IBC | Date Of Order Pronouncement & Time Taken To Provide Certified Copy Excluded From Limitation Period For Appeal To NCLAT: Supreme Court

Case Title: Sanket Kumar Agarwal & Anr v APG Logistics Private Limited

Citation: 2023 LiveLaw (SC) 406

The Supreme Court Bench comprising Chief Justice of India Dr. Dhananjaya Y Chandrachud and Justice J B Pardiwala, has held that for the purpose of computing limitation for filing of appeal under Section 61(2) of the Insolvency and Bankruptcy Code, 2016, the time taken by Tribunal for providing certified copy of order to be challenged ought to be excluded from computation of limitation.

Further, the date on which the order was pronounced must be excluded while computing limitation for filing of appeal against such order. Accordingly, the Bench has set aside an order passed by the National Company Law Appellate Tribunal (“NCLAT”), wherein NCLAT had erroneously included the date of order pronouncement in limitation period and dismissed the appeal for being barred by limitation.

IBC | NCLT Has To Admit Sec 7 Petition If Debt Is Due; Decision In 'Vidarbha Industries' Based On Its Facts: Supreme Court

Case Title: M. Suresh Kumar Reddy v Canara Bank & Ors.

Citation: 2023 LiveLaw (SC) 428

The Supreme Court Bench comprising of Justice Abhay S. Oka and Justice Rajesh Bindal, has held that if the existence of a financial debt and its default on the part of Corporate Debtor has been proved, then the National Company Law Tribunal (“NCLT”) is left with no option apart from admitting the petition under Section 7 of the Insolvency and Bankruptcy Code, 2016 (“IBC”). The only ground on which a petition under Section 7 of IBC can be rejected is when the debt in question has not become due and payable(M. Suresh Kumar Reddy v Canara Bank & Ors.).

Further, the decision in Innoventive Industries Limited v. ICICI Bank and Another, (2018) 1 SCC 407, still holds good and the NCLT must admit a petition under Section 7 of IBC once existence of debt and default is established. The decision in Vidarbha Industries Power Limited v. Axis Bank Limited, 2022 LiveLaw (SC) 587, was passed based on the facts of that particular case and it did not hold anything contrary to the Innoventive Industries judgment.

NCLAT

Allegation That IRP/RP Did Not Conduct CIRP As Per Law, Not A Ground To Challenge Resolution Plan: NCLAT Delhi

Case Title: Brijesh Singh Bhadauriya v Pinakin Shah

Case No.: Company Appeal (AT) (Insolvency) No. 456 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 the order approving the Resolution Plan cannot be interfered with on a mere allegation that the IRP or the Resolution Professional has not conducted the CIRP in accordance with law.

NCLT

NCLT Mumbai Initiates Insolvency Process Against Future Lifestyle Fashions, A Future Group Enterprise

Case Title: Bank of India v Future Lifestyle Fashions Limited

Case No.: CP No. (IB) 959/ MB/ 2022

The National Company Law Tribunal (“NCLT”), Mumbai Bench, comprising of Shri Kuldip Kumar Kareer (Judicial Member) and Shri Shyam Babu Gautam (Technical Member), has initiated Corporate Insolvency Resolution Process (“CIRP”) against Future Lifestyle Fashions Ltd., which is a Future Group enterprise promoted by Mr. Kishore Biyani. Further, Mr. Ravi Sethia has been appointed as the Interim Resolution Professional (“IRP”).

NCLT Chennai Order Dissolution Of M/s Boss Profiles Limited Under Section 54 Of IBC

Case Title: M/s Boss Profiles Limited

Case No.: TCP/126/IB/2017

The National Company Law Tribunal (“NCLT”), Chennai Bench, has ordered for dissolution of M/s Boss Profiles Limited (“Corporate Debtor”) under section 54 of IBC on a petition filed by the Liquidator of the Corporate Debtor. E-auctions were conducted, however, there was no bidder paid the advance amount and the bid application. So the assets of the Corporate Debtor were sold via private sale of assets for a price of 9.75 crores. The Liquidation amount was distributed amongst the Secured Financial Creditors in the order of priority given under Section 53 of IBC.

Flats Sold After Completion Of Construction To Be Included In Computation Of Threshold Limit Under Section 7, IBC: NCLT New Delhi Reiterates

Case Title: Uttam Singhal & Ors vs M/s Anushree Home Developers Ltd. & Anr.

