Insolvency andBankruptcy Code, 2016 - Appealchallenging NCLAT order which reversed the order of the NCLT wherein it hadheld that the application under Section 9 of the Insolvency and BankruptcyCode, 2016 was not time-barred - Allowed - The failure of the NCLAT as thefirst appellate authority to look into a very vital aspect such as this,vitiates its order, especially when NCLT has recorded a specific finding offact - Remanded. S.V. Fashions Pvt. Ltd. v. Ritu Murli Manohar Goyal, 2022 LiveLaw (SC) 326 : 2022 (5) SCALE 442

Insolvency and Bankruptcy Code,2016 – Difference between financial and operational creditors in thenature of their role in the Committee of Creditors - It is assumed theoperational creditors will be unwilling to take the risk of restructuring theirdebts in order to make the corporate debtor a going concern. Thus, their debtis not seen as a long -term investment in the going concern status of thecorporate debtor, which would incentivize them to restructure it, but merely asa one -off transaction with the corporate debtor for certain goods or services.(Para 32) Consolidated Construction Consortium Ltd. v. Hitro Energy SolutionsPvt. Ltd., 2022LiveLaw (SC) 129 : (2022) 7SCC 164

Insolvencyand Bankruptcy Code, 2016 - IBC does notexclude the application of Section 14 or 18 or any other provision of theLimitation Act. (Para 81) AssetReconstruction Company (India) Ltd. v. Tulip Star Hotels Ltd., 2022 LiveLaw (SC) 648 : AIR 2022 SC 3559

Insolvency and Bankruptcy Code,2016 – IBC proceedings should not become recovery proceedings - IBCnot akin to a recovery legislation for creditors, but is a legislationbeneficial for the corporate debtor. Consolidated Construction Consortium Ltd. v.Hitro Energy Solutions Pvt. Ltd., 2022LiveLaw (SC) 129 : (2022) 7SCC 164

Insolvencyand Bankruptcy Code, 2016 - If theResolution Plan ignores the statutory demands payable to any State Governmentor a legal authority, altogether, the Adjudicating Authority is bound to rejectthe Resolution Plan - If a company is unable to pay its debts, which shouldinclude its statutory dues to the Government and/or other authorities and thereis no plan which contemplates dissipation of those debts in a phased manner,uniform proportional reduction, the company would necessarily have to beliquidated and its assets sold and distributed in the manner stipulated inSection 53 of the IBC - The Committee of Creditors, which might includefinancial institutions and other financial creditors, cannot secure their owndues at the cost of statutory dues owed to any Government or GovernmentalAuthority or for that matter, any other dues. (Para 52-54) State Tax Officer v. Rainbow Papers Ltd., 2022 LiveLaw (SC) 743 : AIR 2022 SC 4141

Insolvencyand Bankruptcy Code, 2016 - Intended to consolidate and amend the lawswith a view to reorganize Corporate Debtors and resolve insolvency in a timebound manner for maximization of the value of the assets of the CorporateDebtor - The statute deals with and/or tackles insolvency and bankruptcy. It iscertainly not the object of the IBC to penalize solvent companies, temporarilydefaulting in repayment of its financial debts, by initiation of CIRP. (Para 80 - 81) Vidarbha Industries Power Ltd. v. Axis Bank Ltd., 2022 LiveLaw (SC) 587 : (2022) 8 SCC 352

Insolvencyand Bankruptcy Code, 2016 - NCLT admitted anapplication for initiating CIRP filed by operational creditor - NCLAT set itaside - Supreme Court dismissed and held: NCLT committed a grave error of lawby admitting the application of the Operational Creditor, even though there wasa pre-existing dispute as noted by it. SSEngineers v. Hindustan Petroleum Corporation Ltd; 2022 LiveLaw (SC) 617

Insolvencyand Bankruptcy Code, 2016 - NCLT/NCLAT must make a reasonableassessment of the fees and expenses payable to the Interim ResolutionProfession and cannot pass an order in an ad-hoc manner. (Para 16) Devarajan Raman v.Bank of India Ltd., 2022 LiveLaw (SC) 24 : (2022) 3 SCC 254

Insolvencyand Bankruptcy Code, 2016 - NOIDA is an operational creditor under theprovisions of the IBC Code. New Okhla Industrial Development Authorityv. Anand Sonbhadra, 2022 LiveLaw (SC) 491 : 2022 (7)SCALE 656

