SUPREME COURT

IBC| Principle Of Commercial Wisdom Not Validate A Decision Taken By CoC In Contravention Of Law: Supreme Court

Case Title: M.K. Rajagopalan v Dr. Periasamy Palani Gounder

Citation: 2023 LiveLaw (SC) 403

The Supreme Court Bench comprising of Justice Dinesh Maheshwari and Justice Vikram Nath, has held that the principle of ‘Commercial Wisdom’ of the Committee of Creditors (“CoC”) cannot brush aside the shortcomings of the CoC in cases where decision making was done in contravention to a law which is in force for the time being. The Bench has upheld the NCLAT’s order whereby the Successful Resolution Applicant was declared ineligible in terms of Section 88 of the Indian Trusts Act, 1882, since he had submitted two resolution plans, one in individual capacity and one in the capacity of Managing Trustee of the Trust.

IBC| Ineligibility Of Resolution Applicant As Per S.164(2)(b) Companies Act Can't Be Presumed Unless Competent Authority Declares Disqualification: Supreme Court

Case Title: M.K. Rajagopalan v Dr. Periasamy Palani Gounder

Citation: 2023 LiveLaw (SC) 403

The Supreme Court Bench comprising of Justice Dinesh Maheshwari and Justice Vikram Nath, has held that a resolution applicant cannot be rendered ineligible to submit a resolution plan under the Insolvency and Bankruptcy Code, 2016 (“IBC”), by assuming his/her disqualification under Section 164(2)(b) of the Companies Act, 2013, unless a categorical order disqualifying him/her to act as a director of any company is passed by the competent authority. Further, there is no concept of ‘deemed disqualification’ under Section 164(2)(b) of the Companies Act, 2013.

No Priority For Workers' Dues After Liquidation Of Company Under IBC: Supreme Court Upholds Section 327(7) Of Companies Act 2013

Case Title : Moser Baer Karamchari Union through its President Mahesh Chand Sharma vs Union of India W.P.(C) No. 421/2019 and connected cases.

Citation: 2023 LiveLaw (SC) 386

The Supreme Court Bench comprising Justices MR Shah and Sanjiv Khanna has held upheld the constitutional validity of Section 327(7) of the Companies Act, 2013, which holds that workers' dues will not get preferential payment in the event a company undergoes liquidation as per the provisions of the Insolvency and Bankruptcy Code 2016.

"The enactment of the IBC and Section 53 of IBC necessitated amendment to the Companies Act 2013. The object and purpose of amending the Companies Act 2013 and to exclude Sections 326 and 327 in the event of liquidation of a company under IBC seem to be that there may not be two different provisions in respect to the winding up/ liquidation of a company. Therefore, in view of the enactment of the IBC, it was necessary to exclude the applicability of Section 326 and 327 of the 2013 Act, which cannot be said to be arbitrary, as contended on behalf of the petitioners", 

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.

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.

Remedies Against Third-Parties Not Available Under Section 66 Of IBC: Supreme Court

Case Title: Glukrich Capital Pvt Ltd vs The State of West Bengal

Citation: 2023 LiveLaw (SC) 464

The Supreme Court Bench comprising of Justice Krishna Murari and Justice Sanjay Kumar, affirmed that the remedy against third party is not available under Section 66 of IBC. The Bench further held, “We are of the considered opinion that in such circumstances, it is for the Resolution Professional or the successful resolution applicant, as the case may be, to take such civil remedies against third party, for recovery of dues payable to corporate debtor, which may be available in law. The remedy against third party, however, is not available under Section 66 of IBC, and the civil remedies which may be available in law, are independent of the said Section"

NCLAT

NCLAT Delhi Admits YEIDA’s Appeal Against Jaypee Infratech Resolution Plan On Additional Compensation To Farmers

Case Title: Yamuna Expressway Industrial Development Authority v Monitoring Committee of Jaypee Infratech Ltd. & Ors.

