. Ltd.
Case Reference: Company Appeal (AT) (Insolvency) No. 1257 of 2023 & I.A. No. 4433 of 2023
The National Company Law Appellate Tribunal (NCLAT), Principal Bench, New Delhi, comprising Mr. Justice Rakesh Kumar Jain (Judicial Member) and Shri Ajai Das Mehrotra (Technical Member), held that unilateral entries made in the financial records by the corporate debtor to make a counter claim cannot be considered. In this case, an appeal was filed against a decision of the NCLT in which a petition under section 7 of the Insolvency and Bankruptcy Code (IBC) was dismissed.
Assets Of Partnership Firm Not Property Of Personal Guarantor, Not Covered By Interim Moratorium Merely Because S.95 Application Was Filed: NCLAT New Delhi
Case Title: Ramesh Kumar Chugh v. Assets Care & Construction Enterprises Ltd.
Case Reference: Company Appeal (AT) (Insolvency) No. 1726 of 2024
The National Company Law Appellate Tribunal (NCLAT), Principal Bench, New Delhi, comprising Mr. Justice Ashok Bhushan (Chairperson), Mr. Barun Mitra (Technical Member) and Mr. Arun Baroka (Technical Member), held that the assets held in the name of the partnership firm is not the personal property of the personal guarantor and cannot be subjected to the provisions of interim moratorium merely because a Section 95 application has been filed against a partner of the firm in respect of a personal guarantee given for a party other than the partnership firm.
After Lapse Of Extended Period Of 90 Days Of Insolvency Commencement Date, RP Not Obliged To Accept Any Claim: NCLAT New Delhi
Case Title: Commissioner of Income Tax (TDS-1), Mumbai v. Mr. Sundaresh Bhat (RP)
Case Reference: Company Appeal (AT) (Insolvency) No. 575 of 2023
The National Company Law Appellate Tribunal (NCLAT), Principal Bench, New Delhi, comprising Mr. Justice Ashok Bhushan (Chairperson) and Mr. Barun Mitra (Technical Member), held that after the lapse of extended period of 90 days of the insolvency commencement date, the RP is not obliged to accept any claim. The tribunal further held that the provisions of Income Tax Act do not create any charge or security interest in favour of the Appellant or provides any foundational basis for the Income Tax Department to be a secured Creditor.
NCLAT Permits Participation Of Erstwhile Promoter In CIRP Despite CoC's Disqualification, Cites Relaxation U/S 29A Of IBC
Case: Meir Commodities India Pvt. Ltd. v. Narayanam Nageswara Rao & Ors
Filing Number: Company Appeal (AT) (CH) (INS) No. 206 / 2024 (IA Nos. 563, 564 & 565 / 2024)
The National Company Law Appellate Tribunal (NCLAT) presided by Justice Sharad Kumar Sharma, Member (Judicial) and Jatindranath Swain Member (Technical) dismissed an appeal filed by the Meir Commodities Pvt ltd, challenging the participation of promoter of NCS Sugar ltd in the Corporate Insolvency Resolution Process (CIRP).
The NCLAT upheld the decision of High Court of Telangana and state the respondent should not be termed as “wilful defaulter” and should be allowed to participate in the Resolution process. Also, the Respondent had previously engaged in negotiations with the CoC and the RP and had also revised his plan. Therefore, he had the right to challenge the procedure of application.
Litigant Who Does Not Apply For Certified Copy Cannot Claim Benefit Of Limitation Period If Delay Is Caused Due To Receipt Of Free Copy Of NCLT Order : NCLAT New Delhi
Case Title: Shakir v. Fruitful Buildcon Pvt. Ltd
Case Reference: Comp. App. (AT) (Ins) No. 1893 of 2024 & I.A. No. 6999 of 2024
The National Company Law Appellate Tribunal, Principal Bench, New Delhi, comprising Justice Ashok Bhushan (Chairperson) Barun Mitra (Technical Member) Arun Baroka (Technical Member), held that the litigant who does not apply for the certified copy cannot then fall back and claim that he was awaiting the grant of the free copy to obviate the bar of limitation. The limitation for filing the appeal commences from the date of order is pronounced and litigant has to be vigilant in applying the certified copy of the order.
NCLAT Delhi Closes CIRP Against Jaypee Healthcare Ltd After Full Settlement Of Financial Creditors' Claims
Case Title: Jaypee Infratech Ltd. v. Jaypee Healthcare Ltd. & Ors.
Case Number: Company Appeal (AT) (Insolvency) Nos. 1301, 1186, and 1296 of 2024
The National Company Law Appellate Tribunal (NCLAT), New Delhi bench comprising Justice Ashok Bhushan (Chairperson), Barun Mitra (Technical Member), and Arun Baroka (Technical Member) has set aside the Corporate Insolvency Resolution Process (CIRP) initiated against Jaypee Healthcare Limited after the settlement amount was disbursed to financial creditors.
Any Claims Assessed After Liquidation Commencement Date Cannot Be Accepted By Liquidator: NCLAT New Delhi
Case Title: Assistance Provident Fund Commissioner (Legal), EPFO v. Chandra Prakash Jain (Liquidator)
Case Reference: Company Appeal (AT) (Insolvency) No. 1743 of 2024
The National Company Law Appellate Tribunal (NCLAT), Principal Bench, New Delhi, comprising Mr. Justice Ashok Bhushan (Chairperson), Mr. Barun Mitra (Technical Member) and Mr. Arun Baroka (Technical Member), held that when the claim has to be filed on the liquidation commencement date any claims subsequent including any on the basis of assessment subsequent to the liquidation commencement date cannot be given any credence by the liquidator.
NCLAT Upholds Central Govt's Takeover Of Delhi Gymkhana Club Over Allegations Of Mismanagement
Case Title: Major Atul Dev (Retd.) & Ors. vs. Union of India, Ministry of Corporate Affairs Through Regional Director (North Region) & Ors.
Case Number: Company Appeal (AT) No.93 of 2022 with Company Appeal (AT) No.141 of 2022
The NCLAT bench of Justice Ashok Bhushan (Chairperson) and Arun Baroka (Technical Member) has upheld the NCLT's order which allowed the Central Government to take over the management of the Delhi Gymkhana Club, and directed the existing committee to take remedial steps and hold the election. The NCLAT held that Union of India's intervention in the affairs of the Delhi Gymkhana Club, which resulted in the erstwhile management of the Club being superseded by a 15-member general committee appointed by Union of India to take over the management of the club, was necessitated due to the rampant mismanagement by the erstwhile general committee.
Adjudicating Authority Can Recall Its Judgement But Has No Power To Review Unless Expressly Required: NCLAT New Delhi
Case Title: Aircastle (Ireland) Ltd. Vs. Mr. Ashish Chawchharia, RP of Jet Airways (India) Ltd. and Ors
Case Number: Comp. App. (AT) (Ins) No. 1178 of 2024
The NCLAT Delhi comprising of Justice Rakesh Kumar Jain (Member Judicial), Mr. Naresh Salecha (Member Technical) and Mr. Indevar Pandey (Member Technical) dismissed appeal filed by the Aircastle (Ireland) Ltd. (Appellant) who was aggrieved by the order of the Adjudicating authority. The Bench distinguished between Review Petition and Recall Petition and stated that the adjudicating authorities have the inherent powers to recall their orders but have no power to review the same.
Written Financial Contract Is Not A Pre-Condition For Proving Existence Of Debt U/S 5(8) Of IBC: NCLAT New Delhi
Case Title: Rahul H. Mehta v. Gajendra Investment Ltd. and Ors.
Case Reference: Company Appeal (AT) (Insolvency) No. 739 of 2022
The NCLAT New Delhi Bench of Justices Ashok Bhushan(chairperson) and Barun Mitra (Technical Member) held that it has been held that written financial contract is not a pre-condition or an exclusive requirement for proving existence of debt. It has been further amplified therein that the Application to Adjudicating Authority Rules, 2016 and CIRP Regulations makes it clear that financial debt can be proven from other relevant documents and it is not mandatory that written financial contract can be the only basis for proving the financial debt.
Payment Of Pre-CIRP Dues To Creditors Including Government Dues Cannot Be Made By RP Outside Resolution Framework: NCLAT New Delhi
Case Title: Avil Menezes v. Ministry of Coal and Ors.
Case Reference: Company Appeal (AT) (Insolvency) No. 944 of 2022
The NCLAT New Delhi Bench of Justices Ashok Bhushan, Barun Mitra] Member and Arun Baroka held that the assets of the Corporate Debtor are to be taken over by the Resolution Professions for resolution of the Corporate Debtor. The RP has to make every endeavour to protect and preserve the value of the property of the Corporate Debtor. Payment of pre-CIRP dues to creditors Including Government Dues cannot be made by RP outside the resolution framework.
Dissenting Financial Creditor Only Entitled To Liquidation Value Of Secured Interest U/S 30(2)(b) Of IBC, Commercial Wisdom Of CoC Sacrosanct: NCLAT
Case Title: Merina Commotrade Pvt. Ltd. vs. Anand Sonbhadra Resolution Professional for Shubhkamna Buildtech Pvt. Ltd. & Ors.
Case Number: Comp. App. (AT) (Ins) No. 1347 of 2022 & I.A. No. 4180 of 2022
The NCLAT, New Delhi bench of Justice Rakesh Kumar Jain (Judicial Member) and Mr. Indevar Pandey (Technical Member) has affirmed that as per Section 30(2)(b) of the Insolvency and Bankruptcy Code, 2016, a dissenting financial creditor is only entitled to the liquidation value of its secured interest, not the total liquidation value of the Corporate Debtor. The Tribunal reiterated that the 'commercial wisdom' of the Committee of Creditors (CoC) is paramount and cannot be interfered with unless similarly situated creditors are denied fair and equitable treatment.
Payment Of Lease Amount, Lease Rent And Premium Cannot Be Considered As CIRP Costs; Not Recoverable U/S 14 Of IBC: NCLAT New Delhi
Case Title: Sunil Kumar Agarwal & Anr v. Anand Sonbhadra Resolution Professional of Shubhkamna Buildtech Pvt. Ltd. & Ors
Case Reference: Comp. App. (AT) (Ins) No. 1351 of 2022 & I.A. No. 4196, 4197, 4666, 4731 of 2022 & 1500 of 2023
The NCLAT New Delhi Bench of Justices Rakesh Kumar Jain and Indevar Pandey held that the payment of lease amount, lease rent and premium arising during CIRP cannot be considered as CIRP costs. Therefore, they cannot be claimed in view of section 14 of the IBC which prohibits any recovery of the property of the corporate debtor during the CIRP.
NCLAT Dismisses Travel Agents Association Of India's Allegations Of Anti-Competitive Practices Against Union Govt's Dept Of Expenditure
Case Title: Travel Agents Association of India vs. Competition Commission of India & Ors.
Case Number: Competition App. (AT) No. 26 of 2020
The NCLAT, New Delhi bench comprising Justice Rakesh Kumar Jain (Judicial Member), Mr. Naresh Salecha (Technical Member) and Mr. Indevar Pandey (Technical Member) has held that the Department of Expenditure, Government of India does not qualify as an "enterprise" under Section 2(h) of the Competition Act, 2002, being a “consumer” of air ticketing services.
Development Rights Are Fully Covered By Definition Of "Property" U/S 3(27) Of IBC: NCLAT New Delhi
Case Title: Nilesh Sharma Resolution Professional - Today Homes and Infrastructure Pvt. Ltd. Vs. Mordhwaj Singh & Ors
Case Reference: Company Appeal (AT) (Insolvency) No. 331 of 2024 & I.A. No. 1127 of 2024, Company Appeal (AT) (Insolvency) No. 336 of 2024 and Company Appeal (AT) (Insolvency) No. 337 of 2024
The NCLAT New Delhi Bench of Justices Ashok Bhushan (Chairperson) Barun Mitra (Technical Member) held that it is no more res integra, that the Development Rights are Rights which can be claimed by a Developer in assets. Development Rights are also fully covered by the definition of Property under Section 3(27) of the IBC.
Ineligibility Of Successful Resolution Applicant U/S 29A Of IBC Has To Be Seen On Date Of Submission Of Resolution Plan: NCLAT New Delhi
Case Title: Ashish Singh, Resolution Professional for Vibrant Buildwell Pvt. Ltd. v. Raj Kumar Sahani & Ors.
Case Reference: Company Appeal (AT) (Insolvency) No. 253-254 of 2024
The NCLAT New Delhi Bench of Justices Ashok Bhushan and Barun Mitra held that the eligibility/ineligibility of Successful Resolution Applicant under section 29A of the Insolvency and Bankruptcy Code (IBC) has to be seen on the date of submission of Resolution Plan.
Dissolution Of Corporate Debtor Can Be Sought U/S 54 Of IBC Only After Complete Liquidation: NCLAT
Case Title: Janak Jagjivan Shah Resolution Professional v. Committee of Creditors Rainbow Infrabuild Pvt. Ltd.
Case Reference: Company Appeal (AT) (Insolvency) No.1406 of 2024
The NCLAT New Delhi Bench of Justices Ashok Bhushan (Chairperson), Mr. Barun Mitra (Technical Member) and Arun Baroka (Technical Member) held that the scheme of the IBC clearly provides that dissolution is a step subsequent to the Corporate Debtor having been completely liquidated. In the present case, the liquidation proceedings have not been undertaken and resorting to Section 54 for dissolution could not have been taken as per the scheme of the IBC.
Time-Period U/S 61 Of IBC Cannot Be Extended On Ground Of S.14 Of Limitation Act: NCLAT
Case Title: Hero Exports v. Mr. K. Vasudevan.
Case Reference: IA No. 2830-2831/2020 & IA No. 3019-3020/2020 TA (AT) No.254 & 255 / 2021 (Company Appeal (AT) (Ins) Nos.1048 & 1049/2020) IA No. 2826-2827/2020 &IA No.2828-2829/2020
The NCLAT Chennai Bench of Justices Justice Sharad Kumar Sharma and Jatindranath Swain held that the provisions contained under Section 14 of the Limitation Act will not be a recourse available to the appellant, owing to the fact that Section 61 of the IBC, since being a self-contained provision dealing with the principles of Limitation prescribes an upper limit within which an Appeal has to be filed and that cannot be extended under any circumstances even by this Appellate Tribunal.
Limitation Period U/S 61 Commences From Pronouncement Of Order And Not On Uploading Date Of Order: NCLAT New Delhi
Case Title: Tarandeep Kaur Ahluwalia and Ors. Vs. One City Infrastructure Pvt. Ltd. and Ors
Case Number: Comp. App. (AT) (Ins) No. 1898 of 2024 & I.A. No. 7020, 7024 of 2024
The National Company Law Appellate Tribunal (NCLAT) Principal Bench, New Delhi, comprising of Justice Rakesh Kumar Jain, Mr. Barun Mitra (Member Technical) and Mr. Naresh Salecha (Member Technical), disposed two applications filed by the appellant seeking condonation of one-day delay in filing their appeal against the order of the National Company Law Tribunal (NCLT).
Examining The Interplay Between Sections 29A And 240A Of IBC: Clarifying The Status Of MSMEs Within Insolvency Resolution Framework
The NCLAT in a recent decision titled Ashish Singh, Resolution Professional forVibrant Buildwell Pvt. Ltd. v. Raj Kumar Sahani & Ors (Company Appeal (AT) (Insolvency)No. 253-254 of 2024) observed that under section 240A of the IBC, the date of submission of the resolution plan has to be seen to assess whether ineligibility under section 29A of the IBC is triggered. In this case, the tribunal extended the benefit of section 240A of the Insolvency and Bankruptcy Code, 2016 to the corporate debtor even though the MSME registration had been secured after the commencement of the CIRP.
NCLAT Upholds Approved Resolution Plan For M/S Adico Forge Pvt Ltd Which Secured Workers' Provident Fund And Gratuity Dues In Full
Case Title: Audico Forge Kamgar Sangathana v. CA Ramchandra Dallaram Choudhary & Ors.
Case Number: Company Appeal (AT) (Insolvency) No.1645 of 2024
The NCLAT bench of Justice Ashok Bhushan (Chairperson), Mr. Barun Mitra (Technical Member) and Arun Baroka (Technical Member) has reiterated that the jurisdiction of the NCLT and NCLAT while considering the Plan approved by the CoC is limited. The Tribunal ruled that dues that were previously admitted in the Resolution Plan and paid in full cannot be raised again.
Once Debt And Default Satisfied, Petition U/S 7 Of IBC Has To Be Admitted, Vidharbha Ruling Cannot Be Applied Mechanically: NCLAT
Case Title: Canara Bank v. GTL Limited
Case Reference: Company Appeal (AT) (Ins) No. 69 of 2023 & I.A. No. 274, 275 of 2023
The NCLAT New Delhi Bench of Justices Mr. Rakesh Kumar Jain, Mr. Naresh Salecha and Mr. Indevar Pandey affirmed that a petition under section 7 of the IBC cannot be rejected merely on the ground that there are chances of the amount being recovered from other proceedings which will satisfy the entire debt of the creditors. The tribunal further observed that the ratio of the Vidharbha ruling cannot be applied mechanically without satisfying itself as to whether the amount equal or more than the debt amount due to the creditors will in fact be recovered from such other proceedings.
Lease Rent/Damages Subsequent To Commencement Of CIRP Cannot Be Treated As CIRP Cost: NCLAT
Case Title: Mr. A. Guhan and Anr. V. Ms. Sunita Umesh
Case Reference: Company Appeal (AT) (Insolvency) No. 1095 of 2023 & I.A. No. 3782 of 2023
The NCLAT New Delhi Bench of Justices Ashok Bhushan and Barun Mitra held that lease rent/damages due to the corporate debtor after the commencement of the CIRP cannot be considered as CIRP cost that too when an arbitral award with respect to the same amount had already been secured which could not be executed due to moratorium under section 14 of the IBC.
Settlement Plan U/S 12A Of IBC Cannot Be Considered By CoC After Approval Of Resolution Plan: NCLAT
Case Title: Pratham Expofab Private Limited v. Mr. Anil Matta, Resolution Professional and Ors.
Citation: Company Appeal (AT) (Insolvency) No. 1803 of 2024
The NCLAT New Delhi Bench of Justices Ashok Bhushan and Barun Mitra affirmed that a settlement proposal under Section 12A of the IBC cannot be put before the CoC after the CoC has approved the resolution plan. The tribunal further observed that with the approval of the resolution plan by the CoC, the plan becomes inter se binding between the CoC and the SRA and hence no settlement proposal of the suspended management can be considered thereafter.
Case Title: Sandip Narendrakumar Patel (Promotor/ExDirector) Yours Ethnic Foods Pvt. Ltd. vs. Svakarma Finance Pvt. Ltd. & Anr.
Case Number: Comp. App. (AT) (Ins) No. 1419 of 2023
The National Company Law Appellate Tribunal (NCLAT), New Delhi bench of Justice Rakesh Kumar Jain (Judicial Member), Mr. Naresh Salecha (Technical Member) and Mr. Indevar Pandey (Technical Member) has held that the issuance of a recall notice during the cut off period specified under Section 10A (i.e. from 25.03.2020 to 25.03.2021) does not defer the date of default if the default occurred before 25.03.2020. The Tribunal noted that the recall notice issued during the cut off period was a procedural step that had no bearing on the initial default date because the default occurred well before the cut-off period. The Tribunal held that the application under section 7 of the Insolvency & Bankruptcy Code (IBC) was not hit by section 10A.
Case Title: Telecom Regulatory Authority of India v. Reliance Communication Ltd. & Ors.
Case Reference: Company Appeal (AT) (Insolvency) No.355 of 2024
The NCLAT New Delhi Bench of Justices Ashok Bhushan (Chairperson), Barun Mitra and Arun Baroka held that the IBC being a special statute and having a non-obstante clause under section 238 of the IBC shall prevail over the TRAI Act therefore any penalty imposed by the TRAI on the corporate debtor would be recovered as per the scheme of the IBC. No special treatment can be given to the TRAI over other creditors of the corporate debtor.
Case Title: SUDIP DUTTA @ SUDIP BIJOY DUTTA v. PRASHANT JAIN
Case Reference: Company Appeal (AT) (Insolvency) No. 1494 of 2024 & I.A. No. 5389 of 2024
The NCLAT New Delhi Bench of Justices Ashok Bhushan (Chairperson), Barun Mitra (Technical Member) and Arun Baroka (Technical Member) held that the creditors are entitled to file a Bankrupcty Application under section 121 of the IBC if no repayment plan as per section 106 of the IBC is submitted or if submitted but rejected by the Adjudicating Authority under section 115 of the IBC.
Resolution Professional Has Authority To Determine Creditor's Related Party Status: NCLAT
Case Title: Hari Vitthal Mission vs. Ravi Sethia & Ors.
Case Number: Company Appeal (Ins) No. 1206 of 2022 & I.A. No. 3657, 3658, 3659 of 2022 & 4766 of 2023
The NCLAT bench of Justice Rakesh Kumar Jain (Judicial Member), Mr. Naresh Salecha (Technical Member) and Mr. Indevar Pandey (Technical Member) has held that the Resolution Professional (RP) has the authority to determine the related party status of a creditor. The Tribunal also held that In all cases where the Corporate Debtor is controlled by a trust, the trust would fall under the category of a related party in section 5(24)(h) and (j) of the Insolvency and Bankruptcy Code, 2016 (IBC).
Petition U/S 7 Of IBC Is Maintainable For Default Which Occurred Post Consent Decree: NCLAT
Case Title: JUBIN KISHORE THAKKAR V. PHOENIX ARC PRIVATE LIMITED
Case Reference: Company Appeal (AT) (Insolvency) No. 1931 of 2024
The NCLAT New Delhi bench of Justices Ashok Bhushan (Chairperson), Barun Mitra (Technical Member) and Arun Baroka (Technical Member) affirmed that a final judgment and/or decree of any Court or Tribunal or any Arbitral Award for payment of money, if not satisfied, would fall within the ambit of a financial debt for which the creditor is entitled to initiate proceedings under Section 7 of the IBC. In this case, the consent decree was passed in which the corporate debtor was directed to pay the debts but the corporate debtor defaulted.
Case Title: Dhiren Shantilal Shah RP of High Ground Enterprise Ltd. v. Swastik Productions Pvt. Ltd
Case Reference: Company Appeal (AT) (Insolvency) No. 360 of 2024 & Interlocutory Application Nos.1223 of 2024
The NCLAT New Delhi bench of Justice Ashok Bhushan (Chairperson), Barun Mitra (Technical Member) and Arun Baroka (Technical Member) affirmed that the condonation of delay in filing of the Appeal is on facts of each case, no inflexible rule can be laid down while exercising jurisdiction to condone the delay. In Appeals filed under section 61 the IBC, the jurisdiction of the Tribunal to condone the delay in filing of the Appeal after expiry of the limitation period, is only 15 days, which jurisdiction can be exercised.
Case Title: Sandeep Behl v. Nirmal Trading Company and Ors.
Case Reference: Company Appeal (AT) (Insolvency) No. 36 of 2024
The NCLAT New Delhi bench of Justice Ashok Bhushan (Chairperson), Barun Mitra (Technical Member) affirmed that in Section 9 proceeding, there is no need to enter into final adjudication with regard to existence of dispute between the parties regarding operational debt. If the existence of a dispute prior to filing of an insolvency petition is established and the defence raised is not moonshine, spurious, hypothetical or illusory. For such disputed operational debt, Section 9 proceeding under IBC cannot be initiated at the behest of the Operational Creditor.
Case Title: COROB INDIA PVT. LTD. v. MR. BIRENDRA KUMAR AGRAWAL and Anr.
Case Reference: Company Appeal (AT) (Insolvency) No. 749 of 2024
The NCLAT New Delhi bench of Justice Ashok Bhushan (Chairperson), Barun Mitra (Technical Member) held that security deposit given, while entering into a lease agreement cannot be classified as financial debt under section 5(8) of the IBC when it had been advanced with a condition that it would be returned without any interest once the possession of the leased premise is handed over.
Case Title: Alok Tripathi, Suspended Director v. Mohit K Gupta, Liquidator
Case Reference: Company Appeal (AT) (Insolvency) No. 1817 of 2024
The NCLAT New Delhi bench of Justices Ashok Bhushan (Chairperson), Barun Mitra (Technical Member) and Arun Baroka (Technical Member) held that when the Liquidator has got a Transaction Audit Report done and on the basis of which has come to a conclusion that this is a preferential transaction, it cannot be said that he has not formed an independent opinion before filing an application for avoidance of preferential transactions under section 43 of the IBC.
Case Title: Mr. Vinay Rai (Personal Guarantor) v. Technology Development Board and Ors.
