NCLT Jaipur Holds Section 95 IBC Maintainable For Pre-2019 Guarantees If Default Occurs Later

The Jaipur National Company Law Tribunal (NCLT) on 26 May held that insolvency proceedings under Section 95 of the Insolvency and Bankruptcy Code, 2016 can be initiated against a personal guarantor even where the guarantee was executed prior to the coming into force of the personal guarantor framework, so long as the default and invocation of the guarantee occurred thereafter. Judicial Member Reeta Kohli and Technical Member Kavita Bhatnagar admitted an insolvency application filed by Tata...

Agreement To Sell Does Not Confer Ownership Rights Over Corporate Debtor's Property: NCLT Bengaluru

The Bengaluru National Company Law Tribunal (NCLT) on 26 May held that an agreement to sell, by itself, does not confer ownership rights or create any interest in an immovable property in favour of a purchaser in insolvency proceedings.Judicial Member Sunil Kumar Aggarwal and Technical Member Radhakrishna Sreepada dismissed an application seeking execution of a sale deed in respect of a commercial property owned by Fortuna Buildcon (India) Private Limited, which is undergoing Corporate...

Complex Disputed Commercial Arrangements Cannot Be Decided In Summary Insolvency Proceedings: NCLT Jaipur

The Jaipur Bench of the National Company Law Tribunal (NCLT) has refused to admit Empire Housing Projects Pvt. Ltd.'s insolvency plea against Ninaniya Estates Ltd. It held that the dispute arose from a complex and seriously contested commercial arrangement linked to a real estate transaction, which could not be resolved in summary insolvency proceedings. The matter was heard by a bench of Judicial Member Reeta Kohli and Technical Member Kavita Bhatnagar. “In the considered opinion of this...

Auction Purchaser Of CoC Member Company Cannot Represent It Until Sale Completion: NCLT Kolkata

The National Company Law Tribunal (NCLT), Kolkata Bench, has recently held that a successful auction purchaser of a company that is a committee of creditors (CoC) member in another insolvency process cannot participate in that other company's CoC meetings until the acquisition is legally completed. It held that mere purchase through auction does not by itself confer that right. The bench of Judicial Member Bidisha Banerjee, and Technical Member Siddharth Mishra held that the liquidator would...

NCLT Chennai Reiterates Unauthorised Communications Cannot Trigger CIRP, Dismisses ₹1.24 Crore Plea

The Chennai Bench of the National Company Law Tribunal (NCLT) on 5 May dismissed an insolvency application filed by Daedong Shipping Company Limited, a South Korean shipping company, holding that communications from an unauthorised person cannot be used to establish an operational debt or initiate proceedings under the Insolvency and Bankruptcy Code, 2016. Judicial Member Jyoti Kumar Tripathi and Technical Member Ravichandran Ramasamy reiterated that corporate liability must rest on valid...

Highest Score In Evaluation Matrix Doesn't Guarantee Resolution Plan Approval: NCLT Kochi

Securing the highest score under the evaluation matrix does not give a resolution applicant any vested right to have its plan approved by the Committee of Creditors (CoC), the National Company Law Tribunal at Kochi has reiterated. A coram of Judicial Member Vinay Goel said: “It is now well settled that the Evaluation Matrix is only a guiding tool intended to facilitate comparative assessment of Resolution Plans and does not confer any vested or enforceable right upon the highest-scoring...

Settled Debt Cannot Be Revived As Operational Debt On Breach Of Settlement: NCLT Kochi In Nest Realtors CIRP

The National Company Law Tribunal (NCLT) at Kochi has dismissed an insolvency petition filed by Kunnel Engineers and Contractors Private Limited against Nest Realtors India Private Limited. It held that once construction dues were extinguished under a settlement agreement, a later breach could not revive the original debt for insolvency proceedings. A bench of Judicial Member Vinay Goel observed: “The settlement agreement specifically and unequivocally records that the earlier operational...

NCLT Hyderabad Approves Beaufond's ₹70.11 Crore Resolution Plan for KOBO Biotech With Restructuring Plan

The Hyderabad bench of the National Company Law Tribunal has approved Beaufond Industries Ltd's ₹70.11 crore resolution plan for KOBO Biotech Ltd. The plan provides for a composite restructuring. Beaufond will merge into KOBO Biotech, the API business will be demerged into a separate entity, and the surviving company will be renamed Beaufond Ltd. The coram of Judicial Member Rajeev Bhardwaj and Technical Member Sanjay Puri clarified that while approval of the resolution plan would suffice to...

NCLT Kolkata Rejects EPFO's ₹8.23 Crore Additional PF Claim In Corporate Power Liquidation

The National Company Law Tribunal (NCLT) in Kolkata has dismissed the Employees Provident Fund Organisation's plea to admit an additional ₹88.23 crore claim towards provident fund damages and interest in the liquidation of Corporate Power Limited(CPL). A bench of Judicial Member Bidisha Banerjee and Technical Member Siddharth Mishra held that the additional EPFO claim, which arose from an assessment completed after the commencement of liquidation, could not be admitted in the process. “Since...

Title Disputes Over Mortgaged Property Do Not Bar Personal Guarantor Insolvency: NCLT Guwahati

The National Company Law Tribunal (NCLT) at Guwahat has recently held that pending title disputes over mortgaged property do not bar insolvency proceedings against a personal guarantor, since such proceedings turn on the existence of debt and default rather than adjudication of property rights.A bench of Judicial Member Rammurti Kushawaha and Technical Member Yogendra Kumar Singh passed the ruling while admitting Canara Bank's insolvency petition against Keishing James Lalrongbawl, personal...

NCLT Delhi Directs Restoration Of Power To Ansal's Sushant Golf City Golf Course, Subject To Dues Payment

The National Company Law Tribunal (NCLT) at New Delhi Bench has directed restoration of electricity supply to the golf course at Ansal Properties and Infrastructure Ltd's Sushant Golf City project in Lucknow. The relief is subject to the operator paying ₹2 lakh within three days and the balance ₹33.75 lakh within two months, while the Tribunal adjudicates a dispute over termination of its operating agreement during the company's insolvency proceedings. A bench of Judicial Member Ashok Kumar...

NCLT Bengaluru Bars Investors From Other Dreamz Projects From Taking Part In Samhita Project CIRP

The National Company Law Tribunal (NCLT) at Bengaluru has refused to allow an investors' association representing depositors in other Dreamz Infra projects to intervene in the project-specific insolvency proceedings for the Dreamz Samhita project, holding that it had failed to establish any project-specific interest. A coram of Judicial Member Sunil Kumar Aggarwal and Technical Member Radhakrishna Sreepada dismissed an application filed by Dreamz GK Investors Welfare Association seeking...