NCLT Cannot Refuse Additional Objections Solely For Want Of Express Provision In IBC: Kerala High Court

The Kerala High Court has held that the National Company Law Tribunal (NCLT) can permit additional objections in insolvency proceedings. It cannot reject such requests on the ground that there is no provision under the Insolvency and Bankruptcy Code or the NCLT Rules to entertain them. Justice Harisankar V. Menon made the observation while allowing a petition filed by BPL Limited. The Court set aside an order of the NCLT, Kochi Bench, which had refused to entertain the company's additional...

Kerala High Court Declines To Stay Lakshya IPO, Cites Alternate Remedy Before SAT

The Kerala High Court on Thursday declined to stay the proposed Initial Public Offering (IPO) of Learnfluence Education Limited, the company operating the Lakshya Indian Institute of Commerce coaching platform. The Court held that the former promoter challenging the issue has an alternative statutory remedy before the Securities Appellate Tribunal (SAT). Justice Harishankar V. Menon passed the order on a writ petition filed by Adheesh Damodaran, a co-founder of Lakshya CA Campus and...

Kerala High Court Quashes GST Notice Issued For Multiple Assessment Years Through Single Proceeding

On 1 June, the Kerala High Court held that the GST Department cannot issue a composite show-cause notice covering more than one assessment year, as such a notice is legally unsustainable and cannot form the basis of adjudication. Justice Ziyad Rahman A.A. quashed the show-cause notice and the consequential Order-in-Original issued against Malabar Trade Links, while granting liberty to the GST Department to initiate fresh proceedings in accordance with law. He held: “The Division Bench has...

Evidence Of Person Without Direct Knowledge Insufficient In Cheque Bounce Case: Kerala High Court

The Kerala High Court has observed that a complainant in a cheque dishonour case cannot rely on evidence from a person who lacks direct knowledge of the transaction and execution of the cheque to prove those facts. “Indubitably such evidence shall be given by the person, who had direct knowledge regarding the transaction and execution of the cheque and the evidence of a person, who does not know the same is insufficient to prove the transaction and the execution of the cheque.” Justice A....

Kerala High Court Dismisses Writ Against NCLT New Delhi Insolvency Proceedings, Cites No Jurisdiction

On 25 May, the Kerala High Court held that it cannot entertain a writ petition challenging insolvency proceedings initiated before the National Company Law Tribunal (NCLT), New Delhi, against a personal guarantor merely because the underlying credit facilities were availed in Kerala, since territorial jurisdiction under the Insolvency and Bankruptcy Code depends on the location of the corporate debtor's registered office. Justice Harisankar V Menon dismissed a writ petition filed by a personal...

Kerala HC Directs CIT To Reconsider Registration Of Trust From 2021, Examines CBDT Circular 7/2024

On 4 June, the Kerala High Court directed the Commissioner of Income Tax (Exemptions) to reconsider a Atma Bodhodaya Sangham Sree Subhananda Trust's claim for registration under Section 12A of the Income Tax Act with effect from 1 April 2021, after examining the applicability of CBDT Circular No. 7/2024 on rectification of defective exemption applications. A Division Bench of Justices Devan Ramachandran and Basant Balaji set aside the orders of the Income Tax Appellate Tribunal (ITAT) and the...

Kerala HC Holds ISD Optional Before 2024 Amendment; Quashes ₹1.31 Cr. GST Demand Against Intertek

On 8 June, the Kerala High Court held that, prior to the Finance Act, 2024 amendment to the Central Goods and Services Tax Act, companies were not required to distribute input tax credit (ITC) among distinct units through the Input Service Distributor (ISD) mechanism. Justice Ziyad Rahman A.A. allowed a writ petition filed by Intertek India Pvt. Ltd. and quashed an order passed under Section 74 of the CGST Act that demanded over Rs.1.31 crore in GST and penalty on allegations of fraud,...

Depositors Can Approach Consumer Fora Despite Co-operative Societies Act Remedies: Kerala High Court

The Kerala High Court on 2 June held that remedies under the Kerala Co-operative Societies Act, 1969 do not bar depositors of co-operative banks from approaching consumer fora under the Consumer Protection Act for redressal of their grievances. A Division Bench comprising Justices Dr. A.K. Jayasankaran Nambiar and Preeta A.K. dismissed an appeal filed by Puthur Service Co-operative Bank against orders of the consumer fora directing repayment of matured fixed deposits. The judges held: “...even...

SARFAESI Sale Certificates Not Liable To Stamp Duty Upon Issuance: Kerala High Court [Full Bench]

The Kerala High Court has recently held that a sale certificate issued pursuant to an auction sale under the SARFAESI Act is not liable to stamp duty merely upon its issuance. The Court also held that a Registering Officer cannot refuse to file a copy of such certificate on the ground that it is unstamped. A Full Bench comprising Justices Sathish Ninan, T.R. Ravi and M.A. Abdul Hakhim answered a reference arising from conflicting Division Bench decisions on the issue. “It has been held that...

Magistrate Cannot Refer Parties To Mediation In SARFAESI Proceedings Under Section 14: Kerala High Court

The Kerala High Court has set aside an order referring a SARFAESI proceeding to mediation, holding that the role performed by a Magistrate in such proceedings is purely ministerial and does not involve any adjudicatory process. Justice P.V. Balakrishnan observed that a Chief Judicial Magistrate or Additional Chief Judicial Magistrate exercising powers under the SARFAESI Act does not perform any quasi-judicial function and has no discretion in the matter. “It cannot be disputed that the power...

Unauthenticated Alteration In Cheque Date Renders It Void: Kerala High Court

The Kerala High Court has recently held that an alteration in the date of a cheque that is not authenticated by the drawer's full signature amounts to a material alteration and renders the cheque void, while upholding an acquittal in a cheque dishonour case. Justice A. Badharudeen held: “When there is alteration of the date in the cheque which is not authenticated by putting the full signature of the drawer on the place of alteration, the same operates as a material alteration and the same...

Mandatory RERA Pre-Deposit Cannot Be Diluted By Replacing Statutory Interest Rate With MCLR: Kerala HC

The Kerala High Court has recently held that a builder could not be permitted to calculate the mandatory pre-deposit for pursuing a RERA appeal on the basis of the Marginal Cost of Funds-based Lending Rate (MCLR) instead of the State Bank of India's Benchmark Prime Lending Rate plus 2% prescribed under Rule 18 of the Kerala Real Estate (Regulation and Development) Rules, 2018. The Court observed that such a course would "render Rule 18 a dead letter." A Division Bench of Justice Raja...