In Absence Of Pre-Existing Dispute, Petition U/S 9 Of IBC Must Be Admitted If Debt And Default Are Proved: NCLAT

The NLCAT 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...

Corporate Debtor's Property Cannot Be Recovered By Owner/Lessor During Moratorium Period U/S 14 Of IBC: NCLAT

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...

Any Amount Proposed In Settlement Plan U/S 12A Of IBC Cannot Be Refunded If Plan Is Approved: NCLAT

The NLCAT 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...

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

The NLCAT 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...

Adjudicating Authority Cannot Enter Into Merits At S. 95 Application Stage Before Report Of RP Is Submitted U/S 99 Of IBC: NCLAT

The NLCAT 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...

Banking Companies Not Required To Exhaust MSME Revival Option Before Filing Petition U/S 7 Of IBC: NCLT, Mumbai

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...

IBC Weekly Digest: 4th November To 10th November 2024

NOMINAL INDEX Noida Special Economic Zone Authority Vs. Manish Agarwal & Ors., CIVIL APPEAL NOS. 5918-5919 OF 2022, 2024 LiveLaw (SC) 858STATE 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, 2024 LiveLaw (SC) 866Pratham Expofab Private Limited v. Mr. Anil Matta, Resolution Professional...

Extinguishment Of Promoters' Personal Guarantees In Resolution Plan Is Valid If Plan Complies With IBC Provisions: NCLT Mumbai

The NCLT Mumbai Bench of Justices 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...

Timely Implementation Of Resolution Plan Is Crucial To Achieve IBC's Objective Of Protecting Assets Dissipation: Supreme Court

The Supreme Court bench comprising Chief Justice of India DY Chandrachud, Justice JB Pardiwala and Justice Manoj Misra held that unnecessary delay caused in implementation of the Resolution Plan would also lead to the assets of the corporate debtor diminishing in value. Therefore, there is no doubt that the timely implementation of the Resolution Plan is also one of...

IBBI Releases Discussion Paper On Real Estate Issues, Suggests Inclusion Of Land Authorities In CoC Meetings

On 7th November, 2024, the Insolvency and Bankruptcy Board of India (IBBI) has released a discussion paper on the issues related with the Real Estate with seven proposals. This discussion paper is based on findings and recommendations from a recent study group by the Indian Institute of Insolvency Professionals of ICAI (IIIPI) that focused on improving real estate resolutions under...

Filing Petition U/S 94 Of IBC By Guarantor Through RP Does Not Preclude Financial Creditors From Seeking Replacement Of RP: NCLAT

The NLCAT New Delhi bench of Justice 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...

Liquidator's Reliance On Transaction Audit Report Sufficient To File Application For Avoidance Of Preferential Transactions U/S 43 Of IBC: NCLAT

The NLCAT New Delhi bench of Justice 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...