IBC
Insolvency Action Against Guarantor Inequitable When Arbitration Against Borrower Is Unsettled: NCLT Hyderabad
The Hyderabad Bench of the National Company Law Tribunal (NCLT) declined to admit a petition filed by the State Bank of India (SBI) seeking initiation of insolvency proceedings against Mallampati Madhu, the personal guarantor of TN (DK) Expressways Limited, holding that such action would be inequitable while a substantial arbitral award of Rs. 288.96 crores in its favour remains under challenge and unrealised. A Bench comprising Judicial Member Rajeev Bhardwaj and Technical Member Sanjay Puri...
No TDS Refund Set Off In Shri Jalaram Rice Industries Liquidation As No Claim Was Filed: NCLAT
The National Company Law Appellate Tribunal (NCLAT) at Delhi has dismissed an appeal filed by the Principal Commissioner of Income Tax-3, Ahmedabad. It held that in the liquidation of Shri Jalaram Rice Industries Pvt Ltd, the department could not adjust a TDS refund against an earlier tax demand because it had not filed any claim in the liquidation proceedings. “Appellant having not filed any claim question of claiming set off does not arise,” the bench of Chairperson Justice Ashok Bhushan and...
Pre-March 2020 Defaults Not Covered By Section 10A Of IBC: NCLAT Delhi
The National Company Law Appellate Tribunal (NCLAT), Delhi, on 24 February, held that Section 10A of the IBC cannot bar Corporate Insolvency Resolution Process (CIRP) initiation where the debt had fallen due prior to 25 March 2020, clarifying that dishonour of cheques during the COVID-19 suspension period does not alter the original default date. The Principal Bench, comprising Judicial Member Justice Mohammad Faiz Alam Khan and Technical Member Naresh Salecha, dismissed an appeal filed by...
Project Segregation In CHD-Vann Real Estate Insolvency Justifies 525-Day CIRP Exclusion: NCLAT
Holding that in a real estate insolvency involving multiple projects, the period till segregation of a project from the CIRP was liable to be excluded, the National Company Law Appellate Tribunal (NCLAT) has allowed exclusion of 525 days in the CHD-Vann matter and set aside the NCLT's rejection of the plea. A Bench of Chairperson Justice Ashok Bhushan and Technical Member Barun Mitra observed that the insolvency pertained to a real estate company with several projects, and different orders had...
120-Day Timeline For Personal Insolvency Resolution Process Is Directory, Not Mandatory: NCLAT Delhi
On 26 February, the National Company Law Appellate Tribunal (NCLAT), New Delhi, held that the 120-day timeline for completing the Personal Insolvency Resolution Process (PIRP) under the Insolvency and Bankruptcy Code (IBC) is directory and not mandatory. A Bench comprising Chairperson Justice Ashok Bhushan and Technical Member Indevar Pandey set aside the order of the National Company Law Tribunal (NCLT) Mumbai, which had refused to extend the process beyond the prescribed period. The Tribunal...
Supreme Court Refuses To Interfere With NCLAT Order Upholding CIRP Against Kirtiman Cements
The Supreme Court on Friday declined to interfere with a National Company Law Appellate Tribunal (NCLAT) judgment upholding the initiation of Corporate Insolvency Resolution Process (CIRP) against Kirtiman Cements and Packaging Industries Ltd. under Section 9 of the Insolvency and Bankruptcy Code, 2016 (IBC). A Bench of Justice J.B. Pardiwala and Justice K.V. Viswanathan dismissed the Civil Appeal filed under Section 62 of the IBC, stating that it was not inclined to interfere with the NCLAT's...
Byju's Insolvency: Supreme Court Continues NCLAT's No Final Order Direction In Plea To Remove GLAS Trust From CoC
The top court was hearing an appeal filed by the Committee of Creditors challenging the NCLAT's decision upholding the rejection of its plea to implead itself in proceedings seeking removal of GLAS Trust from the CoC of Think & Learn Pvt. Ltd.
NCLAT Dismisses Insolvency Plea, Says Rs 1 Crore Debt Threshold Applies On Filing Date, Not Demand Notice Date
The National Company Law Appellate Tribunal (NCLAT) at Delhi has upheld the dismissal of a Section 9 insolvency plea against SBEC Sugar Limited, holding that the Rs 1 Crore threshold under Section 4 of the Insolvency and Bankruptcy Code must be satisfied on the date of filing the petition and not on the date of issuing the demand notice. A bench of Judicial Member Justice N. Seshasayee and Technical Members Arun Baroka and Indevar Pandey dismissed an appeal filed by Mosco International...
Courts Must Remain Vigilant Against Expanding 'Narrow Boundaries' Of IBC Review: Supreme Court
The Supreme Court on Friday upheld the approval of Sarda Energy and Minerals Ltd.'s (SEML) resolution plan for SKS Power Generation (Chhattisgarh) Ltd., cautioning courts against expanding judicial review under the Insolvency and Bankruptcy Code, 2016. Affirming the National Company Law Appellate Tribunal's order, which had upheld the National Company Law Tribunal's approval of the plan, a Bench of Justices BV Nagarathna and R Mahadevan stressed that the IBC prioritises speed and...
NCLAT Dismisses Dhoot Brothers' Plea, Upholds Insolvency Proceedings As Videocon Guarantors
The National Company Law Appellate Tribunal (NCLAT) has dismissed appeals filed by Rajkumar Nandlal Dhoot and Pradeep Nandlal Dhoot, brothers of Videocon founder Venugopal Dhoot, clearing the way for insolvency proceedings against them in their capacity as personal guarantors to debt-ridden Videocon Industries Ltd. A bench of Justice Ashok Bhushan and Technical Member Barun Mitra held that the applications moved by the State Bank of India under Section 95 of the Insolvency and Bankruptcy Code...
NCLAT Allows AMNS To Replace ArcelorMittal India In ₹1,300 Crore Essar Steel RTU Appeal
The National Company Law Appellate Tribunal (NCLAT) at Delhi has allowed ArcelorMittal Nippon Steel India Private Limited to be transposed as the appellant in a pending appeal arising from the Rs 1,300 crore Right to Use charges dispute linked to the Essar Steel insolvency resolution process. The company will replace ArcelorMittal India Pvt. Ltd., the original successful resolution applicant, in the proceedings. The tribunal clarified that the transposition will be subject to the applicant...
Supreme Court Refuses To Frame Guidelines On Parallel Insolvency Against Borrower and Guarantor
The Supreme Court on Thursday observed that while simultaneous Corporate Insolvency Resolution Processes (CIRPs) against principal borrowers and corporate guarantors are legally permissible, it will not frame additional judicial guidelines regulating such proceedings, leaving any reform to Parliament and the Insolvency and Bankruptcy Board of India (IBBI). “We, however, decline to lay down guidelines as proposed; and for good reason. IBC is a product of a well-thought, deliberated, and...