Case Reference: Company Appeal (AT) (Insolvency) No. 1891 of 2024
The NCLAT New Delhi bench of Justices Ashok Bhushan (Chairperson), Barun Mitra (Technical Member) and Arun Baroka (Technical Member) held that financial creditors are entitled to file an application seeking replacement of the Resolution Professional under section 98 of the IBC if they are of the opinion that the RP would not work in an independent manner or has association with other parties to the litigation. The fact that personal guarantor has a vested right to initiate insolvency resolution process under section 94 of the IBC does not preclude the financial creditor from filing the application under section 98 seeking replacement of the RP.
Adjudicating Authority Cannot Enter Into Merits At S. 95 Application Stage Before Report Of RP Is Submitted U/S 99 Of IBC: NCLAT
Case Title:Central Bank of India Versus Deepen Arun Parekh
Case Reference: Company Appeal (AT) (Insolvency) No. 697 of 2024
The NCLAT New Delhi bench of Justice Ashok Bhushan (Chairperson), Barun Mitra (Technical Member) and Arun Baroka (Technical Member) affirmed that Adjudicating Authority cannot exercise its adjudicatory power at the stage of consideration of application under section 95 of the IBC by entering into the merits of the case. The power which is conferred on the adjudicating authority at this stage is to appoint a resolution professional. The Adjudicatory role comes into play when a report is submitted by the Resolution Professional under section 99 recommending either to admit or reject the application.
Directors Of Financial Creditors Not Disqualified From Filing Plea U/S 7 Of IBC Due To Sister Company's Default U/S 248 Of Companies Act: NCLAT
Case Title: CADILLAC INFOTECH PVT. LTD.Versus JKM INFRASTRUCTURE PVT. LTD and Ors.
Case Reference: Company Appeal (AT) (Insolvency) No. 1610 of 2024 & I.A. No. 5879 of 2024
The NCLAT New Delhi bench of Justice Ashok Bhushan (Chairperson) and Barun Mitra (Technical Member) held that directors of the financial creditors are not disqualified from filing a petition under section 7 of the IBC merely on the ground that sister company of the financial creditors in which they were holding the same position, defaulted under section 248 of the Companies Act in failing to continue its business for continuous period of 2 years. The default under section 164(2) of the Companies Act has to be proved to disqualify them from acting as the directors in other companies than which is in default.
Any Amount Proposed In Settlement Plan U/S 12A Of IBC Cannot Be Refunded If Plan Is Approved: NCLAT
Case Title: Globomet Engineering Private Limited Versus Shri Tejas J Parikh and Ors.
Case Reference: Company Appeal (AT) (Insolvency) No. 1080 of 2022
The NCLAT New Delhi bench of Justice Ashok Bhushan (Chairperson), Barun Mitra (Technical Member) and Arun Baroka (Technical Member) held that any amount proposed in the settlement plan under section 12A of the IBC cannot be refunded if the plan is later approved and the CIRP is closed. In this case, a settlement plan was proposed by the appellant in which 3 crores rupees was proposed to be given to the financial creditors. This plan was later approved.
Corporate Debtor's Property Cannot Be Recovered By Owner/Lessor During Moratorium Period U/S 14 Of IBC: NCLAT
Case Title: Chandrakant Khemka Versus Santanu Bhattacharjee and Ors.
Case Reference: Company Appeal (AT) (Ins.) No. 1064 of 2023
The NCLAT New Delhi bench of Justice Rakesh Kumar Jain (Judicial Member), Mr. Naresh Salecha (Technical Member) and Mr. Indevar Pandey (Technical Member) affirmed that properties occupied by the corporate debtor cannot be recovered by owner/lessor during the moratorium period under section 14 of the IBC. In this case, the NCLT had handed over the possession of the property of the CD to the respondents on the submission of RP that the property was no longer required. This submission of the RP was not backed by the decision of the CoC.
In Absence Of Pre-Existing Dispute, Petition U/S 9 Of IBC Must Be Admitted If Debt And Default Are Proved: NCLAT
Case Title: SURENDRA SANCHETI Versus GOSPELL DIGITAL TECHNOLOGIES CO. LIMITED and Ors.
Case Reference: Company Appeal (AT) (Insolvency) No. 583 of 2024
The NCLAT New Delhi bench of Justice Ashok Bhushan (Chairperson) and Barun Mitra (Technical Member) affirmed that once it is established that the corporate debtor has defaulted in the payment of operational debt which amount had clearly become due and payable above the threshold limit, and further if there is no credible or plausible evidence to show the existence of pre-existing dispute, application under section 9 must be admitted by the Adjudicating Authority.
Sale Of Corporate Debtor As Going Concern Under Liquidation Regulations Takes Precedence Over Scheme Of Compromise U/S 230: NCLAT
Case Title: Narottamka Trade & Vyapaar Pvt. Ltd., V SPP Insolvency Professionals LLP and Anr.
Case Reference: Company Appeal (AT) (CH) (Ins) No.305/2024 and (IA No.817/2024)
The NCLAT Chennai bench of Justice Sharad Kumar Sharma (Judicial Member) and Jatindranath Swain (Technical Member) affirmed that the sale of the Corporate Debtor as a going concern under Regulations 32(e) & 32A of the Liquidation Regulations is more transparent and effective; therefore, the sale of the Corporate Debtor as a going concern will have precedence, rather than resorting to the Scheme of Compromise under Section 230 (1) of the Companies Act, 2013.
NCLAT Orders Refund Of Pre-CIRP Electricity Dues Paid By SRA Under Protest For Restoration Of Electricity Connection
Case Title: Twentyone Sugars Limited vs. Maharashtra State Electricity Distribution Co. Ltd.
Case Number: COMPANY APPEAL (AT) (INS) NO.487/2023
The NCLAT bench comprising Justice Yogesh Khanna (Judicial Member) and Mr. Ajai Das Mehrotra (Technical Member) has allowed the refund of pre-Corporate Insolvency Resolution Process (CIRP) electricity dues paid by the Successful Resolution Applicant (SRA). Maharashtra State Electricity Distribution Co. (Respondent) had imposed the clearance of past dues as a precondition for restoring electricity connection. The Tribunal held that even if the payment was not made by the SRA/Appellant under protest, the Respondent was barred from recovering arrears that were extinguished by operation of law.
CoC Can Direct Liquidation Of Corporate Debtor Any Time Before Confirmation Of Resolution Plan U/S 33(2) Of IBC: NCLAT
Case Title: Sunil Surrendrakumar Kakkad Shareholder & Suspended Director of Sujyot Infrastructure Pvt. Ltd. Versus Sujyot Infrastructure Pvt. Ltd. and Anr.
Case Reference: Company Appeal (AT) (Insolvency) No. 1423 of 2024
The NCLAT New Delhi bench of Justice Ashok Bhushan (Chairperson), Barun Mitra (Technical Member) and Arun Baroka (Technical Member) has held that the CoC in its commercial wisdom can decide to liquidate the corporate debtor anytime after its constitution but before the confirmation of the Resolution Plan under section 33(2) of IBC. It is not mandatory that all steps related to revival of the corporate debtor through resolution plan must be exhausted before the liquidation can be directed.
Section 19(2) Application Can Be Preferred For Effective Conduct Of CIRP Despite Challenge To Admission Of CIRP: NCLAT
Case Title: M/s. Vilmar Agro Polymers Pvt. Ltd vs. SPC FAB Private Limited Saraswathi Nilayam & Anr.
Case Number: Company Appeal (AT) (CH) (Ins) No. 55/2024
The NCLAT, Chennai bench comprising Justice Sharad Kumar Sharma (Judicial Member) and Jatindranath Swain (Technical Member) has held that an application under section 19(2) of the Insolvency & Bankruptcy Code is maintainable when the Corporate Insolvency Resolution Process (CIRP) is admitted. The Tribunal observed that section 60(5) will not have a superseding effect to the provisions contained under section 19(2) read with section 14 for the purpose of effective conduct of CIRP proceedings
Case Title: Mr. Bhagawant Narayan Naik, Versus Ritesh R. Mahajan and Ors.
Case Reference:Company Appeal (AT) (CH) (Ins.) No. 394/2024 (IA Nos. 1072 & 1074/2024 & 1073/2024)
The NCLAT Chennai bench of Justice Sharad Kumar Sharma (Judicial Member) and Jatindranath Swain (Technical Member) has held that property that is sold which was in possession of the corporate debtor immediately before the judgment in a petition under section 7 of the IBC was reserved cannot be excluded from the purview of the assets of the corporate debtor.
NCLT Is Not Right Forum To Decide Whether Closure Of Factory Under Industrial Dispute Act Was As Per Law: NCLAT
Case Title: Rakesh J Shah & Ors. Vs. Sanjay Kumar Agarwal & Ors.
Case Reference:Company Appeal (AT) (Insolvency) No. 1490 of 2024
The NCLAT New Delhi bench of Justice Ashok Bhushan (Chairperson), Barun Mitra (Technical Member) and Arun Baroka (Technical Member) has held that the Adjudicating Authority is not the right forum to decide whether closure of the factory was in accordance with law. Such an issue should have been raised before the relevant authority under the Industrial Disputes Act and not before the Adjudicating Authority.
Revisiting Resolution Plan After Commencement Of Liquidation Process Is Against Principle Of Procedural Finality: NCLAT Chennai
Case Title: Mapletree Leather Goods Private Limited v. Savan Godiawala, C/o Deloitte Touche Tohmatsu India LLP
Case Number: Company Appeal (AT)(CH)(Ins) No.314/2020 (IA No.436/2021)
The National Company Law Appellate Chennai comprising of Justice Sharad Kumar Sharma, (Member Judicial) and Jatindranath Swain (Member Technical) dismissed two appeals filed by the Corporate Debtor seeking to challenge the order of NCLT, Bangalore by which it was directed to be put into the liquidation process and second to challenge the order of the same tribunal which dismissed the prayer of the Appellant for issue of an appropriate direction to the liquidator to put on hold the auction of the mmovable asset of the Corporate Debtor.
Performance Pay Does Not Qualify As Operational Debt For Which Proceedings U/S 9 Of IBC Cannot Be Initiated: NCLAT
Case Title: M Ramakanth v. M/s. Nagarjuna Fertiliser and Chemicals Limited
Case Reference:Company Appeal (AT) (CH) (Ins) No.213/2024
The NCLAT Chennai bench of Justice Sharad Kumar Sharma (Judicial Member) and Jatindranath Swain (Technical Member) has held that a variable claim like performance pay which is not certain and has to be determined based on the performance of the employee will not be an operational debt as it is not the payment due therefore proceedings under section 9 of the IBC cannot be initiated for such a claim.
Application U/S 95 Cannot Be Rejected On Grounds Of Pendency Of One Time Settlement Proposal: NCLAT
Case Title: Mohit Dewan v. Bank of Maharashtra and Anr.
Case Reference:Comp. App. (AT) (Ins) No. 2176 of 2024 & I.A. No. 8129 of 2024
The NCLAT New Delhi bench of Mr. Justice Ashok Bhushan (Chairperson), Mr. Barun Mitra (Technical Member) and Mr. Arun Baroka (Technical Member) has held that pendency of One Time Settlement Proposal (OTS) which is yet to be accepted, cannot be a ground to refuse initiation of insolvency process against the personal guarantors.
No Part Of Resolution Plan Can Be Given On Application Of Operational Creditor Till Plan Is Approved By Adjudicating Authority: NCLAT
Case Title: Pakhi Infra and Ors. v. Jabalpur MSW Pvt. Ltd.
Case Reference:Comp. App. (AT) (Ins) No. 2175 of 2024
The NCLAT New Delhi bench of Mr. Justice Ashok Bhushan (Chairperson), Mr. Barun Mitra (Technical Member) and Mr. Arun Baroka (Technical Member) has held that no part of the Resolution Plan can be given to the operational creditor till the Resolution Plan pending for approval before the Adjudicating Authority is approved. However, any objections to the approval of the plan can be raised before the Adjudicating Authority.
Sale Certificate Issued In Favor Of Successful Bidder Can Be Cancelled If Bid Amount Is Not Paid Within 90 Days: NCLAT
Case Title: S P Construction v. Narendra Kumar Sharma
Case Reference:Company Appeal (AT) (Insolvency) No. 858 of 2024
The NCLAT New Delhi bench of Mr. Justice Ashok Bhushan (Chairperson), Mr. Barun Mitra (Technical Member) and Mr. Arun Baroka (Technical Member) has held that as per Liquidation Regulations, the bid amount has to be paid within 90 days. If the amount is not paid, sale certificate issued in favor of the Successful Bidder can be cancelled and the security amount be forfeited.
Information Memorandum Based On Which Resolution Plan Is Submitted And Approved By CoC Cannot Be Modified: NCLAT
Case Title: Mrs. Supriya Singh Versus M/s Ansal Urban Condominiums Pvt. Ltd. and Ors.
Case Reference:Company Appeal (AT) (Insolvency) No. 1974 of 2024
The NCLAT New Delhi bench of Mr. Justice Ashok Bhushan (Chairperson), Mr. Barun Mitra (Technical Member) and Mr. Arun Baroka (Technical Member) has held that Information Memorandum prepared by the Resolution Professional based on which the Resolution Plan was submitted and later approved by the CoC, cannot be modified.In this case, the allotment units to homebuyers were cancelled by the erstwhile management of the Corporate Debtor and this information was also included in the Information Memorandum based on which the plan was submitted and approved.
Share Application Money Deposited With Corporate Debtor Cannot Be Treated As Financial Debt U/S 5(8) Of IBC: NCLAT
Case Title:M/s. MURLIDHAR VINCOM PVT. LTD. Versus M/s. SKODA (INDIA) PVT. LTD
Case Reference:Company Appeal (AT) (Insolvency) No. 1334 of 2024
The NCLAT New Delhi bench of Mr. Justice Ashok Bhushan (Chairperson), Mr. Barun Mitra (Technical Member) and Mr. Arun Baroka (Technical Member) has held that share application money deposited with the corporate debtor cannot be treated as financial debt under section 5(8) of the IBC. In this case, share application money was given for the allotment of shares but neither were shares allotted nor was money refunded.
Petition U/S 9 Of IBC Cannot Be Rejected On Grounds Of Raising Spurious Claim Of Pre-Existing Dispute: NCLAT
Case Title: Romi Datta Versus Sigma Supply Chain Solutions Pvt. Ltd and Anr.
Case Reference:Company Appeal (AT) (Insolvency) No. 1652 of 2023
The NCLAT New Delhi bench of Mr. Justice Ashok Bhushan (Chairperson) and Mr. Barun Mitra (Technical Member) has held that making belated entries in the books of account to show that goods were misappropriated cannot escape the conclusion that the dispute raised by the corporate debtor was merely a moonshine just to avoid the liability.
Impleadment Of Party After Closure Of Initial CIRP Plea Against Corporate Debtor: NCLAT Chennai Protects Operational Creditor's Claims
Case Title: Sathya Moorthy Sai Prasad vs Shapoorji Pallonji and Company Pvt. Ltd. & Anr.
Case No.: Company Appeal (AT) (CH) (Ins) No.134/2023 (IA Nos. 449/2023, 446/2023, 447/2023, 448/2023, 450/2023, 889/2023, 161/2024, 999/2024 & 1134/2024)
The National Company Law Appellate Tribunal (NCLAT), Chennai bench of Justice Sharad Kumar Sharma (Judicial Member) and Mr Jatindranath Swain (Technical Member) allowed the impleadment application filed by an Operational Creditor, on the ground that its application to initiate CIRP proceedings against the Corporate Debtor were closed due to initiation of CIRP by another creditor. The NCLAT exercised its discretionary power under Order 1 Rule 10 (2) of the CPC to allow the application.
Guarantor Cannot Become Financial Creditor Without Making Any Payment In Discharge Of Guarantee: NCLAT
Case Title: Mr. Suresh Kumar and Anr. Versus Central Bank of India
Case Reference: Company Appeal (AT) (Insolvency) No. 1592 of 2024
The NCLAT New Delhi bench of Mr. Justice Ashok Bhushan (Chairperson), Mr. Barun Mitra (Technical Member) and Mr. Arun Baroka (Technical Member) has held that guarantor cannot become a financial creditor without paying any amount towards discharging the liability of the principal borrower for whom the guarantee was given.
Once Plausibility Of Pre-Existing Dispute Is Established, Application U/S 9 Of IBC Must Be Rejected: NCLAT
Case Title: M/s. Kashyap lnfraprojects Pvt. Ltd. Versus M/s. Hi-Tech Sweet Water Technologies Pvt. Ltd.
Case Reference: Company Appeal (AT) (Insolvency) No. 33 of 2023
The NCLAT New Delhi bench of Justice Rakesh Kumar Jain (Judicial Member), Barun Mitra (Technical Member) and Indevar Pandey (Technical Member) has held that IBC bestows only summary jurisdiction upon the Adjudicating Authority. Once plausibility of a pre-existing dispute is noticed, it is not required of the Adjudicating Authority to make further detailed investigation. It is well settled that in a Section 9 proceeding, the Adjudicating Authority is not to enter into final adjudication with regarding the operational debt.
Application U/S 7 Of IBC Cannot Be Admitted In Absence Of Debt And Default: NCLAT New Delhi
Case Title: Mr. Atul Nathalal Patel Versus Mr. Manish Pardasani and Ors.
Case Reference:Company Appeal (AT) (Insolvency) No. 1008 of 2023
The NCLAT New Delhi bench of Justice Ashok Bhushan (Judicial Member) and Mr. Barun Mitra (Technical Member) has held that application under section 7 of the IBC cannot be admitted in absence of any debt and consequent default on the part of the corporate debtor. In this case, the corporate debtor had discharged the liability arising under the agreement despite this an application under section 7 was admitted.
Fraudulent Initiation Of CIRP Can Be Set Aside By NCLAT While Hearing Appeal U/S 61: NCLAT New Delhi
Case Title: Apnaghar Builders Pvt. Ltd. Versus Intense Fitness & Spa Pvt. Ltd. & Ors.
Case Number: Comp. App. (AT) (Ins.) No. 1025 of 2022 & I.A. No. 2964, 2965, 2966 of 2022
The NCLAT New Delhi bench of Justice Rakesh Kumar Jain (Judicial Member),Mr. Naresh Salecha (Technical Member) and Mr. Indevar Pandey (Technical Member) has held that fraudulent initiation of the CIRP can be set aside by the NCLT or as a corollary by NCLAT also as they have jurisdiction to decide whether any proceeding under the code has been initiated fraudulently or not. In this case, the financial creditor in connivance with the corporate debtor and ex management of the corporate debtor had initiated the CIRP under section 7 of the code.
Written Agreement Not Mandatory To Prove Financial Debt If It Can Be Proved From Other Materials On Record: NCLAT
Case Title: Ravi Auto Ltd. Vs. Surana Mercantiles Pvt. Ltd.
Case Number: Company Appeal (AT) (Insolvency) No. 1059 of 2022 & I.A. No. 3090 of 2022
The NCLAT New Delhi bench of Mr. Justice Ashok Bhushan (Judicial Member) and Mr. Arun Baroka (Technical Member) has affirmed that it is not necessary for financial debt to be proved by a written agreement if it can be established from other materials on record then application under section 7 can be admitted.In this case, the section 7 application of the financial creditor was rejected on the ground that there was not written agreement to prove the existence of financial debt.
Liquidator Can Recover Amount Which Belongs To Corporate Debtor By Filing Application U/S 60(5)(c) Of IBC: NCLAT
Case Title: Arkay Logistics Limited Versus Mr. Abhijit Guhathakurta
Case Number: Company Appeal (AT) (Insolvency) No.836 of 2024 & I.A. No.3021 of 2024
The NCLAT New Delhi bench of Mr. Justice Ashok Bhushan (Chairperson), Mr. Barun Mitra (Technical Member) and Mr. Arun Baroka (Technical Member) has held that liquidator can recover the amount of the corporate debtor by filing an application under section 60(5)(c) of the code before the NCLT as it is a matter which arises solely from or which relates to the insolvency of the Corporate Debtor.
If Interest On Principal Amount Crosses Threshold Limit, Application U/S 7 Of IBC Can Be Admitted: NCLAT
Case Title: Mrs. Rita Kedia Versus Ashika Global Securities Private Limited and Ors.
Case Number: Company Appeal (AT) (Insolvency) No. 1536 of 2023
The NCLAT Delhi bench of Justice Yogesh Khanna (Judicial Member) and Mr. Ajai Das Mehrotra (Technical Member) has affirmed that if interest on the principle amount disbursed to the corporate debtor crosses the threshold limit as provided under section 4 of the IBC, application under section 7 of the code can be admitted as interest is considered to be a disbursal against time value of money under section 5(8) of the code. In this case, although the principal amount was not claimed but the interest claimed crossed the threshold limit.
Case Title: M/s Vedic Projects Pvt. Ltd. Versus Shri Sutanu Sinha
Case Reference: Company Appeal (AT) (Insolvency) No.1927 of 2024
The NCLAT New Delhi bench of Justice Ashok Bhushan (Chairperson) and Barun Mitra (Technical Member) held that no interest on principal amount can be claimed if there is no clause to this effect in the agreement executed between the parties. In this case, operational creditor while claiming its operational due also demanded payment of interest since it was an MSME and as per section 16 of the MSME Act, it was entitled to claim interest on the delayed payment. However, the RP rejected this demand and admitted only the principal amount.
Development Rights Constitute Property U/S 3(27) Of IBC, Can Be Included In Information Memorandum By RP U/S 29 Of Code: NCLAT
Case Title: K.H. Khan & Anr. Vs. Art Constructions Pvt. Ltd. & Ors.
Case Reference: Company Appeal (AT) (Insolvency) No. 1116 of 2024 and Company Appeal (AT) (Insolvency) No. 1117 of 2024
The NCLAT New Delhi bench of Justice Ashok Bhushan (Chairperson) and Barun Mitra (Technical Member) affirmed that development rights are property within the meaning of section 3(27) of the IBC which can be included in the Information Memorandum by Resolution Professional under section 29 of the IBC. The Tribunal further observed that the Adjudicating Authority has jurisdiction to enter into as to whether property included in the IM is asset of the corporate debtor under section 60 of the IBC and for decision of the question, the parties are not required to be relegated to the Competent Civil Court having jurisdiction
If Genuine Pre-Existing Dispute With Regard To Operational Debt Is Established, Petition U/S 9 Of IBC Must Be Rejected: NCLAT
Case Title: LAW & KENNETH SAATCHI & SAATCHI PRIVATE LIMITED Versus PATANJALI PARIDHAN PRIVATE LIMITED
Case Reference: Company Appeal (AT) (Insolvency) No. 1033 of 2023
The NCLAT New Delhi bench of Justice Yogesh Khanna (Judicial Member) and Mr. Ajai Das Mehrotra (Technical Member) affirmed that a petition under section 9 of the IBC can be rejected if the dispute raised by the corporate debtor with respect to the debt is genuine and not a moonshine or a bluster just to avoid the liability.
NCLAT Judge Records In Order His Brother's Message For Favour, Recuses From Matter
Case : Mr. Babu Manoharan Jaikumar Christhurajan V Mr. Umesh Garg & 2 Ors |Company Appeal (AT) (CH) (Ins) No.358/2022
A judicial member of the National Company Law Appellate Tribunal has recused from hearing a matter after his brother messaged him requesting favourable orders in the case.
Interestingly, in the recusal order, the judge extracted the entire message verbatim.
The extraordinary event took place before the bench presided by Justice Sharad Kumar Sharma at the NCLAT Chennai Bench. Justice Sharma stated in the order that he was "approached" by his real brother.
CoC Has Authority To Modify Resolution Plan To Comply With Directions Of Supreme Court: NCLAT
Case Title: Meenakshi and Kushal Goyal Versus Amit Agarwal and Ors.
Case Reference: Company Appeal (AT) (Insolvency) No. 1022 of 2024
The NCLAT has affirmed that the CoC is empowered to modify the resolution plan in order to comply with the directions issued by the Supreme Court. In this case,while resolution plan was pending before the Adjudicating Authority, the Supreme Court passed its decision in State Tax Officer in which it was held that the debts owed to a secured creditor, which would include the State under the GVAT Act, are to rank equally with other specified debts including debts on account of workman's dues for a period of 24 months preceding the liquidation commencement date.
Since Shareholders Of Corporate Debtor Do Not Fall Within Definition Of “Aggrieved Party”, Appeal Filed U/S 61 Of IBC Not Maintainable: NCLAT
Case Title: Clarion Health Food LLP Versus Goli Vada Pav Pvt. Ltd. and Anr.
