NCLT
NCLT Mumbai Sets Aside MIDC's Cancellation Of Plot Allotments To Jet Airways, Directs Lease Execution
The tribunal held that Jet Airways' rights under the long-term lease formed part of the liquidation estate and could not be excluded as mere contractual rights to use the land
NCLT Mumbai Rejects ₹4.43 Cr Section 9 Plea, Holds Pre Existing Dispute Over Part Of Debt Sufficient
The Mumbai Bench of the National Company Law Tribunal (NCLT) on 30 June held that a pre existing dispute raised before issuance of a demand notice can defeat a Section 9 application under the Insolvency and Bankruptcy Code (IBC), even if the dispute relates only to a part of the operational debt, unless the disputed amount is wholly insignificant. Judicial Member Nilesh Sharma and Technical Member Sameer Kakar rejected Lumens Technologies Pvt Ltd's Section 9 petition seeking initiation of the...
NCLT Ahmedabad Holds Mere Breach Claims Cannot Defeat CIRP, Admits ₹2.02 Cr. Plea Against Mehsana Dairy
The Ahmedabad Bench of the National Company Law Tribunal (NCLT) on 26 June held that a corporate debtor cannot defeat an insolvency petition by raising contractual disputes that are unsupported by contemporaneous evidence. Judicial Member Shammi Khan and Technical Member Sanjeev Sharma admitted an insolvency petition filed by Mehsana Food Tradelinkers Pvt. Ltd. against Mehsana Dairy and Food Products Ltd. under the Insolvency and Bankruptcy Code, 2016 (IBC) for an operational debt of Rs. 2.02...
NCLT Kochi Rejects Insolvency Plea Against BPL, Finds It Was Attempt To Recover Arbitral Award Dues
The National Company Law Tribunal (NCLT) at Kochi has recently dismissed an insolvency plea against consumer electronics company BPL Limited. It held that the Insolvency and Bankruptcy Code (IBC) cannot be invoked as an additional or parallel mechanism to recover the balance amount under an arbitral award after a creditor has already pursued execution proceedings. The tribunal observed, "the present proceedings are essentially an attempt to recover the balance amount claimed under the Award...
Cooperative Society's Statutory Charge Survives Liquidation, Enforceable Against Auction Purchaser: NCLT Mumbai
The Mumbai Bench of the National Company Law Tribunal (NCLT) has held that a cooperative society can enforce its statutory first charge over a property against an auction purchaser even after participating in the liquidation process by filing its claim before the liquidator. A bench of Judicial Member Ashish Kalia and Technical Member Charanjeet Singh Gulati observed that participation in the liquidation process does not extinguish the statutory charge created under the Maharashtra Co-operative...
NCLT Mumbai Rejects 4B Networks Resolution Plan Over Clause Giving SRA Exclusive Rights To PUFE Recoveries
The Mumbai Bench of the National Company Law Tribunal has rejected the resolution plan submitted by Armaan Sunil Kothari for 4B Networks Pvt Ltd. It held that the plan wrongly allowed the successful resolution applicant (SRA) to exclusively retain recoveries from pending Preferential, Undervalued, Fraudulent and Extortionate (PUFE) proceedings, including one seeking recovery of about ₹7,349 crore. The tribunal granted liberty to the resolution professional (RP) and the committee of creditors...
Statutory Authorities Not Exempt From CIRP Timelines: NCLT Mumbai Rejects EPFO's Delayed Claim
The Mumbai Bench of the National Company Law Tribunal refused to condone a 400-day delay by the Employees' Provident Fund Organisation (EPFO) in filing its claim in the corporate insolvency resolution process (CIRP) of Sovika Aviation Services Pvt Ltd. The tribunal held that the statutory authority had failed to provide any convincing explanation for the delay. It observed that permitting the claim after the Committee of Creditors (CoC) had approved the resolution plan would unsettle the...
'Shylockian System' Of Lending Cannot Be Permitted To Misuse IBC For Debt Recovery: NCLT Kochi
The National Company Law Tribunal (NCLT) at Kochi has refused to admit an insolvency plea against NCS Autocars Private Limited, holding that a "shylockian system" of lending involving advance deduction of interest cannot be permitted to misuse the Insolvency and Bankruptcy Code (IBC). The tribunal found that the proceedings bore the characteristics of a debt recovery action rather than a bona fide insolvency proceeding. A coram of Judicial Member Vinay Goel and Technical Member Ravichandran...
IBC Claim Requires Crystallised Right To "Payment," Not Mere Right To "Performance": NCLT Kolkata
The Kolkata Bench of the National Company Law Tribunal (NCLT) on 3 July held that a contractual right to performance cannot be treated as a “right to payment” under Section 3(6) of the Insolvency and Bankruptcy Code, 2016, unless the claim has crystallised into a payable amount. Technical Member Rekha Kantilal Shah and Judicial Member Bidisha Banerjee dismissed the appeal filed by NPGC Ltd against the liquidator's rejection of its Rs. 71.33 crore claim against D.C. Industrial Plant Services Pvt...
COVID Extension Does Not Waive Interest On Delayed Liquidation Payments: NCLT Mumbai
On 6 July, the Mumbai Bench of the National Company Law Tribunal (NCLT) held that a liquidator's extension of the timeline for payment of auction consideration due to COVID 19 disruptions under Regulation 47A of the Liquidation Process Regulations does not waive the successful bidder's liability to pay contractual interest for delayed payment. Judicial Member Lakshmi Gurung and Technical Member Hariharan Neelakanta Iyer dismissed an application filed by Rudra Construction Co. seeking waiver of...
IBC Threshold Must Be Tested Against MahaRERA Records At Time Of Filing Petition: NCLT Mumbai
On 6 July, the Mumbai Bench of the National Company Law Tribunal (NCLT) held that the number of allottees reflected on the MahaRERA website on the date of filing an application under Section 7 of the Insolvency and Bankruptcy Code (IBC) is the relevant benchmark for determining whether the statutory threshold for initiating insolvency proceedings is satisfied. Technical Member Anil Raj Chellan and Judicial Member K.R. Saji Kumar partly allowed an application filed by K.D. Lite Developers Pvt....
NCLT Mumbai Admits Bank Of Maharashtra's CIRP Plea Against DNR India Autotech Over ₹17.98 Crore Default
The Mumbai Bench of the National Company Law Tribunal (NCLT) has recently admitted Bank of Maharashtra's insolvency plea against DNR India Autotech Pvt Ltd. The Corporate Insolvency Resolution Process has been initiated over an alleged default of ₹17.98 crore arising from a corporate guarantee executed by the company for credit facilities extended to Tirumalla Agro Industries Pvt Ltd.A bench of Judicial Member Nilesh Sharma and Technical Member Sameer Kakar admitted the petition after holding...