High Courts
Kerala High Court Sets Aside Rent Control Appellate Authority Order For Proceeding During IBC Moratorium
The Kerala High Court on Tuesday set aside an order of the Rent Control Appellate Authority after finding that an appeal against a corporate debtor had been taken up despite a moratorium being in force under the Insolvency and Bankruptcy Code. A bench of Chief Justice Soumen Sen and Justice Syam Kumar V.M. observed, “Under Section 14(1), it is clearly stated that once a moratorium is declared, there cannot be an institution of suits or continuation of pending suits or proceedings against the...
Single Judicial Member Of NCLT Can Pass Orders If Authorised By President: Kerala High Court
The Kerala High Court on 18 February, held that a Single Member of the National Company Law Tribunal (NCLT) can pass orders if the President of the Tribunal specifically authorises them under the proviso to Section 419(3) of the Companies Act, 2013. A Bench of Justice Viju Abraham dismissed a writ petition challenging orders passed by a Single Judicial Member of the NCLT, Kochi Bench, upholding the validity of the directions. The Court observed: “It is also to be noted that though Section 419...
'Ruse To Exploit Mill Land': Bombay High Court Rejects Plea To Revive Swadeshi Mills
The Bombay High Court on Monday dismissed an application filed by Grand View Estates Pvt Ltd seeking a stay of winding up proceedings and revival of Swadeshi Mills Company Ltd, holding that the proposal was not a genuine attempt to revive the textile company but an effort to exploit its valuable mill land for real estate development. A single-judge bench of Justice Sharmila U. Deshmukh observed that the revival plan was “nothing but a ruse to obtain the valuable land for exploitation in real...
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...
Once Arbitral Award Holder Files CIRP Claim, Execution Under Arbitration Law Not Maintainable: Delhi High Court
The Delhi High Court has recently observed that once a decree holder lodges its claim arising out of an arbitral award before the resolution professional during the corporate insolvency resolution process (CIRP), it cannot pursue parallel execution proceedings under the Arbitration and Conciliation Act.A single bench of Justice Harish Vaidyanathan Shankar delivered the ruling in a petition filed by Paharpur Cooling Towers Ltd, seeking enforcement of an arbitral award dated November 12, 2021...
'Not Unknown to Law': Telangana High Court Upholds Reserve Price Reduction After Repeated Failed SARFAESI Auctions
The Telangana High Court has recently upheld the phased reduction of the reserve price fixed for the auction sale of a mortgaged immovable property under the SARFAESI Act and dismissed writ petitions filed by the borrower. A Division Bench of Justice Moushumi Bhattacharya and Justice Gadi Praveen Kumar affirmed the order of the Debts Recovery Appellate Tribunal and observed that “the process of marking down of the Reserve Price is not unknown to law.” The Bench examined Rule 8(5) of the...
Calcutta High Court Sets Aside Order Treating WBIDC As Unsecured Creditor In Eastern Explosives Liquidation
The Calcutta High Court has recently set aside an order of a single judge of the court's original side, which upheld the official liquidator's decision treating the West Bengal Industrial Development Corporation Ltd. (WBIDC) as an unsecured creditor in the liquidation of Eastern Explosives and Chemicals Ltd.The Court held that once charge documents were submitted prior to adjudication of claims, the official liquidator was bound to consider WBIDC as a secured creditor.“A creditor, of a company...
Liquidator Can Defend Pending Civil Suits Filed Before Liquidation Under IBC: Bombay High Court
The Bombay High Court has recently held that a liquidator can be impleaded and can defend a civil suit instituted prior to the commencement of liquidation proceedings, observing that the Insolvency and Bankruptcy Code, 2016 does not bar the continuation of such pending suits. “Since Liquidator can sue, I do not see any reason why Liquidator cannot defend an action on behalf of the corporate debtor” Justice Sandeep V. Marne observed.The court clarified that Section 33(5) of the IBC bars...
'Prejudice From Delay Ignored': Delhi High Court Cuts Insolvency Professional's Suspension To Period Undergone
Holding that prolonged delay in disciplinary proceedings had already caused serious prejudice, the Delhi High Court has reduced a one-year suspension imposed by the Insolvency and Bankruptcy Board of India (IBBI) on insolvency professional Vikas Prakash Gupta to the period already undergone. Justice Sachin Datta underscored that “Administrative authorities are required to act within a reasonable period, and any prolonged delay must be justified by cogent reasons.” While noting that the...
Kerala High Court Refuses To Interfere With NCLT's Rejection Of Resolution Plan Despite 100% CoC Approval
The Kerala High Court has refused to interfere with the National Company Law Tribunal's rejection of a resolution plan for an insolvent company, even though it had received 100% approval from the Committee of Creditors. A Division Bench of Chief Justice Soumen Sen and Justice Syam Kumar V.M. held that the NCLT was acting within its jurisdiction in examining the resolution plan and that writ jurisdiction could not be invoked merely because the tribunal disagreed with the Committee of Creditors. ...
Delhi High Court Sets Aside Arbitration Against Bhushan Steel Following Tata Steel Takeover
The Delhi High Court has set aside an arbitral tribunal order that allowed arbitration to continue against Tata Steel, formerly Bhushan Steel, even after its resolution plan under the Insolvency and Bankruptcy Code was approved. A single-judge bench of Justice Amit Sharma allowed Tata Steel's writ petition and quashed the tribunal's October 7, 2020 order. The court said that once a resolution plan is approved, it binds all creditors. “The Resolution Plan had attained finality and would be...