Case No.: IB-762/ND/2020

The National Company Law Tribunal (“NCLT”), New Delhi Bench, comprising Shri P.S.N Prasad (Judicial Member) and Dr. Binod Kumar Sinha (Technical Member), has reiterated that the persons to who flats have already been sold after completing the construction would still be allottees and would be included for computation of threshold limit of Section 7 of IBC.

Claim Of Compensation Cannot Become Part Of Operational Debt Until The Liability Is Adjudicated By A Competent Authority: NCLT Mumbai

Case Title: Chandrashekhar Export Pvt. Ltd vs Babanraoji Shinde Sugar & Allied Industries Ltd.

Case No. C.P. No. 3667/IBC/MB/2019

The National Company Law Tribunal (“NCLT”), Mumbai Bench, comprising Shri Kuldip Kumar Kareer (Judicial Member) and Smt. Anuradha Sanjay Bhatia (Technical Member), has held that Operational Debt must be crystallized, undisputed and not something which requires adjudication by a competent authority.

Person Who Only Advances An Amount For Supply Of Goods & Services Is Not An “Operational Creditor”: NCLT Chennai

Case Title: Mr.V. Umadevi vs Kumarna Gin & Pressing Pvt. Limited

Case No.: IBA/840(CHE)/2020

The National Company Law Tribunal (“NCLT”), Chennai Bench, comprising Shri Sanjiv Jain (Judicial Member) and Shri Sameer Kakar (Technical Member), has held that the payment of advance amount to receive the supply of goods and services from the Corporate Debtor does not come within the ambit of Operational Debt.

NCLT Delhi Admits Go Airlines Into Insolvency, Directs IRP To Ensure Employees Are Not Retrenched

Case Title: Go Airlines (India) Limited

Case No.: Company Petition No. (IB)-264(PB)/2023

The National Company Law Tribunal (“NCLT”), New Delhi Bench, comprising of Justice Ramalingam Sudhakar (President) and Shri L.N. Gupta (Technical Member), has admitted Go Airlines (India) Limited into Corporate Insolvency Resolution Process (“CIRP”) and Mr. Abhilash Lal has been appointed as the Interim Resolution Professional (“IRP”). The Bench has directed the IRP to ensure that retrenchment of employees is not resorted to as a matter of course. Further, any such decision/event should be brought to the attention of the NCLT.

Also, it was held that under Section 10 of IBC there is no mandatory requirement of issuing notice to the Creditor(s) at the pre-admission stage, rather giving notice to the Creditor(s) is a matter of discretion to be exercised on a case-to-case basis on valid grounds. Further, The Bench held that there is no bar in entertaining/considering/adjudicating a Section 65 Application after the initiation of the CIRP.

NCLT Indore Permits Forensic Audit Of Corporate Debtor On An Application Made By Financial Creditor

Case Title: Motel Rahans Pvt Ltd. v JSM Devcons Pvt Ltd.

Case No.: C.P.(IB)/56(MP)2021

The National Company Law Tribunal (“NCLT”), Indore Bench, comprising of Shri Ashok Kumar Bhardwaj (Judicial Member) and Shri Kaushalendra Kumar Singh (Technical Member), has allowed an application filed by a secured Financial Creditor of the Corporate Debtor wherein transaction audit of the Corporate Debtor was prayed for. However, the Financial Creditor (Applicant) would bear the fees of the Auditor. Further, the decision to avail the services of a Professional to run the affairs of CIRP lies with the Resolution Professional. The role of Committee of Creditors is limited to approving the fees of such Professional.

NCLT Allahabad Approves Dwiti Construction Pvt. Ltd’s Resolution Plan For M/S Vaishali Real Estate Private Limited

Case Title: Mr. Amitabh Singh vs M/S Vaishali Real Estate Private Limited

Case No: C.P. (IB)/207(ALD) 2019

The National Company Law Tribunal (“NCLT”), Allahabad bench, comprising of Shri Praveen Gupta (Judicial Member) and Shri Subrata Ashish Verma (Technical Member) has approved a 3.91 crore resolution plan of Dwiti Construction Pvt. Ltd for M/S Vaishali Real Estate Private Limited (“Corporate Debtor”) under section 30(6) of IBC. The Resolution Professional initially admitted claims of 2.91 crores from Unsecured Financial Creditor. The Fair Value and Liquidation Value of the Corporate Debtor were determined to be 6.30 crores and 3.93 crores respectively.

