NCLAT
EPFO Claim Misclassified As Government Dues; NCLAT Directs Lender To Pay Dues In Textile Company's Liquidation
The National Company Law Appellate Tribunal (NCLAT) at Chennai has held that the provident fund dues of liquidation bound Harshavardhan Cotton and Synthetic Pvt. Ltd. could not have been treated as government dues during liquidation, even though the company had not maintained a separate provident fund account. The tribunal said that, on the facts of the case, the amount claimed by EPFO had to be treated as a third-party asset and paid before the liquidation waterfall was applied. A bench of...
No Right To Insist On OTS After Default: NCLAT Upholds Insolvency Against Karanja Terminal
The National Company Law Appellate Tribunal (NCLAT) at New Delhi has upheld the admission of insolvency proceedings against Karanja Terminal & Logistics Pvt. Ltd., holding that repeated and unsuccessful one-time settlement proposals do not prevent action under Section 7 of the Insolvency and Bankruptcy Code once debt and default are established. A bench headed by Chairperson Justice Ashok Bhushan, with Technical Member Barun Mitra, said the settlement proposals relied upon by the corporate...
Late CIRP Bid Can't Be Accepted Without Publishing Provisional List Of Resolution Applicants First: NCLAT
The National Company Law Appellate Tribunal (NCLAT) at New Delhi has held that a belated expression of interest in an insolvency process cannot be accepted unless a provisional list of bidders is first published and objections are invited. The court reiterated that it is a mandatory requirement under the Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) Regulations, 2016.The ruling came while dismissing appeals filed by the committee of creditors of...
NCLAT Expunges Adverse Remarks Against IL&FS Companies In Wind World Insolvency
The National Company Law Appellate Tribunal (NCLAT) at Delhi has expunged adverse remarks made by the NCLT Ahmedabad against three IL&FS group companies during the insolvency proceedings of Wind World (India) Limited. The appellate tribunal held that the observations were made without evidence and could not be allowed to remain. A bench of Judicial Member Justice Mohd. Faiz Alam Khan and Technical Member Indevar Pandey said removing a creditor from the Committee of Creditors is not a...
Credits To Bankrupt's Bank Account Don't Automatically Vest In Bankruptcy Estate: NCLAT
The National Company Law Appellate Tribunal (NCLAT) at New Delhi has ruled that money lying in the bank account of a bankrupt personal guarantor forms part of the bankruptcy estate and can be frozen by the Bankruptcy Trustee. At the same time, it clarified that amounts credited to the account after the start of bankruptcy cannot automatically be taken over unless the Insolvency and Bankruptcy Code procedure is followed. A bench of Chairperson Justice Ashok Bhushan and Technical Member Barun...
NCLAT Declines to Interfere In RCI Industries' Resolution Plan After SRA Disclaims Rights Over Disputed Assets
The National Company Law Appellate Tribunal (NCLAT) at New Delhi, has refused to interfere with the approval of a resolution plan for RCI Industries and Technologies Ltd., after the successful resolution applicant undertook not to claim any rights over two disputed properties and the plan was approved by the committee of creditors. A bench comprising Chairperson Justice Ashok Bhushan and Technical Member Barun Mitra said, “Resolution Plan having been approved by the CoC and SRA having...
NCLAT Issues Notice On REC's ₹37.48 Crore Insolvency Appeal Against Poena Power
The National Company Law Appellate Tribunal (NCLAT) at New Delhi on Thursday issued notice on an appeal by Maharatna PSU REC Limited against an NCLT order that rejected its bid to start insolvency proceedings against Poena Power Development Limited, a subsidiary of RattanIndia Power Limited, over an alleged default of about Rs 37.48 crore. REC has challenged the NCLT's refusal to admit its Section 7 petition, which was dismissed on the ground that no legally enforceable debt had arisen. The...
NCLAT Sets Aside Aman Hospitality CIRP After Suspended Director Undertakes To Pay ₹119 Crore Dues
The National Company Law Appellate Tribunal (NCLAT) on Thursday set aside insolvency proceedings against Aman Hospitality Private Limited after the suspended director undertook to pay Bank of India's dues within three days, overturning an NCLT Delhi order admitting the company into the Corporate Insolvency Resolution Process (CIRP). A bench comprising Chairperson Justice Ashok Bhushan and Technical Member Barun Mitra allowed the appeal filed by suspended director Raj Singh Gehlot after...
NCLAT Lifts 'Impossible Condition' Of ₹40-Crore Security Imposed On Bankrupt Guarantor For US Travel
The National Company Law Appellate Tribunal (NCLAT) has set aside a condition imposed by the NCLT Ahmedabad requiring a bankrupt personal guarantor to deposit Rs. 40 crore as security for travelling to the United States. The tribunal held that a person already declared bankrupt cannot be expected to arrange such funds. A bench led by Chairperson Justice Ashok Bhushan and Technical Member Barun Mitra held that imposing an “impossible condition” amounts to denial of permission to travel. ...
NCLAT Upholds Late Claim In Shivam Continental Insolvency As Debt Was Disclosed In Information Memorandum
The National Company Law Appellate Tribunal (NCLAT) at Delhi has refused to interfere with an order admitting a late claim in an insolvency case. The tribunal said the delay did not, by itself, warrant interference since the liability was already disclosed to bidders during the process. A bench of Chairperson Justice Ashok Bhushan and Technical Member Barun Mitra noted that the Information Memorandum had flagged the dues. It had also cautioned resolution applicants to make their own...
“Sat Over Our Order”: NCLAT Seeks ISPT India IRP's Reply In Contempt Case
The National Company Law Appellate Tribunal (NCLAT) at Chennai has sought a reply from Anil Kumar Khicha, the Interim Resolution Professional (IRP) of ISPT India Pvt Ltd, in contempt proceedings after the tribunal earlier found that an email issued by him in the insolvency proceedings was contemptuous. A bench comprising Judicial Member Justice Sharad Kumar Sharma and Technical Member Jatindranath Swain is dealing with the contempt proceedings arising from the insolvency proceedings of ISPT...
NCLAT Upholds Adani Power's ₹4,000 Crore Resolution Plan For Vidarbha Industries
The National Company Law Appellate Tribunal (NCLAT) at Delhi has recently upheld Adani Power Limited's Rs 4,000 crore resolution plan for Vidarbha Industries Power Limited, rejecting challenges raised by Western Coalfields Limited, a fuel supplier and operational creditor, and an employee representative. A bench of Chairperson Ashok Bhushan and Technical Member Barun Mitra held that changes made by Adani Power to the acquisition structure after the plan was approved by the committee of...