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...

Property Alloted In Lieu Of Consultancy Fees Constitutes Financial Debt: NCLT Mumbai

The National Company Law Tribunal, Mumbai Bench, Court-V, comprising Sh. Sushil Mahadeorao Kochey (Member- Judicial) and Sh. Charanjeet Singh Gulati (Member- Technical), has held that a property allotted in lieu of consultancy fees can be considered as a financial debt. The application was filed requesting to issue a direction to the Resolution Professional to admit the claim filed...

Debt Arising From Structured Supply Chain Finance Facility Does Not Constitute 'Financial Debt' U/S 5(8) Of IBC: NCLT New Delhi

The National Company Law Tribunal, New Delhi Bench, Court-IV, comprising Shri Manni Sankariah Shanmuga Sundaram (Member-Judicial) and Shri Atul Chaturvedi (Member-Technical), has held that the debt arising out of a structured supply chain finance facility doesn't come under the ambit of financial debt u/s 5(8) of the IBC, 2016. The application was filed by Prudent Arc Limited to...

Petition U/S 9 Of IBC Is Inadmissible Without Payment Received By Corporate Debtor In Subcontracted Work Done By Operational Creditor: NCLT Hyderabad

The National Company Law Tribunal (NCLT) Hyderabad bench of Sri Rajeev Bhardwaj (Hon'ble Judicial Member) and Sri Sanjay Puri (Hon'ble Member Technical) has held that in absence of any payment received by the Corporate Debtor in a subcontracted work executed by the Operational Creditor, application under section 9 of the IBC cannot be entertained. Filing such an application would be...

Adjudicating Authority Can Pass Order U/S 114 Of IBC Based On Resolution Professional's Report If No Repayment Plan Is Submitted: NCLT New Delhi

The National Company Law Tribunal (NCLT) New Delhi bench of Sh. Ashok Kumar Bhardwaj (Hon'ble Member (Judicial) and Sh. Man Mohan Gupta (Hon'ble Member Technical) has held that a meeting of the Committee of Creditors is not required to be summoned under Regulation 17A of the Personal Guarantors Regulations when no repayment is submitted by the Personal Guarantor. The Adjudicating...

DRT Cannot Reject Consolidated Plea By Tenants Under SARFAESI Act: Kerala High Court

The Kerala High Court has held that the Debts Recovery Tribunal (DRT) cannot reject a consolidated plea by tenants under the SARFAESI Act.The petition was filed, challenging an order passed by the registrar of the DRT 1, Ernakulam. By that order, it declined to register the application preferred by the petitioners against the notice of dispossession served by the Advocate Commissioner....

Writ Petition Is Maintainable Despite Remedy Under IBC, If NCLT Order Is Passed In Violation Of Natural Justice: Kerala High Court

The present writ petition was filed seeking the quashing of an order passed by the NCLT, Kochi Bench. By that impugned order, the adjudicating authority has directed the resolution professional to reject the claim filed by the home buyers, including the petitioner. The corporate debtor, who is the builder and the landowner, entered into an agreement to construct the building named...

Scheme Of Compromise Sanctioned By Court Under Companies Act Cannot Be Frustrated By Invoking Provisions Of SARFAESI Act: Calcutta HC

The Calcutta High Court has ruled that a scheme of arrangement/compromise sanctioned under section 391 of the Companies Act, 1956, cannot be unilaterally frustrated by a secured creditor by invoking the provisions of the SARFAESI Act, 2002. The application was filed, praying for the execution of an order sanctioning a scheme of arrangement/ compromise under section 391(2) of...

IBC | Naming Creditor In Balance Sheet Not Mandatory, Acknowledgment Extends Limitation: Supreme Court Allows IL&FS Plea

Reaffirming that an entry in a company's balance sheet amounts to a valid acknowledgment of debt under Section 18 of the Limitation Act, 1963 irrespective of the name of the creditor, the Supreme Court today (July 30) revived the dismissed insolvency plea filed by IL&FS against Adhunik Meghalaya Steels for a default of ₹55.45 crore, citing an acknowledgment of debt in the corporate...

Inherent Power Under Rule 11 Of NCLAT Rules Cannot Be Invoked To Recall Orders Passed By Fraud Or Without Jurisdiction: NCLAT Chennai

The National Company Law Appellate Tribunal, Chennai, comprising Justice Sharad Kumar Sharma and Jatindranath Swain, dismissed an appeal while upholding that the inherent powers can only be utilized to fill up the vacuums that are prevailing in the given procedural law, but they cannot act as a substitute for the process of law, which could have been exercised by the appellate...

NCLT Ahmedabad Admits Blu Smart Mobility Ltd Into CIRP Over Default Of ₹1.28 Crore

The National Company Law Tribunal (NCLT), Ahmedabad bench, comprising Justice Shammi Khan (Judicial Member) and Mr. Sanjeev Kumar Sharma (Technical Member), has initiated the Corporate Insolvency Resolution Process (CIRP) against Blu-Smart Mobility Ltd. (Corporate Debtor) upon an admitted default of Rs.1,28,02,195. Brief Facts Catalyst Trusteeship Limited (Applicant/ Financial...

Operational Debt Can't Be Converted Into Financial Debt By Execution Of Subsequent Agreement Between Parties: NCLT New Delhi

The National Company Law Tribunal (NCLT) New Delhi bench of Shri Manni Sankariah Shanmuga Sundaram (Judicial Member) and Shri Atul Chaturvedi (Technical Member) has held that an Operational Debt cannot be converted into a Financial by the execution of subsequent agreement between the parties. If this is permitted, it would open the floodgates for potential misuse of the provisions of...