NCLAT Refuses To Set Aside CIRP Admission On Post-Admission Settlement, Directs IRP To Approach NCLT

The National Company Law Appellate Tribunal (NCLAT) at New Delhi has refused to set aside an insolvency admission order solely on the basis of a settlement reached after the Corporate Insolvency Resolution Process (CIRP) had begun.A bench of Judicial Member Justice Mohammad Faiz Alam Khan and Technical Member Naresh Salecha held that a settlement reached after admission of a Section 9 application cannot by itself efface the admission order or bring the CIRP to an end."The fact that...

NCLAT Issues Notice On Subhash Chandra's Appeal Against NCLT Restraint On Asset Alienation In Insolvency Matter

The National Company Law Appellate Tribunal (NCLAT) on Tuesday issued notice in an appeal filed by Essel Group Chairman Subhash Chandra. The appeal challenges a September 1 order of the Delhi Bench of the National Company Law Tribunal (NCLT), which restrained him from alienating his assets during insolvency proceedings initiated against him as a personal guarantor.The appeal was heard by a bench comprising Officiating Chairperson Justice Yogesh Khanna and Technical Members Barun Mitra and Ajai...

Failure To Opt For Non-Relinquishment Within 30 Days Of Liquidation Makes Bank Guarantees Part Of Estate: NCLAT

The National Company Law Appellate Tribunal (NCLAT), New Delhi, has held that a secured creditor's failure to communicate its decision regarding its security within 30 days of commencement of liquidation results in the assets covered by the security being presumed to form part of the liquidation estate.“As the creditor did not give its choice of non-relinquishment of security within 30 days, it is presumed that the creditor relinquished its security against the Corporate Debtor,” a bench...

CoC's Commercial Wisdom Must Be Respected In Replacing Resolution Professional: NCLAT

The National Company Law Appellate Tribunal (NCLAT) at Chennai has recently held that while a Resolution Professional (RP) must function independently and not at the whims of a dominant creditor, the Committee of Creditors' (CoC) majority view on replacing an RP must be respected. This is subject to compliance with the Insolvency and Bankruptcy Code, 2016.The bench of Judicial Member Justice N. Seshasayee and Technical Member Jatindranath Swain observed:“While it has to be accepted that RP must...

Mere Effect Of IBC Order On Property Possession Does Not Make It A Landlord-Tenant Matter: NCLAT

The National Company Law Appellate Tribunal (NCLAT), New Delhi, has reiterated that an insolvency dispute does not become a landlord-tenant dispute merely because an order under the Insolvency and Bankruptcy Code (IBC) affects possession of a property.“The mere incidental effect of an IBC order on the possession of premises does not convert an insolvency matter into a landlord-tenant matter falling under Entry 18 of List II,” the bench of Officiating Chairperson Justice Yogesh Khanna and...

NCLAT Directs NCLT To Hear RP Replacement Plea Before Resolution Plan In Nimitaya Hotel CIRP

The National Company Law Appellate Tribunal (NCLAT) at Delhi has directed the NCLT to first consider Indian Bank's application seeking replacement of the Resolution Professional (RP) in the insolvency proceedings of Nimitaya Hotel & Resorts Ltd. before taking up the Bank's applications seeking dismissal of the existing resolution plan and permission to issue a fresh Form-G. (expression of interest)The bench of Officiating Chairperson Justice Yogesh Khanna and Technical Members Barun Mitra...

NCLAT Declines To Interfere With Talent Unlimited CIRP, Grants Affle Liberty To Move NCLT

The National Company Law Appellate Tribunal (NCLAT), New Delhi, has declined to interfere with the order admitting Talent Unlimited Online Services Pvt. Ltd. into the Corporate Insolvency Resolution Process (CIRP). It has, however, given Affle 3i Limited liberty to approach the National Company Law Tribunal (NCLT) with a proper application under Section 65 of the Insolvency and Bankruptcy Code (IBC).Section 65 deals with cases where insolvency proceedings are initiated fraudulently or with...

NCLAT Delhi Says Appellant's Past Inaction Can't Influence Merit Adjudication, Restores Company Petition

The Principal Bench of the National Company Law Appellate Tribunal (NCLAT) at New Delhi, has held that a party's past inaction cannot influence adjudication of a matter on merits once the proceedings are being considered on merits. A Bench comprising Judicial Member Justice Sharad Kumar Sharma with Technical Members Arun Baroka and Indevar Pandey set aside the NCLT's order dismissing a company petition for the appellant's failure to produce a family settlement and remitted the matter for fresh...

Subhash Chandra Moves NCLAT Against Restraint On Alienating Assets In Insolvency Case

Essel Group Chairman Dr. Subhash Chandra has moved the National Company Law Appellate Tribunal (NCLAT) against a September 1 order of the Delhi Bench of the National Company Law Tribunal (NCLT) restraining him from alienating his assets in insolvency proceedings initiated against him as a personal guarantor.The appeal was taken up by a three-member NCLAT Bench comprising Officiating Chairperson Justice (retd) Yogesh Khanna and Technical Members Barun Mitra and Ajai Das Mehrotra on Wednesday.The...

Personal Guarantors Cannot Re-agitate Limited Liability After DRT Crystallises Liability For Entire Debt: NCLAT

The National Company Law Appellate Tribunal (NCLAT) has ruled that personal guarantors of an insolvent company cannot re-agitate the extent of their liability under a Deed of Guarantee after the Debt Recovery Tribunal (DRT) has already adjudicated the issue and its order has attained finality.“In any case the liability of the Appellants had already been adjudicated by the Ld. DRT vide order dated 03.08.2021 in O.A. No. 83/2017 for Rs 1,49,26,12,243/-, wherein the validity of the Deed of...

NCLAT Orders ₹54 Crore Refund To JFC Finance After It Is Outbid In Moser Baer Solar Auction

The National Company Law Appellate Tribunal (NCLAT), New Delhi, has rejected a plea by the Liquidator of Moser Baer Solar Ltd. seeking to keep JFC Finance (India) Ltd.'s ₹54 crore deposit until the highest bidder in a fresh auction pays the entire sale consideration.A bench of Officiating Chairperson Justice Yogesh Khanna and Technical Member Barun Mitra held that JFC's deposit had to be returned once another bidder surpassed its bid, as specifically directed in the court's earlier order.“The...

Conversion of IBC Appeal Into Companies Act Appeal Does Not Save Limitation: NCLAT

The National Company Law Appellate Tribunal (NCLAT) at Delhi has recently held that an appeal filed under the insolvency law does not provide continuity for limitation when it is transformed into an appeal under the company law.The tribunal was dealing with an appeal initially filed under Section 61 of the Insolvency and Bankruptcy Code (IBC), which provides for appeals against orders in insolvency proceedings. The appellant later sought to convert it into an appeal under Section 421 of the...