Not Adding Interest To The Principal To Arrive At Threshold Of Rs.1 Crore ; A Critique On CBRE V. United Concepts Decision

In CBRE V. South Asia Private Ltd v. M/s. United Concepts and Solutions Private Limited ("CBRE"), the Principal Bench of the National Company Law Tribunal ("NCLT") recently took a view that "the Interest amount cannot be clubbed with the Principal amount of debt to arrive at the minimum threshold of Rs.1 Crore for complying with the provision of Section 4 of IBC, 2016." In the said case, the operational creditor, CBRE had initiated Corporate Insolvency Resolution Proceedings ("CIRP") under...

NCLT Chennai Admits Application Initiating CIRP Against Coastal Energen Pvt. Ltd.

The NCLT, Chennai Bench comprising of R. Sucharitha (Judicial Member) and Sameer Kakar (Technical Member) in State Bank of India v. Coastal Energen Private Limited, admitted the application of State Bank of India/ Financial Creditor for initiation of CIRP against Coastal Energen Pvt. Ltd./ Corporate Debtor filed u/s 7 of the Insolvency and Bankruptcy Code, 2016. The Applicant in...

Confusion Regarding The Jurisdiction Of NCLT Qua Personal Guarantor's Insolvency

The National Company Law Tribunals (NCLT) gained huge prominence after the enactment of the Insolvency and Bankruptcy Code, 2016 (Code/IBC), and became an epicenter ajudications of commercial laws across the country. As per Section 63 of the Code, it is the only judicial forum that has the jurisdiction to deal with the insolvency resolution process of a company and even the High Courts were cautioned by the Supreme Court in the case of Ghanashyam Mishra& Sons (P) Ltd. v. Edelweiss...

Section 9 IBC- Limitation Does Not Commence When The Debt Becomes Due But Only When A Default Occurs: Supreme Court

The Supreme Court has held that limitation does not commence when the debt becomes due but only when a default occurs.The bench comprising Justices DY Chandrachud, Surya Kant and Vikram Nath that the debt is defined in Insolvency and Bankruptcy Code as the non-payment of the debt by the corporate debtor when it has become due. In this case, the appellant placed orders with the...

Insolvency Application Must Meet Threshold As Per Amended S.4 IBC, Though Notice U/S 8 Was Issued Pre-Amendment : Kerala High Court

The High Court of Kerala in a Bench comprising of Justice T.R. Ravi in the case of M/s Tharakan Web Innovations Pvt. Ltd. v.National Company Law Tribunal & Ors. held that the litmus test is whether the default exists as defined in amended Section 4 of the Insolvency and Bankruptcy Code w.e.f. 24.3.2020, increasing the default amount from Rs. 1 Lakh to Rs. 1 Crore, on the date...

Imposition Of Moratorium Under IBC Does Not Bar Complaints Against Natural Persons: Madras High Court

The Madras High Court in a Bench comprising of Justice N. Sathish Kumar in M/s. Nag Leather Pvt. Ltd. v. M/s. Muzain Hides held that as long as a moratorium under Section 14 of the Insolvency and Bankruptcy Code is imposed, proceedings under Section 138/141 of the Negotiable Instruments Act cannot be initiated against the Corporate Debtor. These proceedings, however, can be...

Principle Of Stare Decisis Applies To NCLT As Well As NCLAT. NCLAT

The NCLAT in a Bench comprising of Justice Ashok Bhushan, Justice Jarat Kumar Jain and Dr. Alok Srivastava in the case of Rajeev R. Jain, Director (Suspended) v. AASAN Corporate Solutions Pvt. Ltd. held that the principle of stare decisis is applicable both to NCLT as well as NCLAT. Factual Background- The Appellant challenged the order of the NCLT, Mumbai Bench which admitted...

NCLT Mumbai Dismisses Application U/S 9, IBC On The Ground Of Existence Of A Principal-Agent Relationship Between The Parties

The NCLT Mumbai Bench comprising of Justice H.V. Subba Rao (Judicial Member) and Mr. Chandra Bhan Singh (Technical Member) in THG Publishing Pvt. Ltd. v. Deadline Advertising Pvt. Ltd. dismissed the application filed u/s 9 of the Code to initiate CIRP, which was filed by the Operational Creditor, THG Publishing Pvt. Ltd. on the ground that the debt due to it did not qualify as an...

Upon 'Supersession' Of Directors Under RBI Act, They Are Not Entitled To Notice Of CoC Meeting: NCLAT

The NCLAT in a Bench comprising of Justice M. Venugopal (Judicial Member), Mr. V.P. Singh and Dr. Ashok Kumar Mishra (Technical Members) in Dheeraj Wadhawan v. The Administrator, Dewan Housing Finance Corporation Ltd. held that there exists a difference between 'supersession of Directors' under the RBI Act and 'suspension of Directors' under the IBC and that a 'Superseded director'...

No Scope For Negotiation Once The CoC Has Approved The Resolution Plan: NCLAT In DHFL Case

The NCLAT in a Bench comprising of Justice M. Venugopal (Judicial Member), V.P. Singh (Technical Member) and Dr. Ashok Kumar Mishra (Technical Member) in the case of Union Bank of India on behalf of the Committee of Creditors of Dewan Housing Finance Corporation Limited. VS Mr. Kapil Wadhawan & Ors. set aside the order passed by the Adjudicating Authority which directed...

Initiation Of CIRP Not A Pre-Requisite To Initiate IRP Against The Personal Guarantor: NCLAT

The NCLAT in a Bench comprising of Justice Ashok Bhushan (Judicial Member) and Dr. Alok Srivastava (Technical Member) in State Bank of India v. Mahendra Kumar Jajodia held that initiation of Corporate Insolvency Resolution Process is not a pre-requisite to initiate Insolvency Resolution Process (IRP) against the Personal Guarantor of the Corporate Debtor. The Appellant, State...

Scrutiny By Income Tax Department Barred For The Period Covered By The Resolution Plan: Telangana High Court

The High Court of Telangana in a Bench consisting of Justice Ujjal Bhuyan and Justice Chillakur Sumalatha in Sirpur Paper Mills Limited & Another. V. Union of India & Two Others held that for the period covered by the Resolution Plan, Income Tax Department cannot carry out any scrutiny or assessment in respect of the Corporate Debtor regarding carry forward of losses and set...