Insolvency andBankruptcy Code 2016 - Supreme Court holds that there is noground to review the the judgment in Vidarbha Industries Power Ltd. v. AxisBank Limited, 2022 LiveLaw (SC) 587 whichheld that the National Company Law Tribunal has discretion to not admit theinsolvency application filed by a financial creditor even if the corporatedebtor is in default. Axis Bank Ltd v. Vidarbha Industries Power Ltd; 2022 LiveLaw (SC) 817

Insolvencyand Bankruptcy Code, 2016 - The provisions of Section 18 of the LimitationAct are not alien to and are applicable to proceedings under the IBC; and (ii)An acknowledgement in a balance sheet without a qualification can furnish alegitimate basis for determining as to whether the period of limitation wouldstand extended, so long as the acknowledgement was within a period of threeyears from the original date of default. (Para13) State Bank of India v. KrishidhanSeeds, 2022 LiveLaw (SC) 497 : 2022 (8) SCALE 253

Insolvencyand Bankruptcy Code 2016 - There can be nodispute with the proposition that the period of limitation for making anapplication under Section 7 or 9 of the IBC is three years from the date ofaccrual of the right to sue, that is, the date of default. (Para 56) Kotak Mahindra Bank Limited v. Kew PrecisionParts Pvt. Ltd., 2022 LiveLaw (SC) 673 : (2022) 9SCC 364

Insolvencyand Bankruptcy Code 2016 - There is nospecific period of limitation prescribed in the Limitation Act, 1963, for anapplication under the IBC, before the Adjudicating Authority (NCLT). Anapplication for which no period of limitation is provided anywhere else in theSchedule to the Limitation Act, is governed by Article 137 of the Schedule tothe said Act. Under Article 137 of the Schedule to the Limitation Act, theperiod of limitation prescribed for such an application is three years from thedate of accrual of the right to apply. (Para55) KotakMahindra Bank Limited v. Kew Precision Parts Pvt. Ltd., 2022 LiveLaw (SC) 673 : (2022) 9SCC 364

Insolvency and Bankruptcy Code, 2016 - TheCourt allowed withdrawal of Corporate Insolvency Resolution Process against abuilder in an application filed by three homebuyers in view of a settlementplan agreed upon by the majority of them. In the larger interest of thehomebuyers, the Apex Court exercised power under Article 142 to permitwithdrawal of the CIRP proceedings and set aside all matters pending betweenthe parties. Amit Katyal v. Meera Ahuja, 2022 LiveLaw (SC) 259: AIR 2022 SC 1433 : (2022)8 SCC 320

Insolvencyand Bankruptcy Code, 2016 - The IBC is notjust a statute for recovery of debts. It is also not a statute which onlyprescribes the modalities of liquidation of a corporate body, unable to pay itsdebts. It is essentially a statute which works towards the revival of acorporate body, unable to pay its debts, by appointment of a ResolutionProfessional. (Para 55) AssetReconstruction Company (India) Ltd. v. Tulip Star Hotels Ltd., 2022 LiveLaw (SC) 648 : AIR 2022 SC 3559

Insolvencyand Bankruptcy Code, 2016 - The Legislature has consciouslydifferentiated between Financial Creditors and Operational Creditors, as thereis an innate difference between Financial Creditors, in the business ofinvestment and financing, and Operational Creditors in the business of supplyof goods and services. Financial credit is usually secured and of much longerduration. Such credits, which are often long term credits, on which theoperation of the Corporate Debtor depends, cannot be equated to operationaldebts which are usually unsecured, of a shorter duration and of lesser amount.The financial strength and nature of business of a Financial Creditor cannot becompared with that of an Operational Creditor, engaged in supply of goods and services.The impact of the non-payment of admitted dues could be far more serious on anOperational Creditor than on a financial creditor. (Para 78) Vidarbha IndustriesPower Ltd. v. Axis Bank Ltd., 2022 LiveLaw (SC) 587 : (2022) 8 SCC 352

Insolvency and Bankruptcy Code, 2016 - Theobject and purpose of 14 the IBC is not to kill the company and stop/stall theproject, but to ensure that the business of the company runs as a goingconcern. (Para 12) Amit Katyal v. Meera Ahuja, 2022 LiveLaw (SC) 259: AIR 2022 SC 1433 : (2022)8 SCC 320

Insolvencyand Bankruptcy Code, 2016 - The provisions of the Code are essentiallyintended to bring the corporate debtor to its feet and are not of moneyrecovery proceedings as such. Invest Asset Securitisation andReconstruction v. Girnar Fibres, 2022 LiveLaw (SC) 423

