NCLT/NCLAT Under IBC Lacks Jurisdiction To Set Aside Auction Sale Conducted Prior To Initiation Of CIRP: NCLAT

The National Company Law Appellate Tribunal (NCLAT) New Delhi bench of Justice Ashok Bhushan, Mr. Barun Mitra (Technical Member) and Mr. Arun Baroka (Technical Member) has held that an auction sale conducted before the commencement of the CIRP cannot be set aside by the NCLT while exercising its jurisdiction under the Insolvency and Bankruptcy Code, 2016 (IBC). Such an auction is not hit...

Electricity Can't Be Disconnected At Corporate Debtor's Plant When Assets Are Put On Auction To Maximise Value: NCLT Kolkata

The National Company Law Tribunal (NCLT), Kolkata Bench of Rekha Kantilal Shah (Technical Member) and Labh Singh (Judicial Member) has held that electricity cannot be disconnected at the Corporate Debtor's plant while machinery and other assets are being auctioned. Electricity is essential to maximise asset value and ensure safety of the assets. The present application has...

Impleadment Of GST Authorities Not Permissible In Proceedings U/S 9 Of IBC Merely Due To Allegations Of Bogus Invoices: NCLT Allahabad

The National Company Law Tribunal (NCLT), Allahabad Bench of Shri Praveen Gupta, (Hon'ble Member Judicial) and Shri Ashish Verma (Hon'ble Member Technical) has held that impleadment of the GST Authorities in proceedings under Section 9 of the Insolvency and Bankruptcy Code, 2016 (IBC), is not permissible merely on the ground that the invoices on which the petition is based have...

Power Of NCLT To Restore Name Of Struck Off Company U/S 252 Of Companies Act Can't Be Exercised Suo Motu: NCLT New Delhi

The National Company Law Tribunal (NCLT), New Delhi Bench of Shri Manni Sankariah Shanmuga Sundaram (Hon'ble Member Judicial) and Shri Atul Chaturvedi (Hon'ble Member Technical) has held that the power to restore a name of the struck company under section 252 of the Companies Act, 2013 cannot be exercised suo moto. A company's name can be restored only on an application filed by...

IBC Moratorium Doesn't Bar Voluntary Surrender Of Corporate Debtor's Leased Property To Lessor: Supreme Court

The Supreme Court on Tuesday (August 5) held that the moratorium under the Insolvency and Bankruptcy Code, 2016 (IBC), does not bar the voluntary handover of property leased by the corporate debtor to the lessors if retaining the asset is deemed unviable and the Committee of Creditors (“CoC”) endorses the decision. A bench comprising Justices Sanjay Kumar and S.C. Sharma set aside...

Set-Off Of Transactions Executed Prior To Commencement Of CIRP Based On Arbitral Award Is Permissible During CIRP: NCLT New Delhi

The National Company Law Tribunal (NCLT), New Delhi Bench of Shri Bachu Venkat Balaram Das (Hon'ble Member Judicial) and Shri Atul Chaturvedi (Hon'ble Member Technical) has held that a set off of transactions based on arbitral award entered into prior to the commencement of the Corporate Insolvency Resolution Process (CIRP) is permissible even during the currency of the CIRP, and...

Fixed Deposit Receipts Form Part Of Corporate Debtor's Financial Assets, RP Can Seek Their Defreezing & Take Custody: NCLT New Delhi

The National Company Law Tribunal (NCLT), New Delhi Bench of Shri Manni Sankariah Shanmuga Sundaram (Hon'ble Member Judicial) and Shri Atul Chaturvedi (Hon'ble Member Technical) has held that Fixed Deposit Receipts (FDRs) form part of the Corporate Debtor's financial assets; therefore, the Resolution Professional can approach the concerned bank to seek their defreezing and...

Resolution Professional Can't Cherry-Pick Entries From Financial Records Of Corporate Debtor While Verifying Claims Of Creditors: NCLT New Delhi

The National Company Law Tribunal (NCLT), New Delhi Bench of Shri Manni Sankariah Shanmuga Sundaram (Hon'ble Member Judicial) and Shri Atul Chaturvedi (Hon'ble Member Technical) has held that the Resolution Professional is obligated to verify the claims of creditors after considering all entries in the financial records of the corporate debtor. The RP cannot cherry-pick entries and...

90-Day Timeline Under Regulation 2B Of IBBI Regulations For Schemes Of Compromise/Arrangement Is Directory, Not Mandatory: NCLAT, Chennai

The National Company Law Appellate Tribunal (NCLAT) Chennai bench comprising Justice Sharad Kumar Sharma (Judicial Member) and Jatindranath Swain (Technical Member) have held that the 90-day timeline prescribed under Regulation 2B(1) of the IBBI (Liquidation Process) Regulations, 2016 for completing a scheme of compromise or arrangement under Section 230 of the Companies Act, 2013...

DM Can Re-Execute Possession Orders U/S 14 Of SARFAESI Act After Illegal Re-Entry By Borrower: MP High Court

A division bench of Madhya Pradesh High Court, comprising Justice Anand Pathak and Justice Hirdesh, has allowed an appeal and upheld that a district magistrate can re-execute possession orders u/s 14 of the SARFAESI Act after illegal re-entry by the borrower. The Court directed the respondent authorities to provide necessary assistance to the petitioner to dispossess the borrower...

Corporate Debtor May Be Permitted To Complete Project Under IRP's Supervision If A Structured Plan Is Proposed: NCLT Indore

The National Company Law Tribunal (NCLT), Indore Bench of Sh. Shammi Khan (Judicial Member) and Sh. Sanjeev Sharma (Technical Member) has held that while admitting a petition under Section 7 of the IBC filed by homebuyers based on the default committed by the corporate debtor, the corporate debtor can be directed to complete the project under the reverse Corporate...

Interest Claims Under MSMED Act Can't Be Added To Principal Amount: NCLT Mumbai

The National Company Law Tribunal (NCLT), Mumbai Bench of Justice V. G. Bisht (Retd.) (Judicial Member) and Sh. Prabhat Kumar (Technical Member) has held that since the NCLT under the IBC is not competent to adjudicate interest claims under the MSMED Act, such interest claims cannot be added to the principal amount to meet the threshold limit for filing an insolvency petition. The...