Case Reference: Company Appeal (AT) (Ins.) No. 1522 of 2023
The NCLAT New Delhi bench of Justice Rakesh Kumar Jain (Judicial Member),Mr. Naresh Salecha (Technical Member) and Mr. Indevar Pandey (Technical Member) affirmed that a shareholder of the company is not the “aggrieved party” as per the provisions of the Code therefore appeal filed by him under section 61 of the Code would not be maintainable.
The 'Appellants' even as “shareholders” cannot be aggrieved merely by the admission of the 'Corporate Debtor' into 'Corporate Insolvency Resolution Process'. Such objection may render the object of I & B Code, 2016 illusory since any shareholder of any 'Corporate Debtor' against which Insolvency proceedings have been initiated can then seek to maintain a derivative action and sabotage a valid 'Corporate Insolvency Resolution Process' initiated by the Adjudicating Authority, the tribunal noted.
Allotment Of Commercial Space By Corporate Debtor Through Unregistered Allotment Letter Remains Their Asset, Can't Be Excluded From Resolution Plan: NCLAT
Case Title: Praveen Arya & Ors. Versus Anju Aggarwal (RP of Corporate Debtor ) & Anr
Case Reference: Company Appeal (AT) (Insolvency) No. 40 of 2024 With Company Appeal (AT) (Insolvency) No.45 of 2024 & Interlocutory Application No.140 of 2024
The NCLAT New Delhi bench of Justice Ashok Bhushan (Chairperson) and Barun Mitra (Technical Member) has held that allotment of commercial spaces by the corporate debtor through unregistered documents like allotment letter, lease deed etc.cannot divest the CD of their ownership. They would continue to remain the assets of the CD therefore they cannot be excluded from the Resolution Plan.
Filing Petition U/S 10 Of IBC Subsequent To Action Taken Under SARFAESI Act Cannot Be Termed Malicious Or Fraudulent: NCLAT
Case Title: Getz Cables Private Limited Versus State Bank of India and Anr.
Case Reference: Company Appeal (AT) (Insolvency) No.1953 of 2024
The NCLAT New Delhi bench of Justice Ashok Bhushan (Chairperson) and Arun Baroka (Technical Member) has held that merely because proceeding under Section 13, sub-section (2) and (4) of the SARFAESI Act has been initiated by the creditor prior to filing of Section 10 application, cannot be a ground to hold that Section 10 application is filed with malicious and fraudulent intent to be rejected under section 65 of the IBC.
Official Liquidator Cannot Institute S. 61 Proceedings To Challenge Directions Issued To IBBI: NCLAT Chennai
Case Title: CA Ramasamy Shanmuggam, Liquidator of RLS Alloys Pvt. Ltd. Vs Insolvency and Bankruptcy Board of India
Case Number: Company Appeal (AT) (CH) (Ins) No.413/2022
The National Company Law Appellate Chennai comprising of Justice Sharad Kumar Sharma (Member Judicial) and Jatindranath Swain (Member Technical) dismissed an appeal filed by the Liquidator of the Corporate Debtor M/s RLS Alloys Pvt. Ltd stating that the appeal is a pre-mature appeal and that the Liquidator cannot institute a Section 61 proceedings to challenge the directions given to the IBBI.
Case Title: Prabhat Jain, Liquidator of Narmada Cereal Pvt. Ltd. vs MP Industrial Development Corporation Limited and Ors.
Case No.: Comp. App. (AT) (Ins.) No. 697 of 2023 & I.A. No. 2322 of 2023
The National Company Law Appellate Tribunal, New Delhi bench of Justice Rakesh Kumar Jain (Judicial Member), Naresh Salecha (Technical Member) and Mr Indevar Pandey (Member) held a liquidator cannot not create sub-leases over public land without adhering to the statutory requirements. It was further held that Section 238 of the Insolvency and Bankruptcy Code, 2016 cannot override a public body's statutory authority to regulate its properties.
Case Title: Decor Paper Mills Ltd. Versus Mahashakti Plasto Pvt. Ltd.
Case Number: Company Appeal (AT) (Insolvency) No. 2022 of 2024 & I.A. No. 7591 of 2024
The NCLAT New Delhi bench of Justice Ashok Bhushan (Judicial Member), Mr. Barun Mitra (Technical Member) and Arun Baroka (Technical Member) has affirmed that application under section 9 of the code cannot be admitted for the invoices covered by prohibited period under section 10A of the code.
Pre-CIRP Dues Cannot Be Recovered After Admission Of Corporate Debtor Into Insolvency: NCLAT
Case Title: Central Transmission Utility of India Ltd. Versus Mr. Summit Binani and Anr.
Case Number: TA (AT) NO. 174/2021 (Company Appeal (AT) (Ins.) No. 1011/2020)
The NCLAT Chennai bench of Justice Rakesh Kumar Jain (Judicial Member) and Mr. Ajai Das Mehrotra (Technical Member) has held that pre-CIRP dues cannot be recovered once the corporate debtor is admitted into insolvency due to moratorium under section 14 of the code. Any amount due to the corporate debtor can be recovered by filing claims before the IRP/RP as the case may be.
Case Title: Fintech Restructuring LLP M/s Fairdeal Multifilament Private Limited and Ors.
Case Number: Company Appeal (AT) (Insolvency) No. 1823 of 2024
The NCLAT New Delhi bench of Justice Ashok Bhushan (Judicial Member) and Barun Mitra (Technical Member) has held that adverse remarks cannot be passed by the Adjudicating Authority against the RP for performing his duties in accordance with the commercial wisdom of the CoC. In this case, the Resolution Plans were revised multiple times for which the Adjudicating Authority found the RP responsible.
Case Title: Bikram Bhadur Vs. Union Bank of India & Anr.
Case Number: Company Appeal (AT) (Insolvency) No. 1289 of 2024
The NCLAT New Delhi bench of Justice Ashok Bhushan (Judicial Member) and Barun Mitra (Technical Member) has held that upon declaration of the loan account/ debt as NPA that date can be reckoned as the date of default to enable the Financial Creditor to initiate action under Section 7 of the Code.
Case Title: Yogeshkumar Jashwantilal Thakkar and Anr. Versus George Samuel, Resolution Professional of Jason Dekor Private Limited and Anr.
Case Number: Company Appeal (AT) (Insolvency) No. 1417 of 2024
The NCLAT New Delhi bench of Justice Ashok Bhushan (Judicial Member) and Barun Mitra (Technical Member) has held that approval of Resolution Plan by the Committee Of Creditors (CoC) cannot be interfered with unless it is violative of section 30(2) of the Code.
Section 43 Of IBC Cannot Be Attracted When No Transaction Was Made By Corporate Debtor: NCLAT
Case Title: Commercial Tax Department Versus Mr. Mangesh Vitthal Kekre and Anr.
Case Number: Company Appeal (AT) (Insolvency) No. 232 of 2024 & I.A. No. 737, 783 of 2024
The NCLAT New Delhi bench of Justice Ashok Bhushan (Judicial Member) and Barun Mitra (Technical Member) has held that section 43 of the code can be attracted only when the transaction in question is made by the corporate debtor and not when it is made by the third party in pursuance of a statutory demand.
Case Title: Indian Renewable Energy Development Agency Limited Versus Waaree Energies Limited and Anr.
Case Number: Company Appeal (AT) (Insolvency) No.1380 of 2024
The NCLAT New Delhi bench of Justice Ashok Bhushan (Judicial Member), Barun Mitra (Technical Member) and Arun Baroka (Technical Member) has held that raising money by issuance of convertible debentures with an option to be later converted into equity shares can be classified as a financial debt if a default is committed by the corporate debtor.
Case Title: Suraksha Asset Reconstruction Ltd. Vs. Varsha Bagri, Liquidator of Bharat NRE Coke Ltd.
Case Number: Company Appeal (AT) (Insolvency) No. 650 of 2024 & I.A. No. 2325 of 2024
The NCLAT New Delhi bench of Justice Ashok Bhushan (Judicial Member) and Barun Mitra (Technical Member) has held that if the secured creditor fails to pay the liquidation costs within 90 days after its intention to realise the security interest, the security interest shall stand relinquished under Regulation 21A(3) of the Liquidation Regulations, 2016.
Amount Seized By Income Tax Department And Adjusted Against Demand Prior To Initiation Of CIRP Is Not Asset Of CD: NCLAT
Case Title: Harish Chander Arora Liquidator of Rathi Super Steel Ltd. Versus The Principal Commissioner of Income Tax, Ghaziabad, & Anr.
Case Number: Comp. App. (AT) (Ins) No. 306 of 2024 & I.A. No. 898, 8327 of 2024
The NCLAT New Delhi bench of Justice Rakesh Kumar Jain (Judicial Member) and Mr. Naresh Salecha (Technical Member) Has held that an amount seized by the Income Department and adjusted against demand prior to initiation of the CIRP cannot be considered as assets of the corporate debtor.
Petition U/S 7 Of IBC Cannot Be Barred For Default Committed Prior To S.10A Period: NCLAT
Case Title: Mobile Constructions Private Limited Versus Apple Land Development Private Limited
Case Number: Company Appeal (AT) (Insolvency) No. 756 of 2024
The NCLAT New Delhi bench of Justice Ashok Bhushan (Judicial Member), Barun Mitra( Technical Member) and Arun Baroka (Technical Member) has held that when default has been committed by the Corporate Debtor prior to Section 10A period, any default committed during the Section 10A period cannot be held to bar the application which is filed on the basis of default prior to Section 10A and subsequent to Section 10A period.
Secured Creditor Is Liable To Pay Liquidator's Fees Under Rule 21A Of Liquidation Regulations If Option U/S 52 Of IBC Is Exercised: NCLAT
Case Title: Shikshak Sahakari Bank Ltd. Versus Mr. Jagdish Kumar Parulkar
Case Number: Company Appeal (AT) (Insolvency) No. 2023 of 2024 & I.A. No. 7595 of 2024
The NCLAT New Delhi bench of Justice Ashok Bhushan (Judicial Member), Barun Mitra( Technical Member) and Arun Baroka (Technical Member) has held that the fee of the liquidator has to be paid within 90 days from the liquidation commencement date as provided under Regulation 21A of the Liquidation Regulations if the secured creditor opts to realise its security interest under section 52 of the code.
Deposit In Pursuance Of One Time Settlement Proposal Remains Corporate Debtor's Asset If Settlement Fails: NCLAT
Case Title: Bank of India Rep. Versus Mr. Naren Sheth
Case Number: Company Appeal (AT) (Insolvency) No. 533 of 2021
The NCLAT New Delhi bench of Justice Yogesh Khanna (Judicial Member) and Mr. Ajai Das Mehrotra (Technical Member) has held that the amount deposited with the bank by the corporate debtor in pursuance of an One Time Proposal to show bonafides will remain assets of the corporate debtor and can be taken into custody by the RP under section 18 of the code when the said proposal is not materialised.
NCLT Can Allow Date Of Default To Be Amended In CIRP Proceedings: NCLAT
Case Title: Puneet P. Bhatia vs. ASERC (India) Ltd. & Ors.
Case Number: Company Appeal (AT) (Ins.) No. 139 of 2024
The National Company Law Appellate Tribunal (NCLAT) bench of Justice Rakesh Kumar Jain (Judicial Member), Mr. Naresh Salecha (Technical Member) and Mr. Indevar Pandey (Technical Member) has held that the NCLT is empowered to allow the parties to amend the pleadings before the final orders in Corporate Insolvency Resolution Process (CIRP) proceedings are passed. In other words, the Tribunal has discretion to amend the default date after the CIRP petition is filed.
Disbursement Of Non Fund-Based Facilities Cannot Be Refused By Lenders When Resolution Plan Contains Clause For Disbursement: NCLAT
Case Title: State Bank of India & Ors. Vs. Jyoti Structures Ltd. & Ors.
Case Number: Company Appeal (AT) (Insolvency) No. 1962 & 1963 of 2024 & I.A. No. 7303, 7304 of 2024
The NCLAT New Delhi bench of Justice Ashok Bhushan (Judicial Member), Barun Mitra (Technical Member) and Arun Baroka (Technical Member) has held that Non Fund Based facilities cannot be refused to be disbursed when the approved Resolution Plan contains a clause for their disbursement.
Pendency Of Proceedings Before NCLT For Approval Of Scheme Of Arrangement Does Not Preclude Financial Creditor From Filing Petition U/S 7: NCLAT
Case Title:Sunil Kumar Sharma Versus ICICI Bank Limited and Anr.
Case Number: Company Appeal (AT) (Insolvency) No. 1158 – 1162 of 2024 & IA Nos.4145-4159, 4941, 5550 & 5554 of 2024
The NCLAT New Delhi bench of Justice Ashok Bhushan (Judicial Member), Mr. Barun Mitra (Technical Member) and Mr. Arun Baroka (Technical Member) has held that the pendency of proceedings before the NCLT for approval of the scheme of arrangement does not preclude the Financial Creditor to proceed with Section 7 application. The tribunal also held that direction of RBI under Section 35AA of Banking Regulation Act, 1949 for initiation of insolvency cannot be disregarded/ ignored while determining application under Section 7 of IBC.
Copy Of Other Prospective Resolution Applicants' Plans Cannot Be Shared When Suspended Management Is Also A Resolution Applicant: NCLAT
Case Title: Yashdeep Sharma Suspended Director Versus Tara Chand Meenia, Resolution Professional and Ors.
Case Number:Company Appeal (AT) (Insolvency) No. 1906
The NCLAT New Delhi bench of Justice Ashok Bhushan (Judicial Member) and Mr. Barun Mitra (Technical Member) has held that copy of the Resolution Plans submitted by other Prospective Resolution Applicants cannot be shared in advance with the suspended management of the corporate debtor when the suspended management is also a Resolution Applicant.
CIRP Can't Be Extended Beyond 330 Days U/S. 12(3) Of IBC Absence Of “Exceptional Circumstances”: NCLAT
Case Title: Sibanarayan Chhotray vs. Indian Overseas Bank & Anr.
Case Number: Company Appeal (AT) (Insolvency) No. 887 of 2024 with Company Appeal (AT) (Insolvency) No. 2246 of 2024
The NCLAT bench of Justice Ashok Bhushan (Chairperson) and Arun Baroka (Technical Member) has observed that the maximum timeline prescribed under Section 12(3) of the Insolvency and Bankruptcy Code (IBC) is 330 days. While this period is directory (not mandatory), an extension beyond 330 days is permissible only in “exceptional circumstances”, where a short time is required to complete the CIRP. The Tribunal held that the period sought to be excluded was 252 days, which is huge, hence the request for exclusion is liable to be turned down as the Appellant failed to show requisite “exceptional circumstances”.
Non-Admission Of Claim By Resolution Professional Cannot Be Challenged First Time In Appeal Before Appellate Tribunal: NCLAT
Case Title: State Tax Officer Vs. Ricoh India Ltd. & Ors
Case Number: Company Appeal (AT) (Insolvency) No. 248 of 2020
The NCLAT New Delhi bench of Justice Ashok Bhushan (Judicial Member) and Mr. Arun Baroka (Technical Member) has held that non admission of claim in the Resolution Plan by the Resolution Plan if not challenged before the Adjudicating Authority cannot be challenged in the appeal before the NCLAT.
Date Of Default In Case Of Personal Guarantor Depends On Terms Of Contract Of Guarantee: NCLAT
Case Title: Mavjibhai Nagarbhai Patel Versus State Bank of India and Anr.
Case Number: Company Appeal (AT) (Insolvency) No. 1702 of 2024
The NCLAT New Delhi bench of Justice Ashok Bhushan (Judicial Member), Mr. Arun Baroka (Technical Member) and Barun Mitra (Technical Member) has held that the liability of a borrower and guarantor is co-extensive but the liability of a Guarantor stems from the contract of guarantee and therefore the date of default in the case of the guarantor depends on the terms of contract of guarantee.
Case Title: Union Bank of India (Erstwhile Corporation Bank) Vs. Mr. Dinkar T. Venkatasubramanian & Ors.
Case Number: Company Appeal (AT) (Insolvency) No. 729 of 2020
The NCLAT New Delhi bench of Justice Ashok Bhushan (Judicial Member) and Barun Mitra (Technical Member) has held that the Resolution Plan which is approved in commercial wisdom of the CoC binds all stakeholders including the dissenting financial creditor. The commercial wisdom of the CoC approving the Resolution Plan is binding on all.
Case Title: Harpal Singh Chawla (Suspended Director of Spaze Towers Pvt. Ltd.) Versus Vivek Khanna & Ors.
Case Number: Interlocutory Application No.7853 of 2024 in Company Appeal (AT) (Insolvency) No. 2002 of 2024
The NCLAT New Delhi bench of Mr. Justice Ashok Bhushan (Chairperson), Mr. Barun Mitra (Technical Member) and Mr. Arun Baroka (Technical Member) has held that when a unit holder is handed over possession and a Conveyance Deed has also been executed, no claim survives of such unit holders. Whether a claim filed by a Financial Creditor in a class, deserves admission, is a question, which need to be first looked into by the RP as per the statutory regulations governing the collation and verification of the claim.
Decree Holder Is “Financial Creditor” Under IBC, Limitation For Filing Section 7 Petition Is Extendable On Acknowledgment Of Debt: NCLAT
Case Title: Mr. Rakesh Kumar Jain vs. M/s ADTV Communications Private Limited
Case Number: Company Appeal (AT) (Insolvency) No. 849 of 2023 & I.A. No. 2894, 2895 of 2023
The National Company Law Appellate Tribunal (NCLAT) New Delhi bench comprising Justice Yogesh Khanna (Judicial member) and Arun Baroka (Technical member) has held that a decree holder falls within the definition of "Financial Creditor" under Section 5(7) and Section 5(8) of the Insolvency and Bankruptcy Code (IBC) if the decree is based on a financial debt. The Tribunal observed that the cause of action for initiating proceedings under Section 7 of the IBC arises when the debt is acknowledged by the debtor. The Tribunal noted that the Petition filed by the Appellant was within the limitation period as the Respondent had acknowledged the debt, extending the limitation period under Section 18 of the Limitation Act, 1963. It initiated the Corporate Insolvency Resolution Process (CIRP) against the Respondent.
Status Report Submitted In Criminal Proceeding Can Have No Bearing While Deciding Application U/S 7 Of IBC: NCLAT
Case Title: Dinesh Kumar Versus Narendra Kumar Sharma & Ors.
Case Number: Company Appeal (AT) (Insolvency) No. 1422 of 2024
The NCLAT New Delhi bench of Justice Ashok Bhushan (Judicial Member) and Mr. Arun Baroka (Technical Member) has held that Status Report submitted in a criminal proceeding regarding allegations of fraud and forgery can have no bearing while deciding Section 7 Application. The said Status Report is not an evidence on which it can be pronounced that threshold of 100 allottees was not complete in filing of Section 7 Application.
Application U/S 12A Of IBC Can Be Withdrawn By Resolution Professional Before It Is Heard Or Allowed: NCLAT
Case Title: Mehul Patel (Member of Suspended Board of Anupam Port Cranes Corporation Ltd.) Vs. Nandish S. Vin & Anr
Case Number: Company Appeal (AT) (Insolvency) No.2191 of 2024
The NCLAT New Delhi bench of Justice Ashok Bhushan (Judicial Member), Barun Mitra (Technical Member) and Arun Baroka (Technical Member) has held that CIRP withdrawal application can be withdrawn by Resolution Professional before the application is heard and allowed.
Case Title: Ghaziabad Development Authority vs. Competition Commission of India
Case Number: Competition Appeal (AT) No. 26 of 2018
Ghaziabad Development Authority (GDA) filed an appeal, challenging the Competition Commission of India's (CCI) order wherein the CCI found that GDA had abused its dominant position in the market for the provision of services related to the development and sale of low-cost residential flats for Economically Weaker Sections (EWS) under the Pratap Vihar Residential Housing Scheme. GDA was found to have unilaterally increased the prices of flats and imposed arbitrary and unfair terms on allottees, violating Section 4(2)(a)(i) of the Competition Act. The CCI imposed a penalty of 5% of GDA's average turnover for the last three years in connection with the relevant market.
Case Title: Varun Gupta vs. ISINOX Pvt. Ltd. Through the IRP Mr. Manishkumar R. Patel & Ors.
Case Number: Comp. App. (AT) (Ins) No. 430 of 2023 & I.A. No. 1429, 1430, 1431 of 2023 & 2005 of 2024
The NCLAT New Delhi bench of Justice Rakesh Kumar Jain (Judicial Member), Mr. Barun Mitra (Technical Member) and Mr. Indevar Pandey (Technical Member) has held that the application under Section 7 of the Insolvency and Bankruptcy Code, 2016, was not maintainable as the transaction in question constituted an 'operational debt' and was not covered under Section 5(8)(e) but was governed by Section 5(20) and Section 21(5) of the Code. The Tribunal allowed the appeal against the admission of petition under section 7 and relegated the Respondents to pursue their remedy under Section 9 of the Code.
Once CoC Approves Resolution Plan Then No Claim Is To Be Entertained: NCLAT
Case Title: Vadilal Industries Ltd. vs. Fanendra Munot & Ors.
Case Number: Company Appeal (AT) (Ins.) No. 748 of 2023
The NCLAT New Delhi bench of Justice Rakesh Kumar Jain (Judicial Member), Mr. Barun Mitra (Technical Member) and Mr. Indevar Pandey (Technical Member) have reiterated that once the Committee of Creditor (CoC) has approved the resolution plan, then no claim is to be entertained.
Case Title: Vidyadhar Sarfare & Anr Versus CS Anagha Anasingharaju & Ors.
Case Number: Company Appeal (AT) (Insolvency) No.1733 of 2024
The NCLAT New Delhi bench of Justice Ashok Bhushan (Judicial Member) and Barun Mitra (Technical Member) has held that CIRP cannot be withdrawn under section 12A read with Regulation 30A unless application for withdrawal is filed by the applicant who initiated the CIRP.
Non Impleadment Of Owner As Party By Liquidator In Application U/S 19 Of IBC Not Malafide If Ownership Was Uncertain: NCLAT
Case Title: Kavita Jagatramka Versus Mr. Sumit Binani
Case Number: Company Appeal (AT) (Insolvency) No. 1889 of 2024
The NCLAT New Delhi bench of Justice Ashok Bhushan (Judicial Member), Mr. Arun Baroka (Technical Member) and Barun Mitra (Technical Member) has held that non impleadment of the owner in application under section 19 of the code filed by the liquidator due to the uncertainty over the ownership of the premises cannot be termed malafide.
NBCC To Lead Completion Of Supertech's Stalled Projects, Securing Homebuyers' Rights
Case Title: Ram Kishor Arora, Suspended Director of Supertech Ltd. vs. Union Bank of India & Anr.
Case Number: Company Appeal (AT) (Insolvency) No. 406 of 2022 & Interlocutory Application No.6557 of 2024
In a landmark judgment, the National Company Law Appellate Tribunal (NCLAT) Delhi bench comprising Justice Ashok Bhushan (Chairperson) and Barun Mitra (Technical Member) has approved NBCC (India) Ltd.'s proposal to complete 16 incomplete projects of Supertech Limited. NBCC will act as the Project Management Consultant to ensure timely and quality completion of these projects. The judgment advocates for transparency and accountability in the real estate industry and protection of the rights of homebuyers, lenders, and public funds.
NCLT
NCLT Mumbai: Financial Creditor Can't Initiate CIRP Against Successful Resolution Applicant On Default Of Payment As Per Resolution Plan
Case Title: ICICI Prudential Asset Management Company Ltd. vs. Nandi Vardhan Infrastructure Ltd.
Case No.: CP(IB) 276 MB 2023
The National Company Law Tribunal ('NCLT'), Mumbai Bench, comprising Shri Kuldip Kumar Kareer (Judicial Member) and Shri Anil Raj Chellan (Technical Member), has held that the Financial Creditor cannot initiate a Corporate Insolvency Resolution Process ('CIRP') application against the Successful Resolution Applicant ('SRA') on default in payment to Stakeholders/Creditors as per terms of the approved Resolution Plan under IBC.
NCLT Delhi Approves Resolution Plan of Ramkrishna Forgings Ltd For ACIL Ltd.
Case Title: IDBI Bank Limited v M/s ACIL Limited
Case No.: CP IB-170/PB/2018
The National Company Law Tribunal (“NCLT”), New Delhi Bench, comprising of Shri Mahendra Khandelwal (Judicial Member) and Dr. Sanjeev Ranjan (Technical Member), has approved the Resolution Plan submitted by M/s Ramkrishna Forgings Limited for ACIL Ltd.
The Resolution Plan is valued at Rs. 129.5 Crores, while the total admitted claims of the Corporate Debtor amounts to Rs. 1,782 Crores.
