Supertech Insolvency: Supreme Court Approves 'Project Wise Resolution' Plan

Case Title: Indiabulls Asset Reconstruction Company Limited v Ram Kishore Arora & Ors.

Citation: 2023 LiveLaw (SC) 436

The Supreme Court Bench comprising of Justice Dinesh Maheshwari and Justice Sanjay Kumar, has declined to grant any interim relief in respect of order passed by the National Company Law Appellate Tribunal (“NCLAT”) directing ‘project wise insolvency resolution process’ of Supertech Ltd.’s Eco Village-II project. The Bench has observed that constituting Committee of Creditors (CoC) for all the projects of Supertech Limited would affect the ongoing projects and cause hardship to the homebuyers.

The Bench has directed that during the pendency of the appeal, any process beyond voting on the Resolution Plan should not be undertaken without specific orders of the Supreme Court in respect to the Corporate Insolvency Resolution Process (CIRP) of Eco Village-II project.

NCLAT

Not Mandatory To File Hard Copies; NCLAT Dispenses The Requirement Of Physical Filing In Addition To E-Filing

File No.: 10/37/2018-NCLAT

The National Company Law Appellate Tribunal (“NCLAT”) has issued a circular dated 15.05.2023, directing that the physical filing of hard copies alongwith appeals, interlocutory applications, reply, rejoinders etc., which have been electronically filed, is not mandatory now.

The NCLAT had rolled out its e-filing portal available at: (https://efiling.nclat.gov.in), for electronic filing of Appeals/Interlocutory Applications/Reply/Rejoinder etc. w.e.f. 04.01.2021. However, it was mandatory to file a hard copy of the concerned appeal/application/reply/rejoinder etc. after the e-filing gets concluded. Through the circular dated 15.05.2023, the NCLAT has modified its earlier filing procedure and has dispensed with the ‘mandatory’ requirement of filing hard copies after e-filing.

Disposed Petition On Consent Terms Can Be Revived On Breach Of Terms, Irrespective Of Liberty Granted Or Not: NCLAT Delhi

Case Title: IDBI Trusteeship Services Limited v Nirmal Lifestyle Limited

Case No.: Company Appeal (AT) (Insolvency) No. 117 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of Justice Ashok Bhushan (Chairperson) and Shri Barun Mitra (Technical Member), has held that when a petition is withdrawn by placing on record the consent/settlement terms, then the petition is liable to be revived if consent terms provide for its revival in the event of default. The Bench has further held that it is inconsequential whether or not the NCLT has granted any liberty for revival, the petition is liable to be revived if consent terms placed on record contains a clause for revival.

NCLT

Land Owners Entering Into Joint Development Agreements For Sharing Of Profit Do Not Come Within The Ambit Of Operational Creditors: NCLT New Delhi

Case Title: Mrs Gurmeet Kaur Gill vs Raheja Developers Limited

Case No.: C.P. (IB)/393(PB)/2019

The National Company Law Tribunal, New Delhi Bench, comprising Justice Ramalingam Sudhakar (Judicial Member) and Shri Avinash K. Srivastava (Technical Member), has held that an agreement in the nature of a Joint Development Agreement for a project with sharing of profit in an agreed ratio does not come within the ambit of an Operational Debt. It was further observed that there may be a wide variety of development contracts like Collaboration Agreement, Joint Development Agreement, etc under different names which may have a component in the nature of a loan. The purposes of these agreements involve giving rise to mutually binding legal relation in lieu of consideration. These types of agreements cannot come within the purview of an Operational Debt and what needs to be seen is the real intention of the parties.

NCLT Mumbai Admits Section 7 Petition Against M/S Tulip Hotels Private Limited For Defaults Of More Than Rs. 900 Crores

Case Title: J C Flowers Asset Reconstructions Pvt. Ltd vs M/s Tulip Hotels Private Limited

Case No.: CP (IB) No. 05/MB-IV/2020

The National Company Law Tribunal (“NCLT”), Mumbai bench, comprising of Shri Kishore Vemulapalli (Judicial Member) and Shri Prabhat Kumar (Technical Member), has initiated Corporate Insolvency Resolution Process (“CIRP”) against M/s Tulip Hotels Private Limited. The Corporate Debtor had defaulted in payment of two Guarantees amounting to Rs. 900,00,00,000/- (Rs. 900 Crores) in its capacity as a guarantor for loans disbursed by Yes Bank to Cox and Kings Limited and Ezeege One Travel & Tours Limited (“Principal Burrowers”).

