NCLT
Claims For Interest Based On RERA Order Do Not Translate Into Financial Debt Under IBC: NCLT Delhi
The National Company Law Tribunal, New Delhi (NCLT) comprising of Shri Manni Sankariah Shanmuga Sundaram, Member (Judicial) and Dr. Sanjeev Ranjan, Member (Technical) dismissed a Section 60(5) application filed by the Mr. Yogesh Kumar Gupta against Mr. Devendra Umrao, the Resolution professional (RP) of M/s Opulent Infradevelopers Pvt Ltd. Background An application was filed under Section 60(5) of the Insolvency and Bankruptcy Code, 2016 read with Rule 11 of NCLT Rules, 2016 by Mr....
Absence Of Record In Information Utility Negates Claim Of Pre-Existing Dispute: NCLT Bengaluru
The National Company Law Tribunal, Bengaluru Bench, Bengaluru comprising of Hon'ble Shri Sunil Kumar Aggarwal (Member (Judicial) and Hon'ble Shri Radhakrishna Sreepada, (Member (Technical) admitted a Section 9 application filed by the operational creditor (PAN Oceanic Seed Solutions Private Limited) due to the presence of operational debt and non-repayment despite repeated reminders from the Corporate Debtor. Background The following Section 9 application has been filed by PAN...
Defaults Occurring Out Of Settlement Agreements Are Not “Operational Debts” U/S 5(21) Of IBC: NCLT Delhi
The National Company Law Tribunal (NCLT), New Delhi bench of Shri Manni Sankariah Shanmuga Sundaram (Judicial Member) and Dr. Sanjeev Ranjan (Technical Member), rejected a section 9 Petition filed by the operational creditor under the Insolvency & Bankruptcy Code, 2016 (the code), holding that Default occurring out of settlement agreements are not “operational debts” under Section 5(21) of the Code. Background: M/s. Harji Engineering Works Pvt. Ltd. (“Operational Creditor”) is...
Application U/S 19(2) Of IBC Is Not Maintainable Against Third Party: NCLT Delhi
The National Company Law Tribunal (NCLT), Chandigarh bench of Shri Bachu Venkat Balaram Das (Judicial Member) and Shri Atul Chaturvedi(Technical Member), has held that an application under section 19(2) of the Insolvency & Bankruptcy Code, 2016 (“Code”), filed by the Resolution Professional (“RP”) to collect information for effective conduct of Corporate Insolvency Resolution Process (“CIRP”) is not maintainable against third party to the proceedings. As per Section 19(2) of the...
Fraud Or Malicious Intent U/S 65 Of IBC Is Proven If Terms Of Loan Extended By Financial Creditor Are Designed To Cause Default: NCLT
The National Company Law Tribunal (NCLT), New Delhi bench of Shri Manni Sankariah Shanmuga Sundaram (Judicial Member) and Dr. Sanjeev Ranjan (Technical Member) held that a Petition under Section 7 of Insolvency & Bankruptcy Code, 2016 (“Code”) is proved to have been filed with Fraud or Malicious intent under Section 65 of the Code if terms of the loan extended by Financial Creditor are designed to cause default by the Corporate Debtor. Brief Facts: The Applicant, Saivi Finance...
Acknowledgement Of Debt By Corporate Debtor Extends Limitation Period For Personal Guarantor As Well: NCLT Chandigarh
The National Company Law Tribunal (NCLT), Chandigarh bench of Shri Harnam Singh Thakur (Judicial Member) and Shri Shishir Agarwal (Technical Member), has held that acknowledgement of debt by the principal borrower would extend the limitation period under section 18 of the Limitation Act, 1963 (Limitation Act) for the personal Guarantor as well for initiation of Personal Insolvency Resolution Process (PIRP) under Section 94 of Insolvency & Bankruptcy Code, 2016 (Code) Brief Facts: ...
Petition U/S 7 Of IBC Based On Arbitral Award Cannot Be Admitted Before Expiration Of 120 Days From Date Of Award: NCLT Delhi
The National Company Law Tribunal (NCLT), New Delhi bench of Shri Manni Sankariah Shanmuga Sundaram (Judicial Member) and Dr. Sanjeev Ranjan (Technical Member), has held that a Petition under Section 7 of Insolvency & Bankruptcy Code, 2016 (Code), based on Arbitral Award passed in favour of the Financial Creditor, cannot be admitted unless the time period for filing objections (120 days) against the Award as per Section 34 of the Arbitration & Conciliation Act, 1996 (Arbitration...
Interest Accrued Before MSME Registration Cannot Be Included In Operational Debt For Plea U/S 9 Of IBC: NCLT Mumbai
The National Company Law Tribunal (NCLT) Mumbai bench of K. R. Saji Kumar (Judicial Member) and Sanjiv Dutt (Technical Member) has held that the provisions of the Micro, Small and Medium Enterprises Development Act (MSMED Act) cannot override the threshold limit prescribed under Section 4 of the Insolvency and Bankruptcy Code, 2016 (the Code). Therefore, interest accrued on the delayed payment to an MSME prior to its registration under the MSMED Act cannot be included as part of the...
Absence Of Creditor's Name In Balance Sheet Does Not Negate Acknowledgment Of Debt: NCLT Kolkata
The National Company Law Tribunal (NCLT), Kolkata, special bench, consisting of Smt. Bidisha Banerjee (Member - Judicial) and Shri Sameer Kakar (Member - Technical), has allowed an application filed by the State Bank of India under Section 7 of the IBC seeking to initiate the Corporate Insolvency Resolution Process (CIRP) against the corporate debtor. The bench observed that the absence of the financial creditor's name in the corporate debtor's balance sheet does not vitiate the...
Disbursal Against Time Value Of Money Constitutes Financial Debt: NCLT Kolkata
The National Company Law Tribunal, Kolkata bench, consisting of Smt. Bidisha Banerjee (Member - Judicial) and Cmde Siddharth Mishra (Member - Technical), has allowed an application filed under Section 7 of the IBC seeking to initiate the Corporate Insolvency Resolution Process (CIRP) against the corporate debtor. The bench held that the financial debt exists where money is disbursed against the consideration for time value of money. The bench also observed that once the “debt” and...
Insufficiently Stamped Agreements Do Not Present A Bar To Application U/S 7 Of IBC: NCLT Bengaluru
The National Company Law Tribunal (NCLT), Bengaluru Bench, consisting of Shri. Sunil Kumar Aggarwal, Member (Judicial), and Shri. Radhakrishna Sreepada, Member (Technical), admitted a petition filed under Section 7 of the IBC, 2016, read with Rule 4 of the Insolvency & Bankruptcy (Application to Adjudicating Authority) Rules, 2016, seeking to initiate the Corporate Insolvency Resolution Process (CIRP) against the Corporate Debtor, M/s. Redwoods Infrastructure Private Limited. The...
No Automatic Right To Interest Under IBC, Regulation 16A(7) Of CIRP Regulations Does Not Mandate Interest On Principal Amount: NCLT Mumbai
The National Company Law Tribunal (NCLT) Mumbai bench of Justice Sushil Mahadeorao Kochey (Judicial Member) and Mr. Charanjeet Singh Gulati (Technical Member) has held that there is no provision in the Insolvency and Bankruptcy Code, 2016 (the Code) for automatic interest on the principal amount. Specifically, Regulation 16A(7) of the CIRP Regulations, 2016 does not provide for interest to be charged on the principal. Therefore, such interest cannot be claimed as a matter of right,...