Case No.: Company Appeal (AT) (Insolvency) No. 493 of 2023

The National Company Law Appellate Tribunal (“NCLAT”), Principal Bench, comprising of Justice Ashok Bhushan (Chairperson) and Shri Barun Mitra (Technical Member), has admitted the appeal filed by the Yamuna Expressway Industrial Development Authority (“YEIDA”) against the approved resolution plan of M/s. Suraksha Realty Ltd. and M/s. Lakshdeep Investments & Finance Pvt. Ltd. for Jaypee Infratech Ltd. YEIDA has challenged the approved Resolution Plan on limited ground of allocation of Rs. 10 Lakhs as against a claim for Rs. 1,689.017 Crores for paying additional compensation to the farmers.

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.

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.

Litigant Has No Right To Ask NCLT Member To Recuse Himself From Hearing: NCLAT Delhi

Case Title: Ishrat Ali v The Cosmos Cooperative Bank Ltd. & Anr.

Case No.: Company Appeal (AT) (Insolvency) No. 420 of 2023

The National Company Law Appellate Tribunal (“NCLAT”), Principal Bench, comprising of Justice Ashok Bhushan (Chairperson) and Shri Naresh Salecha (Technical Member), has held that a litigant has no right under Rule 62 of NCLT Rules, 2016 to seek recusal of a NCLT Member from hearing a case.

“The litigant has no right to ask the member to recuse himself. The present is a case where request was made by the Appellant to the Member to recuse from hearing the proceeding. Rule 62 cannot be put to such interpretation and giving any such right to litigant shall lead to disastrous and unwelcome results”, the Bench ruled.

Go Airlines | NCLAT Upholds Initiation Of Insolvency Proceedings, Aircrafts To Remain In Possession Of Go Airlines

Case Title: SMBC Aviation Capital Ltd. Vs. Interim Resolution Professional of Go Airlines (India) Ltd.

Case No.: Comp. App. (AT) (Ins) No. 593 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 upheld the NCLT order whereby Corporate Insolvency Resolution Process (“CIRP”) was initiated against Go Airlines (India) Limited.

The Bench has rejected an appeal filed by the Lessors challenging the NCLT’s direction to keep the leased aircrafts intact in the possession of Go Airlines. Since the Lessors had challenged the imposition of moratorium on leased aircrafts (third party assets) when the lease agreement stood terminated prior to CIRP, the NCLAT has granted liberty to IRP and the Lessors to file application(s) before the NCLT with respect to their claims relating to the leased aircrafts.

Not Mandatory To Issue Notice To The Creditors At Pre-Admission Stage Of Section 10 Application: NCLAT Delhi

Case Title: SMBC Aviation Capital Ltd. Vs. Interim Resolution Professional of Go Airlines (India) Ltd.

Case No.: Comp. App. (AT) (Ins) No. 593 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 IBC does not contain any provision which requires that a notice be served upon the creditors of the Corporate Applicant at pre-admission stage of Section 10 application.

“….since the statutory Scheme does not contain any obligation of issuing notice to the creditors by the Corporate Applicant, any objector appearing at the time of hearing has to be heard and the objection may be noted by the Adjudicating Authority and thereafter the appropriate decision can be taken. We, thus, conclude that the mere fact that no notice was issued to the creditors or any opportunity was given to the objectors before proceeding to hear, the Corporate Applicant, cannot be held to vitiate any procedure or violating the principles of natural justice, more so when objectors were heard by the Adjudicating Authority.”

Delay In Filing Of Appeal Under Section 42 Of IBC Is Condonable Under Section 5 Of Limitation Act: NCLAT Delhi

Case Title: Canara Bank v Commercial Tax Department Circle 09, Indore, Madhya Pradesh & Anr.

Case No.: Company Appeal (AT) (Insolvency) No. 655 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 delay in filing the Appeal under Section 42 of IBC is condonable in exercise of power under Section 5 of the Limitation Act, 1963.

Home Buyers Have No Right To File Intervention Application Prior To Admission Of Section 7 Petition: NCLAT Delhi

Case Title: Vikash Kumar Mishra & Ors. v Orbis Trusteeship Service Pvt. Ltd. & Anr.