Insolvencyand Bankruptcy Code, 2016 - Various stages involved in the corporateinsolvency process in India discussed. (Para 34) Sundaresh Bhatt, Liquidator of ABG Shipyard v. Central Boardof Indirect Taxes and Customs, 2022 LiveLaw (SC) 715 : 2022 (13) SCALE275

Section 3 (30) - "secured creditor"

Insolvencyand Bankruptcy Code, 2016; Section 3(30) - Secured Creditor - A creditor in favour of whom security interest is credited - Suchsecurity interest could be created by operation of law. The definition ofsecured creditor in the IBC does not exclude any Government or GovernmentalAuthority. (Para 57) State TaxOfficer v. Rainbow Papers Ltd., 2022 LiveLaw (SC) 743 : AIR 2022 SC 4141

Section 5 (7) & (8) - "financial creditor"& "financial debt"

Insolvencyand Bankruptcy Code 2016; Section 5(8), 5(7) - A liability inrespect of a claim arising out of a Recovery Certificate would be a "financialdebt" - The holder of the Recovery Certificate would be a financial creditorand would be entitled to initiate CIRP, if initiated within a period of threeyears from the date of issuance of the Recovery Certificate - Affirmed the viewtaken in Dena Bank (Now Bank of Baroda) vs. C. Shivakumar Reddy (2021) 10 SCC330. (Para 84-85) Kotak Mahindra Bankltd. v. A. Balakrishna, 2022 LiveLaw (SC) 534 : AIR 2022 SC 2652 : (2022)9 SCC 186

Section 5 (13) - "insolvency resolution processcosts"

Insolvency and Bankruptcy Code, 2016; Section 5(13), 53(1)(b),53(1)(c) - Insolvency resolution process costs - Duestowards the wages/salaries of only those workmen/employees who actually workedduring the CIRP are to be included in the CIRP costs - The wages and salariesof all other workmen / employees of the Corporate Debtor during the CIRP whoactually have not worked and/or performed their duties when the CorporateDebtor was a going concern, shall not be included automatically in the CIRPcosts. Such dues will be governed by Section 53(1)(b) and Section 53(1) (c) ofthe Insolvency and Bankruptcy Code. (Para 9-10) Sunil Kumar Jain v. SundareshBhatt, 2022 LiveLaw (SC) 382: AIR 2022 SC 1985 : (2022) 7 SCC 540

Section 5 (20) & (21) - "OperationalCreditor" & "Operational Debt"

Insolvency and Bankruptcy Code,2016 – Section 5(20) and 5(21) - Operational Debt - Operational Creditor- A debt which arises out of advance payment made to a corporate debtor forsupply of goods or services would be considered as an operational debt - Thephrase "in respect of" in Section 5(21) has to be interpreted in a broad andpurposive manner in order to include all those who provide or receiveoperational services from the corporate debtor, which ultimately lead to anoperational debt. (Para 43, 45) Consolidated Construction Consortium Ltd. v.Hitro Energy Solutions Pvt. Ltd., 2022LiveLaw (SC) 129 : (2022) 7SCC 164

Section 7 - Initiation of corporate insolvency resolutionprocess by financial creditor

Insolvencyand Bankruptcy Code, 2016; Section 7 - An application under Section 7 of the IBC would not be barred bylimitation, on the ground that it had been filed beyond a period of three yearsfrom the date of declaration of the loan account of the Corporate Debtor asNPA, if there were an acknowledgement of the debt by the Corporate Debtorbefore expiry of the period of limitation of three years, in which case theperiod of limitation would get extended by a further period of three years. (Para97) Asset ReconstructionCompany (India) Ltd. v. Tulip Star Hotels Ltd., 2022 LiveLaw (SC) 648 : AIR 2022 SC 3559

Insolvencyand Bankruptcy Code, 2016; Section 7 - CIRP can be initiated against the Corporate Guarantor withoutproceeding against the principal borrower - The liability of the guarantor isco-extensive with that of the Principal Borrower. (Para 13-16) K. Paramasivam v. Karur Vysya Bank Ltd., 2022 LiveLaw (SC) 742 : AIR 2022 SC 4127

Insolvencyand Bankruptcy Code, 2016; Section 7 - Limitation Act, 1963; Section 18 - Entries in Books of Account/Balance sheet of a company can be treatedas acknowledgement of liability in respect of debt payable to a financialcreditor. (Para 85) AssetReconstruction Company (India) Ltd. v. Tulip Star Hotels Ltd., 2022 LiveLaw (SC) 648 : AIR 2022 SC 3559