Claim Arising Out Of Arbitral Award Against Which Section 34 Proceedings Are Pending, NCLT Kolkata Upholds RP's Decision To Admit Claim Contingently
Case Title: Bank of India v McNally Bharat Engineering Company Limited
Case No.: CP (IB) No. 891/KB/2020
The National Company Law Tribunal (“NCLT”), Kolkata Bench, comprising of Shri Rohit Kapoor (Judicial Member) and Shri Balraj Joshi (Technical Member), has upheld the Resolution Professional's decision to admit claim arising out of an arbitral Award as contingent claim, since proceedings under Section 34 of Arbitration and Conciliation Act, 1996 are pending before the High Court against the Award.
Case Title: Vasathi Anandi Owners Welfare Association v. Vasathi Housing Ltd.
Case No.: Company Petition-CP(IB) No. 50/7/HDB/2020
The National Company Law Tribunal ('NCLT'), Hyderabad Bench, comprising Shri. Rajeev Bhardwaj (Judicial Member) and Shri Sanjay Puri (Technical Member), has held that the amount deposited in Corpus Fund towards the maintenance of constructed apartments by Homebuyers does not qualify as 'Financial Debt' within the meaning of Section 5(8)(f) of IBC. It was observed that Corpus Fund amount is similar to a prepayment made to a service provider for maintenance and the same does not meet the criteria for classification as Financial Debt.
Suspended Directors Can't Transfer Amount From Corporate Debtor's Account During Stay On CIRP, NCLT Mumbai Directs Refund
Case Title: State Bank of India v Arshiya Northern FTWZ Limited
Case No.: C.P. No. 1245 of 2021
The National Company Law Tribunal (“NCLT”), Mumbai Bench, comprising of Ms. Reeta Kohli (Judicial Member) and Shri Sanjiv Dutt (Technical Member), has held that Suspended Directors of Corporate Debtor cannot transfer amounts from the Corporate Debtor's account while there is a stay on CIRP.
The NCLAT stayed the CIRP and before vacation of stay the Suspended Directors transferred certain amounts from the Corporate Debtor's account towards loan payment of Group Companies. The Bench directed the Group Companies to revert the amount in the Corporate Debtor's account.
“After the stay of the CIRP order, Resolution Professional cannot discharge any function. Stay of admission order/CIRP does not mean that the Corporate Debtor should be put back in the management of day to day affairs of the company and allowed to function as such. Interim Order staying CIRP clearly means that no further process shall be taken in CIRP and the Resolution Professional shall not take any further action. The Corporate Debtor can no longer be permitted to function as it was functioning prior to the date of admission order.”
NCLT Allahabad: Operational Debt, Out Of Non Delivery Of Goods Due To Export Ban, Not Maintainable
Case Title: Morex Corporation Ltd. v. Jindal Poly Films Ltd.
Case No.: CP (IB) No.12/ALD/2021
The National Company Law Tribunal ('NCLT'), Allahabad, comprising Shri. Praveen Gupta (Judicial Member) and Shri Ashish Verma (Technical Member), has held that a Corporate Insolvency Resolution Process ('CIRP') application under Section 9 of IBC is not maintainable for any claim arising on account of non-delivery of goods for export by the Corporate Debtor due to a ban imposed by the Government of India.
NCLT Hyderabad Approves Resolution Plan For GVK Power (Goindwal Sahib) Ltd., A GVK Group Company
Case Title: Axis Bank Limited v GVK Power (Goindwal Sahib) Ltd
Case No.: CP No. (IB) 43/7/HDB/2020
The National Company Law Tribunal (“NCLT”), Hyderabad Bench, comprising of Dr. N. Venkata Ramakrishna Badarinath (Judicial Member) and Shri Charan Singh (Technical Member), has approved the Resolution Plan submitted by Punjab State Power Corporation Limited for GVK Power (Goindwal Sahib) Limited, which is a part of GVK Group promoted by Mr. Gunupati Venkata Krishna Reddy.
The Resolution Plan is valued at Rs. 1,080 Crores, while the total admitted claims of the Corporate Debtor amounts to Rs. 6,615.48 Crores.
NCLT Mumbai: Non-Acceptance Of Goods By Corporate Debtor Does Not Equate To Operational Debt U/S 5(21) Of IBC
Case Title: Adishank Chemicals Pvt. Ltd. vs. Baerlocher India Additives Pvt. Ltd.
Case No.: CP(IB)/736/MB/2023
The National Company Law Tribunal ('NCLT'), Mumbai Bench, comprising Justice Kuldip Kumar Kareer (Judicial Member) and Mr. Anil Raj Chellan (Technical Member), has held that the non-acceptance of the goods by the Corporate Debtor cannot be equated with the default in respect of an Operational debt under Section 5(21) of IBC.
NCLT Hyderabad: IBC Overrides The Provisions Of Andhra Pradesh Revenue Recovery Act, 1864
Case Title: K. Sivalingam RP of NCS Sugars Ltd. vs. District Collector and Ors.
Case No.: CP(IB) No.299/7/HDB/2018
The National Company Law Tribunal ('NCLT') Hyderabad, comprising Dr. Venkata Ramakrishna Badarinath Nandula (Judicial Member) and Shri. Charan Singh (Technical Member) held that the Insolvency and Bankruptcy Code, 2016 ('IBC') overrides the provisions of the Andhra Pradesh Revenue Recovery Act, 1864.
NCLT Hyderabad: Moratorium U/s 14 Of IBC Imposes Legal 'Embargo' Not Only On Financial Creditors But On Any Other Person For Sale Of Assets In CIRP
Case Title: K. Sivalingam RP of NCS Sugars Ltd. vs. District Collector and Ors.
Case No.: CP(IB) No.299/7/HDB/2018
The National Company Law Tribunal ('NCLT') Hyderabad, comprising Dr. Venkata Ramakrishna Badarinath Nandula (Judicial Member) and Shri. Charan Singh (Technical Member), has held that the moratorium u/s 14 of IBC operates as a legal 'embargo' on the sale or alienation of the assets of the Corporate Debtor during the CIRP of the Corporate Debtor not only on the Financial Creditor but also on any person.
NCLT Kolkata: Revival Of Corporate Debtor Is Primary Goal Of Resolution Plan And Going Concern Sale
Case Title: Universaltech Paper LLP vs. Mr. Krishnaswami CVR, Liquidator of Kohinoor Pulp & Paper Pvt. Ltd.
Case No.: I.A. (I.B.C.) 1055/KB/2023 In CP(IB) No. 511/KB/2019
The National Company Law Tribunal ('NCLT') Kolkata, comprising Justice Rohit Kapoor (Judicial Member) and Mr. Balraj Joshi (Technical Member), has held that the primary goal of Resolution Plan as well as the sale of a Corporate Debtor as a going concern remains the same i.e revival of the Corporate Debtor's business.
IBC | Settlement In Section 7 Or Dropping Of Sec. 66 Proceedings Does Not Automatically End Proceedings Under Section 43: NCLT Mumbai
Case Title: Reserve Bank of India v Dewan Housing Finance Corporation Limited
Case No.: COMPANY PETITION (IB) NO. 4258/MB/2019
The National Company Law Tribunal (“NCLT”), Mumbai Bench, comprising of Shri Kuldip Kumar Kareer (Judicial Member) and Shri Anil Raj Chellan (Technical Member), has held that the proceedings under Section 43 of IBC would not automatically end against a party, if the parties enter settlement in Section 7 of IBC proceedings or proceedings under Section 66 of IBC are dropped.
“We again wish to reiterate that merely because the Applicant has settled the matter with regard to the said loan does not ipso facto absolve it of the insinuations or allegations made in the application u/s 43 of the Code. We are further of the view that it would be untimely and inopportune to exonerate the Applicant of the allegations made against it in the said application which is yet to be heard and decided on merits. Besides, settlement with the Respondent in proceedings u/s 7 of the Code does not or cannot have the effect of drawing curtains over the proceedings u/s 43 of the Code which are altogether different and distinct.”
NCLT Indore: Insolvency Resolution Professional Can Continue To Function Till Appointment Of RP U/S 16(5) Of IBC
Case Title: Indian Bank vs. Indison Agro Foods Ltd.
Case No.: IA/166(MP)2023 & IA/253(MP)2023
The National Company Law Tribunal ('NCLT') Indore, comprising Shri P. Mohan Raj (Judicial Member) and Shri Kaushalendra Kumar Singh (Technical Member), held that the Interim Resolution Professional ('IRP') can continue to function till the date of appointment of the Resolution Professional ('RP') as per the amended provisions of Section 16(5) of IBC.
NCLT Delhi: Debt Assignment Deed Cannot Be Challenged In CIRP U/s 7 Of IBC
Case Title: CFM Asset Reconstruction Pvt. Ltd. Vs. M.G. Finvest Pvt. Ltd.
Case No.: Company Petition IB (IBC) NO. 115/PB/2022
The National Company Law Tribunal ('NCLT') New Delhi Bench, comprising Justice Mahendra Khandelwal (Judicial Member) and Dr. Sanjeev Ranjan (Technical Member), held that the Debt Assignment Deed cannot be challenged in a Corporate Insolvency Resolution Process ('CIRP') under Section 7 of IBC.
Case Title: Hpcl-Mittal Pipelines Limited v Coastal Marine Construction And Engineering Limited
Case No.: C.P. (IB) 323/MB/2023
The National Company Law Tribunal (“NCLT”), Mumbai Bench, comprising of Mr. Kuldip Kumar Kareer (Judicial Member) and Mr. Anil Raj Chellan (Technical Member), has held that the nature of an operational debt would not change to financial debt with the passing of a decree or arbitral award in respect of the same.
“Undisputedly, the claim on the basis of which arbitral proceedings were initiated by the Petitioner emanated from a work contract which originally was at best an operational debt and as per the law laid down in the afore cited cases, the nature of debt would not change with the passing of a decree or an award and, therefore, simply because an award was passed in respect of an operational claim, it will not by itself metamorphose into a financial debt.”
NCLT Mumbai Approves Demerger Scheme For Raymond And Raymond Lifestyle
Case Title: In the Matter of Section 230-232 of the Companies Act, 2013 and other applicable provisions of the Companies Act, 2013 read with the Companies (Compromises, Arrangements and Amalgamations) Rules, 2016; AND In the matter of Arrangement Between Raymond Limited (“Demerged Company”) And Raymond Lifestyle Limited (“Resulting Company or Transferee Company”) And Ray Global Consumer Trading Limited (“Transferor Company”) And their respective Shareholders
Case Number: CP (CAA)/38/MB-IV/2024 IN CA (CAA)/281/MB/2023
The National Company Law Tribunal (NCLT), Mumbai bench of Kishore Vemulapalli (Judicial Member) and Anu Jagmohan Singh (Technical Member) has granted approval on for a composite scheme of arrangement involving Raymond Limited (RL), Raymond Lifestyle (RLL), and Ray Global Consumer Trading (RG).
Speculative Investor Is Not A Financial Creditor: NCLT Chandigarh
Case Title: Nikhil Khanna & Ors vs. Spaze Towers Pvt Limited
Case No.: CP (IB) No. 70/Chd/Hry/2022 & IA No. 81/2024
The National Company Law Tribunal, Chandigarh Bench, comprising Shri Harnam Singh Thakur (Judicial Member) and Shri L.N Gupta (Technical Member), while adjudicating an application under Section 7 of Insolvency and Bankruptcy Code, 2016 (“IBC, 2016”) has held that speculative investor cannot claim the status and benefits as a Financial Creditor by virtue of being an allottee under Section 5(8)(f) of the Code.
NCLT Delhi: 'Homebuyers' Seeking Redressal Through 'RERA' Or 'NCDRC' Prior To Approaching 'NCLT' Retain Their Status As Financial Creditors
Case Title: Tarun Ahuja & Ors. Vs Puri Construction Private Limited
Case No: CP IB NO. 755/PB/2020
The National Company Law Tribunal (“NCLT”), New Delhi, comprising Shri Mahendra Khandelwal (Judicial Member) and Dr. Sanjeev Ranjan (Technical Member), has held that regardless of whether homebuyer-allottees have sought recourse through RERA (Real Estate Regulatory Authority) or NCDRC (National Consumer Disputes Redressal Commission) prior to approaching Tribunal, their status as 'financial creditors' under Section 5(8)(f) of the IBC will remain unchanged.
NCLT New Delhi: NCLT Rejects Insolvency Petition Filed By Wilmington Trust Against Spicejet Ltd.
Case Title: Wilmington Trust SP Services (Dublin) Ltd. vs. SpiceJet Ltd.
Case No.: CP IB NO. 349/(ND)/2023
The National Company Law Tribunal ('NCLT') New Delhi, comprising Shri Mahendra Khandelwal (Judicial Member) and Shri Rahul Bhatnagar (Technical Member), has declined Wilmington Trust's application to initiate the Corporate Insolvency Resolution Process ('CIRP') against SpiceJet Limited. The CIRP application has been rejected on the premise that for the Insolvency and Bankruptcy Code, 2016 ('IBC'), a clear distinction is required between the Owner, Lessor, Assignee, Trustee, to being recognized as Operational Creditor in terms of provision of IBC.
NCLT Kolkata: Simultaneous CIRP Can Be Initiated Against Principal Borrower And Corporate Guarantor
Case Title: State Bank of India vs. Anupriya Management Pvt. Ltd.
Case No.: Company Petition (IB) No. 18/KB/2023
The National Company Law Tribunal ('NCLT') Kolkata comprising Smt. Bidisha Banerjee (Judicial Member) and Shri D. Arvind (Technical Member) held that a simultaneous Corporate Insolvency Resolution Process ('CIRP') can be initiated against Principal Borrower and Corporate Guarantor under the Insolvency and Bankruptcy Code, 2016 ('IBC').
NCLT Kolkata: Filing Of Default Information With Information Utility Under Rule 20(1A) Of IBBI (UI) Regulations 2017 Is Not Mandatory
Case Title: State Bank of India vs. Anupriya Management Pvt. Ltd.
Case No.: Company Petition (IB) No. 18/KB/2023
The National Company Law Tribunal ('NCLT') Kolkata comprising Smt. Bidisha Banerjee (Judicial Member) and Shri D. Arvind (Technical Member) held that the filing of default information with Information Utility in compliance with Rule 20(1A) of IBBI (Information Utilities) Regulations 2017 ('IBBI Regulations 2017') is not mandatory compliance.
NCLT Hyderabad: 'Provisional Order Of Attachment' Made Under PMLA Would Not Nullify The Protection Granted Under Section 32A IBC
Case Title: Canara Bank vs Deccan Chronicle Holdings Limited
Case No.: CP(IB)No.41/7/HDB/2017
The National Company Law Tribunal ('NCLT') Hyderabad, comprising Dr. Venkata Ramakrishna Badarinath Nandula (Judicial Member) and Shri Charan Singh (Technical Member), has held that the provisional order of attachment (POA) under Section 5(1) of the Prevention of Money Laundering Act, 2002, in respect of the properties of the corporate debtor covered under the approved resolution plan, would not end the protection available to such properties under section 32A IBC.
Section 32A stipulates that once Resolution Plan is approved by the Adjudicating Authority after completion of CIRP, there cannot be attachment or confiscation of assets of Corporate Debtor, as otherwise same will defeat objects of the insolvency Regime.
Private Sale Conducted In Non-Transparent Manner & In Absence of Several SCC Members, NCLT Indore Directs Liquidator To Re-Conduct Bidding
Case Title: Hira International Limited v M/s Girdharilal Sugar and Allied Industries Limited
Case No.: CP(IB) 591 of 2019
The National Company Law Tribunal (“NCLT”), Indore Bench, comprising of Shri P. Mohan Raj (Judicial Member) and Shri Kaushalendra Kumar Singh (Technical Member), has directed the Liquidator to re-conduct private sale bidding of the Corporate Debtor since the earlier bidding was not conducted in transparent manner. The Bench observed that the Liquidator failed to make genuine efforts to sale the Corporate Debtor under Liquidation through Public Auction. Thereafter, the Liquidator conducted Private Sale hastily and without giving proper prior notice to Stakeholders Consultation Committee (“SCC”) to attend the bidding. Consequently, only one SCC member could attend the bidding.
On an application filed by unsuccessful bidder, the Bench has directed the Liquidator to re-conduct the Private Sale bidding in presence and consultation of SCC members, including the Commercial Tax Department.
NCLT Mumbai: Corporate Guarantor's Date Of Default Is Independent Of Principal Borrower's Date Of Default
Case Title: Central Bank of India vs Superfine Profile and Extrusions Pvt. Ltd.
Case No.: CP (IB) 692/MB/2023
The National Company Law Tribunal ('NCLT') Mumbai, comprising Mr. Kishore Vemulapalli (Judicial Member) and Ms. Anu Jagmohan Singh (Technical Member), has held that the date of default by the Principal Borrower is not relevant to determine the date of default by the Corporate Guarantor.
NCLT Ahmedabad: Amount Invested In A Joint Venture Project Of A Promoter And Investor Does Not Constitute Financial Debt Under IBC
Case Title: Deccan Charters Pvt. Ltd. vs. GSEC Monarch and Deccan Aviation Pvt. Ltd.
Case No.: CP(IB)/100(AHM)2022
The National Company Law Tribunal ('NCLT') Ahmedabad, comprising Justice Mrs. Chitra Hankare (Judicial Member) and Mr. Velamur G Venkata Chalapathy (Technical Member), has held that the amount invested in a Joint Venture Project of a promoter and investor is not a Financial Debt under IBC.
NCLT Chennai: Liquidation Is A Time-Bound Process And Liquidator Is Accountable To Explain Delay In Liquidation Process
Case Title: State of Tamil Nadu vs. S. Rajendran, Liquidator of Daehsan Trading India Pvt. Ltd. and Anr.
Case No.: IA/1318/IB/2020 in TCP/111/IB/2017
The National Company Law Tribunal ('NCLT') Chennai, comprising Justice Sanjiv Jain (Judicial Member) and Mr. Venkataraman Subramanian (Technical Member) held that Liquidation is a time-bound process and the Liquidator being made accountable is required to explain if there is any delay caused in the liquidation process.
Appeal Under Section 42 Of IBC Would Only Lie Against An 'Adjudicating' Order Of The Liquidator: NCLT Mumbai
Case Title: Sai Projects & Engineers Private Limited v Kalpyog Chemicals Private Limited
Case No.: C.P.(IB)/1619(MB)/C-III/2019
The National Company Law Tribunal (“NCLT”), Mumbai Bench, comprising of Smt. Lakshmi Gurung (Judicial Member) and Shri Charanjeet Singh Gulati (Technical Member), has held that an appeal under Section 42 of IBC would only lie against an 'adjudicating' order passed by the Liquidator. The Bench has rejected an appeal filed under Section 42 of IBC, whereby Employees Provident Fund Organization challenged a letter sent by the Liquidator at a time when he stood discharged from his duties due to dissolution of the Corporate Debtor.
NCLT Mumbai: Society Not Entitled To Recover Past Arrears Of Applicant's Purchase In The Auction From Liquidator Of Corporate Debtor
Case Title: Mr. Hitendra Vishanji Nagda and Ors. vs. Prime Plaza Premises Co-operative Society Ltd.
Case No.: CP (IB) No. 4302/MB/C-II/2018
The National Company Law Tribunal ('NCLT') Mumbai, comprising Justice Shri. Kuldip Kumar Kareer (Judicial Member) and Shri. Anil Raj Chellan (Technical Member) held that the Society is not entitled to recover the past arrears in respect of the unit purchased by the Applicant in the auction from the Liquidator of the Corporate Debtor.
NCLT Mumbai Allows Withdrawal Of Liquidation Application On Receipt Of Resolution Plan
Case Title: Salil Shashank Kulkarni v Rubique Technologies India Private Limited
Case No.: I.A. No. 4372 of 2023 in CP (IB) No. 4304 (MB) of 2019
The National Company Law Tribunal ('NCLT') Mumbai, comprising Justice Shri. Kuldip Kumar Kareer (Judicial Member) and Shri. Anil Raj Chellan (Technical Member) allowed the withdrawal of the liquidation application since one resolution plan was received by the Committee of Creditors ('CoC') during the pendency of the liquidation application upholding the aim of IBC.
NCLT Mumbai: CIRP Can't Be Initiated U/S 7 Of IBC Based On Transfer Agreement For Purchase Of Debentures From Financial Creditors
Case Title: Edelweiss Asset Reconstruction Company Ltd. vs. Ajmera Realty and Infra India Ltd.
Case No.: CP (IB) No.877/MB/2023
The National Company Law Tribunal ('NCLT') Mumbai, comprising Justice V.G. Bisht (Retd.) (Judicial Member) and Mr. Prabhat Kumar (Technical Member) held that the Corporate Insolvency Resolution Process ('CIRP') under Section 7 of IBC cannot be initiated based on Transfer Agreement/promise for purchase of Debentures from Financial Creditors.
NCLT Imposes Rs. 2.5 Lakh Cost On Personal Guarantor For Delayed Filing Of Reply, NCLAT Delhi Reduces Cost To Rs. 25,000
Case title: Rakesh Nayar v State Bank of India
Case No.: Company Appeal (AT) (Insolvency) No. 270 of 2024
The National Company Law Appellate Tribunal (“NCLAT”), Principal Bench, comprising of Justice Ashok Bhushan (Chairperson), Shri Barun Mitra (Technical Member) and Shri Arun Baroka (Technical Member), has reduced the cost imposed by NCLT on Personal Guarantor for 6 days delay in filing of Reply from Rs. 2.5 Lakhs to Rs. 25,000. The Bench opined that the imposition of Rs. 2.5 Lakh cost is excessive as delay in filing of Reply to application under Section 95 of IBC was of mere 6 days.
NCLT Mumbai Orders Dream 11's Sports Platform Owner Sporta Technologies Pvt. Ltd. Into CIRP Under IBC
Case Title: Piyush Jani, RP for Reward Business Solutions Pvt. Ltd. vs. Sporta Technologies Pvt. Ltd.
Case No.: CP No. 775/(IB)-MB-V/2021
The National Company Law Tribunal ('NCLT') Mumbai, comprising Justice Reeta Kohli (Judicial Member) and Shri. Anil Raj Chellan (Technical Member) allowed the petition and ordered Sporta Technologies Pvt. Ltd. (Corporate Debtor) into the Corporate Insolvency Resolution Process ('CIRP') under Section 9 of the Insolvency and Bankruptcy Code, 2016 ('IBC'). The Corporate Debtor is Dream 11's sports platform owner.
NCLT Orders Liquidation Of Mehul Choksi-Promoted Gitanjali Gems
The National Company Law Tribunal (NCLT), Mumbai Bench, comprising Shri Kuldip Kumar Kareer (Judicial Member) and Shri Anil Raj Chellan (Technical Member), has ruled for the liquidation of Gitanjali Gems, a jewelry retailing company headed by fugitive Mehul Choksi, under Section 33 of IBC.
“On perusal of records, it is evident that the assets of the Corporate Debtor were under attachment by the Directorate of Enforcement under the enforcement under the provisions of the PMLA, 2002 and considering the bleak chances of insolvency resolution amid the ongoing investigations and attachment of assets, the CoC had resolved in its 06th Meeting held on 05th April, 2019 to liquidate the Corporate Debtor by a majority of 90.16% voting in favour.”
The tribunal further added that, “The CoC with requisite voting as given under Section 33(2) has approved the liquidation of Corporate Debtor in view of bleak chances of receiving any resolution plan for the reasons discussed hereinbefore. This Tribunal has very limited powers of judicial review in such matters of commercial wisdom.”
NCLT Kolkata: MSME Promoters Can Be Relaxed From Net Worth Criteria For Resolution Plan Submission, But Are Required To Deposit Security Deposit And EMD
Case Title: Mr. Manish Kumar, suspended director of Wearit Global Ltd. vs. Rachna Jhunjunwala, RP and Anr.
Case Number: I.A. (IB) No. 53/KB/2024 in Company Petition (IB) No. 100/KB/2019
The National Company Law Tribunal ('NCLT') Kolkata bench of Justice Bidisha Banerjee (Judicial Member) and Shri Arvind Devanathan (Technical Member) held that MSME promoters can be relaxed from the net worth eligibility criteria to submit a Resolution Plan but not be waived off from depositing Security Deposit and EMD.
