Power Of Attorney Can Be Executed By Officers Nominated By Designation, Not Necessarily By Name: NCLAT New Delhi

The National Company Law Appellate Tribunal, Principal Bench, New Delhi, comprising Justice N. Seshasayee (Member – Judicial) and Arun Baroka (Member – Technical), has held that a power of attorney (POA) executed by bank officers nominated by their designation, rather than by name, is legally valid for instituting proceedings under the IBC, 2016. Background of the Case The appeal was filed against the decision of the adjudicating authority, by which it had dismissed the appellant's...

Insolvency Resolution Professional Is Public Servant, Sanction Needed To Prosecute Him Under Prevention Of Corruption Act: Madras High Court

The Madras High Court has recently directed the Insolvency and Bankruptcy Board of India to consider granting sanction for prosecuting a Resolution Professional for allegedly mismanaging funds of a company during a resolution process. Justice Bharatha Chakravarthy noted that the resolution professional performed duties in connection with the administration of justice, was a person from whom a report was called for by the court of justice, and was performing a public duty. Thus, the...

Conversion Of Corporate Debtor To Private Company Can't Be Denied On Grounds Of Pending SFIO Probe After Approval Of Resolution Plan: NCLT Mumbai

The National Company Law Tribunal (NCLT), Mumbai Bench of Sh. Prabhat Kumar (Technical Member) and Sh. Sushil Mahadeorao Kochey (Judicial Member)has held that an application for conversion of a company from a public limited company to a private limited company under an approved resolution plan cannot be rejected on the ground that prosecutions or SFIO investigations are pending against the corporate debtor, as all such investigations abate once the plan is approved. The present...

Pooling Of Debt By Multiple Operational Creditors Is Prohibited U/S 9 Of IBC: NCLT New Delhi

The National Company Law Tribunal (NCLT), New Delhi Bench of Shri Manni Sankariah Shanmuga Sundaram (Judicial Member) and Shri Atul Chaturvedi (Technical Member) has held that a petition under Section 9 of the IBC cannot be admitted based on the pooling of debt by multiple operational creditors, as such pooling is prohibited under the IBC. While a composite application under Section 7 of the IBC is permitted, no provision concerning the pooling of debt exists under Section 9 of the IBC. ...

Electricity Connection Can't Be Denied To Purchaser Of Corporate Debtor's Properties Due To Past Dues When Claims Are Filed Before Liquidator: NCLT Mumbai

The National Company Law Tribunal (NCLT), Mumbai Bench of Justice Ms. Lakshmi Gurung and Sh. Hariharan Neelakanta Iyer, Technical Member has held that electricity connection cannot be denied to the successful auction purchaser of the corporate debtor's properties on account of past dues, when such claims have already been filed before the Liquidator and will be addressed as per Section 53 of the IBC. The present application has been filed under section 60(5) of the Insolvency and...

Set-Off Of Pre-CIRP Tax Dues Is Not Permitted Against Post-CIRP Tax Refund In Absence Of Pre-Existing Contractual Provision: NCLT Mumbai

The National Company Law Tribunal (NCLT), Mumbai Bench of Sh. Prabhat Kumar (Technical Member) and Sh. Sushil Mahadeorao Kochey (Judicial Member) has held that pre-CIRP tax dues cannot be adjusted against post-CIRP tax refunds determined during the CIRP, in the absence of any pre-existing contractual set-off provision. The present application has been filed by the Resolution Professional under section 60(5) of the Insolvency and Bankruptcy Code, 2016 (IBC) seeking declaration that...

NCLT Under IBC Is Not Empowered To Direct De-Attachment Of Property Attached Under PMLA By ED: NCLT Bengaluru

The National Company Law Tribunal (NCLT), Bengaluru Bench of Justice Shri. Sunil Kumar Aggarwal (Judicial Member) and Shri. Radhakrishna Sreepada (Technical Member) has held that the NCLT under the IBC is not empowered to direct the de-attachment of property attached under the PMLA by the Enforcement Directorate, as such power falls within the realm of public law over which the NCLT has no jurisdiction. The present application has been filed by the Resolution Professional under...

Director Communications Can't Replace Documentary Proof For Establishment Of Loan: NCLT Delhi

The National Company law Tribunal Delhi bench of Shri Manni Sankariah Shanmuga Sundaram And Shri Atul Chaturvedi Dismissed a section 7 petition for initiation of Corporate Insolvency Resolution process, holding that communications from the directors of the Corporate Debtor cannot override the lack of substantive documentary proof such as audited financials, books of accounts, or banking records for establishment of loan. The Financial creditor, Altitude Finvest Limited filed an...

CoC Has Discretion To Allow Resolution Applicant To Submit Revised Plan If Its Name Appears In Final Resolution Applicant List: NCLAT

The National Company Law Appellate Tribunal (NCLAT) New Delhi bench of Justice Ashok Bhushan and Mr. Barun Mitra (Technical Member) has held that the committee of creditors (CoC) has discretion to allow the Resolution Applicant to submit a revised plan to maximise the value of the corporate debtor's assets if the Resolution Applicant's name appears in the final RA list. The present appeal has been filed against an order passed by the National Company Law Tribunal (NCLT) Mumbai. By the ...

Approval Of Resolution Plan Can't Be Interfered With Over 'NIL' Payment To Operational Creditors If Claims Have Been Properly Dealt With: NCLAT

The National Company Law Appellate Tribunal (NCLAT) New Delhi bench of Justice Ashok Bhushan and Mr. Barun Mitra (Technical Member) has held that since current legislative scheme does not mandate payment to Operational Creditors in event of the corporate debtor's liquidation, the Adjudicating Authority cannot interfere with the Resolution Plan approved by Committee of Creditors with 100% voting shares and in which the claims of the Operational Creditors have been properly dealt with. ...

In Absence Of Crystallised Debt Due To Dispute Over Quality Of Product Supplied, Petition U/S 9 Can't Be Admitted: NCLAT

The National Company Law Appellate Tribunal (NCLAT) New Delhi bench of Justice Ashok Bhushan and Mr. Barun Mitra (Technical Member) has held that when debt is not crystallized due to repeated communication on Whatsapp between the parties over the quality of the product supplied by the Operational Creditor and the defects acknowledged by the Supplier, an application under section 9 of the IBC cannot be accepted. The present appeal has been filed under section 61 of the Insolvency and...

Corporate Debtor's Shareholdings Are An Integral Part Of Financial Assets, Can't Be Excluded From Valuation Report: NCLT Bengaluru

The National Company Law Tribunal (NCLT), Bengaluru Bench of Shri Sunil Kumar Aggarwal (Judicial Member) and Shri Radhakrishna Sreepada (Technical Member) the has held that the shareholdings of the corporate debtor in its subsidiaries form an integral part of its financial assets therefore cannot be excluded from the valuation reports. Such exclusion of the financial assets compromise the fairness and integrity of the CIRP. The present applicant has been filed seeking fresh...