Case No.: Comp. App. (AT) (Ins) No. 246 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 an intervention application filed by the homebuyers in petition under Section 7 of IBC is not maintainable before such petition gets admitted. The right to file such application would accrue after admission of the Section 7 petition. The homebuyers of ‘Sikka Kaamna Greens’ project had filed an intervention application supporting the case of the Corporate Debtor (Builder) that the petition under Section 7 of IBC must be rejected. Both NCLT and NCLAT rejected the application on grounds of maintainability.

NCLT

CoC Resolution With 66% Voting Share Not A Pre-Condition For Liquidation When No Resolution Plan Received By The AA: NCLT Hyderabad

Case Title: State Bank of India vs Suryajyothi Spinning Mills Ltd

Case No. ;IA No. 96 of 2021 in CP (IB) No. 166/7/HDB/2019

The National Company Law Tribunal (“NCLT”), Hyderabad Bench, comprising Smt. Telaprolu Rajani (Judicial Member) and Shri Charan Singh (Technical Member), has held that a resolution by the CoC with 66% voting share for Liquidation of Corporate Debtor is not necessary when no resolution plan is received by the Adjudicating Authority. It was observed that the Tribunal has the power to order for Liquidation when no resolution plan is submitted. Thus, the Adjudicating Authority only has to see whether any resolution plan has been presented before it prior to the order of Liquidation under Section 33(1)(a). It is immaterial whether the CoC has resolved for liquidation or whether there was no coordination between the RP and CoC for an order of Liquidation under Section 33(1)(a) when no resolution plan is received by the Adjudicating Authority.

Interest Can Be Added To Reach 1 Crore Threshold Only If Provided In The Agreement: NCLT New Delhi Reiterates

Case Title:M/s Bhotika Trade and Services Pvt. Ltd. vs M/s. Avinash EM Projects Pvt. Ltd.

Case No. ;(IB)-598(ND)2022

The National Company Law Tribunal (“NCLT”), New Delhi Bench, comprising Shri Bachu Venkat Balram Das (Judicial Member) and Shri L.N. Gupta (Technical Member), has reiterated that interest can be charged on Operational Debt only if it is clearly stipulated in the invoices raised. Reliance was placed on the NCLAT judgment of Pavan Enterprises vs Gammon India Ltd [Company in Appeal (AT)(Insolvency) No. 148 of 2018 wherein it was held that debt will include interest if it is payable in the terms of the agreement. Further Reliance was placed on the NCLAT judgment of Prashant Agarwal vs Vikash Parasrampuria & Anr. [Company Appeal (AT) No. 690 of 2022] wherein it was held that total amount of maintainability of a claim will include interest on delayed payment clearly stipulated in the invoice itself

Merely Sending Of Summons By DLSA Can’t Be Considered A Proceeding: NCLT New Delhi

Case Title: Supernova Tech Craft Engineering Overseas Limited v Valtrom Technologies Private Limited

Case No. COMPANY PETITION IB (IBC)/334(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 held that merely sending summons by District Legal Services Authority cannot be considered a proceeding and it further doesn’t fall within the ambit of “suit” or “arbitration proceedings” under Section 8(2) of IBC, 2016.

New Claims Cannot Be Admitted When Resolution Plan Is Approved By The CoC And Is Pending Before The AA For Approval: NCLT Mumbai Reiterates

Case Title: D.S. Kulkarni and Associates vs Manoj Kumar Agarwal (Resolution Professional) in the matter of Bank of Maharashtra vs DS Kulkarni Developers Ltd.

Case No.: C.P. (IB) No. 1633/MB/C-I/2019

The National Company Law Tribunal (“NCLT”), Mumbai Bench, comprising Shri H.V. Subba Rao (Judicial Member) and Shri Shyam Babu Gautam (Technical Member), has reiterated that new claims cannot be admitted when the resolution plan has been approved by the CoC and is pending before the Adjudicating Authority for approval.