Prior Approval Of AA Under Section 33(5) Mandatory Before Initiation Of Legal Proceedings By Liquidator: NCLT Mumbai

Case Title: Birla Cotsyn (India) Limited vs Birla Global Corporate Private Limited

Case No.: C.P. 565 OF 2021

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 prior approval of the Adjudicating Authority under Section 33(5) of IBC is mandatory before initiating a legal proceeding on behalf of the Corporate Debtor under Liquidation.

NCLT Mumbai Dismisses Section 7 Petition Against Direct Media Distribution Ventures Limited

Case Title: IDBI Trusteeship Services Limited Vs Direct Media Distribution Ventures Private Limited

Case No.: CP (IB) No. 827/MB-IV/2022

The National Company Law Tribunal (“NCLT”), Mumbai bench, comprising of Shri Kishore Vemulapalli (Judicial Member) and Shri Prabhat Kumar (Technical Member) has dismissed a petition under Section 7 of IBC against Direct Media Distribution Ventures Limited and refused to initiate Corporate Insolvency Resolution Process (“CIRP”) against it. The date of default fell within the period of Section 10A of IBC, therefore, the filing of application under Section 7 of IBC is barred forever.

NCLT Mumbai Admits Section 7 Petition Against Sterling Oil Resources Limited For Defaults Of More Than Rs. 1655 Crores

Case Title: State Bank of India vs Sterling Oil Resources Limited

Case No.: CP (IB) No.596/MB-IV/2022

The National Company Law Tribunal (“NCLT”), Mumbai bench, comprising of Shri Kishore Vemulapalli (Judicial Member) and Shri Prabhat Kumar (Technical Member), has initiated Corporate Insolvency Resolution Process (“CIRP”) against Sterling Oil Resources Limited. The Tribunal observed that the DRT had issued a decree for a sum of 1217.60 crores in favour of the Financial Creditor. This amount had not been paid even though some amount had been paid under the One Time Settlement. Since there was a default in the payment of a Financial Debt, the Application was admitted.

A Petition Against A Corporate Guarantor Cannot Be Dismissed Simply Because A Resolution Plan For The Corporate Debtor Is Under Consideration: NCLT Mumbai

Case Title: M/s. Edelweiss Asset Reconstruction Company Limited vs Sadguru Multitrade Private Limited

Case No.: C.P. 381 OF 2022

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 insolvency proceedings can be initiated against both the Corporate Debtor and Corporate Guarantor simultaneously and a petition against a Corporate Guarantor cannot be dismissed simple on the ground that a Resolution Plan is under consideration.

NCLT Is Not A Forum For Adjudication Of Fraud: NCLT Cuttack Reiterates

Case Title: Srimanta Kumar Tripathy and Anusuya Tripathy vs S.S Mining and Infra Private Limited

Case No.: CP (IB) No. 38/CB/2022

The National Company Law Tribunal (“NCLT”), Cuttack Bench, comprising Shri P. Mohan Raj (Judicial Member) and Shri Satya Ranjan Prasad (Technical Member), has held reiterated that NCLT is not a forum for adjudication of Fraud or determination of Forgery. It has reiterated that a joint Demand Notice under Section 8 of IBC and Joint petition under Section 9 of IBC is not permitted.

Advance Paid Towards Transfer Of Leasehold Rights In An Immovable Property Is Not An Operational Debt: NCLT Mumbai

Case Title: RSM Infra Partners vs Siddhivinayak Skyscrapers Private Limited

Case No.: CP (IB) No. 1155/MB-IV/2020

The National Company Law Tribunal (“NCLT”), Mumbai bench, comprising of Shri Kishore Vemulapalli (Judicial Member) and Shri Prabhat Kumar (Technical Member), has held that an amount paid as advance towards an agreement of transfer of leasehold rights in an immovable property does not come within the ambit of Operational Debt. It was observed that the debt has arisen due to failure of the Corporate Debtor to transfer the leasehold rights. The agreement being for purchase of leasehold rights in an immovable property, the immovable property is neither a good, nor a service nor a claim for repayment of dues arising under any law. Thus, the amount claimed does not for part of an Operational Debt.