Relevance Of Doctrine Of Priority In Liquidation Under Insolvency & Bankruptcy Code

It is a well established principle that where conflicting, but equal interests have been created in favour of multiple persons, it should be determined based on the maxim qui prior est tempore potior est jure, i.e., he who is earlier in time is stronger in law. This principle has been incorporated under the Transfer of Properties Act, 1882, as Section 48, which provides that where a person purports to create by transfer at different times, rights in or over the same immovable property,...

"Is Stock Broking Company A Financial Service Provider Under IBC?" NCLAT To Examine

The National Company Appellate Tribunal (NCLAT), New Delhi has recently agreed to examine a serious question of law i.e. whether a stock broking company should be considered as a Financial Service Provider under Section 3(16) of the Insolvency and Bankruptcy Code, 2016 and should be kept out of the purview of the Insolvency and Bankruptcy Code, 2016 ("IBC")? The development came while the NCLAT stayed the Committee of Creditors formation of Corporate Debtor i.e. Simandhar Broking Ltd. if not...

Process Analysis Of Pre-Packs: The Next Step In The Evolution Of Insolvency Regime In India

The enactment of the Insolvency and Bankruptcy Code, 2016 ('the Code') provided a new insolvency regime to the country in order to resolve the corporates and individuals, undergoing financial distress, in a time bound manner. Given the fact that the market for the new professions created by the Code have sufficiently matured and the processes introduced by it have adequately evolved, the Government found it feasible to explore new initiatives in order to further improve the effectiveness...

NCLAT: Liquidation Proceedings Quashed On The Ground That Sole Decision Of Related Parties Financial Creditors Could Be Fatal For The Existence Of The Corporate Debtor

The Principal Bench of the National Company Appellate Law Tribunal at Delhi comprising of Justice A.I.S. Cheema and Justice V. P. Singh, quashed the liquidation proceedings against the Corporate Debtor- 'INCAB Industries Limited and directed to appoint another IRP/ Resolution Professional in place while restoring the application u/S. 9 of the Insolvency Bankruptcy Code, 2016 to the NCLT. "An order for liquidation of corporate debtor based on the sole decision of related parties...

BR Foundation: Webinar On "How To Make A Career In IBC?" [19th-20th June 2021]

BR Foundation is conducting a webinar on "How to make a career in IBC?" from 19th-20th 2021. The media partner for the webinar is IBC Law reporter. Eminent Speakers: ● Mr Bahram N Vakil | Founder & Senior Partner, AZB & Partners. He is the keynote speaker for the webinar who has also been a member of the Bankruptcy Law Reforms Committee and is currently serving on a committee that has proposed amendments to the IBC. ● Dr Neeti Shikha | Head, Centre for...

Insolvency Law In Review – April 2021

The enactment of the Insolvency and Bankruptcy Code 2016 (Code) has had significant ramifications on the corporate insolvency landscape. Over time, the Code has witnessed a manifold increase in litigation, and consequently in the number of decisions. This has made it difficult for insolvency practitioners to stay updated with developments in the field. The purpose of this column is to fill this gap by providing brief summaries of latest decisions, from the various fora dealing with...

Delayed Submission Of Claim By Operational Creditor In Liquidation Process

During the procedure of insolvency resolution, if the resolution plan fails, the corporate debtor is liquidated. Under S.33 of Chapter III of the Insolvency and Bankruptcy Code, 2016 ("Code"), which deals with liquidation process, the National Company Law Tribunal ("NCLT") orders the liquidation of corporate debtor and a liquidator is appointed as per section 34 of the Code. Regulation 12 of the Insolvency and Bankruptcy Board of India (Liquidation Process) Regulations, 2016 ("Regulations")...

Personal Guarantors Under The Insolvency And Bankruptcy Code, 2016

The Supreme Court of India in Lalit Kumar Jain vs. Union of India & Ors.[1] has dismissed a challenge to a notification dated 15.11.2019 issued by the Ministry of Corporate Affairs,[2] which brought into force the following provisions of the Insolvency and Bankruptcy Code (hereinafter referred to as the 'Code'), 2016: Clause (e) of Section 2Section 78 (except with regard to fresh start process) and Section 79Sections 94 to 187 (both inclusive)Clause (g) to clause (i) of sub-section...

Complete Re-Appointment Process Of NCLT/NCLAT Members Within 2 Months : Supreme Court Directs Centre

The Supreme Court on Monday directed the Central government to complete the process of reappointment of members of NCLT and NCLAT at the earliest, and not later than two months. In respect of the process to initiate for filling up the existing vacancies for which a search cum selection committee has to be constituted, the Court has directed the selection process to be initiated at the earliest. A three-judge Bench of Justice Nageswara Rao, Justice Hemant Gupta and Justice Ravindra...

Lenders To Initiate Insolvency Proceedings Against Personal Guarantors

With the recovery proceedings under the Insolvency and Bankruptcy Code, 2016 ("Code") not moving at the pace that it should, the Government, on November 15, 2019 came out with a new provision that empowered banks to move an application for initiation of insolvency against personal guarantors, who are usually promoters of big business houses. The intention was to hold liable the promoters of the defaulter companies who had furnished personal guarantees for the loans taken by their...

Book Review- Emergence Of Commercial Justice Insolvency And Arbitration By Vivek Sood

Indian economy was often called a debtor's paradise and a creditor's hell till the Insolvency & Bankruptcy Code (IBC) 2016 came into being. While companies went bust over decades, the creditors and employees have been at the receiving end. Delays in insolvency resolution would often work in favour of the bankrupt entity where its management would stay in control of daily operations. Liquidation would be an endless process. The regulator, Board of Industrial & Financial Reconstruction...

'Incorporated With Fraudulent Motive, Invoking Arbitration Against Antrix Not Bona Fide' : NCLT Orders Winding Up Of Devas Multimedia

The National Company Law Tribunal, Bengaluru bench, has ordered the forcible liquidation and winding up of Devas Multimedia by allowing a petition filed Indian Space Research Organization's commercial arm Antrix Corporation Limited.The Tribunal held that Devas was incorporated in a "fraudulent manner to carry out unlawful purposes" and its management resorted to "fraudulent activities" in relation to the commercial contract with Antrix."The incorporation of Devas itself was with fraudulent...