NCLT
Correctness Of NPA Classification Irrelevant To Initiating CIRP Once Default Is Proven: NCLT Mumbai
The National Company Law Tribunal (NCLT) at Mumbai has recently held that insolvency proceedings under the Insolvency and Bankruptcy Code depend only on the factual occurrence of default and are not affected by alleged irregularities in declaring an account as a Non Performing Asset or by non compliance with the MSME rehabilitation framework. It ruled that objections to the bank's NPA classification cannot defeat a creditor's right to initiate insolvency once a default is shown. A coram of...
NCLT Mumbai Reaffirms Insolvency Process Can Proceed Against Guarantors Without CIRP Of Corporate Debtor
The National Company Law Tribunal (NCLT) at Mumbai recently reaffirmed that insolvency proceedings against personal guarantors under the Insolvency and Bankruptcy Code can be initiated even if no CIRP is pending against the corporate debtor, relying on the Supreme Court's ruling in State Bank of India v. Mahendra Kumar Jajodia(2022). A coram of Judicial Member Sushil Mahadeorao Kochey and Technical Member Prabhat Kumar reiterated that the tribunal's jurisdiction is independent of any insolvency...
NCLT Mumbai Upholds IL&FS' Power To Raise Price of Its BKC Headquartes, Rejects Chronos' Plea To Enforce ₹1,080-Crore LoI
The National Company Law Tribunal (NCLT) at Mumbai has recently held that IL&FS was contractually empowered to unilaterally amend the Letter of Intent and increase the bid consideration for the sale of its iconic IL&FS Financial Centre in Bandra Kurla Complex, Mumbai refusing to compel execution of the definitive agreement at the originally approved value of Rs 1,080 crore. The ruling effectively permits IL&FS to revise the sale price to Rs 1,481 crore after approvals were granted,...
NCLT Ahmedabad Orders Liquidation of Girdhari International After Finding Collusion With Resolution Applicants
The National Company Law Tribunal at Ahmedabad has held that the resolution plan for Girdhari International Private Limited was a "collusive arrangement" between the resolution applicant and the sole financial creditor, Drip Capital Inc., and refused to approve it, ordering liquidation instead. The tribunal said that “the entire exercise suggests an accommodation or collusive arrangement” designed to secure the corporate debtor the benefits of clean slate under the Code rather than revive the...
Pending Cheque-Bounce Case Not A Bar To Admitting Insolvency Plea: NCLT Mumbai
The National Company Law Tribunal (NCLT) at Mumbai has recently ruled that the pendency of cheque-bounce proceedings under the Negotiable Instruments Act does not prevent initiation of insolvency proceedings, while admitting an application filed by Rexel India Private Limited seeking to commence the corporate insolvency resolution process against Proto D Industries Private Limited. The coram of Judicial Member Nilesh Sharma and Technical Member Sameer Kakar held that proceedings under the NI...
NCLT Kolkata Pulls Up Insolvency Professional For Appearing In Vest During Virtual Hearing, Issues Contempt Notice
The National Company Law Tribunal at Kolkata has recently issued a criminal contempt show-cause notice to insolvency professional Subrato Ghosh for appearing in a virtual hearing wearing only a vest/baniyan. The incident took place during the insolvency proceedings initiated by SREI Equipment Finance Ltd against Samsara Energy Ltd. A coram of Judicial Member Labh Singh and Technical Member Rekha Kantilal Shah noted that young lawyers, most of whom are women, regularly appear before the Tribunal...
NCLT Delhi Clears ₹3,800-Crore MAHAGENCO–NTPC Plan To Revive Sinnar Thermal Power
The National Company Law Tribunal (NCLT) at Delhi has recently approved a ₹3,800 crore resolution plan jointly submitted by public sector power companies, Maharashtra State Power Generation Company (MAHAGENCO) and National Thermal Power Corporation (NTPC) to revive the defunct Sinnar Thermal Power Limited in Maharashtra, holding that the proposal met all requirements under the Insolvency and Bankruptcy Code (IBC). A coram of Judicial Member Manni Sankariah Shanmuga and Technical Member Atul...
NCLT Orders Opulent Infradevelopers' Directors To Repay Rs 10.46 Crore For Fraudulent Transactions
The National Company Law Tribunal (NCLT) at New Delhi has ordered suspended directors of insolvent Opulent Infradevelopers to personally contribute Rs 10.46 crore back to the company after finding that they ran the business “with intent to defraud creditors” by making unauthorised donations, advancing interest-free loans, falsifying accounts and booking fictitious expenses. The order was passed by Judicial Member Manni Sankariah Shanmuga Sundaram and Technical Member Atul Chaturvedi on an...
NCLT Mumbai Rejects Indo Global Employees' Claims Filed 18 Months Late, Says Stakeholders Must Be Vigilant
The National Company Law Tribunal (NCLT) at Mumbai has recently stressed that stakeholders must act within statutory timelines during a corporate insolvency resolution process, dismissing six applications filed by former employees of Indo Global Soft Solutions and Technologies Private Limited after finding that their claims had been submitted 18 months after the last date prescribed for filing claims under the Insolvency and Bankruptcy Code A Bench of Judicial Member K R Saji Kumar and Technical...
Liquidator Must Recover Assets Even If Attached By Third Parties, Attachment Cannot Override IBC: NCLT Bengaluru
The National Company Law Tribunal (NCLT) at Bengaluru has recently held that a liquidator must assume custody and control of all assets of a corporate debtor even when those assets have been seized or attached by third parties including investigating agencies, stating that such seizure cannot override the Insolvency and Bankruptcy Code. The order was passed by Judicial Member Sunil Kumar Aggarwal and Member Technical Radhakrishna Sreepada in an application filed by the liquidator of Welworth...
Buyers Of Commercial Units Are Not Homebuyers; Cannot Be Recognised As Financial Creditors: NCLT Mumbai
The National Company Law Tribunal at Mumbai has recently held that purchasers of commercial or industrial units cannot claim parity with homebuyers and are therefore not entitled to the special protection accorded to them under the Insolvency and Bankruptcy Code, which recognises homebuyers as financial creditors. A coram of Judicial Member Mohan Prasad Tiwari and Technical Member Charanjeet Singh Gulati rejected an industrial unit purchaser's plea to be treated as a financial creditor. The...
NSEL Gets NCLT Nod For ₹1,950-Crore Settlement With 5,682 Traders Affected In 2013 Scam
The National Company Law Tribunal at Mumbai on Friday approved a Rs 1,950-crore one-time settlement for 5,682 traders affected by the 2013 National Spot Exchange Ltd (NSEL) scam, holding that the proposal met statutory requirements and did not violate public policy.A bench of Judicial Member Sushil Mahadeorao Kochey and Technical Member Prabhat Kumar noted that the settlement had received 91.35% approval in value and over 92% in number from specified creditors who voted, and said its role was...