Adjudicating Authority Rejects Application For Initiating Personal Insolvency Resolution Process Due To Forum Shopping: NCLT Delhi
Case Title: Intec Capital Limited vs. Mr. Parul Upadhyay
Case Number: CP(IB) 315(ND)/2022 & IA No. 913/2024
The National Company Law Tribunal, Delhi Bench, comprising Shri Bachu Venkat Balram Das (Judicial Member) and Shri Atul Chaturvedi (Technical Member), while adjudicating an application under Section 95 of Insolvency and Bankruptcy Code, 2016 (“IBC, 2016”) held that the applicant has approached all possible forums for remedies, constituting forum shopping. It was stated that this conduct indicates the applicant did not approach the Adjudicating Authority with clean hands.
NCLT Mumbai Admits Personal Insolvency Application Against Videocon's Promoter Rajkumar Dhoot
Case Title: State Bank of India through Asish Narayan vs Mr. Rajkumar Nandlal Dhoot
Case No.: C.P. (IB) NO. 1195/MB/2020
The National Company Law Tribunal Mumbai bench, comprising Justice V.G. Bisht (Judicial Member) and Mr. Prabhat Kumar (Technical Member) has admitted personal insolvency application against Mr. Rajkumar Nandlal Dhoot, Promoter and Co-owner, of Videocon Industries Limited.
Case Title: ICICI Bank Limited vs Jaiprakash Associates Limited
Case No.: CP (IB) No. 330/ALD/2018 with IA No.263 of 2024 and IA No. 406 of 2023
The Allahabad bench of the National Company Law Tribunal has directed the initiation of insolvency proceedings against Jaiprakash Associates Limited (JAL), a prominent firm within the Jaypee Group. This decision follows insolvency petitions filed by ICICI Bank in 2018 and State Bank of India (SBI) in 2022, aiming to recover debts amounting to several thousand crores.
Case Title: In the matter of Mr. Siri Kishan Aggarwal
Case No.: CP IB NO. 403/ND/2023
The National Company Law Tribunal Court-V, New Delhi bench of Mahendra Khandelwal (Judicial Member) and Dr. Sanjeev Ranjan (Technical Member) has appointed a Resolution Professional in an application filed under Section 94(1) of the Insolvency and Bankruptcy Code, 2016. The Personal Guarantor approached the bench for insolvency proceedings to be initiated against himself.
Case Title: Mr. Ankur Kumar vs Mr Jitendra Kikavat & others and connected matters
Case No.: I.A. 2020 OF 2020 and connected matters
The National Company Law Tribunal Mumbai Bench-I of Justice Shri V.G. Bisht (Judicial Member) and Prabhat Kumar (Technical Member) held that there is no need for any fraudulent intent for a preferential transaction under Section 43 of the Insolvency and Bankruptcy Code, 2016.
Case Title: Omkara Assets Reconstruction Private Limited vs Gigeo Construction Company Private Limited
Case No.: CP (IB) No.1180/MB/2022
The National Company Law Tribunal, Mumbai Bench-VI bench of K. R. Saji Kumar (Judicial Member) and Sanjiv Dutt (Technical Member) has held that the principal debtor and the surety are jointly and severally liable to the creditor which has the right to recover its dues from either or both of them simultaneously.
Allotment Of Shares At Lesser Price, An Oppressive Act Against Existing Members : NCLT Mumbai
Case Title: Mr. Ajay Tajpuriya & Anr. vs Goel Ganga Infrastructure & Real Estate Pvt. Ltd. & Ors.
Case No.: T.C.P. No. 08 of 2014
The National Company Law Tribunal Mumbai Bench-I of Justice V.G. Bisht (Retd.) (Judicial Member) and Prabhat Kumar (Technical Member) held that allotment of the shares at a concessional price is an oppressive act qua existing members to whom no such allotment has been made. It held that the allotment of the share value at a face value, which is less than its book value is not in accordance with the provision of Section 42 of the Companies Act.
Case Title: M/s Tri-Wall Pak Private Limited vs M/S 5 Core Acoustics Private Limited
Case No.: I.A. 2892/2023 In Company Petition No. (IB) – 468/ND/2020
The National Company Law Tribunal Court V, New Delhi bench of Mahendra Khandelwal (Judicial Member) and Dr Sanjeev Ranjan (Technical Member) has held that CoC in the legislative scheme of the Insolvency and Bankruptcy Code, 2016 is empowered to take the decision to liquidate the Corporate Debtor, any time after its constitution and before confirmation of the resolution plan.
NCLT Orders Byju's To Halt Second Rights Issue Amid Allegations Of Mismanagement
Case Title: M/s. MIH Edtech Investments B.V. & Ors. vs M/s. Think & Learn Pvt. Ltd. & Ors.
Case No.: C.A. Nos.71, 72 & 76/2024 in C.P. No.18/BB/2024
The National Company Law Tribunal (NCLT) has directed Byju's to maintain the status quo regarding its shareholding structure. This directive effectively halts the company's controversial second rights issue. The interim order was issued by a special bench consisting of M.S.S. Sundaram (Judicial Member) and Manoj Kumar Dubey (Technical Member) in response to a petition filed by a group of investors alleging oppression and mismanagement.
NCLT Chandigarh: Indemnity Obligation Can't Be Treated As Operational Debt For Lack Of Privity
Case Title: M/s Agarwal Foundries Private Limited vs POSCO E&C India Private Limited
Case No.: CP (IB) No. 109/Chd/Hry/2019
The National Company Law Tribunal Chandigarh bench of Harnam Singh Thakur (Judicial Member) and LN Gupta (Technical Member) held that indemnity obligation pertaining to a guarantee is not applicable in cases involving operational debt.
Case Title: Manish Aneja & Ors. vs M/S Revital Reality Private Limited
Case No.: Company Petition IB (IBC) NO. 657/ND/2021
The National Company Law Tribunal Court V, New Delhi bench of Mahendra Khandelwal (Judicial Member) and Dr Sanjeev Ranjan (Technical Member) has initiated insolvency proceedings against Revital Reality Private Limited noting that it failed to deliver possession of the residential units within the stipulated time frame.
NCLT Orders Insolvency Proceedings Against Himalayan Mineral Waters Following Rs 50 Crore Default
Case Title: Jammu And Kashmir Bank vs Himalayan Mineral Waters Private Limited
Case No.: CP (IB) NO.37/ALD/2022
The National Company Law Tribunal (NCLT) recently ordered the initiation of insolvency proceedings against Himalayan Mineral Waters, following a plea by Jammu and Kashmir Bank. The decision came after Himalayan Mineral Waters, acting as the corporate guarantor for Leel Electricals, failed to repay a debt amounting to Rs 50 crore. This debt was owed to Jammu and Kashmir Bank which arose from credit facilities obtained by Leel Electricals.
NCLT Chandigarh Bench Approves Air India-Vistara Merger
Case Title: In the matter of Composite Scheme of Arrangement amongst Talace Pvt. Limited and Tata Sia Airlines Ltd. and Air India Ltd. and their respective shareholders.
Case No.: Company Petition No. (CAA)-41/CHD/HRY/2023 connected with Company Application No. CA (CAA)-28/CHD/HRY/2023
The National Company Law Tribunal (NCLT) Chandigarh bench of Harnam Singh Thakur (Judicial Member) and L. N. Gupta (Technical Member) has given its approval for the merger of Air India and Vistara. The merger, which was initially announced in November 2022, has received the green light from various stakeholders and regulatory bodies.
Breach Of Settlement Agreement Not 'Operational Debt' Under Section 5(21) Of IBC: NCLT Kolkata
Case Title: M/s. Amrik Cranes and Infrastructure vs Simplex Infrastructures Limited
Case No.: Company Petition (IB) No. 202 (KB) of 2022
The National Company Law Tribunal Kolkata bench of Justice Bidisha Banerjee (Judicial Member) and D. Arvind (Technical Member) has held that the breach of settlement agreement between the operational creditor and corporate debtor does not fall within the ambit of “Operational Debt” as per Section 5 (21) of the IBC. Further, the bench held that NCLT was not the forum where parties could seek implementation of the Settlement Agreement.
Section 9 Application Is Not Maintainable In Absence Of Strict Proof Of Debt And Default: NCLT Mumbai
Case Title: Mittal Polymers vs Suvarna Additives Private Limited
Case No.: CP (IB) No. 95/MB/2022
The National Company Law Tribunal, Mumbai bench, comprising Shri K. R. Saji Kumar (Judicial Member) and Shri Sanjiv Dutt (Technical Member), while adjudicating an application under Section 9 of Insolvency and Bankruptcy Code, 2016 (“IBC, 2016”) has held that Section 9 Application is not maintainable in the absence of strict proof of debt and default.
Case Title: Mr. Gireesh Sanghi vs. Sanghi Cements Limited and Anr.
Case No.: CP NO. 5/59/HDB/2020
The National Company Law Tribunal Hyderabad bench comprising Justice Dr. Venkata Ramakrishna Badarinath Nandula (Judicial Member) and Shri Charan Singh (Technical Member) dismissed a petition filed under Section 59 of the Companies Act, 2013 and referred the matter to Civil Court for a detailed investigation.
Case Title: Mr. Ravindra Beleyur Resolution Professional Reliable Cashew Company Pvt Ltd
Case Number: IA(IBC)/2308(CHE)/2023
The National Company Law Tribunal Chennai Bench of Jyoti Kumar Tripathi (Judicial Member) and Ravichandran Ramasamy (Technical Member) has recalled its order. This order follows a directive from the Karnataka High Court, which ordered maintaining the status quo on the Insolvency and Bankruptcy Board of India's (IBBI) recommendations for appointment of liquidator other than Insolvency Resolution Professional (IRP)/Resolution Professional (RP).
Case Title: Grant Thornton Bharat LLP vs. Resolution Capital Global Pvt Ltd
Case Number: TP (Co. Act.)-11(PB)/2024
The National Company Law Tribunal Principal Bench, New Delhi, of Justice Ramalingam Sudhakar (President) and Mr. Avinash K. Srivastava (Technical Member) has asked the Insolvency and Bankruptcy Board of India (IBBI) to amend the Corporate Insolvency Resolution Process (CIRP) regulations.
NCLT Mumbai Holds Resolution Professional Accountable For Biased Conduct, Sets Aside Approved Resolution Plan
Case: Bank of India Vs Wadhwa Buildcon LLP
Citation: C.P. (IB) No. 2946 of 2019
The National Company Law Tribunal (NCLT), Mumbai bench, comprising of Justice Reeta Kohli (Judicial Member) and Madhu Sinha (Technical Member), has held the Resolution Professional accountable for biased conduct aimed at facilitating the approval of the Successful Resolution Applicant (SRA) Plan by the Committee of Creditors (COC). Consequently, the NCLT has set aside the Resolution Plan of the SRA, as approved by the COC, holding SRA ineligible under Section 29A of the IBC to submit the Resolution Plan.
Party Refuses To Argue Unless Proceedings Are Recorded, NCLT Ahmedabad Adjourns Party's All Cases Sine Dine Till Recording Facility Is Made Available
Case Title: Gujarat Operational Creditors Association & Another Vs Nemo in 'State Bank of India v Essar Steels Ltd.'
Case No.: IA/347(AHM)2024 in CP(IB) 40 of 2017
The National Company Law Tribunal (“NCLT”), Ahmedabad Bench, comprising of Mrs. Chitra Hankare (Judicial Member) and Dr. Velamur G Venkata Chalapathy (Technical Member), has adjourned all matters sine dine belonging to Gujarat Operational Creditors Association (Applicant) till the time the project for online recording of proceedings is taken up by the administrative side of NCLT.
“Till the project for online recording of proceedings is taken up by the administrative side we will not hear any of applicant's matters and it is listed for further hearing Sine die as per his prayer.”
In a recall application filed by the Applicant, interim prayers were made for switching on the recording feature in Webex platform for audio/video recording of proceedings before NCLT. The NCLT ruled that it is not empowered under NCLT Rules or otherwise to grant such prayer.
“The main prayer sought by the Learned Counsel before this Court through this application is recording of the proceedings to be conducted when the cases filed by him are being heard in order to enable him to interpret or determine whether the orders passed are in order to satisfy the prayers filed by him. This Court has no powers under either the duties and responsibilities entrusted to this Court for conducting the proceedings, or the procedure prescribed in NCLT Rules (which were followed to hear the application) to pass any order as sought and the orders were passed strictly in terms of Rules laid down in NCLT 2016.”
NCLT Chennai - Resolution Professional Should Not Rely Solely On Corporate Debtor's Records For Verifying Claims
Case Title: K. Amutha Versus Resolution Professional of M/s. Ambojini Property Developers Private Limited
Case No.: CP/938/IB/2018
The National Company Law Tribunal (“NCLT”), Chennai bench, comprising Justice Jyoti Kumar Tripathi (Judicial Member) and Shri Ravichandran Ramasamy (Technical Member), has held that The Resolution Professional (RP) should not rely solely on the Corporate Debtor's records for verifying claims as the improper maintenance of the records can unfairly burden the creditors.
General Power Of Attorney Holder Can File An Application U/S 7 Of IBC Without A Specific Board Resolution Authorization: NCLT Mumbai
Case Title: Punjab National Bank v. Arshiya Limited
Case No.: CP (IB) No. 3143/MB/2019
The National Company Law Tribunal (“NCLT”), Mumbai Bench, comprising Shri K.R. Saji Kumar (Judicial Member) and Shri Sanjiv Dutt (Technical Member) has held that a General Power of Attorney (“GPA”) holder can file an application under Section 7 of IBC without having a specific Board Resolution.
The Bench held that under Section 7(1) of IBC, an application filed by a GPA holder will be considered to have been filed by the Financial Creditor itself and not by any person on its behalf. Therefore, a GPA holder does not need to have a specific Board Resolution as per the MCA Notification.
Loan Sanction Letter, Loan Agreement, Statement Of Account, And Copy Of Notice U/S 13(2) OF SARFAESI Constitute “Such Other Record” U/S 7(3)(A) Of IBC: NCLT Mumbai
Case Title: Indiabulls Housing Finance Limited v. Primcomm Media Distribution Ventures Private Limited
Case No.: C.P.(IB)-246(MB)/C-III/2022
The National Company Law Tribunal (“NCLT”), Mumbai Bench, comprising Smt. Lakshmi Gurung (Judicial Member) and Shri Charanjeet Singh Gulati (Technical Member), has held that loan sanction letter, statement of account, copy of notice under section 13(2) Securitization and Reconstruction of Financial Assets and Enforcement of Securities Interest Act, 2002 (“SARFAESI”), and revised payment schedule will constitute “such other record” under section 7(3)(a) of IBC.
Case Title: Machino Transport Private Limited vs. Machino Finance Private Limited
Case No.: IA (CA) No. 213/KB/2023 and CP No. 42/KB/2021
The National Company Law Tribunal ('NCLT') Kolkata, comprising Shri Rohit Kapoor (Judicial Member) and Shri Balraj Joshi (Technical Member) held that the limitation period for enforcing a scheme under the Companies Act, 2013 is 12 years as prescribed under the Article 136 of the Limitation Act, 1963.
Case Title: Mr. Jai Kumar Rai and Mrs. Supriya Saxena v. Mr. Arun Kapoor In M/s. Capri Global Capital Ltd. v. M/s. Monarch Brookefields LLP
Case No.: IA No. 3014 of 2021 In CP (IB) 2517(MB) of 2018
The National Company Law Tribunal (“NCLT”), Mumbai Bench, comprising Mr. Kuldip Kumar Kareer (Judicial Member) and Mr. Anil Raj Chellan (Technical Member) has held that claims cannot be admitted after the approval of the resolution plan by the Committee of Creditors (“CoC”) even if approval by the Adjudicating Authority under section 31 of the Insolvency and Bankruptcy Code, 2016 (“Code”) is pending.
Amount Given As Share Application Money Does Not Qualify As A Financial Debt Under IBC: NCLT Kolkata
Case Title: Mittson Fille Enterprise vs. Sammaan Ventures Limited
Case No.: C.P. (IB) No. 147/KB/2023
The National Company Law Tribunal (“NCLT”), Kolkata Bench, comprising Shri Rohit Kapoor (Judicial Member) and Shri Balraj Joshi (Technical Member) has held that amount given as Share Application Money does not qualify as a financial debt under section 5(8) of the Insolvency and Bankruptcy Code, 2016 (“Code”).
Case Title: Subodh Kumar Agarwal, RP of Hindustan Controls and Equipment Pvt. Ltd. vs. Steel Authority of India
Case No.: IA(IB) No. 1820/( KB) /2023 in CP (IB) No. 1256/KB/2019
The National Company Law Tribunal ('NCLT') Kolkata, comprising Smt. Bidisha Banerjee (Judicial Member) and Shri D. Arvind (Technical Member) held that the Adjudicating Authority lacks jurisdiction to set aside an arbitral award even when the award was issued post-initiation of Corporate Insolvency Resolution Process ('CIRP') and during moratorium period under Section 14 of the Insolvency and Bankruptcy Code, 2016 ('IBC').
Case Title: Indiabulls Housing Finance Limited v. Primcomm Media Distribution Ventures Private Limited
Case No.: C.P.(IB)-246(MB)/C-III/2022
The National Company Law Tribunal (“NCLT”), Mumbai Bench, comprising Smt. Lakshmi Gurung (Judicial Member) and Shri Charanjeet Singh Gulati (Technical Member) has held that loan sanction letter, statement of account, copy of notice under section 13(2) Securitization and Reconstruction of Financial Assets and Enforcement of Securities Interest Act, 2002 (“SARFAESI”), and revised payment schedule will constitute “such other record” under section 7(3)(a) of the Insolvency and Bankruptcy Code (“Code”).
Case Title: Punjab National Bank vs. Arshiya Limited
Case No.: CP (IB) No. 3143/MB/2019
The National Company Law Tribunal (“NCLT”), Mumbai Bench, comprising Shri K.R. Saji Kumar (Judicial Member) and Shri Sanjiv Dutt (Technical Member) has held that a General Power of Attorney (“GPA”) holder can file an application under section 7 of the Insolvency and Bankruptcy Code, 2016 (“Code”) without having a specific Board Resolution.
NCLT Notifies Holidays And Upcoming Vacation In Benches Of NCLT
File No.: 10/03/2024-NCLT
The Registrar of the National Company Law Tribunal (“NCLT”) has issued a circular dated 02.05.2024, intimating the holidays and upcoming vacation benches at NCLT. The Registrar has directed that during the vacation only urgent matters at NCLT Benches shall be taken up via video conferencing mode. The same is subject to the availability of the Hon'ble Member (s). Hon'ble Member(s) shall grant hearing to the urgent matters as per their convenience.
File No. 25/02/2024-NCLT
The Registrar of the National Company Law Tribunal (“NCLT”) has issued a circular dated 29.04.2024, intimating a free Wi-Fi facility for Advocates, litigants, and other stakeholders of NCLT Benches. The said circular has been issued in compliance with the Hon'ble Supreme Court's Order in Writ Petition(s)(Criminal) No(s). 351/2023, titled “Sarvesh Mathur vs. The Registrar General High Court of Punjab and Haryana”.
Case Title: Mr. Sanjay Gupta Liquidator of Lanco Babandh Power Limited vs. Mr. Tarun Kumar Panda & Ors.
Case No.: Contempt Petition No.16 of 2023 in IA No.939 of 2020 in CP (IB) No.296/7/HDB/2018
The National Company Law Tribunal ('NCLT') Hyderabad, comprising Justice Rajeev Bhardwaj (Judicial Member) and Mr. Sanjay Puri (Technical Member) held Mr. Ravi Kiran Saladi Konda, Deputy Traffic Manager, New Mangalore Port Authority and Mr. Sriman Nayan Mishra, Senior Assistant Traffic Manager, Paradip Port Authority ('Respondents') guilty of contempt for disobeying the directions of the Adjudicating Authority and sentenced them to simple imprisonment of 1 month each with a fine of Rs 1000.
NCLT Defers Hearing On Go First's Insolvency Case To July
The National Company Law Tribunal (NCLT), New Delhi division bench of Justice Mahendra Khandelwal (Judicial Member) and Dr. Sanjeev Ranjan (Technical Member) has postponed the hearing on the insolvency plea of Go First, the grounded airline, to July 11, 2024. This decision came among concerns regarding the future of the airline. The tribunal stated it needed time for further examination of the recent developments, particularly the ramifications of the Delhi High Court's order, before reaching a verdict.
NCLT Grants Approval For Viacom18 And Star India Merger Scheme
Case Title: In the matter of The Scheme of Arrangement Among Viacom18 Media Private Limited (“Transferor Company”) And Digital18 Media Limited (“Transferee Company or Demerged Company”) And Star India Private Limited (“Resulting Company”)
Case No.: CA (CAA)/64/MB-IV/2024
The National Company Law Tribunal (NCLT) in Mumbai has taken the first step towards the completion of merger deal involving Reliance Industries Ltd's Viacom18, its subsidiary Digital18, and Walt Disney's Star India. The tribunal's Mumbai bench has admitted the merger scheme.
Case Title: Mr. Narayanam Nageswara Rao vs. Mr. K. Sivalingam (RP) and Anr.
Case No.: IA. Nos. 897 & 898 of 2024 in CP (IB) No. 299/7/HDB/2018
The National Company Law Tribunal ('NCLT') Hyderabad, comprising Dr. Venkata Ramakrishna Badarinath Nandula (Judicial Member) and Shri Charan Singh (Technical Member) held that the term “connected person” referred to in Explanation-I read with Section 29A(j) of Insolvency and Bankruptcy Code, 2016 ('IBC') relates to the Resolution Applicant and not the Corporate Debtor.
NCLT Mumbai Approves Withdrawal Of Insolvency Proceedings Against Syska LED Lights After Settlement
Case Title: Ms. Neeraj Singh Proprietor of M/S. N.J. Electronics Vs Syska Led Lights Private Limited
Case Number: IA 2297/2024 in C.P. (IB)/63(MB)2024
The Mumbai bench of the National Company Law Tribunal (NCLT) of Justice Virendra Singh Bisht (Judicial Member) and Prabhat Kumar (Technical Member) has approved the withdrawal of the Corporate Insolvency Resolution Process (CIRP) initiated against Syska LED Lights Pvt Ltd. This decision was made after a settlement agreement was reached between Syska and its operational creditor, Neeraj Singh, proprietor of NJ Electronics.
Case Title: Edelweiss Asset Reconstruction Company Ltd. vs ND S Art World Pvt. Ltd.
Case No.: IA 2243/2024 (New IA) in C.P. (IB)/895(MB)2022
The National Company Law Tribunal ('NCLT') Mumbai, comprising Justice Virendra Singh Bisht (Retd.) (Judicial Member) and Mr. Prabhat Kumar (Technical Member) allowed the plea of ND Studio Resolution Professional's (“RP”) granting exclusion of 116 days from the Corporate Insolvency Resolution Process (“CIRP”) period acknowledging the genuine hardships due to the ongoing criminal proceedings.
NCLT Issues Three Notices To Byju's Over Unpaid Dues, Hearing Scheduled For July 3
The National Company Law Tribunal (NCLT) has issued notices to Think and Learn Pvt Ltd, the parent company of Byju's, due to claims of unpaid dues from several creditors.
Three companies, McGraw Hill, Cogent E-services, and AG Automation, have filed cases against Byju's. McGraw Hill claims that Byju's owes them Rs 1.43 crore, while Cogent E-services says they are owed Rs 6 crore. The NCLT has set hearings for these cases on July 3, giving Byju's two weeks to respond and another week for the creditors to reply.
Record Approval Of Resolution Plans Under IBC in FY2024 By NCLT
The National Company Law Tribunal (NCLT) achieved a record number of approvals for resolution plans under the Insolvency and Bankruptcy Code (IBC) in the financial year 2023-24 (FY24). According to an analysis by ICRA, the NCLT approved 269 resolution plans, a significant increase from the previous high of 189 plans in FY23. This notable rise in approvals is attributed to the surge in corporate debtors admitted under the IBC in FY23, largely influenced by the economic impacts of the Covid-19 pandemic.
Case Title: Metamorphosis Trading LLP vs. Membrane Filters (India) Private Limited
Case No.: C.P.(IB)-880(MB)/C-III/2022
The National Company Law Tribunal ('NCLT') Mumbai Bench, comprising Ms. Lakshmi Gurung (Judicial Member) and Sh. Charanjeet Singh Gulati (Technical Member), while adjudicating an application under Section 7 of Insolvency and Bankruptcy Code, 2016 (“IBC, 2016”) in the case of Metamorphosis Trading LLP vs Membrane Filters (India) Private Limited has held that the loan amount acknowledged in the books of the Corporate Debtor as “Long-term Borrowings” is a loan having commercial effect of borrowing and is therefore, covered under section 5(8) of the I&B Code as financial debt.
