S. 7 IBC | Corporate Debtor's Inability To Pay Not Relevant For CIRP Plea Admission: Supreme Court

The Supreme Court on Wednesday reaffirmed that the Adjudicating Authority cannot refuse to admit a financial creditor's plea under Section 7 of the Insolvency and Bankruptcy Code on the ground of the corporate debtor's inability to pay. The only question at the admission stage is whether a financial debt exists and whether there has been a default. The inability of the corporate debtor to pay is not required to be examined at this stage. Dismissing an appeal filed by Power Trust, promoter...

Active DIN Status Not Sufficient To Establish Eligibility To Submit Resolution Plan Under IBC: NCLT Indore

The National Company Law Tribunal (NCLT) at Indore has held that mere reflection of a Director Identification Number (DIN) as “Approved/Active” on the MCA portal is not sufficient to establish eligibility to submit a resolution plan under Section 29A of the Insolvency and Bankruptcy Code (IBC). The tribunal dismissed an application filed by Carnet Elias Fernandes, Suspended Management/Promoter of GEI Power Limited, challenging the Resolution Professional's decision declaring him ineligible to...

NCLAT Says COVID Limitation Ruling Not Properly Considered In Encore ARC's CIRP Against Pandhe Constructions

The National Company Law Appellate Tribunal (NCLAT) has set aside an order of the NCLT Mumbai bench that had dismissed a CIRP plea filed by Encore Asset Reconstruction Company Pvt Ltd against Pandhe Constructions Pvt Ltd as time-barred. The appellate tribunal held that the NCLT misapplied the Supreme Court's COVID-19 limitation directions and failed to properly consider acknowledgment of debt under Section 18 of the Limitation Act. A bench of Judicial Member Justice Mohd. Faiz Alam Khan and...

NCLT Mumbai Admits Insolvency Plea Against Reliance Ornatus Over ₹133.88 Crore Default

The National Company Law Tribunal (NCLT), Mumbai has admitted an insolvency application filed by Creative Ashtech Engineering Projects Private Limited against Reliance Ornatus Enterprises and Ventures Private Limited Ventures Private Limited, holding that a financial debt of Rs. 133.88 crore and default stood established.A bench of Judicial Member Nilesh Sharma and Technical Member Sameer Kakar held, “In view of the aforesaid findings, this Application bearing C.P. (IB) No. 176/MB/2025 filed...

Resolution Professional Cannot Seek Removal Of Statutory Lien Created Before CIRP: NCLT Mumbai

The National Company Law Tribunal at Mumbai has held that while the Insolvency and Bankruptcy Code mandates a resolution professional to preserve and take control of the assets of the corporate debtor, it does not confer any specific authority to seek removal of statutory attachments or liens lawfully created prior to commencement of the insolvency.On February 13, a bench comprising Judicial Member Mohan Prasad Tiwari and Technical Member Charanjeet Singh Gulati held that a statutory lien...

Municipal Dues Cannot Be Recovered From Auction Purchaser After IBC Liquidation: Calcutta High Court

The Calcutta High Court has held that once liquidation proceedings commence under the Insolvency and Bankruptcy Code, municipal dues must be dealt with strictly within the framework of the Code and cannot be enforced independently against auction purchasers through contractual clauses such as “as is where is” or “whatever there is." Such clauses generally mean that a buyer takes the property in its existing physical and legal condition, along with all visible defects, risks, and liabilities...

NCLT President Submits Enquiry Report After NCLAT Calls Chennai Bench Order “Rather Dubious”

Outgoing NCLT President Chief Justice (Retd.) Ramalingam Sudhakar has firmly rejected allegations of impropriety against the Chennai Bench, stating that “no material has emerged suggesting any impropriety, bias or departure from judicial discipline.” The report was submitted pursuant to an enquiry ordered by the National Company Law Appellate Tribunal in an appeal filed by Asset Reconstruction Company (India) Limited in the insolvency proceedings of Regen Powertech Private Limited. While...

Authorisation, Stamping, and IU Defects Cannot Block Insolvency Petition: NCLAT Delhi

On 6 February, the National Company Law Appellate Tribunal (NCLAT) at Delhi held that defects in authorisation, stamping, and Information Utility records cannot invalidate a Section 7 insolvency petition when the debt and default are acknowledged by the corporate debtor. A Bench of Judicial Member Justice N. Seshasayee and Technical Members Arun Baroka and Indevar Pandey dismissed the appeal of Vinodkumar Nihalchand Parmar, which challenged an NCLT Mumbai Bench order admitting the...

NCLT Ahmedabad Refuses Travel Relief To Personal Guarantor With ₹2717 Crore Liability

The National Company Law Tribunal at Ahmedabad, on 12 February rejected a travel permission plea filed by Sunil Surendrabhai Kakkad, a personal guarantor facing liabilities of Rs. 2,717.88 crore, holding that his proposal to travel abroad for employment could jeopardise the time-bound bankruptcy process. A Bench comprising Judicial Member Chitra Hankare and Technical Member Dr. Velamur G. Venkata Chalapathy held that the applicant's presence was “absolutely necessary for the further...

Limitation For IBC Appeal Runs From Pronouncement Date, Not Knowledge: NCLAT Dismisses CIRP Appeal

The National Company Law Appellate Tribunal (NCLAT) at Delhi has dismissed an appeal challenging the admission of Corporate Insolvency Resolution Process (CIRP) against a private company as time-barred. It held that the limitation under Section 61(2) of the Insolvency and Bankruptcy Code runs from the date of pronouncement of the order, not from the date of knowledge. A bench of Judicial Member Justice Ashok Bhushan and Technical Member Barun Mitra observed: “For counting the statutory period...

NCLT Mumbai Says Mumbai, Delhi Airport Operators Are Unsecured Creditors In Jet Airways Liquidation

The National Company Law Tribunal (NCLT), Mumbai Bench, has recently held that Mumbai International Airport Ltd (MIAL) and Delhi International Airport Ltd (DIAL) are not secured creditors in the liquidation of Jet Airways (India) Ltd, rejecting their contention that airport regulations conferred a lien over aircraft for unpaid dues“Hence, we are of considered view that the applicant is an unsecured creditor and its claims is to be dealt with accordingly,” the tribunal held. Jet Airways was...

NCLAT Sets Aside Insolvency Process Against HNGIL Guarantor, Says Compromise Didn't Waive Guarantee Invocation

The National Company Law Appellate Tribunal (NCLAT) at Delhi has recently set aside the NCLT Kolkata's order admitting DBS Bank's Section 95 application against Mukul Somany, a personal guarantor of Hindustan National Glass & Industries Ltd, holding that the bank had not invoked the guarantee before initiating insolvency proceedings. The appellate tribunal reiterated that where a guarantee deed requires a demand by the lender, invocation of the guarantee is a mandatory pre-condition before...