Amendment In Application U/S 7 Of IBC Cannot Be Permitted If It Amounts To Withdrawal Of An Admission: NCLAT Chennai

The National Company Law Appellate Tribunal (NCLAT), Chennai Bench, comprising Justice Sharad Kumar Sharma (Member-Judicial) and Jatindranath Swain (Member-Technical), allowed an appeal arising out of a decision of the NCLT, Amravati Bench. The main issue before the tribunal was whether an amendment in a Section 7 IBC application can be allowed if it withdraws a pleading already raised before NCLT, which is held before the courts or the tribunals, or if it amounts to withdrawal of an...

Employment Contract Disputes Cannot Be Adjudicated By NCLT/NCLAT Under IBC: NCLAT

The National Company Law Appellate Tribunal (NCLAT) New Delhi bench of Justice Ashok Bhushan (Judicial Member) and Mr. Arun Baroka (Technical Member) has held that a dispute arising from an employment contract concerning the determination of emoluments and salaries to be paid to an employee of a company after his termination cannot be adjudicated by the National Company Law Tribunal (NCLT) or the NCLAT under the Insolvency and Bankruptcy Code, 2016 (Code). Brief Facts: The present...

No Provision Under IBC Mandating Resolution Professional To Share Valuation Report With Suspended Management Of Corporate Debtor: NCLAT

The National Company Law Appellate Tribunal (NCLAT) New Delhi bench of Justice Ashok Bhushan (Judicial Member) and Mr. Barun Mitra (Technical Member) has held that there is no provision in the Insolvency and Bankruptcy Code, 2016 (Code), that mandates the valuation report to be shared with the suspended management of the Corporate Debtor. Therefore, the Resolution Professional cannot be faulted for not providing the report. Brief Facts: M/s Medirad Tech India Ltd. (Corporate Debtor)...

SEBI-Imposed Penalty Qualifies As A 'Fine' & Is An 'Excluded Debt' U/S 79(15)(A) Of IBC: NCLAT Chennai

The National Company Appellate Tribunal (NCLAT), Chennai Bench, comprising Justice Sharad Kumar Sharma (Member-Judicial) and Jatindranath Swain (Member-Technical), has upheld a decision passed by the Adjudicating Authority (NCLT, Hyderabad), admitting an application filed under Section 122(1) of the IBC, 2016. The Adjudicating Authority has earlier held that the penalty imposed by the SEBI will come under the ambit of 'fine' and will be treated as the 'excluded debt' for the purpose of...

No Cause of Action Arises Unless the Section 95 IBC Petition Is Admitted Against the Personal Guarantors: NCLAT Chennai

The National Company Law Appellate Tribunal (NCLAT), Chennai Bench, comprising Justice Sharad Kumar Sharma (Member-Judicial) and Jatindranath Swain (Member-Technical), has ruled that the personal guarantors cannot challenge the appointment of the resolution professional and other procedural actions taken under Section 95 to 100 of the IBC, 2016. The tribunal observed that these provisions are non-adjudicatory in nature, and no cause of action arises until an order under Section 100 is ...

NCLAT Dismisses Appeal Against DLF U/S 61 Of IBC For ₹4.65 Crores Debt, Says Multiple Exchanges Between Parties Prove Pre-Existing Dispute

The National Company Law Appellate Tribunal (NCLAT) New Delhi bench of Justice Ashok Bhushan (Judicial Member), Mr. Barun Mitra and Mr. Arun Baroka (Technical Member) has dismissed an appeal filed by the contractor under Section 61 of the Insolvency and Bankruptcy Code, 2016 (Code) against DLF, claiming a debt of Rs. 4.65 crores, was dismissed on the grounds that multiple exchanges between the corporate debtor and the operational creditor prior to the issuance of the demand notice under...

Absence Of Assignee Name In Balance Sheet Of Corporate Debtor Does Not Negate Applicability Of Section 18 Of Limitation Act: NCLAT

The National Company Law Appellate Tribunal (NCLAT) New Delhi bench of Justice Ashok Bhushan (Judicial Member) and Mr. Barun Mitra (Technical Member) has held that the fact that the debt was assigned to Assignee and the assignee was not named in the balance sheets does not negate the applicability of Section 18 of the Limitation Act, 1963 (Limitation Act). It further held that the debt at the time of filing an application under Section 7 of the Insolvency and Bankruptcy Code, 2016 (Code)...

Joint Application U/S 9 Of IBC Not Maintainable If Individual Claims Do Not Meet Threshold Limit U/S 4 Of IBC: NCLAT

The National Company Law Appellate Tribunal (NCLAT) New Delhi bench of Justice Ashok Bhushan (Judicial Member), Mr. Baurn Mitra (Technical Member) and Mr. Arun Baroka (Technical Member) has held that in a joint application filed by operational creditors under Section 9 of the Insolvency and Bankruptcy Code, 2016 (the Code), the threshold limit prescribed under Section 4 must be independently satisfied by each operational creditor. The collective or aggregate debt of all operational...

No Claim Can Be Submitted After Approval Of Resolution Plan By CoC If Creditor Was Aware Of CIRP Initiation Against Corporate Debtor: NCLAT

The National Company Law Appellate Tribunal (NCLAT) New Delhi bench of Justice Ashok Bhushan (Judicial Member) and Mr. Arun Baroka (Technical Member) has held that when a creditor is well aware of the initiation of the Corporate Insolvency Resolution Process (CIRP) against the corporate debtor but chooses not to file a claim before the Resolution Professional, it cannot be permitted to submit the claim after the Resolution Plan has been approved by the Committee of Creditors (CoC). ...

Homebuyers Remain Financial Creditors U/S 5(8)(F) Of IBC Regardless Of Whether They Obtained RERA Recovery Certificates: NCLAT

The National Company Law Appellate Tribunal (NCLAT) New Delhi bench of Justice Ashok Bhushan (Judicial Member), Mr.Barun Mitra (Technical Member) and Mr. Arun Baroka (Technical Member) has held that whether or not homebuyers have obtained recovery certificates from the Real Estate Regulatory Authority (RERA), they remain financial creditors under Section 5(8)(f) of the Insolvency and Bankruptcy Code, 2016 (Code). Brief Facts: Shailendra Agarwal (Appellant) has filed the present...

NCLT Cannot Adjudicate Disputed Contractual Claims During Liquidation Under IBC If There Exists An Arbitration Clause: NCLAT Chennai

The National Company Law Appellate Tribunal (NCLAT), Chennai Bench, comprising Justice Sharad Kumar Sharma (Member-Judicial) and Jatindranath Swain (Member-Technical), dismissed an appeal arising out of an order passed by the NCLT, Chennai. The tribunal observed that a liquidator under the IBC, 2016, cannot seek adjudication of a disputed contractual claim if the contract provides an arbitration clause. The tribunal held that the IBC forums are not the appropriate platform for ...

When There Is Sufficient Material To Show Dispute U/S 9(5)(ii)(d) Of IBC, Adjudicating Authority Cannot Ignore The Same: NCLAT, New Delhi

The National Company Law Appellate Tribunal, Principal Bench, New Delhi (NCLAT) comprising of Justice Ashok Bhushan (Chairperson) and Barun Mitra (Member Technical) admitted appeal filed Suspended Director of the Corporate Debtor challenging the order dated 26.03.2025 passed by the Adjudicating Authority (National Company Law Tribunal), Mumbai Bench, Court-I, admitting Section 9 application filed by Armaco Infralinks Pvt. Ltd. Background An appeal was filed by Bhawani Prasad Mishra...