Insolvencyand Bankruptcy Code, 2016; Section 7 - Pleadings - An application under Section 7 in the prescribed form cannot becompared with the plaint in a suit, and cannot be judged by the same standards,as a plaint in a suit, or any other pleadings in a Court of law - There is noscope for elaborate pleadings - Documents filed along with the application, orlater, and subsequent affidavits and applications would have to be construed aspart of the pleadings. (Para 49,76) AssetReconstruction Company (India) Ltd. v. Tulip Star Hotels Ltd., 2022 LiveLaw (SC) 648 : AIR 2022 SC 3559

Insolvencyand Bankruptcy Code, 2016; Section 7 - The approval of a resolution in respect of one borrower cannotcertainly discharge a co-borrower - If there are two borrowers or if twocorporate bodies fall within the ambit of corporate debtors, there is no reasonwhy proceedings under Section 7 of the IBC cannot be initiated against both theCorporate Debtors - The same amount cannot be realised from both the CorporateDebtors. If the dues are realised in part from one Corporate Debtor, thebalance may be realised from the other Corporate Debtor being the co-borrower.However, once the claim of the Financial Creditor is discharged, there can beno question of recovery of the claim twice over. (Para 36-37) Maitreya Doshi v. Anand Rathi Global FinanceLtd., 2022 LiveLaw (SC) 789 : AIR 2022 SC 4595

Insolvencyand Bankruptcy Code, 2016; Section 7 - The period of limitation for making an application under Section 7 or9 of the IBC is three years from the date of accrual of the right to sue, thatis, the date of default. (Para 69) AssetReconstruction Company (India) Ltd. v. Tulip Star Hotels Ltd., 2022 LiveLaw (SC) 648 : AIR 2022 SC 3559

Insolvency andBankruptcy Code 2016; Section 7(5) - No ground to review judgment in VidarbhaIndustries Power Ltd. v. Axis Bank Limited which held that adjudicatingauthority has discretion under Section 7(5) - Apprehension that the judgmentwill undermine the objectives of IBC is misconceived - Observations were madein the context of the case at hand. Axis Bank Ltd v. Vidarbha IndustriesPower Ltd; 2022 LiveLaw (SC) 817

Insolvencyand Bankruptcy Code, 2016; Section 7(5)(a) - Ordinarily, theAdjudicating Authority (NCLT) would have to exercise its discretion to admit anapplication under Section 7 of the IBC of the IBC and initiate CIRP onsatisfaction of the existence of a financial debt and default on the part ofthe Corporate Debtor in payment of the debt, unless there are good reasons notto admit the petition - It has to consider the grounds made out by theCorporate Debtor against admission, on its own merits. (Para 87 - 88) VidarbhaIndustries Power Ltd. v. Axis Bank Ltd., 2022 LiveLaw (SC) 587 : (2022) 8 SCC 352

Insolvencyand Bankruptcy Code, 2016; Section 7(5)(a) - The AdjudicatingAuthority (NCLT) has been conferred the discretion to admit the application of theFinancial Creditor. If facts and circumstances so warrant, the AdjudicatingAuthority can keep the admission in abeyance or even reject the application. Ofcourse, in case of rejection of an application, the Financial Creditor is notdenuded of the right to apply afresh for initiation of CIRP, if its duescontinue to remain unpaid - The Adjudicating Authority might examine theexpedience of initiation of CIRP, taking into account all relevant facts andcircumstances, including the overall financial health and viability of theCorporate Debtor. The Adjudicating Authority may in its discretion not admitthe application of a Financial Creditor. (Para77 - 79) Vidarbha Industries Power Ltd.v. Axis Bank Ltd., 2022 LiveLaw (SC) 587 : (2022) 8 SCC 352

Insolvencyand Bankruptcy Code, 2016; Section 7(5)(b) - when the Adjudicating Authority is satisfied that default has notoccurred or the application is incomplete or any disciplinary proceeding ispending against the proposed resolution professional, it may, by order, rejectsuch application - provided it shall, before rejecting the application, give anotice to the applicant to rectify the defect in his application within sevendays of receipt of such notice from the Adjudicating Authority - the provisionwould extent to appeals - appeal is the continuation of original proceedings. (Para 70) Kotak Mahindra BankLimited v. Kew Precision Parts Pvt. Ltd., 2022 LiveLaw (SC) 673 : (2022) 9SCC 364

Insolvencyand Bankruptcy Code, 2016; Section 7-9 - Noticeable differences in the IBC between the procedure of initiationof CIRP by a financial creditor and by an operational creditor -The NCLT is nota debt collection forum. (Para 31-32) SS Engineers v. Hindustan PetroleumCorporation Ltd; 2022 LiveLaw (SC) 617

