Belated Claims Of Homebuyers Can't Be Rejected When Reflected In Corporate Debtor's Records: NCLAT New Delhi

The National Company Law Appellate Tribunal (NCLAT) New Delhi held that claims of genuine allottees whose names are reflected in the corporate debtor's records cannot be rejected merely on the ground that the claims were filed belatedly. A bench of Justice Ashok Bhushan and Mr. Arun Baroka (Technical Member) held that “when the amount paid by the unit holders on the basis of valid allotment is reflected in the record of the Corporate Debtor, the judgment of “Puneet Kaur vs. M/s. K.V....

Non-Declaration Of Beneficial Ownership U/S 9 Companies Act Does Not Amount To Oppression & Mismanagement: NCLAT New Delhi

The National Company Law Appellate Tribunal (NCLAT), New Delhi, comprising Justice Yogesh Khanna (Member-Judicial) and Mr. Ajai Das Mehrotra (Member-Technical), has held that the non-declaration of the beneficial ownership under section 89 of the Companies Act, 2013, doesn't amount to oppression and mismanagement. The bench ruled that section 89 casts a duty upon the owner to make the declaration, and avoiding such a declaration makes him liable for penalties. The appeal was filed...

NCLT Rejects Byju's' Plea to Halt Aakash's Proposed Rights Issue

The National Company Law Tribunal (NCLT) at Bengaluru, has recently refused to grant interim relief to insolvent ed-tech Byju's (Think and Learn Pvt Ltd) in its bid to stop Aakash Educational Services Ltd. (AESL) from proceeding with a proposed rights issue.The order, allows AESL to hold its Extraordinary General Meeting (EGM) on October 29 as scheduled.The order was passed by a coram of Judicial Member Sunil Kumar Aggarwal and Technical Member Radhakrishna Sreepada in an oppression and...

Amount Paid As Advance Consideration Constitutes Operational Debt Under Section 5(21) Of IBC: NCLAT

The National Company Law Appellate Tribunal (NCLAT) New Delhi held that an amount paid as advance consideration constitutes an Operational Debt under section 5(21) of the IBC especially when the said amount is reflected in the audited balance sheet of the corporate debtor as advance without any qualifying note by the auditor. A bench comprising Justice Yogesh Khanna (Judicial Member) and Mr. Indevar Pandey (Technical Member) held that “a purchaser who has made advance payments for...

NCLT Cuttack Orders Initiation Of CIRP Against Bhilai Jaypee Cement Limited

The National Company Law Tribunal (NCLT), Cuttack Bench, Deep Chandra Joshi (Member-Judicial) and Banwari Lal Meena Banwari Lal Meena (Member-Technical) has initiated the CIRP against Bhilai Jaypee Cement Limited, a subsidiary of the debt-ridden group Jaiprakash Associates Limited, for a default of Rs 45 crore. The petition under section 9 of the IBC was filed by the operational creditor, Sidhgiri Holdings Pvt Ltd. Bhilai Jaypee Cement Limited used to purchase coal from the...

NCLT Cannot Recall Order Passed On Merits Under Rule 11 Of NCLT Rules 2016: NCLAT Chennai

The National Company Law Appellate Tribunal (NCLAT), Chennai Bench, comprising Justice Sharad Kumar Sharma (Member-Judicial) and Jatindranath Swain (Member-Technical), has held that an order passed on merits cannot be recalled by the NCLT under rule 11 of the NCLT Rules, 2016. Background The CIRP of the corporate debtor was initiated, and the appellant turned out to be the successful resolution applicant (SRA). Six homebuyers filed applications before the NCLT seeking execution of...

Suspended Directors' Duty To Sign Balance Sheets Continues During CIRP, Any Acknowledgment Extends Limitation Against Personal Guarantor: NCLAT

The National Company Law Appellate Tribunal (NCLAT) New Delhi held that since the liability of the guarantor is co-extensive with that of the borrower, any acknowledgment of liability by the corporate debtor extends the limitation period against the guarantor also. The Tribunal also held that signing balance sheets is a statutory duty of the directors of a company from which they are not relieved even during the Corporate Insolvency Resolution Process (CIRP). Therefore, any acknowledgment...

Consumer Complaint Is Not Maintainable Against Corporate Debtor During Subsistence Of Moratorium: Bombay High Court

The Nagpur Bench of the Bombay High Court, comprising of Justice M.M. Nerkiar, has held that the consumer complaint before the District Consumer Dispute Redressal is not maintainable if the insolvency of the corporate debtor has been admitted during the continuance of the moratorium. The petition was filed against the order of the District Consumer Dispute Redressal. In the impugned order the commission had directed the petitioner to return the JCB machine to the respondent. ...

Can Multi-State Cooperative Societies Submit Resolution Plans Under IBC? Supreme Court To Consider

The Supreme Court recently directed that the Central Registrar of Multi-State Cooperative Societies be made a party to the appeal filed by a multi-state co-operative society against a National Company Law Appellate Tribunal (NCLAT) judgment that had held the society ineligible to submit a resolution plan for a company under the Insolvency and Bankruptcy Code, 2016.A bench of Justice JB Pardiwala and Justice KV Viswanathan sought a response from the Central Registrar on whether multi-state...

NCLT President Cannot Transfer Cases Beyond Territorial Jurisdiction Of Bench: Gujarat High Court In Essar Steel Insolvency Case

The Gujarat High Court has recently held that the President of the National Company Law Tribunal (NCLT) has no authority to transfer cases from one State to another through administrative orders.The ruling came in proceedings linked to the Essar Steel insolvency process, where the court also found that repeated recusals by NCLT Members in Ahmedabad were neither "legal" nor "justified."A single bench of Justice Niral R Mehta made the finding in a petition filed by Arcelormittal Nippon Steel India...

S.238 IBC Is Non-Obstante Clause, Overrides Provisions Of Electricity Act: Allahabad High Court

The Allahabad High Court has held that the Insolvency and Bankruptcy Code, 2016 overrides the provisions of Electricity Act, 2003 read with Electricity Supply Code, 2005.A bench of Justice Arindam Sinha and Justice Prashant Kumar held“Section 238 of Insolvency and Bankruptcy Code, 2016 is a non- obstante clause meaning it grants the IB Code a power of overriding effect on other laws, for the time being in force, or any instrument that is inconsistent with it. This is a Special Section, which...

Documents Not Filed Before NCLT Cannot Be Entertained As Evidence By NCLAT For Deciding Appeal: NCLAT Chennai

The NCLAT, Chennai Bench, comprising Justice Sharad Kumar Sharma (Member-Judicial) and Jatindranath Swain (Member-Technical), has held that any document available but not filed before the NCLT cannot be entertained as evidence by the NCLAT at the appellate stage. The CIRP of the corporate debtor was initiated, and due to the failure to receive the resolution plan, a liquidation order was passed by the NCLT Kochi. The liquidator was appointed, who discovered that certain transactions...