IBC
Financial Creditor Cannot Avoid Liquidation Costs After Settling Dues Through OTS: NCLT Bengaluru
The National Company Law Tribunal (NCLT) at Bengaluru has held that a financial creditor that participated in the liquidation process and secured its dues through a one-time settlement cannot later avoid paying its share of liquidation costs for the ime it had taken part in it. A coram of Judicial Member Sunil Kumar Aggarwal and Technical Member Radhakrishna Sreepada directed Jammu & Kashmir Bank Ltd to bear its proportionate share of liquidation expenses in the liquidation of Alpine...
Interest-Free Loans, Write-Offs Not Fraudulent Per Se Without Intent: NCLT Mumbai
The Mumbai bench of the National Company Law Tribunal (NCLT) has held that accounting irregularities or regulatory violations, including the grant of interest-free advances, do not by themselves amount to fraudulent trading. It clarified that fraudulent trading can be established only when there is clear, cogent evidence showing an intent to defraud creditors, assessed in the context of the company's business model.A coram of Judicial Member Sushil Mahadeorao Kochey and Technical Member Prabhat...
CoC Member Can Vote on Resolution Plan Despite Related Party's Stake In Resolution Applicant Consortium
The National Company Law Tribunal (NCLT) at Mumbai has clarified that a member of the Committee of Creditors (CoC) is not barred from voting on a resolution plan merely because its related persons have an interest in the consortium of a resolution applicant.It said insolvency law does not prescribe any such disqualification on the ground of conflict of interest.A coram of Judicial Member Sushil Mahadeorao Kochey and Technical Member Prabhat Kumar dismissed an application filed by the suspended...
Promise To Arrange Funds In Case of Default Does Not Make Promoter A Guarantor: Supreme Court
The Supreme Court of India has held that a promoter's promise to arrange funds to help a borrower meet financial covenants does not amount to a contract of guarantee under the Indian Contract Act and cannot be used to fasten insolvency liability on the promoter. A bench of Justice Sanjay Kumar and Justice Alok Aradhe said that for an obligation to qualify as a guarantee under Section 126 of the Act, there must be a clear and unambiguous promise by the surety to repay the borrower's debt if the...
Requests For Time Or Settlement Does Not Amount To Pre-Existing Dispute Under IBC: NCLT Mumbai
The National Company Law Tribunal at Mumbai has held that requests for time, settlement, or proposals for alternative arrangements does not amount to a dispute under the Insolvency and Bankruptcy Code and therefore do not negate an admitted liability.A coram of Judicial Member Nilesh Sharma and Technical Member Sameer Kakar, in an order dated January 12, said such communications far from raising a genuine dispute, often reinforce acknowledgement of debt.“A request for time, settlement...
Civil Courts Have No Jurisdiction Over Share Register Rectification Despite Pending Civil Suits: NCLAT Reiterates
The National Company Law Appellate Tribunal (NCLAT) at New Delhi has recently reiterated that civil courts have no jurisdiction over disputes relating to rectification of a company's register of members, holding that such powers vest exclusively with the National Company Law Tribunal under the Companies Act, 2013. A bench of Judicial Member Justice Yogesh Khanna and Technical Member Indevar Pandey held that the NCLT had taken an incorrect view by refusing to decide a rectification petition...
NCLT Hyderabad Orders Dissolution of Srianagha Sky Scrapers After Voluntary Liquidation Under IBC
The National Company Law Tribunal (NCLT) has recently ordered the dissolution of Srianagha Sky Scrapers Private Limited, a Hyderabad-based infrastructure company, after recording the successful completion of its voluntary liquidation under the Insolvency and Bankruptcy Code, 2016. The order was passed by the Hyderabad Bench on January 8, 2026.A coram comprising Judicial Member Rajeev Bhardwaj and Technical Member Sanjay Puri, said it was satisfied that the process was carried out strictly as...
NCLT Hyderabad Declares Personal Guarantor of Techtrans Constructions Bankrupt After No Repayment Plan
The National Company Law Tribunal (NCLT) at Hyderabad has recently ordered the bankruptcy of Pasam Laxmi Srinivas Reddy, the personal guarantor of Techtrans Constructions India Private Limited, an infrastructure firm. The tribunal said there was no repayment plan on record and no way forward for resolution. The order was passed by Judicial Member Rajeev Bhardwaj and Technical Member Sanjay Puri. Setting out the reason in clear terms, the bench said, “Admittedly, the repayment plan has not been...
Disputed Property Cannot Be Excluded From Information Memorandum After CoC Approval: NCLT Mumbai
The National Company Law Tribunal (NCLT) at Mumbai has held that once a resolution plan is approved by the Committee of Creditors (CoC) and awaits confirmation, permitting amendments to the Information Memorandum would unsettle the resolution process.“Once the Resolution Plan has been approved by the Committee of Creditors and is pending approval before this Tribunal, permitting exclusion of the subject property from the Information Memorandum would unsettle the resolution process,” the tribunal...
Delay In Seeking Revised Valuation Of Asset Not Enough To Term It Sham: NCLT Mumbai
The National Company Law Tribunal (NCLT) at Mumbai has held that a revised valuation obtained after discovery of additional restrictions on a property cannot be dismissed as a sham merely because there was a delay in seeking such revision.It said valuation is a technical exercise and must be assessed in light of the facts available to the valuer at the relevant time.“Though, there is considerable delay in seeking revised valuation report consequent upon purported discovery of “red-zone”...
NCLT Mumbai Approves Supreme Capinfra's Rs. 96 Crore Plan To Revive C & M Farming
The National Company Law Tribunal (NCLT) at Mumbai has approved a Rs 96.81 crore resolution plan for the revival of C and M Farming Ltd, a poultry business. The tribunal held that once a resolution plan meets the requirements of the Insolvency and Bankruptcy Code, it cannot interfere with the commercial decisions of the Committee of Creditors. A coram comprising Judicial Member Mohan Prasad Tiwari and Technical Member Charanjeet Singh Gulati passed the order on January 9. The bench found the...