Attempt To Convert Operational Debt Into Financial Debt; NCLT Chennai Rejects Section 7 Petition

Case Title: Step Stones Infras Private Limited vs Yes and Yes Infracon (P) Ltd

Case No. IBA/403/2020

The National Company Law Tribunal, Chennai Bench, comprising Shri Sanjiv Jain (Judicial Member) and Shri Sameer Kakar (Technical Member), has held that transfer of the same work by a subsequent MOU would not alter the nature of the original transaction.

Approval Of Resolution Does Not Absolve Guarantor; NCLT Mumbai Reiterates

Case Title: Anchor Leasing Private Limited vs Sejal Realty and Infrastructure Limited

Case No. C.P. No. 889/(IB)-MB-V/2021

The National Company Law Tribunal, Mumbai Bench, comprising Shri Kuldip Kumar Kareer (Judicial Member) and Smt. Anuradha Sanjay Bhatia (Technical Member), has reiterated that the liability of the guarantor does not ipso facto come to an end merely with the approval of the resolution plan against the Principal Borrower.

The Bench observed that during the CIRP against the Principal Borrower, the Corporate Debtor voluntarily agreed to forego their right of subrogation against the successful resolution applicant. This showed that the liability of the Corporate Debtor as guarantor did not come to an end with the approval of the resolution plan . Further, there is no specific mention in the resolution plan that the liability of the guarantors of the Principal Borrower would come to an end with the approval of the plan.

Sec. 126 Of ICA, 1872 Can’t Be Interpreted To Mean That Co-Borrower And Guarantor Can’t Be The Same Person: NCLT Mumbai

Case Title: Pegasus Assets Reconstruction Private Limited vs M/s. Whiz Enterprise Private Limited

Case No.: CP No. 530/(IB)-MB-V/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 Section 126 of the Indian Contract Act, 1872 cannot be interpreted to mean that co-borrower and the guarantor cannot be one and the same person. Further, the Corporate Debtor voluntarily entered into the contract in the capacity of a Co-borrower as well as the Guarantor. Hence it cannot contend that the contract was hit by Section 126 of Indian Contract Act, 1872.

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.

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.

IBC Amendment Prescribing Minimum Number Of Homebuyers Applicable To All Company Petitions Pending For Final Admission: NCLT Mumbai

Case Title: S. Ramasubramonian vs Shree Sukhakarta Developers Private Limited

Case No.: C.P. No. 821/IBC/MB/2019

The National Company Law Tribunal, Mumbai Bench, comprising Shri H.V. Subba Rao (Judicial Member) and Smt. Anu Jagmohan Singh (Technical Member), has held that the IBC amendment prescribing the minimum number of homebuyers for initiation Corporate Insolvency Resolution Process under Section 7 of IBC is applicable to all the pending Company Petitions that are pending for final admission.

Registration Of A Partnership Firm Not A Pre-Requisite For A Section 9 Petition: NCLT Mumbai

Case Title: Haren Sanghvi & Associates vs CDigital Arts & Crafts Private Limited

Case No.: C.P. 4427/IB/MB/2019

The National Company Law Tribunal, Mumbai Bench, comprising Shri Kuldip Kumar Kareer (Judicial Member) and Shri Prabhat Kumar (Technical Member), has held that registration of partnership firm is not a pre-requisite for filing of a petition under Section 9 of IBC.

Allegation Of Fraud In Appointment Of IRP As RP Is No Ground For Rejection Of Resolution Plan Under Section 30(2)(e): NCLT Mumbai

Case Title: Mr. Amit Sangal vs Prince MFG Industries Private Limited

Case No.: CP(IB)934/MB/2020

The National Company Law Tribunal, Mumbai Bench, comprising Shri Kuldip Kumar Kareer (Judicial Member) and Shri Shyam Babu Gautam (Technical Member), has held that the ground that the Interim Resolution Professional had filed false and fabricated documents to show himself appointed as the RP is no legal ground to reject the Resolution Plan under section 30(2)(3) of IBC.