IBC | Supreme Court Accepts Apology Of Tax Authorities For Asking Successful Resolution Applicant To Pay Dues Not Covered By Approved Plan

Giving the benefit of doubt and accepting their unconditional apology, the Supreme Court today disposed of a contempt petition filed against Chhattisgarh tax authorities for raising demand notices against a successful resolution applicant over claims in respect of a period prior to the approval of the resolution plan."we have no hesitation in holding that the demands raised by the respondents/authorities for a period prior to the date on which the learned NCLT has approved the Resolution Plan...

Application U/S 94 Of IBC Cannot Be Entertained Against Sole Proprietorship Firms: Madhya Pradesh High Court

The Madhya Pradesh High Court bench of Justice Vivek Rusia and Justice Prem Narayan Singh has held that since sole proprietorship firms are not included in the definition of the corporate person under section 3(7) of the Insolvency and Bankruptcy Code, 2016 (Code), an application under section 94 of the Code cannot be entertained. Brief Facts: The petitioner is an owner of the property situated at House No.437-B, Katju Nagar, Ratlam, M.P. The aforesaid property was mortgaged as a...

NCLT Kolkata Remits Repayment Plan U/S 114(3) Of IBC To Committee Of Creditors Due To Non Consideration Of Detective Report

The National Company Law Tribunal (NCLT) Kolkata bench of Smt. Bidisha Banerjee (Judicial Member) and Smt. Madhu Sinha (Technical Member ) has remitted the repayment plan remitted to the Committee of Creditors (CoC) for reconsideration on the ground that no discussion took place on the detective report, which disclosed that the personal guarantor had sold certain properties and acquired a new one. Despite this, the creditors approved the repayment plan without deliberating on the report. ...

Notice U/S 263 Of Income Tax Act Cannot Be Issued By Authority After Approval Of Resolution Plan U/S 31 Of IBC: Gujarat High Court

The Gujarat High Court bench of Justice Bhargav D. Karia and Justice D.N.Ray has held that after approval of the Resolution Plan under Section 31 of the Insolvency and Bankruptcy Code, 2016 (Code), all liabilities prior to the approval of the plan stand extinguished. Therefore, the Income Tax Authority cannot be permitted to issue a notice under Section 263 of the Income Tax Act, 1961 (Act) seeking to revise the assessment after the approval of the Plan. Brief Facts: Amw Auto...

Adding Inflated Interest To Outstanding Liability Merely To Cross Threshold U/S 4 Of IBC Is Not Permissible: NCLAT

The National Company Law Appellate Tribunal (NCLAT) New Delhi bench of Justice Ashok Bhushan (Judicial Member), Mr. Arun Baroka (Technical Member) and Mr. Barun Mitra (Technical Member) has held that the interest cannot be added to the outstanding liability when there is no contract between the parties to this effect and no past practice justifying such action merely to cross the threshold of Rs. 1 crore under section 4 of the Insolvency and Bankruptcy Code, 2016 (Code). Brief Facts: ...

When There Is No Privity Of Contract Between Operational Creditor And Corporate Debtor, Application U/S 9 Of IBC Cannot Be Admitted: NCLAT

The National Company Law Appellate Tribunal (NCLAT) New Delhi bench of Justice Ashok Bhushan (Judicial Member), Mr. Arun Baroka (Technical Member) and Mr. Barun Mitra (Technical Member) has held that an application under Section 9 of the Insolvency and Bankruptcy Code, 2016 (Code), cannot be admitted when there is no privity of contract between the Operational Creditor and the Corporate Debtor. When the invoices were raised on the sister concern of the Corporate Debtor rather than on the ...

NCLT Mumbai Dismisses Syska LED Lights' Plea For Withdrawal Of Insolvency Application U/S 12A Of IBC

The National Company Law Tribunal (NCLT), Mumbai bench comprising K.R. Saji Kumar (Judicial Member) and Anil Raj Chellan (Technical Member) has dismissed the withdrawal application filed under Section 12A of the Insolvency and Bankruptcy Code (IBC/Code) in the insolvency proceedings of Syska LED Lights Pvt. Ltd (Corporate Debtor). The Tribunal held that once a Corporate Insolvency Resolution Process (CIRP) is admitted, it becomes a 'collective proceeding' in rem. The Tribunal observed...

Fresh Period Of Limitation U/S 18 Of Limitation Act Begins From Date When Balance Sheet Is Signed By Corporate Debtor: NCLAT

The National Company Law Appellate Tribunal (NCLAT) New Delhi bench of Justice Ashok Bhushan (Judicial Member) and Mr. Barun Mitra (Technical Member) has held that a fresh period of limitation under Section 18 of the Limitation Act, 1963 (Limitation Act) for the purpose of filing an application under section 7 of the Insolvency and Bankruptcy Code, 2016 (Code) begins from the date the balance sheet is signed by the authorized signatories of the corporate debtor, not from the date it is uploaded...

Order Passed After Considering All Materials Essential For Determining Issue Cannot Be Recalled: NCLAT

The National Company Law Appellate Tribunal (NCLAT) New Delhi bench of Justice Ashok Bhushan (Judicial Member), Mr. Arun Baroka (Technical Member) and Mr. Barun Mitra (Technical Member) has held that an order passed by the Adjudicating Authority after considering all necessary materials essential for determining the issue cannot be recalled. Therefore, it cannot be said that such an order was obtained by playing fraud on the court on which ground only an order can be recalled. Brief...

When Corporate Debtor's One Time Settlement Proposal Is Rejected By Financial Creditor, Application U/S 7 Of IBC Must Be Admitted: NCLAT

The National Company Law Appellate Tribunal (NCLAT) New Delhi bench of Justice Ashok Bhushan (Judicial Member) and Mr. Arun Baroka (Technical Member) has held that when a One-Time Settlement (OTS) proposal submitted by the corporate debtor is rejected by the financial creditor and the debt remains unpaid, the application under Section 7 of the Insolvency and Bankruptcy Code, 2016 (the Code), must be admitted. Brief Facts: The corporate debtor was constituted a Special Purpose...

IBC Cases Weekly Round Up [17th March-23rd March 2025]

Nominal Index: Manish Mukim v. Ms. Rakhi and Anr., Company Appeal (AT) (Insolvency) No. 617 of 2023 VISHNOO MITTAL VERSUS M/S SHAKTI TRADING COMPANY, 2025 LiveLaw (SC) 314 Authum Investment and Infrastructure Limited The Ruby Versus Ashdan Properties Private Limited and Ors., Company Appeal (AT) (Insolvency) No. 1566 of 2024 & I.A. No. 5973, 6380 of 2024 Shree Rajasthan Syntex Ltd. V Chief Engineer (Commercial), Ajmer, Ajmer Vidyut Vitran Nigam Ltd, Company Appeal (AT)...

NCLT Hyderabad Lays Out Structured Buy-Out Mechanism To Resolve Deadlock Between Shareholders In Escentia Group Case

The National Company Law Tribunal (NCLT) Hyderabad bench of Dr. Venkata Ramakrishna Badarinath Nandula (Judicial Member) and Charan Singh (Technical Member) in a company petition seeking relief under sections 241 and 242 of the Companies Act, 2013 (Companies Act) held that the actions of the Deccan Group amounted to grave acts of oppression and was not mere instances of internal shareholder disputes. The Tribunal further laid out a structured buy-out mechanism to resolve the deadlock...