[S.66 IBC] NCLAT Upholds NCLT's Order Directing Corporate Debtor To Restore ₹3.18 Crore Generated From Fraudulent Transactions

The National Company Law Appellate Tribunal (NCLAT) New Delhi bench of Justice Rakesh Kumar Jain (Judicial Member), Mr. Naresh Salecha (Technical Member) and Mr. Indevar Pandey (Technical Member) has held that once transactions are declared fraudulent under section 66 of the Insolvency and Bankruptcy Code, 2016 (IBC), the Adjudicating Authority can pass an appropriate order directing...

Conduct Of Litigant Can't Be Considered Bonafide When Fresh Order Is Challenged In Re-Filed Appeal After Curing Defects: NCLAT

The National Company Law Appellate Tribunal (NCLAT) New Delhi bench of Justice Ashok Bhushan (Judicial Member), Mr. Barun Mitra (Technical Member) and Mr. Arun Baroka (Technical Member) has held that the conduct of the litigant cannot be considered bona fide when an appeal, re-filed after rectification of defects, challenges a new order different from the one challenged in the...

Liability Of Corporate Debtor Not Discharged By Release Of Guarantors' Liability If Bank Preserves Right To Proceed Under IBC: NCLAT

The National Company Law Appellate Tribunal (NCLAT) New Delhi bench of Justice Rakesh Kumar Jain (Judicial Member), Mr. Naresh Salecha (Technical Member) and Mr. Indevar Pandey (Technical Member) has held that the liability of the Corporate Debtor is not discharged merely because the guarantors were released from their liabilities by the Bank after One time settlement (OTS) especially...

Govt Cannot Maintain Attachment Of Property To Press For Recovery Outside Liquidation Framework: NCLAT Chennai

The National Company Law Appellate Tribunal, Chennai Bench, comprising Justice Sharad Kumar Sharma (Member – Judicial) and Jatindranath Swain (Member – Technical), has addressed the conflict between a secured creditor's statutory attachment under the Tamil Nadu Revenue Act, 1864, and the liquidation process under the IBC, 2016. The tribunal held that the government's attachment...

Bankrupt Can File Application For Discharge After One Year, If Bankruptcy Trustee Fails To Do So: NCLAT New Delhi

The National Company Law Appellate Tribunal, Delhi held that when the Bankruptcy Trustee does not fulfil its statutory obligation under Section 138(1)(a) of the Insolvency and Bankruptcy Code, 2016, which requires the Trustee to apply for a discharge order after expiry of one year from the bankruptcy commencement date, the Bankrupt who is directly affected by continuance of the...

Application U/S 7 Of IBC Withdrawn After Settlement Agreement Can Be Revived If Settlement Terms Are Breached By Corporate Debtor: NCLAT

The National Company Law Appellate Tribunal (NCLAT) New Delhi bench of Justice Ashok Bhushan (Judicial Member), Mr. Barun Mitra (Technical Member) and Mr. Arun Baroka (Technical Member) has held that the right of the financial creditor to seek revival of the original application filed under Section 7 of the Code cannot be taken away merely because a settlement agreement was reached, if...

Belated Claims Of Homebuyers Can't Be Rejected If Their Units Are Reflected In Corporate Debtor's Records: NCLAT

The National Company Law Appellate Tribunal (NCLAT) New Delhi bench of Justice Ashok Bhushan (Judicial Member) and Mr. Arun Baroka (Technical Member) has held that claims filed by homebuyers cannot be rejected merely for being filed beyond the stipulated time period, if the homebuyer's unit is reflected in the list of homebuyers who had not filed their claims on time. The...

Related Party Status Must Be Determined On When Insolvency Proceedings Commence, Not By Historical Facts: NCLT Ahmedabad

The National Company Law Tribunal, Ahmedabad bench of Mr. Shammi Khan (Judicial Member) and Mr. Sanjeev Kumar Sharma (Technical Member), held that related party status as per the Insolvency & Bankruptcy Code must be determined on the date of commencement of Insolvency Proceedings and not based on historical roles. Background Facts: The Corporate Debtor, Sebacic India Limited,...

Personal Guarantor's Liability Can't Exceed Contractual Limit: NCLT Kochi Dismisses Petitions U/S 95 IBC For Defective Demand Notices

The National Company Law Tribunal (NCLT), Kochi Bench comprising Smt. Madhu Sinha (Technical Member) and Shri. Vinay Goel (Judicial Member) has held that where a guarantee agreement expressly limits the liability of the personal guarantor, any demand notice or invocation of guarantee which seeks to recover an amount exceeding such capped liability is invalid and cannot form the basis...

IBC Not A Recovery Mechanism, Additional Claims Of Interest Beyond Amount In Petition Cannot Justify Admission Of Insolvency Plea: NCLT Mumbai

The National Company Law Tribunal, Mumbai, comprising Justice V.G. Bisht (Retd.) and Prabhat Kumar (Member - Technical), examined if a petition u/s 7 of the IBC could be admitted when the amount claimed in the petition is subsequently offered by the corporate debtor through a demand draft. The bench dismissed the petition and observed that IBC is not a recovery mechanism and...

The Working Of The IBC – Some Thoughts And Reflections : Justice Anand Venkatesh Writes

1. The Insolvency and Bankruptcy Code (IBC), 2016 aims at timely reorganization and resolution of corporates, firms and individuals; to maximize the assets of such debtors for the benefit of all stakeholders. It has been said that introspection is a powerful tool for self-betterment. Aristotle is believed to have said that knowing yourself is the beginning of all wisdom. There is no doubt...

Fresh Application U/S 7 Of IBC Can Be Filed Upon Default Under Restructured Terms: NCLAT

The National Company Law Appellate Tribunal (NCLAT) New Delhi bench of Justice Ashok Bhushan (Judicial Member), Mr. Barun Mitra (Technical Member) and Mr. Arun Baroka (Technical Member) has held that section 10A of the Insolvency and Bankruptcy Code, 2016 (IBC) does not prohibit parties from entering into an arrangement to restructure their debts during or after the section 10A period. If...