IBC
Inconsistencies Between E-Auction Notice And Process Memo Vitiate Liquidation Sale: NCLT Amaravati
The National Company Law Tribunal (NCLT) at Amaravati has prima facie held that inconsistencies between an e-auction sale notice and the auction process memorandum create serious ambiguity regarding the assets offered for sale and render the liquidation auction process legally unsustainable under the Insolvency and Bankruptcy Code. “This Adjudicating Authority is of the considered view that the inconsistency between the E-Auction Sale Notices and the Auction Process Memorandum creates serious...
'Prejudice From Delay Ignored': Delhi High Court Cuts Insolvency Professional's Suspension To Period Undergone
Holding that prolonged delay in disciplinary proceedings had already caused serious prejudice, the Delhi High Court has reduced a one-year suspension imposed by the Insolvency and Bankruptcy Board of India (IBBI) on insolvency professional Vikas Prakash Gupta to the period already undergone. Justice Sachin Datta underscored that “Administrative authorities are required to act within a reasonable period, and any prolonged delay must be justified by cogent reasons.” While noting that the...
Delay In Statutory Demand Notice No Ground to Reject Insolvency Plea If Within Limitation: NCLT Mumbai
The National Company Law Tribunal (NCLT) at Mumbai has held that a delay in issuing a statutory demand notice does not invalidate personal insolvency proceedings under the Insolvency and Bankruptcy Code so long as the insolvency plea is filed within time. The tribunal clarified that the limitation runs from the date of default and not from the date on which the demand notice is issued. The ruling was delivered by a coram of Judicial Member Sushil Mahadeorao Kochey and Technical Member Prabhat...
BREAKING | NCLAT Upholds NCLT Order, Rejects Actor Akshay Kumar's Insolvency Plea Against Cue Learn
The National Company Law Appellate Tribunal at New Delhi on Friday upheld an NCLT order refusing to start insolvency proceedings against Cue Learn Private Limited over a payment dispute arising from an endorsement deal with actor Akshay Kumar Bhatia. A coram of Judicial Member Justice N. Seshasayee and Technical Member Indevar Pandey agreed that the disagreement between the parties could not be resolved under the Insolvency and Bankruptcy Code. The tribunal said insolvency proceedings...
NCLT Mumbai Orders ONGC To Release Rs 22.14 Crore Withheld From Dolphin Offshore Over GST Garnishee Notice
The National Company Law Tribunal (NCLT) at Mumbai has recently directed Oil and Natural Gas Corporation Limited (ONGC) to release payments due for work executed under its contracts with Dolphin Offshore Enterprises (India) Ltd., which had been withheld pursuant to a GST department garnishee notice. It held that pre-CIRP claims of the GST department stood extinguished upon approval of the resolution plan. The direction includes the release of Rs. 22.14 crore determined under one of the...
NCLT Kochi Dismisses GST Department's Plea to Include Belated ₹6.06 Crore Claim In SDF Industries Insolvency
The National Company Law Tribunal (NCLT) at Kochi has dismissed the tax department's plea to include a Rs 6.06 crore belated GST claim in the insolvency process of SDF Industries Limited, holding that claims cannot be entertained after approval of the resolution plan by the Committee of Creditors. A coram of Judicial Member Vinay Goel held that permitting the tax department to raise its claim at such a stage would reopen settled stages of the corporate insolvency resolution process and...
Supreme Court Records Justice Abhay Oka–Mediated Settlement In Transcon–Anchor Point Insolvency Dispute
The Supreme Court of India has recently recorded a comprehensive settlement between Transcon Skycity Pvt. Ltd. and Anchor Point Developers Pvt. Ltd., bringing to an end a prolonged insolvency dispute arising out of a stalled real estate project. A bench of Justices J.B. Pardiwala and K.V. Viswanathan noted that the mediation conducted by former Supreme Court judge Justice Abhay S. Oka was successful and that a comprehensive mediation report had been submitted and taken on record. “We had...
Bank's Appropriation Of Corporate Debtor's Fixed Deposit During CIRP Violates Moratorium: NCLT Mumbai
The National Company Law Tribunal (NCLT) at Mumbai has recently held that the unilateral liquidation and appropriation of a corporate debtor's fixed deposit by a bank during insolvency proceedings amounts to an impermissible recovery action barred by the moratorium. “Section 14 of the Code imposes a complete bar on any action to recover, foreclose, or enforce any security interest against the assets of the Corporate Debtor once the CIRP has commenced and the moratorium under Section 14 has...
IBC Is Now Being Misused Like Anything": CJI Surya Kant Flags Pre-Planned Auctions and Asset Undervaluation
The Supreme Court recently flagged the issue of IBC provisions being misused by Insolvent Companies to stage pre-planned auctions and sell assets at undervalued rates. The Chief Justice of India, Justice Surya Kant remarked on the gravity of instances where the IBC procedure is being misused, the CJI said :"Unfortunately, the IBC platform is now being misused like anything, you get the company's all assets undervalued, then you indulge in a kind of an auction, which is also a completely...
Supreme Court Dismisses Law Firm's ₹1.08-Crore Claim Against Insolvency-Bound Realty Company
The Supreme Court of India has recently dismissed an appeal by a law firm seeking to recover more than Rs 1 crore in unpaid legal fees from a realty company undergoing insolvency, declining to interfere with findings that the claim was not backed by the record. The appeal was filed by Juristica Legal Services LLP against Three C Universal Developers Private Limited, which is undergoing a Corporate Insolvency Resolution Process. A Bench of Justices Pamidighantam Sri Narasimha and Alok...
Supreme Court Refuses To Interfere With NCLAT Order Rejecting EPFO Claim Made After Liquidation Commencement
The Supreme Court has recently dismissed an appeal filed by the Employees' Provident Fund Organisation, declining to interfere with a ruling of the National Company Law Appellate Tribunal on the treatment of claims in liquidation. A Bench of Justices Sanjay Kumar and K. Vinod Chandran said it found “no good ground and reason” to interfere with the NCLAT judgment dated September 24, 2024. The dispute arose from the liquidation of Khushi Foods Limited, which began on October 9, 2019. During the...
495-Day Delay Is 'Gross Negligence': NCLAT Rejects Cethar Liquidator's Plea To Amend Avoidance Application
The National Company Law Appellate Tribunal at Chennai has dismissed an appeal filed by the liquidator of Cethar Limited, refusing to excuse a 495-day delay in amending an avoidance application filed during a company's insolvency proceedings. The tribunal held that the delay amounted to “gross negligence” and could not be condoned by relying on Section 148 of the Code of Civil Procedure, a provision that allows courts to extend procedural timelines but limits such extension to 30 days. A...