Section 8 - Insolvency resolution by operational creditor

Insolvencyand Bankruptcy Code, 2016; Sections 8 & 9 - If the claim is undisputedand the operational debt remains unpaid, CIRP must commence- IBC does notcountenance dishonesty or deliberate failure to repay the dues of an OperationalCreditor. (Para 31-32) SS Engineers v. Hindustan PetroleumCorporation Ltd; 2022 LiveLaw (SC) 617

Insolvencyand Bankruptcy Code, 2016; Sections 8 & 9 - if the debt is disputed, the application of the Operational Creditorfor initiation of CIRP must be dismissed - CIRP should be initiated to penalizesolvent companies for non-payment of disputed dues claimed by an operationalcreditor. (Para 31-32) SS Engineers v. Hindustan PetroleumCorporation Ltd; 2022 LiveLaw (SC) 617

Section 9 - Application for initiation of corporateinsolvency resolution process by operational creditor

Insolvencyand Bankruptcy Code, 2016; Sections 9 - Section 9(5)(a) mandatory - Anapplication of an Operational Creditor for initiation of CIRP under Section9(2) of the IBC is mandatorily required to be admitted if the application iscomplete in all respects and in compliance of the 28 requisites of the IBC andthe rules and regulations thereunder, there is no payment of the unpaidoperational debt, if notices for payment or the invoice has been delivered tothe Corporate Debtor by the Operational Creditor and no notice of dispute hasbeen received by the Operational Creditor. The IBC does not countenancedishonesty or deliberate failure to repay the dues of an operational creditor. (Para 76) Vidarbha Industries Power Ltd. v. Axis Bank Ltd., 2022 LiveLaw (SC) 587 : (2022) 8 SCC 352

Insolvency and Bankruptcy Code,2016 - Section 9 – Limitation Act, 1963 – Article 137– Limitation Act would apply to applications filed under Sections 7 and 9 ofthe IBC. Consolidated Construction Consortium Ltd. v. Hitro Energy SolutionsPvt. Ltd., 2022LiveLaw (SC) 129 : (2022) 7SCC 164

Insolvency and Bankruptcy Code,2016 – Section 9 – Limitation Act, 1963 – Article 137– Limitation does not commence when the debt becomes due but only when adefault occurs. As noted earlier in the judgment, default is defined underSection 3(12) of the IBC as the non -payment of the debt by the corporatedebtor when it has become due. (Para 59) Consolidated Construction Consortium Ltd. v.Hitro Energy Solutions Pvt. Ltd., 2022 LiveLaw(SC) 129 : (2022) 7 SCC 164

Section 12A - Withdrawal of application admitted u/s. 7, 9or 10

Insolvency and Bankruptcy Code, 2016; Section 12A- At any stage before a COC is constituted, a party can approachNCLT/Adjudicating Authority directly and the Tribunal may in exercise of itspowers under Rule 11 of the NCLT Rules, allow or disallow an application forwithdrawal or settlement - In an appropriate case and where the case is beingmade out and the NCLT is satisfied about the settlement, may permit/allow anapplication for withdrawal or settlement. Amit Katyal v. Meera Ahuja, 2022 LiveLaw (SC) 259: AIR 2022 SC 1433 : (2022)8 SCC 320

Insolvency andBankruptcy Code, 2016; Section 12A - National Company Law Tribunal Rules, 2016;Rule 11 -Section 12A clearly permits withdrawal of an application under Section 7 IBCthat has been admitted - The question of approval of the Committee of Creditorsby the requisite percentage of votes, can only arise after the Committee ofCreditors is constituted - Before the Committee of Creditors is constituted,there is no bar to withdrawal by the applicant of an application admitted underSection 7 IBC - The settlement cannot be stifled before the constitution of theCommittee of Creditors in anticipation of claims against the Corporate Debtorfrom third persons. The withdrawal of an application for CIRP by the applicantwould not prevent any other financial creditor from taking recourse to aproceeding under IBC. The urgency to abide by the timelines for completion ofthe resolution process is not a reason to stifle the settlement - Rule 11 of theNCLT Rules enables the NCLT to pass orders for the ends of justice includingorder permitting an applicant for CIRP to withdraw its application and toenable a corporate body to carry on business with ease, free of any impediment.(Para 23-30) Ashok G. Rajani v. Beacon Trusteeship Ltd., 2022 LiveLaw (SC) 790 : AIR 2022 SC 4863

Insolvency and Bankruptcy Code, 2016; Section 12A- Regulation 30A of the CIRP Regulations, 2016 - This provision is held to bedirectory depending on fact of case. Amit Katyal v. Meera Ahuja, 2022 LiveLaw (SC) 259: AIR 2022 SC 1433 : (2022)8 SCC 320

