Without Proof Of Disbursement No Financial Debt Can Be Claimed: NCLT Mumbai Reiterates

The National Company Law Tribunal ("NCLT"), Mumbai Bench, comprising of Justice P.N. Deshmukh (Judicial Member) and Shri Shyam Babu Gautam (Technical Member), while adjudicating a petition filed in Sudhir T Deshpande v Dhanada Corporation Limited, has rejected a petition under Section 7 of Insolvency and Bankruptcy Code, 2016 ("IBC") as there was no proof of disbursement of debt. The Bench held that without proof of disbursement an amount cannot be claimed as financial debt under IBC,...

Bank Of India Files Insolvency Plea Against Kishore Biyani Led Future Lifestyle Fashions

Future Lifestyle Fashions Ltd. ("FLFL") is the flagship fashion business of the Mr. Kishore Biyani led Future Group of companies, which have dominated the retail sector in India for years. FLFL operates more than 300 stores across India and owns retail fashion chains such as Central and Brand Factory. Recently, the flagship company of Future Group i.e. Future Retail Ltd., which operates popular retail chains such as Big Bazaar, Foodhall, Easyday Club and WH Smith, was admitted into...

'Liquidation Last Resort', NCLT Directs COC To Re-Consider The Rejected Resolution Plan: NCLT Mumbai

The National Company Law Tribunal ("NCLT"), Mumbai Bench, comprising of Justice P.N. Deshmukh (Judicial Member) and Shri Shyam Babu Gautam (Technical Member), while adjudicating a petition filed in Edelweiss Asset Reconstruction Co. Ltd. v Octaga Green Power and Sugar Company Ltd., has reiterated that liquidation of the Corporate Debtor is the last resort and has accordingly directed the Committee of Creditors to reasonably re-consider the rejected Resolution Plan. The CoC comprised of...

NCLT Ahmedabad Rejects Resolution Plan Selectively Favoured Creditors

The National Company Law Tribunal ("NCLT"), Ahmedabad Bench, comprising of Shri Madan B Gosavi (Judicial Member) and Shri Kaushalendra Kumar Singh (Technical Member), while adjudicating a petition filed in M/s. Sansar Texturisers Pvt. Ltd. v M/s. Polycoat India Pvt. Ltd., has declined to approve the Resolution Plan of the Successful Resolution Applicant that breached the waterfall mechanism of payments as given under Section 53 of IBC and selectively favoured certain creditors without...

Creditor Entitled To Claim From Successful Resolution If It's Suit Is Decreed: NCLAT Delhi

The National Company Law Appellate Tribunal (NCLAT) bench comprising of Justice Ashok Bhushan (Chairperson), Justice N Satyanarayana Murthy (Judicial Member) and Mr. Barun Mitra (Technical Member), while adjudicating in an appeal filed in Goltens India Pvt. Ltd. v Sudip Bhattacharya, has upheld the Adjudicating Authority's order to earmark Rs. 1 towards a contingent claim arising out of a recovery suit filed before the High Court. The NCLAT Bench held that if the suit is decreed then the...

Resolution Plan Can't Be Remanded Back To COC Over Hyper-Technical Grounds: NCLAT Delhi

The National Company Law Appellate Tribunal ("NCLAT"), Principal Bench, comprising of Justice Ashok Bhushan (Chairperson), Justice M. Satyanarayana Murthy (Judicial Member) and Mr. Barun Mitra (Technical Member), while adjudicating an appeal filed in Piya Puri & Ors. v Mr. Debhashish Nanda & Ors., has held that remanding a resolution plan back to Committee of Creditors on the grounds of the procedural deviations raised by a dissenting minority in class of creditors, would render...

Status Of Debtor, Attained Finality, Can't Be Altered Based On A Subsequent Judgment: NCLAT Delhi

The National Company Law Appellate Tribunal ("NCLAT"), Principal Bench, comprising of Justice Ashok Bhushan (Chairperson), Justice M. Satyanarayana Murthy (Judicial Member) and Mr. Barun Mitra (Technical Member), while adjudicating an appeal filed in Raghavendra G. Kundangar & Ors. v Shashi Agarwal & Anr., applied the Doctrine of Prospective Overruling while observing that when status of a debtor attains finality, the same cannot be altered on the basis of a subsequent judgment...

Section 7 Petition To Be Kept In Abeyance For 6 Months, Hoping Settlement: NCLT Indore

The National Company Law Tribunal ("NCLT"), Indore Bench, comprising of Shri Madan B Gosavi (Judicial Member) and Shri Kaushalendra Kumar Singh (Technical Member), while adjudicating a petition filed in State Bank of India v Krishidhan Seeds Pvt Ltd., has kept a Section 7 petition filed under IBC in abeyance for 6 months despite the all essentials for initiating CIRP being fulfilled. The Bench opined that in view of Supreme Court judgment in Vidarbha Industries Power Limited vs. Axis...

Once Bidder Accepts Corporate Debtor In Slump Sale, Can't Request For Conversion Of Sale Into Sale As A Going Concern: NCLT Ahmedabad

The National Company Law Tribunal ("NCLT"), Ahmedabad Bench, comprising of Shri Madan B Gosavi (Judicial Member) and Shri Kaushalendra Kumar Singh (Technical Member), while adjudicating a petition filed in State Bank of India & Anr. v Shirpur Power Pvt. Ltd., has held that once a successful bidder has accepted and purchased the Corporate Debtor in slump sale under IBC, the bidder cannot request to convert that sale into a sale of Corporate Debtor as a going concern. Background...

Entity Issuing A 'Letter Of Comfort' Is Not A Corporate Debtor Or Guarantor Within Framework Of Law: NCLT Delhi

The National Company Law Tribunal ("NCLT"), New Delhi Bench, comprising of Shri P.S.N. Prasad (Judicial Member) and Shri Rahul Bhatnagar (Technical Member), while adjudicating a petition filed in M/s. Shapoorji Pallonji and Company Pvt. Ltd. v M/s. ASF Insignia SEZ Pvt. Ltd., has held that an entity that issues a 'Letter of Comfort' to a party, cannot be treated as Corporate Debtor or Corporate Guarantor within the framework of law. Background Facts M/s Black Canyon SEZ Pvt. Ltd....

Loan Converted Into Equity - NCLT Procedure Being In Summery In Nature, Can't Initiate CIRP; NCLT Kolkata

The National Company Law Tribunal ("NCLT"), Kolkata Bench, comprising of Shri Rohit Kapoor (Judicial Member) and Shri Balraj Joshi (Technical Member), while adjudicating a petition filed in Anup Jhunjhunwala v ADEA Powerquips Private Limited, has declined to initiate insolvency proceedings with respect to a debt disbursed by Director of the Corporate Debtor, as the loan was subsequently converted into equity shares. The Bench opined that NCLT is a summary court and cannot venture into ...

Non Issuance Of Completion Certificate Amounts To Pre Existing Dispute: NCLAT New Delhi

The National Company Law Appellate Tribunal bench comprising of Justice Ashok Bhushan, Justice M Satyanarayana Murthy and Mr. Barun Mitra while dismissing an appeal field by the Operational Creditor against the rejected of Section 9 petition held that the non-issuance of the completion certificate amounts to a pre existing dispute between the parties. It was contended on behalf of the Operational Creditor that it has provided various services to the Respondent such as trenching,...