Case Title: SHAARC Projects Limited vs. Hindustan Construction Company Limited
Case No.: C.P. (I.B) No. 1077/MB/2021
The National Company Law Tribunal (“NCLT”), Mumbai Bench, comprising Justice Reeta Kohli (Judicial Member) and Madhu Sinha (Technical Member) has held that an Operational Creditor cannot combine interest under the Micro, Small and Medium Enterprises Development Act, 2006 (“MSMED”) to the principal amount to meet the threshold limit under section 4 of the Insolvency and Bankruptcy Code, 2016 (“Code”) if it has obtained the MSME certificate post appointed date under section 16 read with section 2(b) of MSMED.
Undated Certificate Of Bankers Book Evidence Act Valid Under IBC: NCLT Chandigarh
Case Title: Canara Bank vs. Laggar Industries Limited
Case No.: CP (IB) 29/CHD/PB/2022
The National Company Law Tribunal (“NCLT”), Chandigarh Bench, comprising Mr. Harnam Singh Thakur (Judicial Member) and Mr. L.N. Gupta (Technical Member) has held that an undated certificate of Bankers Book Evidence Act, 1891, (“Act”) constitutes a valid certificate for regulation 2A of Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) Regulations, 2016 (“IBBI Regulations”).
Assignee Of A Financial Creditor Also A Financial Creditor U/S 5 (7) Of IBC: NCLT Kolkata
Case Title: Assets Care & Reconstruction Enterprise Limited vs Ankit Metal & Power Limited
Case No.: C.P (IB) No.91/KB/2023
The National Company Law Tribunal ('NCLT') Kolkata Bench, comprising Shri Rohit Kapoor (Judicial Member) and Shri Balraj Joshi (Technical Member), while adjudicating an application under Section 7 of Insolvency and Bankruptcy Code, 2016 (“IBC, 2016”) in Assets Care & Reconstruction Enterprise Limited vs Ankit Metal & Power Limited has held that the assignee of a Financial Creditor is also a Financial Creditor within the scope of Section 5(7) of IBC, 2016 and is thus competent to file the case under Section 7 of IBC.
Detention Charges Come Within The Purview Of Operational Debt: NCLT Mumbai
Case Title: ABC India Ltd. vs Prabhakar Engineers Pvt. Ltd.
Case No.: C.P. No. 4216/MB/2019
The National Company Law Tribunal, Mumbai Bench, comprising Ms. Reeta Kohli, (Judicial Member) and Madhu Sinha (Technical Member), while adjudicating an application under Section 9 of Insolvency and Bankruptcy Code, 2016 (“IBC, 2016”) in ABC India Ltd. vs Prabhakar Engineers Pvt. Ltd. has held that Detention Charges are very much a part of the Transportation Charges and hence a part of Operational Debt.
Case Title: S.A. Consultants & Forwarders Pvt. Ltd. v. Prime Cargo Movers & Logistics Pvt. Ltd.
Case No.: C.P. (IB) 1049/MB/2020
The National Company Law Tribunal (“NCLT”), Mumbai Bench, comprising Mr. Kuldip Kumar Kareer (Judicial Member) and Mr. Anil Raj Chellan (Technical Member) has held that Corporate Insolvency Resolution Process (“CIRP”) can be initiated against a Corporate Debtor under section 9 of the Insolvency and Bankruptcy Code, 2016 (“Code”) even if the Corporate Debtor had been acting as an agent of an ultimate client or principal.
NCLT Mumbai: Operational Debt Under IBC Does Not Include Penalty Or Liquidated Damages
Case Title: Sucden India Private Limited vs. Matoshri Laxmi Sugar Co-generation Industries Limited
Case No.: CP (IB) No.219/MB/2022
The National Company Law Tribunal ('NCLT') Mumbai, comprising Shri K.R. Saji Kumar (Judicial Member) and Shri Sanjiv Dutt (Technical Member) held that the operational debt under Insolvency and Bankruptcy Code, 2016 ('IBC') does not include penalty or liquidated damages.
NCLT Notifies Advocates, Litigants, Interns And Advocate Clerks/Court Clerks Not To Be Entertained For Administrative Or Registry Work Beyond 05 PM
File No.: 25/02/2024-NCLT
The Registrar of the National Company Law Tribunal (“NCLT”) has issued an administrative order dated 08.05.2024, intimating that in NCLT Benches, advocates, litigants, interns and advocate clerks/court clerks will not be entertained for any administrative or registry work beyond 05:00 PM.
Case Title: In re: M/s.Piramal Trusteeship Services Pvt Ltd. vs. Mr. Kakkanattil Ibrahimkutty Mohammed Rafi Mather
Case Number: CP(IBC)/36/KOB/2023 & IA(IBC)/96/KOB/2024 IN CP(IBC)/36/KOB/2023
The National Company Law Tribunal Kochi, comprising Justice T Krishna Valli (Judicial Member) and Mr. Shyam Babu Gautam (Technical Member) dismissed the application to initiate insolvency proceedings against the Personal guarantors under Section 95 of Insolvency and Bankruptcy Code, 2016 ('IBC').
ZEE-Sony Failed Merger: NCLT Grants Zee Entertainment Permission To Withdraw Merger Implementation
Case Title: Zee Entertainment Enterprises Limited Vs Bangla Entertainment Private Limited And Anr
Case Number: C.A. 32/MB/C-III/2024, C.A. 54/MB/C-III/2024, C.A. 55/MB/C-III/2024, C.A. 114/MB/C-III/2024 In. C.P.(CAA)/209/MB/C-III/2022
The National Company Law Tribunal Mumbai bench has granted Zee Entertainment Enterprises Limited (ZEEL) permission to withdraw its application seeking the implementation of a merger arrangement with Sony Group Corp-owned Culver Max Entertainment and Bangla Entertainment. This decision follows the termination of the merger agreement by Culver Max and Bangla Entertainment on January 22, 2024 for an alleged breach of the merger cooperation agreement (MCA).
Case Title: Mr. Ashish Chhawchharia, Resolution Professional of Jet Airways (India) Limited vs. TWC Aviation Capital Limited and Ors.
Case No.: IA No. 342/MB/C-I/2021 in C.P (IB) No.2205/MB/C-I/2019
The National Company Law Tribunal Mumbai bench comprising Justice V.G. Bisht (Retd.) (Judicial Member) and Mr. Prabhat Kumar (Technical Member) held that assets of the Corporate Debtor held by third parties must be released to the Resolution Professional ('RP') for the resolution and revival Corporate Debtor. It also ruled that charge holders may file their claims in the appropriate class if they believe to hold a charge over such assets.
Case Title: Prudent Arc Limited vs Shirpur Gold Refinery Limited
Case Number: CP (IB) No. 250/MB/2022
Subhash Chandra-promoted Essel Group's Shirpur Gold Refinery Limited (SGRL) has been admitted for corporate insolvency resolution following an application filed by Prudent ARC at the Mumbai bench of the National Company Law Tribunal.
NCLT Kolkata: Corporate Debtor Can't Take Shelter U/S 186 Of Companies Act To Avoid CIRP When Loan Has Been Advanced In Breach Of Section 186(2) Of Companies Act
Case Title: EDCL Infrastructure Ltd. vs. Urban Infraprojects Pvt. Ltd.
Case No.: Company Petition (IB) No. 106/KB/2023
The National Company Law Tribunal ('NCLT') Kolkata, comprising Smt. Justice Bidisha Banerjee (Judicial Member) and Shri D. Arvind (Technical Member) held that the Corporate Debtor cannot take shelter under Section 186 of the Companies Act, 2013 to avoid Corporate Insolvency Resolution Process ('CIRP') under Section 7 of IBC, wherein the Financial Creditor has advanced loan in breach of Section 186(2) to the Corporate Debtor.
The Bench observed that the said provision serves as a safeguard for the shareholders/stakeholders of the Company, presently the Financial Creditor, ensuring that those managing the company cannot and do not exceed prescribed loan limits which would be in excess of their capacity and could lead the company into significant trouble in case of default. Thus, Section 186 of the Companies Act, 2013, mandates that if a company intends to provide a loan beyond the specified limits, it requires approval from shareholders through a special resolution.
In the event of a violation under Section 186(2) of the Companies Act, 2013, the affected parties would include the shareholders/stakeholders of the Financial Creditor and regulatory authorities. The Corporate Debtor cannot use such violations as a defense to refuse repayment of borrowed funds.
NCLT Mumbai Approves Rs. 9,661 Crore Resolution Plan By IndusInd International Holdings For Reliance Capital
Case Title: Mr. Nageswara Rao Y, Administrator of Reliance Capital Limited vs. Committee of Creditors of Reliance Capital Limited and IndusInd International Holdings Limited
Case No.: CP (IB) No. 1231 of 2021
The National Company Law Tribunal ('NCLT') Mumbai, comprising Justice V.G. Bisht (Judicial Member) and Mr. Prabhat Kumar (Technical Member), has approved the Rs. 9,661 crore resolution plan submitted by IndusInd International Holdings Ltd ('IIHL') for Reliance Capital Limited (Corporate Debtor) under Section 31 of IBC.
The Resolution Plan of IIHL is valued at Rs. 9,661 crores. Out of the total claims of Rs 38,526.42 crore, only Rs 26,086.75 crore were admitted by the NCLT with a massive haircut of 63 percent. The average fair value of the Corporate Debtor is Rs. 16,696.05 crores and the average Liquidation value is Rs. 13,158.46 crores.
Section 53 of IBC provides priority to the dues of Workmen and Employees, however, in the resolution plan they have been paid NIL against an admitted claim of Rs. 5.71 crores.
The Plan provides that the secured financial creditors who voted in favor of the Resolution Plan be paid in full to the extent of their outstanding principal amount. The unsecured financial creditors have been proposed to be paid 5% of their admitted claims.
The Plan provides that payment towards Related Party Creditors be settled for NIL.
NCLT Chennai: Adjudicating Authority Under IBC Is Not The Appropriate Forum To Decide On Revocation Of Attachment Made By ED Under PMLA During CIRP
Case Title: Mr. Palaniappan Liquidator of Nathella Sampath Jewelry Pvt. Ltd. vs. The Joint Director Directorate of Enforcement
Case No.: CP/129(IB)/2018
The National Company Law Tribunal ('NCLT') Chennai, comprising Shri Justice Jyoti Kumar Tripathi (Judicial Member) and Shri Ravichandran Ramasamy (Technical Member) held that the NCLT under IBC, is not the appropriate fora to decide on revocation of attachment made by Enforcement Directorate ('ED') under Prevention of Money Laundering Act, 2002 ('PMLA') during Corporate Insolvency Resolution Process ('CIRP').
NCLT observed that the 'Attachment' as a concept cannot be decided upon by the NCLT and cannot be subject to Section 60(5) of IBC.
NCLT Kolkata: IBC Prevails Over State Financial Corporation Act, 1951
Case Title: Mr. Rajesh Lahila vs. West Bengal Industrial Development Corporation Ltd.
Case No.: C.P. (IB) No. 1674/KB/2019
The National Company Law Tribunal ('NCLT') Kolkata, comprising Justice Ms. Bidisha Banerjee (Judicial Member) and Shri Arvind Devanathan (Technical Member), has held that IBC prevails over State Financial Corporation Act, 1951 (SFC Act).
Tribunal noted the inconsistency between Section 18(f) of IBC and Section 29 of the SFC Act and observed that while Section 18(f) of IBC casts duty on the Resolution Professional to take custody of Corporate Debtor's assets as recorded in the balance sheets, the explanation of the said provision also provides that Corporate Debtor's assets not in possession shall also be taken into custody.
On the other hand, Section 29 of the SFC Act provides that on a failure to the payment as per the terms and conditions of the borrowings, the Corporation can take first charge over the Corporate Debtor's immovable properties to be retained and dispose of the said properties pledged. The NCLT resolved the said inconsistency through the application of Section 238 of IBC providing that IBC shall prevail over any other statute in the case of such inconsistency.
NCLT Mumbai: Profits During CIRP Be Allocated To Financial Creditors When RFRP And Resolution Plan Are Silent On Such Allocation
Case Title: Kalyan Janata Sahakari Bank Ltd. & Anr. vs. Arun Kapoor, Resolution Professional of CICIL Biochem Private Limited
Case No.: C.P. (IB) No. 4676/MB/2018
The National Company Law Tribunal ('NCLT') Mumbai, comprising Mr. Kuldip Kumar Kareer (Judicial Member) and Mr. Anil Raj Chellan (Technical Member) held that the profits accrued during the Corporate Insolvency Resolution Process ('CIRP') be allocated to the Financial Creditors when the Request for Resolution Plan ('RFRP') and the Resolution Plan are silent on the allocation of profits.
Liquidation Value Is More Than Resolution Plan , NCLT Allahabad Directs SRA To Match Liquidation Value
Case title: Hadirah Steels Pvt. Ltd. v Rana Heavy Engineering Ltd.
Case No.: CP (IB) No.50/ALD/2022
The National Company Law Tribunal (“NCLT”), Allahabad Bench, comprising of Shri Praveen Gupta (Judicial Member) and Shri Ashish Verma (Technical Member), has directed the Successful Resolution Applicant to consider matching the resolution plan value at par with the liquidation value, which is on a higher side. The Successful Resolution Applicant is the Financial Creditor of the Corporate Debtor and also the sole member of Committee of Creditors (“CoC”).
“We are also conscious of the fact that commercial wisdom of the Committee of Creditors in the matter of approval of resolution plan should be regarded. However, in the peculiar circumstances of the case where the financial creditor who is member of CoC itself is the SRA as well, we therefore, find it justifiable in passing such directions to the SRA to consider matching the total plan value at par with the liquidation value with corresponding pro-rata rise in the amount of disbursement.”
NCLT Kolkata: Dispute On Forgery And Fabrication Of Document Cannot Be Decided By Adjudicating Authority (NCLT) In A Summary Proceeding Under IBC
Case Title: Abdul Hannan vs. Jai Jute and Industries Ltd.
Case No.: Company Petition (IB) No. 154/KB/2022
The National Company Law Tribunal ('NCLT') Kolkata, comprising Smt. Bidisha Banerjee (Judicial Member), and Shri D. Arvind (Technical Member) held that the dispute relating to forgery and fabrication of a document cannot be adjudicated by the Adjudicating Authority in a summary proceeding under Insolvency and Bankruptcy Code, 2016 ('IBC').
The Tribunal placed reliance on the various decisions of the NCLAT in Radha Exports (India) Pvt. Limited vs. K.P. Jayaram, Jaginder Singh Lather vs. AU Small Finance Bank Ltd., Satori Global Limited v. Shailja Krishna, and Shri T.R. Arya v. Dilawari Motors Pvt. Ltd. wherein it was held that disputes as to whether the documents are forged or have been fabricated cannot be adjudicated by NCLT.
NCLT Kolkata: Police Complaint Before The Issuance Of The Demand Notice U/S 8 Of IBC Relating To Supply Of Inferior Goods Or Services Constitutes 'Pre-Existing Dispute'
Case Title: Abdul Hannan vs. Jai Jute and Industries Ltd.
Case No.: Company Petition (IB) No. 154/KB/2022
The National Company Law Tribunal ('NCLT') Kolkata, comprising Smt. Bidisha Banerjee (Judicial Member), and Shri D. Arvind (Technical Member) held that a Police Complaint, prior to the issuance of the Demand Notice under Section 8 of IBC prosecuting a dispute regarding the supply of inferior goods and/or service is a pre-existing dispute.
The Bench placed reliance on the NCLAT decision in Sherbahadur D. Yadav vs. M/s. Rohan Dyes and Intermediates Ltd. wherein it observed that existence of complaints prior to the initiation of proceedings u/s 9 of IBC is to be considered as a pre-existing dispute between the parties.
Further reliance was placed on NCLAT decision in Mr. Anil J. Nemaavarkar vs. M/s. Kumar Builders Mumbai Realty Pvt. Ltd,. wherein it was held that IBC is not for resolving disputes relating to service, benefits, and the remedy lies elsewhere.
Section 7 IBC Petition Can't Be Filed By Power Of Attorney Holder Unless Authorized By Board Resolution: NCLT Hyderabad
Case Title: Axis Bank Limited vs Karvy Forde Search Pvt. Ltd.
Case No.: CP(IB) No. 249/7/HDB/2022
The National Company Law Tribunal (“NCLT”), Hyderabad Bench, comprising Dr Venkata Ramakrishna Badarinath Nandula (Judicial Member) and Shri Charan Singh (Technical Member), has held that a petition under Section 7 of IBC cannot be filed by a 'power of attorney' holder unless duly authorized by a Board Resolution.
The NCLT examined the requirements for applying under Section 7(2) of IBC and referred to Form-1 of the Insolvency and Bankruptcy (Application to Adjudicating Authority) Rules, 2016. Entries in the form mandate submission of the name and address of the authorized person to apply on behalf of the financial creditor, along with an authorization letter. However, the form does not explicitly mention a 'power of attorney holder'.
The NCLT perused the notification issued by the Central Government under Section 7(1) of IBC, specifying persons authorized to apply on behalf of a financial creditor, which did not include 'power of attorney holders'.
NCLT Kolkata: Any Attachment Of Tainted Assets Of Corporate Debtor Before CIRP Commencement Would Always Be Available To Fulfill The Object Of IBC
Case Title: State Bank of India vs. Shree Mahalaxmi Corporation Pvt. Ltd.
Case No.: Company Petition (IB) No. 130/KB/2022
The National Company Law Tribunal ('NCLT') Kolkata, comprising Smt. Bidisha Banerjee (Judicial Member), and Shri D. Arvind (Technical Member), has held that Any attachment of tainted assets of a Corporate Debtor before the Corporate Insolvency Resolution Process ('CIRP') commencement would always be available to fulfill the object and goal of IBC.
NCLT Kolkata: Provisional Attachment Order Under PMLA Won't Bar Admission Of CIRP Against Corporate Debtor Under IBC
Case Title: State Bank of India vs. Shree Mahalaxmi Corporation Pvt. Ltd.
Case No.: Company Petition (IB) No. 130/KB/2022
The National Company Law Tribunal ('NCLT') Kolkata, comprising Smt. Bidisha Banerjee (Judicial Member), and Shri D. Arvind (Technical Member) held that the Provisional Attachment Order under PMLA will not bar the admission of Corporate Insolvency Resolution Process ('CIRP') proceedings against the Corporate Debtor under IBC.
NCLT Mumbai: Timeline Provided By CIRP Regulation 36A(6) Must Be Adhered To Strictly
Case Title: Shree Siddhivinayak Cotspin Pvt. Ltd. vs. Rajan Deshraj Agarwal and Anr.
Case No.: IA No. 2390 of 2023 In CP(IB) 518 (IB)2020
The National Company Law Tribunal ('NCLT') Mumbai, comprising Justice Kuldip Kumar Kareer (Judicial Member) and Mr. Anil Raj Chellan (Technical Member), has held that the timeline provided by the IBBI (Insolvency Resolution Process for Corporate Persons) Regulations, 2016 ('CIRP Regulation') 36A(6) must be adhered to strictly.
NCLT Chandigarh - Minimum Threshold Will Be Applicable To Any Amount Raised From Allottee
Case: Mr. Tek Chand Narula vs M/s Vatika Ltd.
Citation: CP (IB) No.528/Chd/Hry/2019 & IA No. 302/2022
The National Company Law Tribunal (NCLT), Chandigarh bench, comprising Justice Dr. P.S.N. Prasad (Judicial Member) and Shri Umesh Kumar Shukla (Technical Member), has held that the requirement of satisfying the minimum threshold of either 10% or 100 allottees will be applicable to any amount raised from an allottee, irrespective of whether the said allottee is alleging the default of interest or the principal amount.
Deadlocks In Equal Shareholding Should Be Resolved By Buyout Of Shares: NCLT Mumbai
Case Title: Mr. Hormouz Phiroze Aderianwalla & Anr. vs. Del. Seatek India Pvt. Ltd. and Ors.
Case Number: Company Petition/199/MB/2022 & Company Petition/50/MB/2023
The National Company Law Appellate Tribunal (NCLT), Mumbai bench, comprising Mr. Kishore Vemulapalli Hon'ble Member (Judicial Member) and Ms. Anu Jagmohan Singh (Technical Member) has held that in cases of equal shareholding and director representation among shareholders, where a deadlock arises in the day-to-day management of the company, the deadlock should be resolved by one group purchasing the shares of the other.
Case Title: M/s Apogee Enterprises Pvt. Ltd. (formerly M/s Apogee Manufacturing Pvt. Ltd.) v. Late Shri Anil Nanda
Case Number: I.A. 1362/2024, I.A. 2082/2022, and I.A. 2634/2023 in C.P. (I.B) No. 514 of 2020
The National Company Law Tribunal (NCLT), New Delhi, Bench VI, comprising Shri Mahendra Khandelwal (Member, Judicial) and Shri Rahul Bhatnagar (Member, Technical), has held that insolvency proceedings initiated against a personal guarantor under the IBC abate upon the death of the guarantor and that legal representatives cannot be substituted in such cases.
Case Title: UCO Bank vs GIT Textiles Manufacturing Limited
Case Number: I.A. (IB) No. 1350/KB/2024 In C.P. (IB) No. 600/KB/2019
The National Company Law Tribunal Kolkata division bench of Bidisha Banerjee (Judicial Member) and D. Arvind (Technical Member) has ruled that the approval of a Resolution Plan by the Committee of Creditors (CoC) does not empower the Resolution Professional to cancel an existing lease. The bench stated that such issues must be adjudicated by a competent court with the appropriate jurisdiction.
Case Title: Ashdan Properties Privet Limited vs Mr. Harshad Despande / Resolution Professional & Committee of Creditors of Corporate Debtor
Case Number: I.A. 1143 OF 2024 IN C.P. (IB) No. 783 of 2021
The National Company Law Tribunal Mumbai bench of Reeta Kohli (Judicial Member) and Madhu Sinha (Technical Member) has held that Committee of Creditors' decision to reject the Applicant's plan solely due to a technical delay of one day in submission, without evaluating the substantive efforts made and the potential value of the plan, does not align with the objectives of the Corporate Insolvency Resolution Process (CIRP).
Case Title: Ksheeraabd Constructions Private Limited Vs Reliance Infrastructure Limited
Case Number: CP (IB) No.185/MB/2019
The National Company Law Tribunal, Mumbai bench of K. R. Saji Kumar (Judicial Member) and Sanjiv Dutt (Technical Member) has held the claims presented by the Operational Creditor (OC) in the arbitration proceedings and those in the CIRP application of similar and pertained to the same subject matter indicates the existence of a pre-existing dispute between the parties. Therefore, the bench rejected an application for initiation of CIRP
Interest Claims Must Be Based On Contractual Agreement, Not Just Invoice Terms: NCLT Kolkata
Case Title: Sudarshan Paper & Board Private Limited vs Verges Properties LLP
Case Number: Company Petition (IB) Nom 54 of 2024
The NCLT Kolkata Divison Bench, comprising Bidisha Banerjee, Member (Judicial) and D. Arvind, Member (Technical) has held that interest cannot be clubbed along with the debt in the absence of an agreement or clause in the purchase order. The Tribunal further observed that TDS deduction on the interest payable is not an acknowledgement of liability.
Case Title: Indian Bank Vs Mr. Manish Kumar
Case Number: Company Petition (IB) No. 340/KB/2022 And I.A. (IB) No. 316/KB/2024
The National Company Law Tribunal Kolkata bench of Bidisha Banerjee (Judicial Member) and D. Arvind (Technical Member) has imposed a ₹1 lakh penalty on Indian Bank for filing insolvency proceedings against a Personal Guarantor who was already undergoing insolvency proceedings initiated by the same bank.
Interest Not Mentioned In Invoices Or Civil Court Decree, Can't Add To Reach Threshold Limit: NCLT
Case Title: Mr. Pardeep Kumar Vs M/S. Welldone Exim Private Limited
Case Number: RCP 2(ND)/2024 (Old Case No. IB-548(ND)/2023)
The National Company Law Tribunal New Delhi bench of Bachu Venkat Balaram Das (Judicial Member) and Atul Chaturvedi (Technical Member) has held that claim for interest is not arising out of supplies of goods or services and do not form part of the Operational Debt in terms of Section 5(21) of the Insolvency and Bankruptcy Code, 2016. Therefore, the bench held that the interest awarded by the civil court could not be combined with the principal amount to meet the threshold limit of Rs. 1 Crore.
Case Title: UCO Bank vs Nandini Impex Pvt Ltd.
