Supreme Court Calls For Law To Clarify Validity Of 'Ipso Facto' Contractual Clauses In Relation To Insolvency

The Supreme Court has observed that lack of a legislative voice on the issue of validity/invalidity of ipso facto clauses relating to insolvency will lead to confusion and reduced commercial clarity.The bench comprising Justices DY Chandrachud and MR Shah observed thus while upholding the order of the National Company Law Tribunal which stayed the termination by the Gujarat Urja Vikas...

Time Is A Crucial Facet Of Scheme Under IBC; Resolution Applicant Must Be Fair In Its Dealings: Supreme Court

Time is a crucial facet of the scheme under the IBC, the Supreme Court said while dismissing the appeal filed by a Resolution applicant.In this case, the National Company Law Tribunal [NCLT] allowed the liquidation of the Corporate Debtor to proceed. Upholding this order, the National Company Law Appellate Tribunal [ NCLAT] observed that the applicant had failed to implement the Resolution...

Proceedings Under Section 34 Of Arbitration Act Also Covered By Moratorium Under Section 14 IBC: Supreme Court

The Supreme Court observed that an application under Section 34 of the Arbitration and Conciliation Act to set aside an award is covered by moratorium under Section 14 of the Insolvency and Bankruptcy Code.Section 34 proceeding is a proceeding against the corporate debtor in a court of law pertaining to a challenge to an arbitral award and would be covered just as an appellate proceeding in...

Insolvency Law In Review – January 2021

The enactment of the Insolvency and Bankruptcy Code 2016 (Code) has had significant ramifications on the corporate insolvency landscape. Over time, the Code has witnessed a manifold increase in litigation, and consequently in the number of decisions. This has made it difficult for insolvency practitioners to stay updated with developments in the field. The purpose of this column is to fill this gap by providing brief summaries of latest decisions, from the various fora dealing with...

NCLT Benches To Resume Physical Hearings From March 1

The National Company Law Tribunal (NCLT) has decided to resume physical hearing of cases filed before it from March 1. However, if any party expresses difficulty in physical hearing, he/ she may be permitted to appear via video conferencing. As per an office order issued by the Registrar, "All NCLT Benches shall start regular Physical hearing w.e.f 0l.03.2021. In case any...

Amazon Vs Future: Supreme Court Issues Notice, Allows To Continue Proceedings Before NCLT, Bars Sanction Of Scheme

The Supreme Court on Monday issued notice in the plea by Amazon challenging Delhi High Court's stay on the implementation of its own order passed by the Single Judge bench of Justice Midha, which had directed status quo order on the Future - Reliance retail stake sale deal of nearly Rs. 25000 crore. The Supreme Court allowed the National Company Law Tribunal(NCLT) proceedings related to...

Supreme Court Expunges Adverse Remarks Of NCLAT 5 Member Bench Against 3-Member Bench

The Supreme Court on Friday expunged the adverse remarks made by a 5-member bench of the National Company Law Appellate Tribunal(NCLAT) against a 3-member bench of the NCLAT comprising Justices (Retd) Jarat Kumar Jain, Bavinder Singh and Vijai Pratap Singh.A Supreme Court bench comprising Justices RF Nariman and BR Gavai passed the order on a petition filed by the three serving NCLAT...

Centre Can't Use Power To Notify IBC Sections Only As Regards Personal Guarantors, Salve Argues For Anil Ambani In SC

The Supreme Court on Thursday heard the arguments of Senior Advocate Harish Salve on behalf of Reliance Communications head Anil Ambani on a plea challenging the Central Government notification extending provisions of the insolvency law to personal guarantors."You cannot specify the subject matter as regards which the section comes into force, you can only specify the section" , Salve...

NCLAT Refuses To Entertain Devas Shareholder's Appeal Against NCLT Order Appointing Provisional Liquidator On Antrix's Plea

The National Company Law Appellate Tribunal(NCLAT), Chennai Bench, has refused to entertain an appeal filed by Devas Mauritius Employees Private Ltd - a shareholder of Devas Multimedia Private Ltd - challenging the order passed by the National Company Law Tribunal (NCLT), Bengaluru bench, which appointed a Provisional Liquidator for Devas while admitting a winding up petition filed by...

Delhi High Court Stays Attachment Of Deccan Chronicles' Properties In ED Proceedings, On Plea By Union Bank Of India

A bench of Justice Prathiba Singh in the Delhi High Court has stayed proceedings arising out of the attachment of properties of Deccan Chronicles Holding Ltd by the Enforcement Directorate (ED), on a plea by Union Bank of India (UBI) stating that corporate insolvency resolution process (CIRP) was already initiated against Deccan Chronicles and that the attachment by ED has been done after...

Creditor Will Not Become 'Financial Creditor' Under IBC If A Corporate Debtor Has Only Given Security By Pledging Shares, Without Undertaking To Discharge Borrower's Liability: Supreme Court

The Supreme Court has held that if a corporate debtor has only offered security by pledging shares, without undertaking to discharge the borrower's liability, then the creditor in such a case will not become 'financial creditor' as defined under the Insolvency and Bankruptcy Code(IBC).The Court held that such a creditor could be a secured creditor but will not be a financial creditor under...

Can Defaulting Promoter, Disqualified From Submitting Resolution Plan, Propose Scheme For Compromise? Supreme Court To Examine

'Whether the Promoter is eligible to file an application for Compromise and Arrangement under section 230 of the Companies Act, while he is ineligible under Section 29A of the I&B Code to submit a 'Resolution Plan'?, the Supreme Court on Wednesday agreed to examine.Section 230 of the Companies Act, 2013 provides for a scheme of compromise or arrangement (including a reorganisation of...