Securities Premium Account Cannot Offset Accumulated Losses: NCLT Bengaluru

The National Company Law Tribunal at Bengaluru has recently clarified that while a company may reduce its paid-up share capital to write off accumulated losses under Section 66 of the Companies Act, the securities premium account cannot be used for such write-off, as this is expressly prohibited under Section 52 of the Act. A coram of Judicial Member Sunil Kumar Aggarwal and Technical Member Radhakrishna Sreepada partly allowed the petition filed by Firepro Systems Pvt Ltd, approving the...

Delhi High Court Slaps ₹1 Lakh Cost On Litigant For Misusing Writ Jurisdiction To Stall DRT, NCLT Proceedings

The Delhi High Court recently imposed costs of Rs 1 lakh on a litigant while dismissing his writ petition that sought to halt proceedings pending before two Debts Recovery Tribunals and the National Company Law Tribunal. The Court held that the petitioner, Sanjeev Krishan Sharma, had failed to show any violation of fundamental rights, statutory mandate or natural justice that could justify invoking the High Court's extraordinary writ jurisdiction. The Division Bench of Justices Anil...

Loss of ITC Due To Corporate Debtor's Default In GST Filing Is Not Operational Debt: NCLT Mumbai

The National Company Law Tribunal at Mumbai has recently held that operational creditors cannot claim GST-related dues arising from a corporate debtor's failure to file returns once the GST department has already lodged its own claim in liquidation. A coram of Judicial Member Mohan Prasad Tiwari and Technical Member Charanjeet Singh Gulati rejected the appeal filed by Instakart Services Pvt. Ltd in the liquidation of TopsGroup services and Solutions concluding that the claim “cannot be...

Tribunal's Power To Probe Company's Fraud Cannot Be Misused For Debt Recovery: NCLT Ahmedabad

The National Company Law Tribunal at Ahmedabad has recently held that Section 213 of the Companies Act, which empowers the tribunal to order an investigation into a company's affairs, cannot be invoked for recovery of unpaid dues. A Bench of Judicial Member Shammi Khan and Technical Member Sanjeev Sharma, while dismissing a creditor's plea seeking an investigation into United Petrofer Ltd, observed, “The adjudication of dishonoured cheques and monetary recovery necessarily lie within the...

Operational Creditor Cannot Become Financial Creditor Through Settlement: NCLT Mumbai

The National Company Law Tribunal (NCLT) at Mumbai has recently reaffirmed that an operational creditor cannot be converted into a financial creditor by way of a settlement with the corporate debtor. At the outset, the tribunal noted that Capacite Infraprojects Ltd was engaged only as a contractor for construction of 16 SRA buildings, and that the flats were never part of a real estate transaction between the parties. The units came into the picture much later, when the real estate developer,...

Pre-CIRP Tax Claims Extinguished After Plan Approval, Bombay High Court Quashes Tax Notices To V Hotels

The Bombay High Court has recently reaffirmed that income-tax assessment proceedings for any period prior to the approval of a resolution plan under the Insolvency and Bankruptcy Code (IBC) stand extinguished once the National Company Law Tribunal (NCLT) approves the plan, ruling that the tax department cannot initiate or continue such proceedings thereafter.A Division Bench of Justice B P Colabawalla and Justice Amit S Jamsandekar observed, “Once a resolution plan is approved by the...

Pending Appeal Against CoC Formation Not Grounds To Oppose Appointment Of New Resolution Professional: NCLAT

The National Company Law Appellate Tribunal (NCLAT) at Delhi has recently held that an ongoing appeal questioning the validity or constitution of a Committee of Creditors (CoC) does not prevent the CoC, once constituted and functioning, from replacing the resolution professional (RP) with the approval of the NCLT.A bench of Chaiperson Justice Ashok Bhushan and Technical Member Barun Mitra while dismissing the challenge raised by the suspended director of the insovent company...

NCLT Delhi Seeks Tribunal President's View On Whether Banks Lending to Homebuyers Are Financial Creditors Of The Developer

The National Company Law Tribunal (NCLT), Delhi, has referred to its President the question of whether banks that advanced housing loans to homebuyers under a tripartite agreement be treated as Financial Creditors of the real estate developer undergoing insolvency, after its two members issued conflicting rulings in the CIRP of AVJ Developers (India) Pvt Ltd. AVJ has been in insolvency since October 2019.The matter was heard by Judicial Member Bachu Venkat Balaram Das and Technical Member...

Written OTS Offer Revives Time-Barred Debt, NCLT Delhi Admits Insolvency Plea Against JS Designer

The National Company Law Tribunal at New Delhi has recently admitted Central Bank of India's insolvency plea against JS Designer Ltd, holding that the company's written one-time settlement proposals in 2024 constituted a fresh and enforceable promise to pay a time barred debt. A coram of Judicial Member Jyotsna Sharma and Technical Member Anu Jagmohan Singh noted that JS Designer had remained in continuous default since 2017, but its subsequent OTS offers revived the limitation period for...

NCLT Hyderabad Orders Liquidation Of Pavana Keerthi Hotels After SRA Fails To Furnish Bank Guarantee

The National Company Law Tribunal at Hyderabad has recently ordered the liquidation of Pavana Keerthi Hotels India Pvt. Ltd after observing that the successful resolution applicant failed to execute the resolution plan including the submission of a mandatory Performance Bank Guarantee (PBG). A coram of Judicial Member Rajeev Bhardwaj and Technical Member Sanjay Puri in an order passed on 20 November 2025, observed: “We find that all legal requirements for ordering liquidation have...

CoC Can Invite Fresh Bids, Regulations Only Limit Modification Of Existing Bids: NCLT Kochi

The National Company Law Tribunal (NCLT), Kochi Bench, has recently clarified that the Insolvency and Bankruptcy Board of India Regulations, 2016, restrict only the modification of an already issued Expression of Interest and do not prevent the Committee of Creditors from issuing a fresh call for EOIs. A coram of Judicial Member Vinay Goel and Technical Member Madhu Sinha dismissed an application filed by Resolution Applicant Sumit Khanna challenging the CoC's decision to invite fresh EOIs for...

NCLAT Dismisses Challenge To Grainotech's Plan For Resolution Of KSG Sugar.

The National Company Law Appellate Tribunal (NCLAT) at Delhi has recently held that the failure to communicate the individual score and ranking of a resolution applicant does not invalidate the corporate insolvency resolution process. The Tribunal ruled that the Consortium of Govindrao Sable's objection to the non disclosure of its scorecard did not affect the approval of the successful resolution plan for KGS Sugar and Infra Corporation Private Limited. The Insolvency and Bankruptcy Code does...