Supreme Court
Weekly Digest Of IBC Cases: 12th To 18th February 2024
Supreme Court IBC | Resolution Plan Requires Closer Examination If Plan Envisages Use Of Asset Owned By Statutory Authority: Supreme Court Case Title: Greater Noida Industrial Development Authority Versus Prabhjit Singh Soni & Anr. Case No.: CIVIL APPEAL NOS.7590-7591 OF 2023 The Supreme Court bench comprising Chief Justice of India Dr. DY Chandrachud, Justice J.B. Pardiwala, and Justice Manoj Misra, has observed that ordinarily feasibility and viability of a resolution...
IBC | Claim Submitted With Proof Cannot Be Overlooked Merely Because It Was Submitted In Wrong Form: Supreme Court
The Supreme Court on Monday (February 12) observed that the claim submitted by the Resolution Applicant (“RA”) under the Corporate Insolvency Resolution Process (“CIRP”) cannot be rejected/overlooked merely on the fact that the claim submitted appears to be in a different form other than the form in which the claim needs to be submitted. In the instant case, the resolution application has submitted a claim to the Resolution Professional (“RP”) under Form C of Regulation 8 of CIRP Regulations...
IBC | Moratorium Under S 14 No Bar To Execute Decree Against Directors/Officers Of Corporate Debtor: Supreme Court
The Supreme Court has held that the imposition of moratorium under Section 14 of the Insolvency and Bankruptcy Code, 2016 (“IBC”) has no effect on the execution of a decree against the Directors or Officers of the Company (Corporate Debtor), which is undergoing Corporate Insolvency Resolution Process (“CIRP”) under IBC.When the Company was admitted into CIRP, the National Consumer Disputes Redressal Commission (“NCDRC”) declined to permit execution of a decree against the Company and also its...
IBC | Inappropriate For NCLAT To Direct NCLT To Admit Petition Under Section 7 Without Evaluating Rival Contentions On Merits: Supreme Court
The Supreme Court has set aside an order passed by the National Company Law Appellate Tribunal (“NCLAT”) whereby the National Company Law Tribunal (“NCLT”) was directed to admit a petition under Section 7 of Insolvency and Bankruptcy Code, 2016 (“IBC”).The Bench comprising Chief Justice of India Dr. Dhananjaya Y Chandrachud, Justice J B Pardiwala and Justice Manoj Misra, has held that it was inappropriate for the NCLAT to direct the NCLT to admit the application under Section 7 of IBC...
IBC | Statutory Set Off Or Insolvency Set Off Inapplicable To Corporate Insolvency Resolution Process: Supreme Court
The Supreme Court has held statutory set off or insolvency set off is not applicable to Corporate Insolvency Resolution Process (“CIRP”) proceedings under the Insolvency and Bankruptcy Code, 2016 (“IBC”). Further, Regulation 29 of the Insolvency and Bankruptcy Board of India (Liquidation Process) Regulations, 2016 (“Liquidation Regulations”), which provides for mutual dealing and set off, does not apply to Part II of the IBC which deals with CIRP.The principle of Set-off recognizes the right of...
IBC - Is Dissenting Financial Creditor Entitled To Minimum Value Of Security Interest? Supreme Court Refers To Larger Bench, Doubts Precedent
The Supreme Court has referred to larger bench the issue whether a dissenting financial creditor is to be paid the minimum value of its security interest as per the Insolvency and the Bankruptcy Code 2016.A bench comprising Justices Sanjiv Khanna and SVN Bhatti, in the case DBS Bank Ltd Singapore v. Ruchi Soya Industries Ltd and another, referred the following question : Whether Section 30(2)(b)(ii) of the Insolvency and Bankruptcy Code, 20161, as amended in 2019, entitles the...
IBC- Properties Sold In Auction Sale Before Declaration Of Moratorium Can't Be Treated As Liquidation Asset : Supreme Court
Recently, the Supreme Court (on December 06) observed that the properties of a defaulting borrower sold in an auction sale could not be treated as liquidation assets if the sale was concluded before the declaration of a moratorium under the Insolvency and Bankruptcy Code 2016.While doing so, the Bench of Justices Aniruddha Bose and Vikram Nath set aside the order passed by the National Company Appellate Tribunal, Delhi (NCLAT).The facts of the present case revolve around the insolvency of Amrit...
IBC | When Matter Heard But No Order Pronounced On The Same Day, Limitation To Commence From The Date When Order Gets Uploaded: Supreme Court
The Supreme Court has held that when the National Company Law Tribunal (“NCLT”) hears a matter on a particular date but does not pronounce the order on the same date, then the limitation for filing an appeal from such order before the National Company Law Appellate Tribunal (“NCLAT”) under Section 61 of the Insolvency and Bankruptcy Code, 2016 (“IBC”), would commence from the date when the Order of NCLT gets uploaded.However, in cases where matter was heard and order was pronounced on the same...
IBC | When Matter Heard On A Particular Date But Order Pronounced Later, NCLT Not To Affix Date Of Hearing On Order: Supreme Court
The Supreme Court has held that when a matter is heard by the National Company Law Tribunal (“NCLT”) on a particular date but the order is pronounced on another date, then NCLT must refrain from affixing the date of hearing on the order. The requirement of pronouncement of order cannot be dispensed with, since under the NCLT Rules, 2016 there is a distinction between 'hearing' and 'pronouncement'.The NCLT heard a matter on 17.05.2023 but no order was pronounced. The order was uploaded on...
Sec 240A IBC | Even If MSME Registration Obtained Post Commencement Of CIRP, Promoter Eligible To Submit Resolution Plan: Supreme Court
The Supreme Court has held that the Promoter of a Corporate Debtor is eligible to submit a resolution plan in terms of Section 240A of the Insolvency and Bankruptcy Code, 2016 (“IBC”), even if the Corporate Debtor was registered as Micro Small Medium Enterprise (“MSME”) after commencement of Corporate Insolvency Resolution Process (“CIRP”).The Bench comprising Justice Sanjay Kishan Kaul and Justice Sudhanshu Dhulia, has set aside an order passed by the National Company Law Appellate Tribunal...
IBC | Cut-Off Date To Determine Resolution Applicant's Eligibility Under S.240A Is Date Of Submitting Resolution Plan : Supreme Court
The Supreme Court has held that for the purpose of Section 240A of Insolvency and Bankruptcy Code, 2016 (“IBC”), the cut-off date to determine the eligibility of a resolution applicant to submit a resolution plan, is the date on which the resolution plan was submitted and not the date on which Corporate Insolvency Resolution Process (“CIRP”) commenced.The Bench comprising Justice Sanjay Kishan Kaul and Justice Sudhanshu Dhulia, has set aside an order passed by the National Company Law Appellate...