Insolvencyand Bankruptcy Code, 2016; Section 12A - When 90% and moreof the creditors, in their wisdom after due deliberations, find that it will bein the interest of all the stakeholders to permit settlement and withdrawCIRP, in our view, the adjudicating authority or the appellate authority cannotsit in an appeal over the commercial wisdom of CoC. The interference would bewarranted only when the adjudicating authority or the appellate authority findsthe decision of the CoC to be wholly capricious, arbitrary, irrational and dehors the provisions of the statute or the Rules. (Para 24) Vallal Rck v. M/s. Siva Industries andHoldings Ltd; 2022 LiveLaw (SC) 541 : AIR 2022 SC2636

Section 13 - Declaration of moratorium and publicannouncement

Insolvencyand Bankruptcy Code, 2016 - Sections 13, 15 and 31 - The claim in respect of the demand was not lodgedafter public announcements were issued under Sections 13 and 15 of the IBC - Onthe date on which the Resolution Plan was approved by the NCLT, all claimsstood frozen - No claim, which is not a part of the Resolution Plan, wouldsurvive. Ruchi Soya Industries Ltd. v.Union of India, 2022 LiveLaw (SC) 207 : (2022) 6 SCC 343

Section 14 - Moratorium

Insolvencyand Bankruptcy Code, 2016; Section 14 - Moratorium on theinitiation of CIRP proceedings and its effects - One of the purposes of themoratorium is to keep the assets of the Corporate Debtor together during theinsolvency resolution process and to facilitate orderly completion of theprocesses envisaged under the statute. Such measures ensure the curtailing ofparallel proceedings and reduce the possibility of conflicting outcomes in theprocess - one of the motivations of imposing a moratorium is for Section14(1)(a), (b), and (c) of the IBC to form a shield that protects pecuniaryattacks against the Corporate Debtor. This is done in order to provide theCorporate Debtor with breathing space, to allow it to continue as a goingconcern and rehabilitate itself. (Para36) Sundaresh Bhatt, Liquidator of ABG Shipyard v. Central Board of IndirectTaxes and Customs, 2022 LiveLaw (SC) 715 : 2022 (13) SCALE275

Insolvency and Bankruptcy Code, 2016; Section 14 - NegotiableInstruments Act, 1881; Section 138 and 141 - Moratorium- Liability of natural persons like a Director of the Company - The moratoriumprovisions contained in Section 14 of the Insolvency and Bankruptcy Code, 2016would apply only to the corporate debtor and that the natural persons mentionedin Section 141 of the Act would continue to be statutorily liable under theprovisions of the Act. Narinder Garg v. Kotak Mahindra Bank, 2022 LiveLaw (SC) 428: 2022 (7) SCALE 162

Insolvencyand Bankruptcy Code, 2016; Section 14, 238 - Securitisation and Reconstructionof Financial Assets and Enforcement of Security Interest Act, 2002 - Afterthe CIRP is initiated, all actions including any action under the SARFAESI Actto foreclose, recover or enforce any security interest are prohibited. (Para 24, 35) Indian Overseas Bank v. RCM Infrastructure Ltd; 2022 LiveLaw (SC) 496 : AIR 2022 SC 2687

Insolvencyand Bankruptcy Code, 2016; Section 14, 60(6) - Section 60(6) doescontemplate exclusion of the entire period during which the moratorium was inforce in respect of corporate debtor in regard to a proceeding as contemplatedtherein at the hands of the corporate debtor - Present an order of Moratoriumunder Section 14, the entire period of the Moratorium is liable to be excludedin computing the period of limitation even in a suit or an application by acorporate debtor. (Para 25-28) New Delhi Municipal Council v. MinoshaIndia Ltd., 2022 LiveLaw (SC) 469

Insolvencyand Bankruptcy Code, 2016; Sections 14, 33(5) - Customs Act, 1961 - IBCwould prevail over Customs Act, to the extent that once moratorium is imposedin terms of Sections 14 or 33(5) of the IBC as the case may be, the respondentauthority only has a limited jurisdiction to assess/determine the quantum of customsduty and other levies. The customs authority does not have the power toinitiate recovery of dues by means of sale/confiscation, as provided under theCustoms Act - Once moratorium is imposed in terms of Sections 14 or 33(5) ofthe IBC as the case may be, the respondent authority only has a limitedjurisdiction to assess/determine the quantum of customs duty and other levies.The respondent authority does not have the power to initiate recovery of duesby means of sale/confiscation, as provided under the Customs Act - After suchassessment, the respondent authority has to submit its claims (concerningcustoms dues/operational debt) in terms of the procedure laid down, in strictcompliance of the time periods prescribed under the IBC, before the adjudicatingauthority - In any case, the IRP/RP/liquidator can immediately secure goodsfrom the respondent authority to be dealt with appropriately, in terms of theIBC. (Para 53) Sundaresh Bhatt,Liquidator of ABG Shipyard v. Central Board of Indirect Taxes and Customs, 2022 LiveLaw (SC) 715 : 2022 (13) SCALE275

