Supreme Court Dismisses Byju Raveendran's Appeal Against NCLAT Order Mandating CoC Nod For BCCI's Plea To Withdraw CIRP

The Supreme Court on Friday dismissed an appeal filed by Byju Raveendran, suspended director and promoter of Think and Learn Private Ltd (which ran the Ed-Tech firm Byju's), challenging an order of the National Company Law Appellate Tribunal which held that the approval of the Committee of Creditors is necessary for the application filed by the BCCI to withdraw the insolvency proceedings...

Investment On Profit-Sharing Basis Does Not Qualify As Financial Debt : NCLT Delhi Reaffirms

The National Company Law Tribunal at New Delhi has recently reaffirmed that an investment made on a profit-sharing basis does not constitute a financial debt under Section 5(8) of the Insolvency and Bankruptcy Code and therefore cannot be used to initiate insolvency proceedings under Section 7. The ruling came in a case where Modern Solar Private Limited sought to treat Rs 20 lakh advanced...

Department of Financial Services Urges PSB Chiefs to Personally Monitor Top Insolvency Cases Amid Delays

Public sector bank chiefs were on Tuesday advised by Department of Financial Services (DFS) Secretary M Nagaraju to personally monitor the top twenty cases pending for admission and the top ten accounts awaiting resolution before the National Company Law Tribunal (NCLT), as part of a wider review of delays in insolvency matters. In a press release, DFS said Nagaraju chaired a meeting with...

No Wilful Disobedience: NCLT Kochi Dismisses Bhagyodayam Company's Contempt Plea Against Ex-MD

The National Company Law Tribunal at Kochi has recently reiterated that simply failing to hand over company records to the tribunal appointed administrator, even after a specific direction from the tribunal, is not enough to initiate contempt unless there is clear proof that the person intended to defy the order. A coram of Judicial Member Vinay Goel and Technical Member Madhu Sinha dismissed...

SARFAESI Notice Counts As Valid Invocation Of Personal Guarantee: NCLT Mumbai

The National Company Law Tribunal at Mumbai has recently held that a notice issued under Section 13(2) of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act (SARFAESI), 2002, which empowers a secured creditor to demand repayment of dues within sixty days prior to enforcing its security, can operate as a valid invocation of a personal guarantee...

Securities Premium Account Cannot Offset Accumulated Losses: NCLT Bengaluru

The National Company Law Tribunal at Bengaluru has recently clarified that while a company may reduce its paid-up share capital to write off accumulated losses under Section 66 of the Companies Act, the securities premium account cannot be used for such write-off, as this is expressly prohibited under Section 52 of the Act. A coram of Judicial Member Sunil Kumar Aggarwal and Technical...

Delhi High Court Slaps ₹1 Lakh Cost On Litigant For Misusing Writ Jurisdiction To Stall DRT, NCLT Proceedings

The Delhi High Court recently imposed costs of Rs 1 lakh on a litigant while dismissing his writ petition that sought to halt proceedings pending before two Debts Recovery Tribunals and the National Company Law Tribunal. The Court held that the petitioner, Sanjeev Krishan Sharma, had failed to show any violation of fundamental rights, statutory mandate or natural justice that could...

Loss of ITC Due To Corporate Debtor's Default In GST Filing Is Not Operational Debt: NCLT Mumbai

The National Company Law Tribunal at Mumbai has recently held that operational creditors cannot claim GST-related dues arising from a corporate debtor's failure to file returns once the GST department has already lodged its own claim in liquidation. A coram of Judicial Member Mohan Prasad Tiwari and Technical Member Charanjeet Singh Gulati rejected the appeal filed by Instakart Services...

Tribunal's Power To Probe Company's Fraud Cannot Be Misused For Debt Recovery: NCLT Ahmedabad

The National Company Law Tribunal at Ahmedabad has recently held that Section 213 of the Companies Act, which empowers the tribunal to order an investigation into a company's affairs, cannot be invoked for recovery of unpaid dues. A Bench of Judicial Member Shammi Khan and Technical Member Sanjeev Sharma, while dismissing a creditor's plea seeking an investigation into United Petrofer...

Operational Creditor Cannot Become Financial Creditor Through Settlement: NCLT Mumbai

The National Company Law Tribunal (NCLT) at Mumbai has recently reaffirmed that an operational creditor cannot be converted into a financial creditor by way of a settlement with the corporate debtor. At the outset, the tribunal noted that Capacite Infraprojects Ltd was engaged only as a contractor for construction of 16 SRA buildings, and that the flats were never part of a real...

Pre-CIRP Tax Claims Extinguished After Plan Approval, Bombay High Court Quashes Tax Notices To V Hotels

The Bombay High Court has recently reaffirmed that income-tax assessment proceedings for any period prior to the approval of a resolution plan under the Insolvency and Bankruptcy Code (IBC) stand extinguished once the National Company Law Tribunal (NCLT) approves the plan, ruling that the tax department cannot initiate or continue such proceedings thereafter.A Division Bench of Justice B...

Pending Appeal Against CoC Formation Not Grounds To Oppose Appointment Of New Resolution Professional: NCLAT

The National Company Law Appellate Tribunal (NCLAT) at Delhi has recently held that an ongoing appeal questioning the validity or constitution of a Committee of Creditors (CoC) does not prevent the CoC, once constituted and functioning, from replacing the resolution professional (RP) with the approval of the NCLT.A bench of Chaiperson Justice Ashok Bhushan and Technical Member Barun Mitra...