“Value of Byju's Stake Cannot Be Preserved if Aakash Is Commercially Killed,” NCLAT Declines to Stay Rights Issue EGM

Observing that the value of Byju's stake in Aakash cannot be preserved if the subsidiary is commercially “killed”, the National Company Law Appellate Tribunal (NCLAT), Chennai Bench, refused to stay Aakash Educational Services Ltd.'s extraordinary general meeting (EGM) for a proposed rights issue scheduled on October 29. The tribunal dismissed a plea by GLAS Trust Company LLC, a US-based lender to Byju's (Think and Learn pvt Ltd) , which sought to block the EGM. It observed “the value of...

NCLAT Chennai Refuses To Stay Aakash's EGM To Approve Rights Issue, Declines Plea By US-Based Lender

The National Company Law Appellate Tribunal at Chennai has rejected a plea by GLAS Trust Company LLC, the U.S.-based lender representing the creditors of crisis hit ed-tech Byju's, to stay the Extraordinary General Meeting (EGM) of Aakash Educational Services Ltd (AESL) scheduled for October 29, 2025. The EGM aims to approve a rights issue that would dilute Byju's 25.75% stake in AESL to approximately 5%, as the company, currently under insolvency proceedings, cannot participate in the...

NCLAT Upholds CIRP Against Privilege Power; Rejects Sarang Wadhawan's Appeal

The National Company Law Appellate Tribunal at New Delhi, recently upheld the initiation of insolvency proceedings against Privilege Power and Infrastructure Pvt. Ltd. (PPIL), dismissing an appeal filed by its shareholder Sarang Kumar Wadhawan.Chairperson Ashok Bhushan and Memebers Barun Mitra and Arun Baroka held that the CIRP application filed by Unity Small Finance Bank Ltd. (successor to Punjab and Maharashtra Co-operative Bank, or PMC Bank) was well within limitation as the fraud was...

Guarantors Cannot Plead Non-Service Of Demand Notice After Admitting Receipt Before Supreme Court: NCLAT Chennai

The NCLAT, Chennai Bench, comprising Justice Sharad Kumar Sharma (Member-Judicial) and Jatindranath Swain (Member-Technical), has set aside the order of the NCLT, Amravati, and restored the SBI's insolvency petition against the personal guarantors of M/s Seven Hills Health Care Pvt. Ltd. Background of the Case The financial creditor (State Bank of India) had provided financial assistance to M/s Seven Hills Health Care Pvt. Ltd., in which Dr. Jitendra Das Maganti and Dr. Renuka Rani...

Listing of Mediated Settlements Within 14 Days is Directory Not Mandatory : NCLAT

The National Company Law Appellate Tribunal (NCLAT) has recently clarified that the 14-day period under Rule 26(1) of the Companies (Mediation and Conciliation) Rules, 2016, for listing a mediated settlement before the Tribunal, is only advisory and not mandatory.A coram comprising Judicial Member Justice Yogesh Khanna and Technical Member Ajai Das Mehrotra made the clarification while hearing an appeal by a shareholder of Accurate Engineering Company Pvt. Ltd., a Salunke family-owned business,...

Belated Claims Of Homebuyers Can't Be Rejected When Reflected In Corporate Debtor's Records: NCLAT New Delhi

The National Company Law Appellate Tribunal (NCLAT) New Delhi held that claims of genuine allottees whose names are reflected in the corporate debtor's records cannot be rejected merely on the ground that the claims were filed belatedly. A bench of Justice Ashok Bhushan and Mr. Arun Baroka (Technical Member) held that “when the amount paid by the unit holders on the basis of valid allotment is reflected in the record of the Corporate Debtor, the judgment of “Puneet Kaur vs. M/s. K.V....

Non-Declaration Of Beneficial Ownership U/S 9 Companies Act Does Not Amount To Oppression & Mismanagement: NCLAT New Delhi

The National Company Law Appellate Tribunal (NCLAT), New Delhi, comprising Justice Yogesh Khanna (Member-Judicial) and Mr. Ajai Das Mehrotra (Member-Technical), has held that the non-declaration of the beneficial ownership under section 89 of the Companies Act, 2013, doesn't amount to oppression and mismanagement. The bench ruled that section 89 casts a duty upon the owner to make the declaration, and avoiding such a declaration makes him liable for penalties. The appeal was filed...

Amount Paid As Advance Consideration Constitutes Operational Debt Under Section 5(21) Of IBC: NCLAT

The National Company Law Appellate Tribunal (NCLAT) New Delhi held that an amount paid as advance consideration constitutes an Operational Debt under section 5(21) of the IBC especially when the said amount is reflected in the audited balance sheet of the corporate debtor as advance without any qualifying note by the auditor. A bench comprising Justice Yogesh Khanna (Judicial Member) and Mr. Indevar Pandey (Technical Member) held that “a purchaser who has made advance payments for...

NCLT Cannot Recall Order Passed On Merits Under Rule 11 Of NCLT Rules 2016: NCLAT Chennai

The National Company Law Appellate Tribunal (NCLAT), Chennai Bench, comprising Justice Sharad Kumar Sharma (Member-Judicial) and Jatindranath Swain (Member-Technical), has held that an order passed on merits cannot be recalled by the NCLT under rule 11 of the NCLT Rules, 2016. Background The CIRP of the corporate debtor was initiated, and the appellant turned out to be the successful resolution applicant (SRA). Six homebuyers filed applications before the NCLT seeking execution of...

Suspended Directors' Duty To Sign Balance Sheets Continues During CIRP, Any Acknowledgment Extends Limitation Against Personal Guarantor: NCLAT

The National Company Law Appellate Tribunal (NCLAT) New Delhi held that since the liability of the guarantor is co-extensive with that of the borrower, any acknowledgment of liability by the corporate debtor extends the limitation period against the guarantor also. The Tribunal also held that signing balance sheets is a statutory duty of the directors of a company from which they are not relieved even during the Corporate Insolvency Resolution Process (CIRP). Therefore, any acknowledgment...

Documents Not Filed Before NCLT Cannot Be Entertained As Evidence By NCLAT For Deciding Appeal: NCLAT Chennai

The NCLAT, Chennai Bench, comprising Justice Sharad Kumar Sharma (Member-Judicial) and Jatindranath Swain (Member-Technical), has held that any document available but not filed before the NCLT cannot be entertained as evidence by the NCLAT at the appellate stage. The CIRP of the corporate debtor was initiated, and due to the failure to receive the resolution plan, a liquidation order was passed by the NCLT Kochi. The liquidator was appointed, who discovered that certain transactions...

NCLT Lacks Jurisdiction To Recover Disputed Contractual Dues During Liquidation U/S 60(5) IBC: NCLAT New Delhi

The NCLAT, New Delhi, Principal Bench, comprising Justice Ashok Bhushan (Chairperson) and Barun Mitra (Member-Technical), has held that the NCLT doesn't have jurisdiction under section 60(5) of the IBC to recover disputed contractual dues during liquidation. Uttar Pradesh Rajkiya Nirman Nigam Ltd. (URNL) was working under the Uttar Pradesh Power Transport Corporation Ltd. (UPPTCL). URNL subcontracted the construction work of three power substations to Dev Denso Power Ltd. (Corporate...