Section 20 - Management of operations of corporate debtoras going concern

Insolvency and Bankruptcy Code, 2016; Section 20- Even if it is found that the Corporate Debtor was not a going concern duringthe CIRP despite best efforts by the resolution professional, it cannot bepresumed that still the Corporate Debtor was a going concern during the CIRPperiod. It depends on the facts of each case. (Para 12) Sunil Kumar Jain v. SundareshBhatt, 2022 LiveLaw (SC) 382: AIR 2022 SC 1985 : (2022) 7 SCC 540

Section 29A - Persons not eligible to be resolutionapplicant

Insolvencyand Bankruptcy Code, 2016; Section 29A(h) - The word "suchcreditor" in Section 29A(h) has to be interpreted to mean similarly placedcreditors after the application for insolvency application is admitted by theadjudicating authority - What is required to earn a disqualification under thesaid provision is a mere existence of a personal guarantee that stands invokedby a single creditor, notwithstanding the application being filed by any othercreditor seeking initiation of insolvency resolution process. This is subjectto further compliance of invocation of the said personal guarantee by any othercreditor. (Para 53) Bank of Baroda v. MBLInfrastructures, 2022 LiveLaw (SC) 62: (2022) 5 SCC 661

Section 30 - Submission of resolution plan

Insolvencyand Bankruptcy Code, 2016; Section 30(2) - A resolution plan which does not meet the requirements of Sub Section(2) of Section 30 of the IBC, would be invalid and not binding on the CentralGovernment, any State Government, any statutory or other authority, anyfinancial creditor, or other creditor to whom a debt in respect of dues arisingunder any law for the time being in force is owed. Such a resolution plan wouldnot bind the State when there are outstanding statutory dues of a CorporateDebtor. (Para 48) State TaxOfficer v. Rainbow Papers Ltd., 2022 LiveLaw (SC) 743 : AIR 2022 SC 4141

Section 31 - Approval of resolution plan

Insolvencyand Bankruptcy Code, 2016; Section 31(2) - If a Resolution Plan is ex facie not in conformity with law and/or theprovisions of IBC and/or the Rules and Regulations framed thereunder, theResolution would have to be rejected - Even if Section 31(2) is construed toconfer discretionary power on the Adjudicating Authority to reject a ResolutionPlan, it has to be kept in mind that discretionary power cannot be exercisedarbitrarily, whimsically or without proper application of mind to the facts andcircumstances which require discretion to be exercised one way or the other. (Para50-51) State Tax Officer v.Rainbow Papers Ltd., 2022 LiveLaw (SC) 743 : AIR 2022 SC 4141

Section 36 – Liquidation Estate

Insolvency and Bankruptcy Code, 2016; Section 36(4), 53(1)- Section 53(1) of the IB Code shall not be applicable to dues of theworkmen/employees on account of provident fund, gratuity and pension - They areto be treated outside the liquidation process and liquidation estate assetsunder the IB Code. (Para 13) Sunil Kumar Jain v. Sundaresh Bhatt, 2022 LiveLaw (SC) 382: AIR 2022 SC 1985 : (2022) 7 SCC 540

Section 53 - Distribution of Assets

Insolvencyand Bankruptcy Code, 2016; Section 53 - Gujarat Value Added Tax, 2003; Section48 - Section 48 of the GVAT Act is not contrary to orinconsistent with Section 53 or any other provisions of the IBC- Under Section53(1)(b)(ii), the debts owed to a secured creditor, which would include theState under the GVAT Act, are to rank equally with other specified debtsincluding debts on account of workman's dues for a period of 24 monthspreceding the liquidation commencement date. (Para 56) State Tax Officer v. Rainbow Papers Ltd., 2022 LiveLaw (SC) 743 : AIR 2022 SC 4141