Case Number: IA No. 795/(KB)/2024 in C.P. No. 1377/KB/2020
The National Company Law Tribunal Kolkata bench of Bidisha Banerjee (Judicial Member) and Balraj Joshi (Technical Member) has held that the liquidation of a corporate debtor should be a measure of last resort. It held that the Insolvency and Bankruptcy Code (IBC) acknowledges a broader public interest in resolving corporate insolvencies with its primary objective extending beyond the mere recovery of outstanding debts. The bench held that the corporate debtor lacks substantial tangible assets that could generate significant recovery for creditors. Consequently, it held that proceeding with liquidation could undermine the IBC's core objective of maximizing asset value.
Case Title: Mayfair Biotech Pvt. Ltd Vs Good Value Chemicals Pvt. Ltd
Case Number: C.P (IB)/215(ND)2020
The National Company Law Tribunal, New Delhi bench of Mahendra Khandelwal (Judicial Member) and Dr. Sanjeev Ranjan (Technical Member) has held that the exchange of debit notes and the pending MSME reference indicate a plausible pre-existing dispute. Therefore, the bench held that if the Corporate Debtor raises a plausible contention about a pre-existing dispute, which is not just a moonshine or feeble legal argument, it would suffice for the Adjudicating Authority to reject the application filed under Section 9 of the IBC.
Case Title: In the matter of Q West Infrastructure Private Limited vs Starwort Engineers Private Limited
Case Number: CP(IB)No. 229/MB/2024
The National Company Law Tribunal, Mumbai bench of Prabhat Kumar (Technical Member) and Justice V.G Bisht (Judicial Member) has held that deficiencies in document stamping, as per the Stamp Act, cannot be used as a reason to dismiss an application under Section 7 of the Insolvency and Bankruptcy Code
Judge Recusals On Frivolous Grounds Enable Litigant Manipulation And Bench Selection: NCLT Mumbai
Case Title: M/s. Perfect Infraengineers Ltd. Vs Technology Development Board
Case Number: Interlocutory Application No. 3403/2024 IN Company Petition No.(IB) 322 of 2023
The National Company Law Tribunal, Mumbai bench of Justice (Retd.) Sh. Virendrasingh Bisht (Judicial Member) and Prabhat Kumar (Technical Member) has held that judges recusing themselves based on frivolous and baseless allegations would enable litigants to manipulate proceedings to select their preferred benches. The bench held that recusal cannot be dictated by litigants; it is solely at the judge's discretion. This practice, if allowed, would effectively permit litigants to choose benches to their liking.
IBC Provisions Prevail Over Kolkata Municipal Corporation Act: NCLT Mumbai
Case Title: Kolkata Municipal Corporation vs Gajesh Labhchand Jain
Case Number: Appeal No.03/MB/2024 In CP (IB) No. 1056/MB/2020
The National Company Law Tribunal Mumbai bench of Anu Jagmohan Singh (Technical Member) and Kishore Vemulapalli (Judicial Member) has held that the provisions of the Kolkata Municipal Corporation Act do not take precedence over those of the IBC. The bench held that claims by the KMC, being in the nature of crown debt, should be classified as government dues and accordingly placed within the waterfall mechanism under Section 53 of the Insolvency and Bankruptcy Code, 2016.
Case Title: Bank of Baroda vs Mr. Jitendra V Kikavat
Case Number: C.P. (IB) NO. 139/MB/2022
The National Company Law Tribunal Mumbai bench of Justice V. G. Bisht (Judicial Member) and Prabhat Kumar (Technical Member) has rejected contention regarding the insufficiency of stamp duty on the guarantee agreement. The bench held that the proceedings under the Insolvency and Bankruptcy Code (IBC) are intended to address insolvency issues rather than to enforce the guarantee itself.
Case Title: MR. Debabrata Ray Choudhuri vs The State Trading Corporation of India Limited
Case Number: Company Petition No. (IB) 242(PB)2020
The National Company Law Tribunal New Delhi bench of Manni Sankariah Shanmuga Sundaram (Judicial Member) and Dr. Sanjeev Ranjan (Technical Member) has rejected an application for the initiation of the Corporate Insolvency Resolution Process (CIRP) by a Senior Advocate for non-payment of Rs. 6.26 Crore legal fees. The bench noted that there exists a pre-existing dispute regarding the invoices issued, as they do not conform to the agreed schedule of fees. The invoices contained discrepancies that have not been rectified despite prior communications highlighting these issues. The bench noted that this discrepancy underscores a substantial dispute between the parties concerning the legitimacy of the invoiced amounts. Therefore, it held that there existed a pre-existing dispute exists regarding the invoices and their alignment with the agreed schedule of fees.
No Provision In IBC To Send Resolution Plan Back To CoC For Reconsideration: NCLT New Delhi
Case Title: Punjab National Bank Vs Saraya Industries Ltd
Case Number: IA 6058/2023 IN Company Petition No. (IB) – 2628/(ND)/2019
The National Company Law Tribunal New Delhi bench of Mahendra Khandelwal (Judicial Member) and Rahul Bhatnagar (Technical Member) has held that there is no provision in IBC allowing the Adjudicating Authority to send the resolution plan back to the Committee of Creditors (CoC) for reconsideration at the CoC's request. Further, the bench held that once a resolution plan is submitted to the Adjudicating Authority, its jurisdiction is very limited concerning the approval or rejection of the plan.
Case Title: Mr. Anirudh Kumar vs M/s. Hydraulics and Pneumatics India LLP & ORS
Case Number: CA-133(ND)/2022 And Company Petition No. 53/45QA/ND/2022
The National Company Law Tribunal New Delhi bench of Dr. Sanjeev Ranjan (Technical Member) and Manni Sankariah Shanmuga Sundaram (Judicial Member) has held that there is no provision empowering it to relax / waive the eligibility requirements prescribed under Section 43(3) of LLP Act. Section 43(3) outlines the conditions under which the Central Government may appoint inspectors to investigate the affairs of an LLP. This subsection mandates that a minimum of one-fifth of the total number of partners must file a petition for such an investigation.
Case Title: Vineet K. Chaudhary vs NTPC Limited
Case Number: INTERLOCUTORY APPLICATION NO. 3453 OF 2022 IN COMPANY PETITION (IB) NO. 1374 (MB)/2017
The National Company Law Tribunal, Mumbai bench of Kuldip Kumar Kareer (Judicial Member) and Anil Raj Chellan (Technical Member) had held that directing Corporate Debtor to seek resolution through civil courts or arbitration for even admitted dues would undermine the objectives of the Insolvency and Bankruptcy Code.
Case Title: State Bank of India vs Dr Renuka Rani Maganti and Anr.
Case No.: CP (IB) NO.50/95/AMR/2022
The National Company Law Tribunal, Amaravati special bench of Dr Venkata Ramakrishna Badarinath Nandula (Judicial Member) dismissed a petition filed by the State Bank of India under Section 95(1) of the Insolvency and Bankruptcy Code, 2016. Discrepancies were found in the addresses used for the demand notice served to the personal guarantor and it was held that SBI failed to send the notice to the correct address as per the guarantee agreement.
Case Title: Employee's provident Fund Organisation vs CA Shirley Mathew
Case Number: I.A. No.4 & 87 of 2024 U/s 60(5) of the IBC, 2016 in C.P.(IB)No.36/BB/2022
The National Company Law Tribunal Bengaluru bench of K. Biswal (Judicial Member) and Manoj Kumar Dubey (Technical Member) has held that claims submitted after the approval of the Resolution Plan, including those related to the moratorium period, are not allowed under the Insolvency and Bankruptcy Code (IBC). The bench held that permitting such belated claims at a later stage would interfere with the Corporate Insolvency Resolution Process.
Case Title: State Bank Of India V/S Jyoti Structures Ltd
Case Number: IA 1217/2024 IA 1835/2024 in C.P. (IB)/1137(MB)2017
The National Company Law Tribunal Mumbai bench of Prabhat Kumar (Technical Member) and Justice Virendrasingh Bisht (Judicial Member) has held that no liability can be imposed on the Successful Resolution Applicant after the approval of the plan by the Committee of Creditors if such liability is not identifiable from the financial records of the Corporate Debtor.
Case Title: State Bank of India vs Dr Jitendra Das Maganti and Anr.
Case No.: CP (IB) No.49/95/AMR/2022
The National Company Law Tribunal (NCLT), Armravati Special Bench of Dr Venkata Ramakrishna Badarinath Nandula (Judicial Member) held that proof of due service of the demand notice presented to the corporate debtor or its guarantor must first be verified by the resolution professional. The creditor cannot present the same directly to the adjudicating authority/tribunal.
Case Title: Gauder & Co. S.A. Vs Isinox Limited
Case Number: CP (IB) No.1277/MB/2022
The National Company Law Tribunal Mumbai bench of K. R. Saji Kumar (Judicial Member) and Sanjiv Dutt (Technical Member) has held that an arbitration clause in an agreement does not prevent an operational creditor from filing an application under Section 9 of the Insolvency and Bankruptcy Code (IBC).
The bench held that the presence of such a clause does not impose any restriction on the Operational Creditor's right to pursue a Section 9 Application.
Interest Not Essential For Debt To Qualify As Financial Debt Under IBC: NCLT Mumbai
Case Title: In the matter of Spenta Enclave Private Limited (Through its Resolution Professional, Mr. Rajesh Jhunjhunwala) vs Spenta Sun City Private Limited
Case Number: C.P. (IB) 1066/MB/2023
The National Company Law Tribunal Mumbai bench of Anil Raj Chellan (Technical Member) and Kuldip Kumar Kareer (Judicial Member) has held that the inclusion of interest is not essential for a debt to qualify as financial debt. The bench held that the definition of financial debt under Section 5(8) of the Insolvency and Bankruptcy Code, 2016, does not explicitly exclude interest-free loans.
Case Title: Proplarity Infratech Private Limited vs Sky High Technobuild Private Limited
Case Number: CP (IB) No.607/(PB)/2023 & I.A. No. 595 of 2024 I.A. No. 1097 of 2024
The National Company Law Tribunal Principal Bench, New Delhi of Chief Justice (Retd.) Ramalingam Sudhakar (President) and Avinash K. Srivastava (Technical Member) has held that mere recording of the transaction as “Inter-Corporate Deposit” in balance sheets is insufficient to establish it as financial debt without supporting documentation. The bench noted that the an application under Section 7 of the IBC can be initiated by Financial Creditor (FC) for initiating the Corporate Insolvency Resolution Process (CIRP) against Corporate Debtor (CD) when there is an existence of 'debt' and consequent 'default.'
Case Title: Nitin Batra and Ors. vs M/s Anand Infoedge Pvt. Ltd. and Others and Connected Matters
Case No.: IA 293/2024, 2497/2024, IN IB-682/PB/2021
The National Company Law Tribunal VI, New Delhi bench of Shri Mahendra Khandelwal (Judicial Member) and Shri Rahul Bhatnagar (Technical Member) held that a joint insolvency resolution process against multiple entities who were involved in the development of the same construction project is recognized and could be initiated under the Insolvency and Bankruptcy Code, 2016.
Insolvency Professional Entities Qualified To Be Appointed As Resolution Professionals: NCLT Mumbai
Case Title: Piramal Capital and Housing Finance Limited vs Notion Real Estate Pvt. Ltd.
Case No.: IA(I.B.C)/3433(MB)2024 IN C.P. (IB)/915(MB)2023
The National Company Law Tribunal, Mumbai bench of Shri Sanjiv Dutt (Technical Member) and Shri K.R. Saji Kumar (Judicial Member), held that Insolvency
Professional Entities (IPEs) are qualified to be appointed as Resolution Professionals (RPs) under the Insolvency and Bankruptcy Code, 2016.
The NCLT held that the Insolvency and Bankruptcy Board of India (IBBI) has the authority to regulate and recognize IPEs as resolution professionals, despite the IBC not explicitly mentioning them as professional service providers.
Case Title: Ericsson India Private Limited vs. Reliance Communications Limited
Case No.: MA No. 3553 of 2019, MA 133 of 2020 & MA 645 of 2020 in CP No.
1386 of 2017 IA No. 3555 of 2019, IA 126 of 2020 & IA 646 of 2020 in CP No. 1387
of 2017
The National Company Law Tribunal ('NCLT') Mumbai bench comprising Justice
V.G. Bisht (Retd.) (Judicial Member) and Mr. Prabhat Kumar (Technical Member) held that exclusion of period of stay of Corporate Insolvency Resolution Process (“CIRP”) petition does not lead to postponement of Insolvency commencement date under Insolvency and Bankruptcy Code, 2016 (“IBC”).
NCLT Mumbai: Notice To CD Recalling Loan Facility Doesn't Constitute Demand On Corporate Guarantor
Case Title: State Bank of India vs. Navjeevan Tyres Private Limited
Case No.: CP (IB) No.1282/MB/2022
The National Company Law Tribunal ('NCLT') Mumbai bench comprising Justice K.
R. Saji Kumar (Judicial Member) and Mr. Sanjiv Dutt (Technical Member) held that notice to Corporate Debtor recalling loan facility doesn't constitute Demand on
Corporate Guarantor.
Case Title: Sanjeev Mahajan vs. Indian Bank (Erstwhile Allahabad Bank) & Anr.
Case No.: I.A. No. 2594/2023 in Company Petition No. (IB) – 1913/ND/2019
The National Company Law Tribunal ('NCLT') Court V, New Delhi bench comprising Shri Mahendra Khandelwal (Judicial Member) and Dr. Sanjeev Ranjan (Technical Member) held that the Adjudicating Authority cannot consider a Settlement
Proposal, even of a higher value than the Resolution Plan, after the approval of the Resolution Plan by the Committee of Creditors ('CoC').
Petition Under Section 95 Not Maintainable Against Partnership Firms: NCLT Hyderabad
Case Title: Union Bank of India v. M/s. K M R Enterprises and Anr.
Case Reference: CP (IB) No. 66/95/HDB/2024
The National Company Law Tribunal (NCLT) Hyderabad in an important judgment clarified that partnership firms do not fall under section 95 of the Insolvency and Bankruptcy Code (IBC). The tribunal dismissed a petition filed by Union Bank of India (Financial Creditor) under section 95 of the IBC against KMR Enterprises (Respondent).
The tribunal observed as under:
“To answer the question as to who can be called as personal guarantor, we use fully refer to section 5(22) of IBC, 2016 which defines Personal Guarantor as an individual who is the surety in a contract of guarantee to a Corporate Debtor. It is important to note that partnership firm was not included under the definition of Personal Guarantor”.
Moratorium Can't Be AShield To Defeat Legitimate Claims Of The Creditors: NCLT Chandigarh
Case Title: Punjab National Bank and Anr v. Mohita Indrayan
Case Reference: IA No. 2727/2023, IA No. 2974/2023 & CP (IB) No. 158/Chd/Hry/2023
The National Company Law Tribunal (NCLT), Chandigarh Bench, comprising Shri Harnam Singh Thakur (Judicial Member) and Shri Ashish Kumar Verma (Technical Member), admitted an insolvency petition under section 95 of the Insolvency and Bankruptcy Code (IBC) against Ms. Mohita Indrayan, a personal guarantor, for the debts of M/s Indian Clothing League Private Limited (corporate debtor). This petition was filed by Punjab National Bank along with Indian bank (banks). The NCLT observed that despite a petition under section 94 of the IBC filed by the personal guarantor, no further steps were taken to proceed with the case therefore benefit of interim moratorium under section 96 of the IBC could not be given.
NCLT Hyderabad Declares Stock Brokers As Financial Service Provider, Petition Under Section 9 Not Maintainable
Case Title: Kapston Facilities Management Ltd.v.Karvy Stock Broking Ltd.
Case Reference: CP (IB) No.332/9/HDB/2021
The National Company Law Tribunal Hyderabad Bench, comprising Shri Rajeev Bhardwaj (Judicial Member) and Shri Sanjay Puri (Technical Member) dismissed insolvency petition filed against Karvy Stock Broking Ltd. (Corporate Debtor/Respondent) by Kapston Facilities Management Ltd. (Operational Creditor) under section 9 of the Insolvency and Bankruptcy Code (IBC). The NCLT held that the respondent is a financial service provider against whom no Corporate Insolvency Resolution Process (CIRP) can be initiated.
The Tribunal held as under:
“However, the financial service provider is not included in the definition of corporate person and accordingly an application cannot be filed for initiation of CIRP against the financial service provider. Here, we may also profitably refer to the decision of Hon'ble NCLAT in Globe Capital Market Ltd. vs. Narayan Securities Ltd. Company Appeal (AT) (Insolvency) No.32 of 2024 & I.A No. 62 of 2024”.
Case Title: Amogh Industrial Products Vs. Mirchi Developers Pvt. Ltd
Case Number: CP(IB) No. 103/9/HDB/2024 u/s. 9 of IBC, 2016
NCLT Hyderabad in its judgement of Amogh Industrial Products Vs. Mirchi Developers Pvt. Ltd dismissed a Section 9 application filed under the Insolvency and Bankruptcy Code, 2016 by Amogh Industrial Products (Operational Creditors) praying to initiate a Corporate Insolvency Resolution Process (CIRP) against Mirchi Developers Pvt ltd, due to the failure in compliance with Section 69(2) of Indian Partnership Act, 1932.
A firm shall be registered under Section 69(2) of the Indian Partnership Act, 1932, to file a petition for the enforcement of rights under contract. In addition, the petitioners did not produce the register of firms showing the names of its partners.
Related Party Prohibited From Participating In CoC, Cannot Overcome Bar Merely By Assignment Of Debt: NCLT Mumbai
Case Title: Greenshift Initiatives Pvt. Ltd.v.Sonu Gupta (RP)
Case Reference: I.A. 331 of 2024 in C.P.(IB) No. 1122/MB/2021
The National Company Law Tribunal (NCLT), Mumbai Bench , comprising Ms. Reeta Kohli (Judicial Member) and Ms. Madhu Sinha (Technical Member), dismissed an application in which voting rights in the committee of creditors (CoC) was sought in the Corporate Insolvency Resolution Process (CIRP) of Rolta Bi & Big Data Analytics Pvt. Ltd. (corporate debtor). Greenshift Initiatives Private Limited (Assignee) who acquired the debt from a related party of the corporate debtor, filed this application. The
Thus, it is evident that firstly the bar is because of the relationship of the parties and secondly the bar is on the person who's holding the debt and not the nature of the debt per-se. That is precisely the reason why the RP has in fact admitted the debt but not allowed the Applicant to be a member of CoC which seems to be justifiable in view of the objective of the law”.
Corporate Debtor Not Responsible For Non-Supply Of Materials By Third Party Being An Agent: Mumbai NCLT
Case Title: Rajendra Kedia (J.M. Steels) vs. Nirav Metals Pvt. Ltd.
Case Reference: CP (IB) No. 186/MB/2024
In a crucial decision, the National Company Law Tribunal (NCLT) Mumbai Bench, comprising Justice V.G. Bisht (Judicial Member) and Prabhat Kumar (Technical Member), dismissed a petition filed by JM Steels (Operational Creditor) under section 9 of the Insolvency and Bankruptcy Code (IBC) against Nirav Metals Pvt. Ltd. (Corporate Debtor). The petition sought to initiate Corporate Insolvency Resolution Process (CIRP) for the default of Rs. 3,63,07,924.89 against the corporate debtor for non-supply of goods.
Interest Cannot Be Raised Unilaterally In Insolvency Petition, Without Prior Intimation To Corporate Debtor: NCLT Bengaluru
Case Title: Janus GBAC Ltd. v. Beloorbayir Biotech Ltd.
Case Reference: CP (IB) No.114/BB/2023
The National Company Law Tribunal (NCLT), Bengaluru, comprising Shri K. Biswal (Judicial Member) and Shri Manoj Kumar Dubey (Technical Member), dismissed a petition under section 9 of the Insolvency and Bankruptcy Code (IBC). The petition was filed by Janus GBAC Ltd. (operational creditor) against Beloorbayir Biotech Ltd. (corporate debtor). The NCLT observed that no interest can be claimed in the petition when it has not been agreed upon in an agreement.
Resolution Professional Becomes Functus Officio After Approval Of Plan, Ceases To Have Authority To File Fresh Application Under IBC: NCLT Mumbai
Case Title: Mr. Ram Ratan Kanoongo v. Mr. Pramod Goenka and Ors.
Case Reference: M.A. 1548 of 2019 in T.P. (IB) 600/MB/2017
The National Company Law Tribunal (NCLT), Mumbai Bench, comprising Justice (Retd) Mr. Virendrasingh Gyansingh Bisht (Judicial Member) and Mr. Prabhat Kumar (Technical Member), observed that Resolution Professional (RP) is not empowered to file an application after the approval of resolution plan. The Tribunal further held that Insolvency and Bankruptcy Board of India (IBBI) should investigate into the conduct of both the RP and respondent 1 to 3 based on the findings of the forensic auditor.
Without Allegations Of Fraud, Objections Raised By Applicant Cannot Be Entertained At Belated Stage After Sale Has Already Been Confirmed: NCLT
Case Title: JSK Estate Pvt. Ltd. v. Mr. Sundaresh Bhat (Liquidator) and Anr.
Case Reference: I.A. No. 5330/2023 in CP(IB) No. 2849(MB)/2018
The National Company Law Tribunal (NCLT), Mumbai Bench, comprising shri Kuldip Kumar Kareer (Judicial Member) and Shri Anil Raj Chellan (Technical Member), dismissed an application filed under section 60(5) of the Insolvency and Bankruptcy Code (IBC) by a prospective bidder in which e-auction sale of the corporate debtor in liquidation was challenged. The Tribunal observed that the sale was conducted in accordance with Liquidation Regulations, 2016 and objections raised by the applicant were belated and without merit.
Ex-Management Of Corporate Debtor Cannot File Proposal U/S 12A During Consideration Of Resolution Plan When Earlier Proposal Was Rejected: NCLT New Delhi
Case Title: Pratham Expofab Pvt. Ltd. and Anr. v. Anil Matta (RP) and Anr.
Case Reference: I.A. – 188/2024 in C.P.(IB)-995 of 2018
The National Company Law Tribunal, New Delhi Bench, comprising Shri Ashok Kumar Bhardwaj (Judicial Member) and Shri Subrata Kumar Dash (Technical Member), held that settlement proposal under section 12A of the Insolvency and Bankruptcy Code (IBC) cannot be considered after the approval of resolution plan. The Tribunal further held that multiple such proposals had already been proposed on previous occasions and all of them were rejected by Committee of creditors (CoC).
Recovery Of Corporate Debtor's Property By Owner/Landlord Is Not Permissible During Moratorium Period: NCLT Mumbai
Case Title: Sudha Apparels Ltd. v. Mr. Ravi Sethia (RP)
Case Reference: Interlocutory Application No. 4147 of 2023 and Intervention Petition No. 27 of 2024 in CP(IB) No. 959(MB)/2022
The National Company Law Tribunal (NCLT), Mumbai Bench, comprising Shri Kuldip Kumar Kareer (Judicial Member) and Shri Anil Raj Chellan (Technical Member), held that the owner or lessor of the property occupied by the corporate debtor is not entitled to the possession during Corporate Insolvency Resolution Process (CIRP). An application under section 60(5) of the Insolvency and Bankruptcy Code (IBC) was filed by Sudha Apparels Limited (applicant) seeking possession of the property and rent amount.
Cannot Interfere With Liquidator's Rejection Of Claims Which Are Tentative, Contingent Or Potential: NCLT Hyderabad
Case Title: Meja Urja Nigam Pvt. Ltd. v. Mr. Sutanu Sinha (Liquidator)
Case Reference: I.A. No.550 of 2021 in C.P. (IB) No. 294/7/HDB/2017
The National Company Law Tribunal (NCLT), Hyderabad Bench, comprising Shri Rajeev Bhardwaj (Judicial Member) and Shri Sanjay Puri (Technical Member), observed that the Liquidator is responsible for determining the actual dues to be paid from the proceeds of liquidation. Consequently, claims must pertain to specific payable amounts—whether fixed or variable, disputed or undisputed, legal or equitable, secured or unsecured, or arising from a judgment—rather than assumed, uncertain, or hypothetical.
Secured Creditor Not Precluded From Filing Petition U/S 95 Of IBC, Even If Security Interest In Mortgaged Property Is Enforced: NCLT Mumbai
Case Title: YES Bank Ltd. v. Mrs. Sakshi Jiwarajka
Case Reference: CP (IB) No. 906/MB/2022 and I.A. No. 3244 of 2024
The National Company Law Tribunal (NCLT), Mumbai Bench, comprising Shri Kuldip Kumar Kareer (Judicial Member) and Shri Anil Raj Chellan (Technical Member), held that merely because a secured creditor has taken action to realise/enforce its security interest in the mortgaged property, the secured creditor is not precluded from initiating insolvency resolution process of the Personal Guarantor unless of course the debt is recovered in full.
