IBC
IBC Moratorium Does Not Bar MPID Attachment Proceedings In NSEL Scam: Bombay High Court
The Bombay High Court recently held that the interim moratorium under the Insolvency and Bankruptcy Code cannot bar attachment proceedings initiated under the Maharashtra Protection of Interest of Depositors (MPID) Act in connection with the National Spot Exchange Limited (NSEL) payment crisis. A Division Bench of Justice A.S. Gadkari and Justice Shyam C. Chandak dismissed an appeal filed by Dulisons Cereals, a proprietorship firm through its proprietor Kanta Gupta, challenging an order of the...
NCLT Mumbai Dismisses CIRP Plea Against Shapoorji Pallonji, Says Claim Inflated With Unilateral Interest
The National Company Law Tribunal (NCLT) at Mumbai Bench has dismissed an insolvency petition filed by GKS Associates against Shapoorji Pallonji and Company Pvt Ltd, a leading construction company headquartered in Mumbai, holding that an operational creditor cannot artificially inflate the claim amount through unilateral interest entries to meet the statutory threshold under the Insolvency and Bankruptcy Code.A bench comprising Judicial Member Nilesh Sharma and Technical Member Sameer Kakar...
NCLAT Sets Aside NCLT Order, Upholds Auction Sale Confirmed Before CIRP, Says Moratorium Not Applicable
The National Company Law Appellate Tribunal (NCLAT) at New Delhi has recently set aside an order of the National Company Law Tribunal (NCLT), Kolkata, which had declared the confirmation of an auction sale and the sale certificate in respect of the corporate debtor's share in a mortgaged property as null and void, holding that the same had been issued after commencement of the corporate insolvency resolution process (CIRP) and during the moratorium. The appellate tribunal held that since the...
NCLAT Upholds Insolvency Against Al-Dua, Rejects Plea That Debt Was Transferred To Another Company
The National Company Law Appellate Tribunal (NCLAT) at Delhi has recently upheld the admission of insolvency proceedings against Al-Dua Food Processing Pvt. Ltd., rejecting the plea of its ex-promoter Mohd. Zaheer that the company was not liable to pay the operational debt as the liability had been transferred to another entity under a Share Purchase Agreement. A bench of Chairperson Justice Ashok Bhushan and Technical Member Barun Mitra held that the defence of transfer of liability was not...
NCLT Chandigarh Rejects Omkara ARC Plea Over 1267-Day Belated Claim In Vikas WSP CIRP
The National Company Law Tribunal (NCLT) at Chandigarh has dismissed a plea filed by Omkara Assets Reconstruction Pvt. Ltd. seeking admission of its claim in the corporate insolvency resolution process (CIRP) of Vikas WSP Ltd., holding that a claim filed 1267 days after the prescribed deadline and after approval of the resolution plan cannot be entertained under the Insolvency and Bankruptcy Code (IBC). Refusing to condone the delay, the bench of Judicial Member Khetrabasi Biswal and Technical...
NCLT Bengaluru Admits CIRP Against VOI Jeans Retail India Over ₹1.11 Crore Operational Debt Default
The National Company Law Tribunal (NCLT) at Bengaluru has admitted a petition filed by Raymond UCO Denim Pvt Ltd seeking initiation of the corporate insolvency resolution process (CIRP) against VOI Jeans Retail India Pvt. Ltd. for an operational debt of Rs 1.1 crore. A coram of Judicial Member Sunil Kumar Aggarwal and Technical Member Radhakrishna Sreepada passed the order. Raymond UCO Denim, the operational creditor engaged in the business of manufacturing and supplying denim fabrics,...
Haryana RERA Late Fee Cannot Be Refunded In IBC Proceedings Without Challenge Before REAT: NCLT, Kolkata
The National Company Law Tribunal's Kolkata bench has recently observed that once the competent Real Estate Regulatory Authority levies and realizes late fee in exercise of its statutory powers, such levy assumes the character of a statutory charge payable to the State authority and cannot be ordered to be refunded in insolvency proceedings unless it is challenged before the appropriate appellate forum under the RERA law. “Once the competent RERA Authority has levied and realized late fee in...
Personal Guarantor Can Face Insolvency Even If Corporate Debtor Is In Liquidation: NCLT Indore
The National Company Law Tribunal (NCLT) at Indore has recently held that insolvency proceedings can be initiated against a personal guarantor even when liquidation proceedings against the corporate debtor are pending. The tribunal observed that the issue before it was, “whether an Insolvency Resolution Process can be initiated against the Personal Guarantor of a Corporate Debtor when the Liquidation Proceedings against the Corporate Debtor are already pending?” and held that “the above issue...
IBC Moratorium Operates Automatically, Not Dependent On Creditor's Knowledge Of CIRP: NCLT Indore
The National Company Law Tribunal (NCLT) at Indore has recently observed that the moratorium under Section 14 of the Insolvency and Bankruptcy Code, 2016, operates automatically from the insolvency commencement date and is binding even if the creditor or statutory authority had no knowledge of the admission of the Corporate Insolvency Resolution Process (CIRP). A bench of Judicial Member Brajendra Mani Tripathi and Technical Member Man Mohan Gupta observed, “The statutory prohibition under...
Kerala High Court Sets Aside Rent Control Appellate Authority Order For Proceeding During IBC Moratorium
The Kerala High Court on Tuesday set aside an order of the Rent Control Appellate Authority after finding that an appeal against a corporate debtor had been taken up despite a moratorium being in force under the Insolvency and Bankruptcy Code. A bench of Chief Justice Soumen Sen and Justice Syam Kumar V.M. observed, “Under Section 14(1), it is clearly stated that once a moratorium is declared, there cannot be an institution of suits or continuation of pending suits or proceedings against the...
Liquidator Cannot Appeal His Own Replacement As He Is Not 'Person Aggrieved' Under IBC: NCLAT
The National Company Law Appellate Tribunal (NCLAT) on Tuesday held that a liquidator cannot maintain an appeal challenging his replacement under the Insolvency and Bankruptcy Code (IBC), ruling that removal from such a statutory assignment does not create a vested entitlement to continue in office.A bench of Chairperson Justice Ashok Bhushan and Technical Member Indevar Pandey observed, “It is well settled that once the Adjudicating Authority, for reasons recorded, directs replacement of a...
NCLAT Upholds Rejection Of Homebuyer's Claim Filed 4 Days Before CoC Vote On Resolution Plan For Developer
The National Company Law Appellate Tribunal (NCLAT) at Delhi on Tuesday upheld the rejection of a homebuyer's claim filed four days before a Committee of Creditors (CoC) meeting to vote on resolution plan, noting that under the CIRP Regulations, belated claims can be admitted only if they are submitted up to seven days before such meetings. A bench of Chairperson Justice Ashok Bhushan and Technical Member Barun Mitra observed, "When we look at the above CIRP Regulations, it is amply clear that...