Corporate Debtor Cannot Be Sold As Going Concern After Omission Of Enabling Liquidation Provisions: NCLT Kolkata

The National Company Law Tribunal (NCLT), Kolkata Bench, has recently held that after the omission of the provisions permitting going-concern sales under the Insolvency and Bankruptcy Board of India (Liquidation Process) Regulations, 2016, it cannot allow the sale of a corporate debtor as a going concern or as a continuing juristic entity during liquidation. The ruling applies where the process for such a sale had not commenced before the amendments came into force. A bench of Judicial Member...

Family Settlement Excluding Legal Heirs, Coparceners Cannot Defeat Oppression Petition: NCLT Kolkata:

The National Company Law Tribunal (NCLT) in Kolkata has held that family settlement agreements entered into by only some members of a family cannot be recognised as binding settlements where other legal heirs and coparceners continue to assert rights in the disputed estate and shareholding. The tribunal ruled that two such agreements relied upon in a dispute concerning Anil Plantations Private Limited were void and illegal. It further held that the agreements could not render the company...

NCLT Delhi Rejects Former SpiceJet Pilot's Insolvency Plea Against Airline Over Salary Dues

The National Company Law Tribunal (NCLT) at Delhi has recently dismissed an insolvency plea filed by a former SpiceJet pilot over alleged unpaid salary dues, holding that the claim fell below the minimum threshold required for initiating insolvency proceedings and was also the subject of a pre-existing dispute. A bench of Judicial Member Mahendra Khandelwal and Technical Member Anu Jagmohan Singh ruled. “Therefore, the present Section 9 application is not admissible on the ground of lack of...

NCLT Bengaluru Allows Change In Default Date In Insolvency Plea Against Cafe Coffee Day Parent

The National Company Law Tribunal (NCLT) at Bengaluru recently allowed an amendment to the date of default in an insolvency petition against Cafe Coffee Day parent Coffee Day Global Ltd, permitting the date to be changed from November 27, 2020, to September 30, 2019. A bench of Judicial Member Sunil Kumar Aggarwal and Technical Member Radhakrishna Sreepada held that the proposed amendment merely aligned the date of default with the factual foundation already set out in the pleadings and did not...

NCLT Chandigarh Orders Eviction Of Related Parties From Venus Garments Assets, Backs Liquidator Under IBC

On 11 June, the Chandigarh Bench of the National Company Law Tribunal (NCLT), held that the Liquidator under the Insolvency and Bankruptcy Code, 2016 (IBC) has overriding authority to recover possession of liquidation estate assets, and that rent control proceedings cannot obstruct such statutory duties.Judicial Member Khetrabasi Biswal and Technical Member Shishir Agarwal directed Duke Fashions (India) Ltd. and UV & W Products Pvt. Ltd. to vacate and hand over possession of prime...

NCLT Delhi Approves ₹1.89 Crore Repayment Plan For Woolways India Personal Guarantor

The National Company Law Tribunal (NCLT) at Delhi has approved a repayment plan worth ₹1.89 crore proposed by Babita Nayar, personal guarantor to Woolways India Limited. The plan envisages repayment to creditors within five months through the sale of immovable properties and financial assistance from friends and relatives. A bench of Judicial Member Bachu Venkat Balaram Das and Technical Member Ravindra Chaturvedi also clarified, in a connected matter, that an earlier direction requiring the...

NCLT Delhi Dissolves Company Despite ₹100.20 Crore GST Demand, Preserves Proceedings Against Directors

The National Company Law Tribunal (NCLT) at Delhi has recently ordered the dissolution of Neemsar Vyapaar Private Limited after finding no impediment to doing so, even though a GST demand of ₹100. 20 crore had been raised against the company during the liquidation process. A bench of Judicial Member Bachu Venkat Balaram Das and Technical Member Ravindra Chaturvedi observed that there was no impediment to dissolution, clarifying that proceedings could continue against persons concerned with the...

NCLT Ahmedabad Rejects CIRP Plea Against Sisa Mosaic, Says Petition May Be Collusive And MOU Appears Fictitious

The Ahmedabad bench of the National Company Law Tribunal (NCLT) has rejected an insolvency application, holding that the petition may be collusive. The tribunal also observed that the Memorandum of Understanding (MOU) relied upon by the applicant appeared to be a fictitious document created for filing the case. The application was filed by Gayatri Engimech Pvt. Ltd. against Sisa Mosaic Pvt. Ltd. seeking initiation of the corporate insolvency resolution process over an alleged default of ₹3.58...

NCLT Delhi Approves ₹135.39 Crore Resolution Plan For Mastana Foods

The Delhi bench of the National Company Law Tribunal (NCLT) has approved a resolution plan worth ₹135.39 crore submitted by a consortium of HR Commercials Pvt. Ltd. and Crown Steels for Mastana Foods Pvt. Ltd. A bench of President Anupinder Singh Grewal and Technical Member Ravindra Chaturvedi observed that the adjudicating authority cannot interfere with the commercial wisdom of the Committee of Creditors (CoC) so long as the resolution plan complies with the Insolvency and Bankruptcy Code. ...

NCLT Allahabad Orders Liquidation Of Usha India Ltd, Rejects ₹22.49 Crore Resolution Plan

The Allahabad Bench of the National Company Law Tribunal (NCLT) has rejected the resolution plan submitted by the consortium of Dr Mukesh Kumar Agarwal and Divyansh Agarwal for Usha India Limited. The tribunal also ordered liquidation of the company. The bench of Judicial Member Praveen Gupta and Technical Member Ashish Verma held that it was unable to record satisfaction that the approved resolution plan complied with the mandatory requirements of the Insolvency and Bankruptcy Code. ...

Creditors Cannot Bypass COVID-Era Insolvency Bar Through Arbitral Award Or Fresh Demand: NCLT Mumbai

The National Company Law Tribunal (NCLT) at Mumbai has recently held that creditors cannot circumvent the insolvency bar imposed during the COVID-19 period by relying on a subsequent arbitral award or a fresh demand arising from the same default. The tribunal observed that accepting such an interpretation would defeat the purpose of the statutory protection. A bench of Judicial Member K.R. Saji Kumar and Technical Member Anil Raj Chellan dismissed an insolvency petition filed by NKGSB...

ARC Must Establish Guarantee Was Assigned Before Proceeding Against Personal Guarantor: NCLT Mumbai

An Asset Reconstruction Company cannot proceed against an alleged guarantor merely by establishing the existence of a guarantee and must also show that the guarantee was assigned to it, the National Company Law Tribunal (NCLT), Mumbai, has held. A bench of Judicial Member Sushil Mahadeorao Kochey and Technical Member Prabhat Kumar rendered the ruling while dismissing an insolvency petition filed by Omkara Assets Reconstruction Pvt Ltd against Agnello Louis D'Souza. The bench held, “In our...