Supreme Court To Examine If Winding-Up Petitions Transferred From HC To NCLT Must Meet IBC Threshold
The Supreme Court on Wednesday agreed to examine whether a winding-up petition filed before a High Court can be subjected to the ₹1 crore minimum default threshold under the Insolvency and Bankruptcy Code after being transferred to the National Company Law Tribunal.
The case concerns winding-up proceedings instituted before the ₹1 crore threshold was introduced under the Code.
The court will consider whether the threshold applicable when the proceedings were originally filed should continue to govern them after their transfer to the tribunal.
A Bench of Justices JB Pardiwala and K. Vinod Chandran said that the matter requires consideration and issued notice in the appeal.
Dictating the order, the Court said,
“The principal question that falls for our consideration, in the present appeal, is whether the proceedings instituted in the year 2013 and statutorily transferred as existing proceedings under Section 434(1)(c) of the Companies Act can be treated as a fresh application, instituted only upon filing of Form 5 after transfer so as to attract a monetary threshold introduced later in point of time after the original institution.”
The Court also permitted counsel for the appellant to implead the Union of India as respondent No. 2 in the matter and directed that the same be done in all connected matters.
Senior Advocate Jayant Mehta, appeared for Aidem Ventures and Senior Advocate Amit Tripathi, appeared for the respondents.
The Court was hearing Aidem Ventures's appeal against the National Company Law Appellate Tribunal decision holding that winding-up proceedings transferred from High Courts must meet the insolvency threshold applicable when the matter is considered by the tribunal.
The NCLAT upheld the NCLT Principal Bench, New Delhi's rejection of Aidem Ventures' pleas against Skyline Radio Network Ltd., E24 Glamour Ltd. and News24 Broadcast India Ltd.
The dispute arose from 2010 agreements under which Aidem Ventures was appointed the exclusive advertising representative for the respondents' television channels, earning commissions ranging from 12% to 25%.
Claiming unpaid commissions of ₹43.71 lakh, ₹8.69 lakh and ₹23.08 lakh respectively, Aidem filed winding-up petitions before the Delhi High Court in 2013.
After the matters were transferred to the NCLT in October 2023, Aidem filed insolvency applications in the prescribed format. The NCLT dismissed the petitions on the ground of pre-existing disputes between the parties.
Before the appellate tribunal, Aidem argued that the threshold applicable when the original winding-up petitions were filed should continue to govern the cases, rather than the threshold in force when the transferred matters were taken up by the NCLT.