Section 61 - Appeals and Appellate Authority

Insolvencyand Bankruptcy Code, 2016; Section 61 - An appeal againstthe order of NCLT shall be preferred within a period of 30 days from the dateon which the order was passed by the NCLT. The Appellate Tribunal has the powerto extend the period of limitation by another 15 days. Safire Technologies Pvt. Ltd. V.Regional Provident Fund Commissioner, 2022 LiveLaw (SC) 472

Section 238 - Provisions of this Code to override otherlaws

Insolvencyand Bankruptcy Code, 2016; Section 238 - IBC is a completeCode in itself - The provisions of the IBC would prevail notwithstandinganything inconsistent therewith contained in any other law for the time beingin force. (Para 25-27) Indian Overseas Bank v. RCM Infrastructure Ltd;2022 LiveLaw (SC) 496 : AIR 2022 SC 2687

NominalIndex

1. Amit Katyal v. Meera Ahuja, 2022 LiveLaw (SC) 259 : AIR2022 SC 1433 : (2022) 8 SCC 320
2. Ashok G. Rajani v. Beacon Trusteeship Ltd., 2022 LiveLaw (SC) 790 : AIR2022 SC 4863
3. Asset Reconstruction Company (India) Ltd. v.Tulip Star Hotels Ltd., 2022 LiveLaw (SC) 648 : AIR2022 SC 3559
4. Axis Bank Ltd v. Vidarbha Industries PowerLtd; 2022 LiveLaw (SC) 817
5. Bank of Baroda v. MBL Infrastructures, 2022 LiveLaw (SC) 62 : (2022)5 SCC 661
6. Consolidated Construction Consortium v. HitroEnergy Solutions, 2022 LiveLaw (SC) 129 : (2022)7 SCC 164
7. Devarajan Raman v. Bank of India, 2022 LiveLaw (SC) 24 : (2022)3 SCC 254
8. IndianOverseas Bank v. RCM Infrastructure Ltd. 2022 LiveLaw (SC) 496 : AIR 2022 SC 2687
9. Invest Asset Securitisation andReconstruction Pvt. Ltd. v. Girnar Fibres Ltd; 2022 LiveLaw (SC) 423
10. K. Paramasivam v. Karur Vysya Bank Ltd., 2022 LiveLaw (SC) 742 : AIR2022 SC 4127
11. Kotak Mahindra Bank Limited v. Kew PrecisionParts Pvt. Ltd., 2022 LiveLaw (SC) 673 : (2022) 9SCC 364
12. Kotak Mahindra Bank ltd. v. A. Balakrishna, 2022 LiveLaw (SC) 534 : AIR2022 SC 2652 : (2022) 9 SCC 186
13. Maitreya Doshi v. Anand Rathi Global FinanceLtd., 2022 LiveLaw (SC) 789 : AIR2022 SC 4595
14. Narinder Garg v. Kotak Mahindra Bank, 2022 LiveLaw (SC) 428 : 2022(7) SCALE 162
15. New Delhi Municipal Council v. Minosha IndiaLtd., 2022 LiveLaw (SC) 469 : (2022) 8SCC 384
16. New Okhla Industrial Development Authority v.Anand Sonbhadra, 2022 LiveLaw (SC) 491 : 2022(7) SCALE 656
17. RuchiSoya Industries Ltd. v. Union of India, 2022 LiveLaw (SC) 207 : (2022)6 SCC 343
18. Safire Technologies Pvt. Ltd. V. RegionalProvident Fund Commissioner, 2022 LiveLaw (SC) 472
19. SS Engineers v. Hindustan PetroleumCorporation Ltd; 2022 LiveLaw (SC) 617
20. State Bank of India v. Krishidhan Seeds, 2022 LiveLaw (SC) 497 : 2022(8) SCALE 253
21. State Tax Officer v. Rainbow Papers Ltd; 2022 LiveLaw (SC) 743 : AIR2022 SC 4141
22. Su Kumar Jain v. Sundaresh Bhatt, 2022 LiveLaw (SC) 382 : AIR2022 SC 1985 : (2022) 7 SCC 540
23. Sundaresh Bhatt, Liquidator of ABG Shipyardv. Central Board of Indirect Taxes and Customs, 2022 LiveLaw (SC) 715 : 2022(13) SCALE 275
24. SVG Fashions Pvt. Ltd. v. Ritu Murli ManoharGoyal, 2022 LiveLaw (SC) 326 : 2022(5) SCALE 442
25. Vallal Rck v. Siva Industries and HoldingsLtd; 2022 LiveLaw (SC) 541 : AIR2022 SC 2636 : (2022) 9 SCC 803
26. Vidarbha Industries Power Ltd. v. Axis BankLtd., 2022 LiveLaw (SC) 587 : (2022)8 SCC 352