NCLT Kochi Orders Liquidation Of Samson And Sons Builders And Developers Under Section 33 Of IBC

Case Title: Vijayakumaran J vs Samson and Sons builders and Developers Pvt. Ltd.

Case No.: CP (IB)/5/KOB/2021

The National Company Law Tribunal (“NCLT”), Kochi bench, comprising of Shri P. Mohan Raj (Judicial Member) and Shri Satya Ranjan Prasad (Technical Member), has ordered for Liquidation of Samson and Sons builders and Developers Pvt. Ltd. (“Corporate Debtor”). The maximum time period under Section 12 of IBC is 330 days, but 519 days had already expired. The NCLT observed that maximization of the assets of the Corporate Debtor is the object of IBC but the said maximization has to be achieved within the timeline provided. Therefore, an order for liquidation was passed instead of extending the CIRP period.

Section 9 Petition Is Not Maintainable If Affidavit Under Section 9(3)(B) Is Not Filed: NCLT Mumbai

Case Title: M/s Welcome Steel vs Kavish International Trading Private Limited

Case No.: CP (IB) No.778/MB-IV/2021

The National Company Law Tribunal (“NCLT”), Mumbai Bench, comprising Shri Kishore Vemulapalli (Judicial Member) and Shri Prabhat Kumar (Technical Member), has held that Affidavit under Section 9(3)(b) of IBC is mandatory in nature and the same must be in relation to the notice of dispute with regard to receipt or non- receipt of the payments made by the Corporate Debtor.
Section 9 Petition Is Not Maintainable If Demand Notice Was Not In Prescribed Format: NCLT Hyderabad

Case Title: M/s. Ven Infra Projects vs M/s. Valentis Laboratories Private Limited

Case No. CP (IB) No. 54/9/HDB/2020

The National Company Law Tribunal (“NCLT”), Hyderabad Bench, comprising Smt. Telaprolu Rajani (Judicial Member) and Shri Charan Singh (Technical Member), has held that mandate of Section 8 IBC, 2016 need to be fulfilled before an application under Section 9 IBC is filed. Thus Section 9 IBC application is not maintainable if the Demand Notice is not in the prescribed format.

NCLT Hyderabad Approves The Resolution Plan Of Jindal Saw Ltd. For Sathavahana Ispat Ltd.

Case Title: M/S Thirumala Logistics v M/S Sathavahana Ispat Limited

Case No.: CP (IB) NO. 17/9/HDB/2020

The National Company Law Tribunal (“NCLT”), Hyderabad Bench, comprising of Dr. Venkata Ramakrishna Badarinath Nandula (Judicial Member) and Shri Charan Singh (Technical Member), has approved the resolution plan of Jindal Saw Limited for Sathavahana Ispat Limited.

The Resolution Plan involves merger of the Corporate Debtor with the SRA and the plan is valued at Rs. 693,60,76,158/-. The Secured Financial Creditors are proposed to be paid Rs. 672.22 Crores as against a claim of Rs. 1747 Crores. The workmen and employees of Corporate Debtor are being paid the claimed amount in full. The Operational Creditors are being paid Rs. 1 Crore as against an admitted claim of Rs. 64,70,06,108/-. The Government is being treated as a secured creditor and being paid Rs. 12.40 Crores as against a claim of Rs. 32.22 Crores. In total, Rs. 693.62 Crores is being paid as against a total claim of Rs. 1954.98 Crores.

Financiers Discounting Invoices Of The Corporate Debtor To Become Operational Creditors: NCLT Bengaluru Reiterates

Case Title: Invoice Discounters of BNH Infra Projects (India) Private Limited vs BNH Infra Projects (India) Private Limited

Case No. C.P. (IB) No.95/BB/2021

The National Company Law Tribunal (“NCLT”), Bengaluru Bench, comprising Justice (Retd.) T. Krishnavalli (Judicial Member) and Shri Manoj Kumar Dubey (Technical Member), has held that discounting of invoices of the Corporate Debtor would make the Financiers step into the shoes of the Corporate Debtor and make them Operational Debtors rather than Financial Creditors.