Pre-Existing Dispute Does Not Bar Operational Creditor From Filing S.9 Application: NCLT Admits CIRP Against Syska LED
Case Title: Sunstar Industries Vs. Syska Led Lights Pvt. Ltd
Case Number: CP (IB)/96/MB/2024
The National Company Law Tribunal Mumbai Bench, Court-II, comprising of Justice Kuldip Kumar Kareer (Member Judicial) and Anil Raj Chellan (Member Technical), admitted a Section 9 petition filed by operational creditor (Sunstar Industries) against the Corporate Debtor (Syska LED Lights Pvt. Ltd) stating that initiation of proceedings before the Micro, Small and Medium Enterprise Facilitation Council (MSEFC) in Delhi, and a complaint under Section 138 of the Negotiable Instruments Act, 1881 did not preclude it from filing a Section 9 application under the Insolvency and Bankruptcy Code, 2016.
Raising Funds Through Share Subscription-Cum-Shareholders Agreement Is Financial Debt, Plea U/S 7 Of IBC Maintainable: NCLT
Case Title: Spectrum Trimpex Pvt. Ltd. v. VPhrase Analytics Solutions Pvt. Ltd.
Case Reference: CP (IB) 249/MB/2024
The National Company Law Tribunal (NCLT), Mumbai Bench, comprising Shri Kuldip Kumar Kareer (Judicial Member) and Shri Anil Raj Chellan (Technical Member), held that money raised through a share and subscription agreement in which an exit window with stipulated return is provided will constitute a financial debt for which a petition under section 7 of the Insolvency and Bankruptcy Code (IBC) can be filed. However, in this case, the petition was dismissed as debt amount failed to meet the threshold limit provided under section 4 of the IBC.
Order U/S 45A Of ESI Act Cannot Be Passed During Moratorium Period U/S 14 Of IBC: NCLT Allahabad
Case Title: Saurabh Chawla v. Employee State Insurance Corporation
Case Reference: IA No. 438/2023 in CP (IB) No. 81/ALD/2019
The National Company Law Tribunal, Allahabad Bench, comprising Shri Praveen Kumar Gupta (Judicial Member) and Shri Ashish Kumar Verma (Technical Member), held that proceedings under ESI Act cannot be initiated after admission of the corporate debtor into insolvency. In this case, an order passed by ESI authority was challenged by Resolution Professional (RP) in which the authority claimed unpaid contribution towards state insurance.
Authorised Officer Of Financial Creditor Can Also File Petition U/S 7 Of IBC: NCLT Mumbai
Case Title: Avendus Finance Private Limited v. Acute Retail Infra Private Limited
Case Reference: C.P. (IB)/913(MB)2023
The National Company Law Tribunal (NCLT), Mumbai Bench, Court V, comprising Ms. Reeta Kohli, Hon'ble Member (Judicial) Ms. Madhu Sinha, Hon'ble Member (Technical), held that general authorization given to an officer of the Financial Creditor by means of a power of attorney, would not disentitle such officer to act as the authorized representative of the Financial Creditor while filing an application under Section 7 of the Insolvency and Bankruptcy Code (IBC). In this case, a petition under section 7 of the IBC was filed.
Non-Obtaining Of NOC From Applicant Does Not Ipso Facto Invalidate Security Documents Executed In Favour Of Respondents: NCLT Mumbai
Case Title: Bank of Baroda v. Mr. Ajit Kumar and Ors.
Case Reference: IA No. 3/2024 ,CP (IB) 1738/MB/ of 2017
The National Company Law Tribunal, Mumbai Bench, comprising Anil Raj Chellan Kuldip Kumar Kareer (Member Technical) (Member Judicial), held that non-obtaining of NOC from the Applicant does not ipso facto invalidate the security documents executed in favour of Respondents.
Right To Replace Resolution Professional Not Provided To Operational Creditor, Only CoC Can Replace RP: NCLT Chennai
Case Title: Giriraj Enterprises v. State Bank of India and Anr.
Case Reference: IA/1693/2024 IN IA(IBC)/1512/CHE/2024 IN IBA NO.1099 OF 2019
The National Company Law Tribunal (NCLT), Chennai Bench, comprising Ravichandran Ramasamy, Jyoti Kumar Tripthi, Member Technical Member (Judicial) ,held that on reading of section 27 of the Insolvency and Bankruptcy Code (IBC), it is clear that the right of replacement of RP is not provided to the operational creditor and necessary party required for adjudication will be heard in lines of Principle of Natural justice.
Case Title: Vijayalaxmi Developers and Anr.
Case Reference: IP. No. 28/2024 in C.P.(IB) No. 336/MB/C-II/2024
The National Company Law Tribunal, Mumbai Bench of justice of Shri Kuldip Kumar Kareer (Judicial Member) and Shri Anil Raj Chellan (Technical Member) held that no third party can be allowed to participate in the pre admission stage of a petition under section 7 of the Insolvency and Bankruptcy Code (IBC).
Expressions Of Interest Submitted After CIRP Due Date Cannot Be Considered: NCLT Mumbai
Case Title: Mr Vikram Venkatrao Gaikwad v. Mr. Jitendra Palande
Case Reference: IA. No. 3106/2024 In C.P.(IB)/1132(MB)/2023
The National Company Law Tribunal, Mumbai Bench of Shri Kuldip Kumar Kareer (Judicial Member) and Shri Anil Raj Chellan (Technical Member) held that no Expressions of Interest (EOIs) can be considered if they are submitted after the due date as provided under regulation 36A of the CIRP Regulations.
Date Of Default Occurring Within Prohibited Period U/S 10A Of IBC Can't Be Shifted By Sending Notice After Prohibited Period For Same Debt: NCLT Mumbai
Case Title: - REC LIMITED v. GLOBAL METAL & ENERGY PRIVATE LIMITED
Case Reference: CP (IB) No.956/MB/2023
The National Company Law Tribunal, Mumbai Bench of Hon'ble Shri K. R. Saji kumar, (Judicial Member) Hon'ble Shri Sanjiv Dutt, (Technical Member) held that the date of default occurring within the prohibited period cannot be shifted merely because a notice for payment is issued again after the end of such prohibited period.
Uncorroborated Allegations Pertaining To Pre-Existing Dispute Cannot Be Entertained: NCLT Admits Petition U/S 9 Of IBC
Case Title:M/s Rishabh Triexim LLP v. M/s Nandi Irrigation Systems Limited
Case Reference:CP (IB) No. 22/09/HDB/2023 & IA No. 1712 of 2023
The National Company law Tribunal (NCLT) Hyderabad Bench of Justices Rajeev Bhardwaj and Sanjay Puri admitted M/s Nandi Irrigation Systems Limited (Corporate Debtor) into Corporate Insolvency Resolution Process (CIRP) on an application made by M/s Rishabh Triexim LLP (Operational Creditor) under section 9 of the Insolvency and Bankruptcy Code (IBC). This case arises due to the default made by the corporate debtor in paying the operational debt amounting to Rs. 11.32 crores which was to be paid on November 30, 2022.
Banks Have Inherent Power To Classify Account Of Personal Guarantor As NPA During Moratorium Period: NCLT New Delhi
Case Title: Central Bank of India vs Kushan Mitra
Case Number: IA-3290/2024
The NCLT, Delhi comprising of Justice Bachu Venkat Balaram Das, Member (Judicial) and Justice Atul Chaturvedi (Technical Member), accepted a Section 95 application filed by the applicant bank to initiate Corporate Insolvency Resolution Process (CIRP) against the Personal Guarantor of M/s CMYK Printech Limited.
Any Claimed/Unclaimed Dues Prior To Approval Date Of Resolution Plan Stand Extinguished: NCLT Kolkata
Case Title: Gandhamardhan Sponge Industries Pvt. Ltd. vs. Income Tax Department and Anr.
Case Number: I.A. (I.B.) No. 880/KB/2024 in C.P. (I.B.) No. 180/KB/2024
The National Company Law Tribunal (NCLT), Kolkata bench of Smt. Bidisha Banerjee (Judicial Member) and Shri D. Arvind (Technical Member) have held that the income tax notice, demand notice and payment for past dues that accrued prior to the date of the Resolution Plan against the corporate debtor is null and void. It observed, “It is a well-established law that the corporate debtor was come out of insolvency resolution process by way of successful resolution of its insolvency cannot be settled with past dues as the successful resolution applicant takes over the corporate debtor on a fresh slate principal and assets as such, any dues claimed/unclaimed for the period up to the date of approval of the resolution plan stands extinguished…”
Constitution Of CoC In Violation Of Section 21(2) Proviso Of IBC Is Nullity In Eyes Of Law, Vitiates Entire CIRP: NCLT
Case Title: Mr. Vipin Kumar Sharma v. Mr. Sunit Suri and Ors.
Case Reference: I.A. No.851 of 2023
The NCLT Bengaluru Bench of Justices Hon'ble Shri K. Biswal and Hon'ble Shri Manoj Kumar Dubey, held that when the constitution of the Committee of Creditors (CoC) violates the Proviso of Section 21(2) of IBC, 2016, such constitution is nullity in the eyes of Law and vitiates the entire CIRP.
Approved Resolution Plan Can Be Amended To Ensure Statutory Compliance U/S 31 Of IBC: NCLT Kolkata
Case Title: Kundan Minerals and Metals Limited v. (National Stock Exchange of India Limited, Mumbai
Case Reference: I.A. (IB) No. 1720/KB/2024
The NCLT Kolkata Bench of Justices D. Arvind and Bidisha Banerjee held that the approved resolution plan can be amended to ensure that it complies with the statutory provisions under section 31(e) of the IBC. In this case, an application seeking amendment to the approved resolution plan was filed by the SRA to increase the public shareholdings to 5% as mandated by Rule 19(5) of the SCRA Rules. The public shareholdings stood at 2.28% after the approval of the plan.
Case Title: Small Industrial Development Bank of India (SIDBI) V/s Harshad Deshpande and Anr.
Case Reference: IA No. 2573/2021 In CP (IB) 4367/MB/ of 2018
The NCLT Mumbai Bench of Justice Anil Raj Chellan (Technical Member) and Kuldip Kumar Kareer (Judicial Member) affirmed that the clause in the resolution plan for extinguishing the personal guarantees of promoters furnished in favour of all financial creditors or the commercial decision of the CoC to approve such release of personal guarantees, including guarantees executed in favour of dissenting financial creditors, will not contravene any provisions of the Code. Further, the dissatisfaction of a creditor in respect of payment under the Resolution Plan is of no consequence unless it violates any of the provisions of the Code.
Banking Companies Not Required To Exhaust MSME Revival Option Before Filing Petition U/S 7 Of IBC: NCLT, Mumbai
Case Title: Technology Development Board vs. M/s Perfect Infraengineers Limited
Case Number: C.P.(IB) No. 322/MB/2023
The NCLT, Mumbai Bench comprising Shri Prabhat Kumar (Technical Member) and Justice Shri V.G. Bisht (Judicial Member) has observed that restructuring process contemplated in the notification dated 29.05.2015 issued by the Ministry of Micro, Small and Medium Enterprises is another mode for revival and rehabilitation of the MSME Corporate Persons in addition to Insolvency and Bankruptcy Code, 2016 (IBC). The Tribunal held that it cannot be said that MSMED Act overrides the provisions of IBC, unless said so expressly in terms of Section 240A(2). Thus, it is not incumbent on the Banking companies to first exhaust the avenue of revival under the Notification before proceeding to file an application under section 7 of IBC for the resolution of financial defaults under the Code. The Tribunal also held that an application under section 7 can be adjudicated by the Tribunal even on application of one financial creditor, provided the debt due to such financial creditor exceeds the threshold limit. Therefore, another lender of Corporate Debtor need not be impleaded as party to proceed under section 7.
Reduction Of Share Capital Does Not Exempt Company From Fulfilling Other Statutory Obligations: NCLT Ahmedabad
Case Title: Mahan Industries Limited
Case Number: CP 8 of 2023 (Under Sec 66 of Companies Act, 2013)
The National Company Law Tribunal, Ahmedabad comprising of Dr V.G Venkata Chalapathy (Member Technical) and Chitra Hankare (Member Judicial) approved a Section 66 application of Companies Act, 2013 filed by the Mahan Industries, seeking confirmation in the reduction of its share capital.
Mere Possession Over Assets Of Corporate Debtor Under SARFAESI Act Does Not Bar Filing Of Petition U/S 7 Of IBC: NCLT Kolkata
Case Title: SREI Equipment Finance Ltd. v. Roadwings International Pvt. Ltd.
Case Reference: I.A. (IB) No. 1268/KB/2024 in Company Petition (IB) No. 224/KB/2023
The NCLT Kolkata bench of Ms. Bidisha Banerjee (Judicial Member) and Shri Arvind Devanathan (Technical Member) have held that mere possession over assets of the corporate debtor under the SARFAESI Act does not prevent the financial creditor from preferring an application under section 7 of the IBC.
Only Assets Are Transferred In Going Concern Sale Of Corporate Debtor Under Liquidation, Liabilities Must Be Settled U/S 53 Of IBC: NCLT Mumbai
Case Title: Mr. Ravikant Modi v. Mr. Anshul Gupta (Liquidator)
Case Reference: IA No. 929 of 2024 in CP (IB) No. 1088/MB/2020
The NCLT Mumbai bench of Ms. Reeta Kohli (Judicial Member) and Ms. Madhu Sinha (Technical Member) has held that in a sale of the corporate debtor in liquidation as a going concern, only assets are transferred and liabilities have to be discharged as per section 53 of the Code.
Threshold Limit For Initiating Insolvency Process Against Personal Guarantors Is Also ₹1 Crore: NCLT New Delhi
Case Title: Mudraksh Investfin Pvt. Ltd. v. Gursev Singh
Case Reference: RCP IB-21/ND/2024 Old No- IB-422/ND/2024
The NCLT New Delhi bench of Shri Subrata Kumar Dash (Technical Member) and Shri Ashok Kumar Bhardwaj (Judicial Member) had held that the threshold limit for initiating insolvency process against the personal guarantors under section 95 of the Code would be the same as is with respect to the corporate debtor under section 4 of the IBC i.e. 1 crore.
Property Of Personal Guarantors Cannot Be Sold Under SARFAESI Act During Moratorium Period U/S 96 Of IBC: NCLT Mumbai
Case Title: Raghavendra Joshi Residing Versus Indian Bank and Anr.
Case Reference: I.A. No. 2247/2023 IN C.P. NO. 575(IB)/MB/2022
The NCLT Mumbai bench of Mr. Charanjeet Singh Gulati (Member Technical) and Justice Lakshmi Gurung (Member Judicial) has held that once a petition under section 95 of the IBC is filed, the interim moratorium under section 96 is triggered. During subsistence of the moratorium, property of the personal guarantors cannot be sold by the financial creditor under the SARFAESI Act even if sale auction notice was issued before commencement of the moratorium.
When Statutory Criteria U/S 7 Of IBC Is Satisfied, Tribunal Must Admit CIRP: NCLT, Mumbai
Case Title: Bank of India vs. GF Toll Road Private Limited
Case Number: CP (IB)/83 (MB)/2024 and CP (IB)/120 (MB)/2024
The National Company Law Tribunal (NCLT), Mumbai bench, comprising Justice V. G. Bisht (Retd.) (Judicial Member) and Sh. Prabhat Kumar (Technical Member) has held that the petition for initiation of Corporate Insolvency Resolution Process (CIRP) was admissible as the statutory criteria under Section 7 of the Insolvency and Bankruptcy Code, 2016 (IBC), viz. the existence of financial debt, default were satisfied. The Tribunal reiterated that the existence of an arbitral award in favour of the Corporate Debtor did not bar the admission of the CIRP petition. It observed that no "good reason" existed to dismiss the petition. The Tribunal also observed, “It is trite law that this Tribunal cannot enforce an alternate mode of resolution than provided in the Code.”
Case Title: Mr. Gajjala Yoganand versus Mr. Birendra Kumar Agarwal and Ors.
Case Number: IA No.373 of 2024 in CP(IB) No.296/7/HDB/2022
The NCLT Hyderabad bench of Sri Rajeev Bhardwaj (Judicial Member) and Sri Sanjay Puri (Technical Member) has affirmed that the decision to consolidate, or not, rests with the CoCs, who are not only better equipped to make such determinations but also have a vested interest in the outcome, and whose commercial wisdom is paramount in insolvency matters and beyond judicial review.
Case Title: M/s Avani Towers Private Limited vs. M/s Energy Properties Private Limited
Case Number: IA(IBC) No. 1299/ (KB)/ 2024 in Company Petition No. (IB)-1711/(KB)/2019
The NCLT, Kolkata bench of Justice Ashok Kumar Bhardwaj has held that once a Financial Creditor had been classified as a “related party”, it could not be allowed to gain entry into Committee of Creditors (CoC) on account of its Operational Debt as it would amount to defeating the legislative intent of keeping related parties out and running of CoC by external creditors. Reliance was placed upon the judgment of the Supreme Court in Phoenix Arc Private Limited vs. Spade Financial Services Private Limited & Ors. to hold that the exclusion referred to in first proviso to Section 21(2) of Insolvency and Bankruptcy Code, 2016 (IBC) lays emphasis on the relationship existing between the parties and not the debt itself.
Case Title: Jammu and Kashmir Bank Limited Vs. Mr. Kanumuru Raghu Rama Krishna Raju
Case Number: CP (IB) No.54/95/HDB/2022
The NCLT Hyderabad bench of Sri Rajeev Bhardwaj (Judicial Member) and Sri Sanjay Puri (Technical Member) has held that the Personal Guarantor should be treated on an equal legal footing with the Corporate Debtor, as it is clearly established by the law that the liability of Corporate Debtor and Personal Guarantor are co-extensive in nature. Therefore, the provisions of the Limitation Act must be applied consistently to both the Corporate Debtor and the Personal Guarantor. The limitation period for both the parties will commence from the same date.
Case Title:Embassy Commercial Projects (Whitefield) Private Limited Versus Pankaj Srivastava
Case Number: I.A No. 545/2024 In CP (IB) No.74/BB/2023
The NCLT Bengaluru bench of K. Biswal (Judicial Member) and Shri Manoj Kumar Dubey (Technical Member) has held that all claims including subject matter of ongoing arbitration proceedings will stand extinguished after the approval of the Resolution Plan under section 31 of the Code.
Case Title: Mr. Rajkumar Jhawar and Anr. Vs Mr. Arun Kapoor and Ors.
Case Number: IA No. 3390/2024 In CP (IB) 2517/MB/2018
The NCLT Mumbai bench of Anil Raj Chellan (Technical Member) and Kuldip Kumar Kareer (Judicial Member) has affirmed that once a resolution plan is duly approved by the Adjudicating Authority under subsection (1) of Section 31 of the Code, the claims as provided in the resolution plan shall stand frozen and will be binding on all stakeholders. Thereafter, no person will be entitled to initiate or continue any proceedings in respect to a claim which is not part of the resolution plan.
NCLT Hyderabad Approves Resolution Plan For Karvy Data Management Services Limited
Case Title: M/S ALLIED HI-TECH INDUSTRIES PRIVATE LIMITED VS. KARVY DATA MANAGEMENT SERVICES LIMITED
Case Number: I.A. (IBC) (PLAN) NO.24 OF 2024 IN CP (IB) No. 25/7/HDB/2022
The National Company Law Tribunal (NCLT) Hyderabad bench of Dr. N. Venkata Ramakrishna Badarinath (Judicial Member) and Shri Charan Singh (Technical Member) has approved the Resolution Plan of Karvy Data Management Services Ltd (KDMSL). It was approved on December 13, 2024. KDMSL, incorporated on 21.04.2008, is a prominent provider of integrated business and knowledge process services. Its clients include UIDAI (Aadhaar Seva Kendras), SEBI (KRA Services) and Protean E-Gov Technologies Limited. Due to operational inefficiencies, market downturns, and external economic reasons, the company experienced financial difficulties, which led to the initiation of Corporate Insolvency Resolution Process (CIRP).
Case Title: M/s. METRO TYRES LIMITED VERSUS M/s. HERO ELECTRIC VEHICLES PVT. LTD
Case Number: C.P. (IB) –397(ND)/2024
The NCLT New Delhi bench of Justice Shri Bachu Venkat Balaram Das (Judicial Member) and Shri Atul Chaturvedi (Technical Member) has held that there is no such provision in the IBC, 2016 and in the Regulation made thereunder that allows the Operational Creditor to issue multiple demand notices to the Corporate Debtor.
IBBI
IBBI Issues Guidelines For Appointment Of Insolvency Professionals
The Insolvency and Bankruptcy Board of India (IBBI) issued guidelines for the process for appointing insolvency professionals (IPs) to roles such as interim resolution professionals (IRPs), liquidators, and bankruptcy trustees.
IBBI Proposes Changes To Process Of Issuance Of Record Of Default By Information Utility, Invites Comments Till 31.05.2024
The Insolvency and Bankruptcy Board of India (“IBBI”) on 10.05.2024 has published a Discussion Paper on “Strengthening the process of issuance of record of default by Information Utility”. It has also invited comments from public/stakeholders regarding proposed changes to the framework pertaining to the process of issuance of record of default by Information Utility”. The comments can be submitted online at www.ibbi.gov.in till 31.05.2024. The Discussion Paper primarily proposes changes to Strengthen the Process Of Issuance Of Record Of Default (Rod).
IBBI Amends CIRP Regulations W.E.F. 15th February 2024
Ref. No. IBBI/2023-24/GN/REG113
The Insolvency and Bankruptcy Board of India (“IBBI”) has issued a notification dated 15.02.2024, whereby amendments have been made to the IBBI (Insolvency Resolution Process for Corporate Persons) Regulations, 2016 (“CIRP Regulations”). The key amendments are:
- Operating separate bank accounts for real estate projects: To ensure financial transparency and accountability, the amendment makes it mandatory to have a separate bank account for each real estate project under a corporate debtor.
- Monthly meetings of the committee of creditors (CoC): Under the amended dispensation, the resolution professional (RP) is mandated to convene a CoC meeting at least once in every thirty days, with a provision to extend the interval between meetings to a maximum of one meeting per quarter, if CoC so decides.
- Voting procedures: In place of provision of minimum period specified for the opening of the voting window with no upper limit, the amended regulation empowers the CoC to decide the period of opening of electronic voting window with a minimum of twenty-four hours and a maximum of seven days with further increments of twenty-four hours each. Further, to streamline the voting process, the amendment mandates that where the matters listed for voting have already received requisite majority vote, the RP shall provide one last opportunity to vote by extending the voting window by a maximum period of twenty-four hours.
- Approval of insolvency resolution process costs: With a view to enhance the oversight of the CoC over going concern costs, the amendment provides that the RP to seek approval from the CoC for all costs including going concern costs related to the insolvency resolution process.
- Disclosure of valuation methodology: With an aim to increase transparency and reduce disputes over valuation related issues, the amendment provide for explaining the valuation methodology to the members of the CoC before the computation of estimates.
- Disclosure of fair value in the information memorandum: For fostering informed participation in the process, the amendment provides that the fair value may be made part of the information memorandum (IM). However, the CoC, after recording the reasons, can decide not to share such an information where in it's considered view such a disclosure is not beneficial for the resolution.
- Flexibility in inviting resolution plans in real-estate cases: With a view that each project in a real estate case may need different treatment in terms of resolution, the amendment clarifies that after due examination, the CoC may direct the RP to invite separate plan for each project.
- Monitoring committee for implementation of resolution plan: The amendment enables the CoC to decide for constitution of a monitoring committee for overseeing the implementation of the resolution plan. The committee may include the RP, any other insolvency professional or any other person as its member. In case the RP is made part of the committee, the monthly fee payable to him shall not exceed the monthly fee received by him during the corporate insolvency resolution process.
Continuation of the resolution process pending extension application: A clarification has been provided to ensure that RP continues to discharge his responsibilities under the resolution process till an application for extension is being decided by the Adjudicating Authority.
The Insolvency and Bankruptcy Board of India (“IBBI”) has issued a circular dated 28.06.2024 directing the Insolvency Professionals to file the forms to monitor the Voluntary Liquidation processes under IBC on the electronic platform hosted on IBBI's website at https://www.ibbi.gov.in. only.
IBBI Issues Circular Directing IPs To File Liquidation Process Forms On Electronic Platform Only
Circular No. IBBI/LIQ/73/2024
The Insolvency and Bankruptcy Board of India (“IBBI”) has issued a circular dated 28.06.2024 directing the Insolvency Professionals to file the forms to monitor the liquidation process under IBC on the electronic platform hosted on IBBI's website at https://www.ibbi.gov.in.only