Approval Of OTS Proposal By One Member Of Consortium Subject To Approval Of Other Lenders Can't Bar Petition U/S 7 Of IBC: NCLAT

The National Company Law Appellate Tribunal (NCLAT) New Delhi bench of Justice Rakesh Kumar Jain, Justice Mohd Faiz Alam Khan and Mr. Naresh Salecha (Technical Member) has held that an One Time Settlement (OTS) proposal submitted by the corporate debtor, and approved by one consortium member subject to approval by all members, cannot bar the filing of an application under Section 7 of the IBC merely because the OTS is pending consideration before other lenders. The present appeal has...

Claims Of EPFO Based On Inspection Conducted During CIRP Are Unenforceable: NCLAT

The National Company Law Appellate Tribunal (NCLAT) New Delhi bench of Justice Ashok Bhushan and Mr. Barun Mitra (Technical Member) has held that the claims of the EPFO based on inspection conducted subsequent to initiation of the Corporate Insolvency Resolution Process (CIRP) are unenforceable and cannot be admitted. The present three appeals have been filed against orders passed by National Company Law Tribunal (NCLT) by which it dismissed applications filed by both the Resolution...

Specific Pleadings U/S 9 Of IBC Regarding Part Payments, Supported By Written Acknowledgment Resets Limitation Period: NCLAT

The National Company Law Appellate Tribunal (NCLAT) New Delhi bench of Justice Ashok Bhushan and Mr. Barun Mitra (Technical Member) has held that when there are specific pleadings under Section 9 of the IBC regarding part payments made by the Corporate Debtor, further supported by a written acknowledgment in the reply to the demand notice, the limitation period for filing the application is reset in terms of Section 19 of the Limitation Act. The present appeal has been filed under...

EPFO Dues Arising From Post-Liquidation Assessments U/S 7A Of EPF Act Are Not Admissible: NCLAT New Delhi

The National Company Law Appellate Tribunal (NCLAT), Principal Bench, New Delhi, comprising Justice Ashok Bhushan (Chairperson) and Barun Mitra (Member-Technical), has held that the EPFO dues arising from the post-liquidation assessment under section 7A of the EPF Act are not admissible. The CIRP of the corporate debtor was ordered on 30.11.2017, and its liquidation was ordered on 16.09.2019. The appellant conducted the inquiry u/s 7A of the EPF Act, 1952, on 11.10.2021 and determined...

CIRP Order Based On GST Dept Letter Neither Addressed To, Nor Received By Corporate Debtor Is Invalid: NCLAT New Delhi

The National Company Law Appellate Tribunal (NCLAT), Principal Bench, New Delhi, comprising Justice Rakesh Kumar Jain (Member-Judicial), Justice Mohammad Faiz Alam Khan (Member-Judicial), and Mr. Naresh Salecha (Member-Technical), has invalidated a CIRP Order Passed by the Adjudicating Authority Based on a Letter Neither Addressed to Nor Received by the Corporate Debtor. The corporate debtor was engaged in the business of manufacturing the non-ferrous metals used in the batteries, and...

Guarantor's Liability Can't Be Restricted To Cap Prescribed Under Deed Of Guarantee On Principal Borrower's Liability: NCLAT

The National Company Law Appellate Tribunal (NCLAT) New Delhi bench of Justice Ashok Bhushan and Mr. Barun Mitra (Technical Member) has held that the liability of the guarantor cannot be restricted to only the capped amount prescribed in respect of the principal borrower's liability, since the guarantor's liability to discharge repayment obligations upon invocation of the guarantee and the principal borrower's liability operate in separate spheres. The present appeal has been filed...

Issue Of Share Application Money As Financial Debt Once Decided In Earlier Proceedings Can't Be Reagitated In Subsequent Plea U/S 7 Of IBC: NCLAT

The National Company Law Appellate Tribunal (NCLAT) New Delhi bench of Justice Ashok Bhushan and Mr. Barun Mitra (Technical Member) has held that Once the issue of whether share application money amounts to a financial debt has been decided by the Adjudicating Authority in earlier proceedings, the same question cannot be agitated in a subsequent application filed under Section 7 of the IBC as such a plea is barred by Res-Judicata. The present appeal has been filed under section 61 of...

Adjudicating Authority Can Enforce Arbitral Award Upon Application By Resolution Professional U/S 60(5) Of IBC: NCLAT New Delhi

The National Company Law Appellate Tribunal (NCLAT), Principal Bench, New Delhi, comprising Justice Rakesh Kumar Jain (Member-Technical), Justice Mohammad Faiz Alam Khan (Member-Technical), and Mr. Naresh Salecha (Member-Technical), has held that the adjudicating authority has jurisdiction under Section 60(5) of the IBC to entertain an IA filed by the Resolution Professional seeking enforcement of an arbitral award. Contention of the Appellant The appellant submitted that the...

When There Is More Than One Guarantor, Creditor Has Discretion To Proceed Against All Or Any One Of Them: NCLAT

The National Company Law Appellate Tribunal (NCLAT) New Delhi bench of Justice Ashok Bhushan and Mr. Barun Mitra has held that it is for the creditors to decide whether to proceed against all or any one of the personal guarantors when there are multiple guarantors. Therefore, an application under Section 95 of the IBC cannot be rejected merely on the ground that the creditor chose to proceed against only one of the personal guarantors. The present appeal has been filed against an order...

Corporate Debtor Cannot File Appeal U/S 61 Of IBC In It's Own Name After Appointment Of Resolution Professional: NCLAT New Delhi

The National Company Law Appellate Tribunal (NCLAT), Principal Bench, New Delhi, comprising Justice Rakesh Kumar Jain (Member-Judicial), Mr. Naresh Salecha (Member-Technical), and Mr. Indevar Pandey (Member-Technical), has held that a corporate debtor in its own name cannot file an appeal under section 61 of the IBC after initiation of CIRP and appointment of IRP. Background of the Case The present appeal was preferred by the corporate debtor, Dhara Cements (India) Pvt. Ltd., u/s...

NCLAT New Delhi Affirms CIRP Of M/S Revital Reality Private Limited (Group Company Of Supertech Limited)

The National Company Law Appellate Tribunal (NCLAT), New Delhi, comprising Justice Ashok Bhushan (Chairperson) and Barun Mitra (Member - Technical), has affirmed the initiation of the Corporate Insolvency Resolution Process (CIRP) against M/s Revital Reality Private Limited, under section 7 of the IBC, 2016. The bench ruled that the non-obtaining of an Occupation Certificate (OC) cannot be used as a defense when default arises from incomplete construction and failure to deliver possession...

Mere Allegations Of Fraud Can't Invalidate Auction When Unsuccessful Bidder Failed To Put In Bid Despite Opportunity: NCLAT

The National Company Law Appellate Tribunal (NCLAT) New Delhi bench of Justice Yogesh Khanna and Mr. Indevar Pandey (Technical Member) has held that mere bald assertions or allegations of fraud cannot invalidate an otherwise valid auction, especially when the unsuccessful bidder was given ample opportunity to log in to the system but failed to place a valid bid. The present appeal has been filed under section 61 of the Insolvency and Bankruptcy Code, 2016 (IBC) against an order passed...