Decoding Section 7 of IB Code for admitting an application for Corporate Insolvency Resolution Process
by Ankit Parhar† and Rashi Srivastava††
Cite as: 2023 SCC OnLine Blog Exp 55
Corporate Debtor
Go Airlines insolvency: NCLAT approves appointment of new Resolution Professional by CoC
NCLAT directed the new Resolution Professional to protect the assets of the Corporate Debtor as required under S. 25(1) of the IBC
Operational creditor cannot seek to initiate CIRP against Corporate Debtor when real dispute exists: NCLAT
The NCLAT set aside Adjudicating Authority’s order initiating CIRP of the Corporate Debtor.
Can Corporate Debtor raise issue of pre-existing dispute if there is no evidence of any lacuna prior to demand notice? NCLAT answers
“The Adjudicating Authority does not appear to have committed any error in holding the alleged disputes claimed by the Corporate Debtor to be feeble as it is not supported by credible evidence.” NCLAT
No benefit to Corporate Debtor, if Criminal Proceedings were initiated after receipt of Demand Notice: NCLAT upholds NCLT’s order
While upholding NCLT’s order the NCLAT held that in the present case there is a debt which remained unpaid by the Operational Creditor.
NCLT admits Go Air insolvency plea
A creditor has limited grounds to object to S. 10 of IBC application.
NCLT imposes exemplary cost of ₹ 5 Lakhs on Trimex Industries (P) Ltd for filing frivolous litigation
NCLT imposed cost to restain Trimex Industries (P) Ltd. from filing frivolous applications which consume Tribunal’s valuable resources and time.
Intent of Corporate Debtor irrelevant in establishing existence of preferential transaction: NCLAT
There is no need to prove any fraudulent intent for a preferential transaction as per S. 43 of the IBC.
What is the rule for settlement after constitution of ‘Committee of Creditors’? NCLAT Answers
“Any settlement after passing of the impugned order and after constitution of the CoC is only permissible when the same is approved with 90% vote share of CoC.”
No embargo on Operational Creditor to file application u/S 9 IBC, even if agreement has an arbitration clause: NCLAT
The scope and objective of the Code is ‘Resolution’, and not a ‘Recovery Mode / Forum’.
To reject application under Sec. 9 IBC, a genuine pre-existing dispute must exist: NCLAT
The National Company Law Appellate Tribunal held that no pre-existing dispute regarding quality of supplied goods exist as the same was not raised before consumption of the goods.
NCLAT cannot condone delay beyond 15 days in appeal due to lack of jurisdiction even if fraud has been played
National Company Law Appellate Tribunal observed that as per S. 61(2) every appeal must be filed within 30 days before the Appellate Tribunal and the Appellate Tribunal has the jurisdiction to extend the period of 15 days if it is satisfied that there is a sufficient cause for not filing the appeal within the prescribed time.
[Reliance Capital (RCap) Resolution] CoC has power to negotiate and call for higher bid; NCLAT allows another round of bidding
The NCLAT held that even after completion of challenge mechanism under CIRP Regulation 39(1A)(b), the CoC retains its jurisdiction to negotiate with one or other Resolution Applicants, or to annul the Resolution Process and embark on to re-issue RFRP.
NCLAT upholds NCLT’s rejection to dislodge resolution plan against POSCO India Processing Center Private Limited
NCLAT observed that allowing present appeal holding the Successful Resolution Applicant ineligible would automatically make the resolution plan redundant.
Do Third-party/shareholders have locus to challenge initiation of CIRP against Corporate Debtor? NCLAT answers
The NCLAT held that there is no law which allows a third party or shareholders to settle the claims of Financial Creditor on behalf of the Corporate Debtor, M/s McDowell Holdings Limited.
Advance paid for purchase of shares of Corporate Debtor does not fall under definition of Financial Debt: NCLT
NCLT held that the amount of advance paid for purchase of shares of the Corporate Debtor does not fall under the definition of Financial Debt as it was not disbursed against the consideration for the time value of money.
Thanos’ Infinite Gauntlet Given an Endgame Treatment – Jurisdiction of the NCLT under Section 60(5) as interpreted by the Apex Court
by Akaant Kumar Mittal†
Cite as: 2023 SCC OnLine Blog Exp 23
Once Resolution Plan approved and submitted to Adjudicating Authority, it cannot be sent back for re-consideration: NCLAT
In matter related to reconsideration of Resolution Plan after approval, NCLAT held that thought the object of the CIRP is maximisation of value of the Corporate Debtor, but the said maximisation must be achieved within the timeline provided in the scheme.