[IBC] Limitation Period For CIRP Application Is Three Years From The Date Of Default: SC [Read Judgment]

The Supreme Court has reiterated that the limitation period for application under Section 7 of the Insolvency and Bankruptcy Code is three years as provided by Article 137 of the Limitation Act, which commences from the date of default and is extendable only by application of Section 5 of Limitation Act if any case for condonation of delay is made out. The issue considered by the...

IBC (Amendment) Ordinance, 2020: A Pandemic Of Bad Drafting

Much awaited amendment has been made in IBC by an Ordinance promulgated on 5th June, 2020. It is not happily worded, and within a short span of time we have seen many conflicting interpretations. Two Sections, viz. 10A and 66(3) have been incorporated in the Insolvency and Bankruptcy Code, 2016. The arrangement of expressions in the newly-inserted Section 10A is very poor, creating the unwanted confusion, compelling me to name it "A Pandemic of Bad Drafting". The main part of Section...

NCLT (Judicial) Member Challenges His Transfer In Delhi High Court

A member (judicial) of National Company Law Tribunal (NCLT) has moved the Delhi High Court against the order transferring him from the Mumbai Bench to the Kolkata Bench of NCLT. The challenge is with respect to two transfer orders, dated April 30 and May 12, through which a number of members posted in various cities were transferred to different cities. This includes the transfer of the...

A Personal Guarantor's Pandemic: IBC Suspension And Its Repercussions

On 25 March 2020, in light of the COVID-19 pandemic currently plaguing the world, the Central Government, through the Ministry of Home Affairs, had to take the harsh step of imposing a nationwide lockdown, which has been supplemented by periodic extensions. As a result of the unprecedented impact of this measure on businesses, and to aid the plunging economic scenario in the country, a series of economic reforms have been sought to be implemented under the aegis of the finance minister...

NCLT Bengaluru To Conduct "E-Filing Training Programme" Today For Advocates & Other Stakeholders [Read Notification]

In an appreciable move, the Bengaluru Bench of the National Company Law Tribunal has decided to conduct an online training programme to make Advocates and other stake holders in the Tribunal familiar with its e-filing software. As the e-filing system is running successfully in some of the NCLT's benches, the principal Bench of NCLT at Delhi has decided to extend this benefit to all...

Impact of Covid-19 Outbreak On The Resolution Plans Submitted By The Successful Bidders

Nationwide lockdown announced by several governments including the Indian Government has adversely affected the business resulting in an extensive market interruptions and relapse of consumption. Lately, the Fitch Ratings has condensed India's GDP growth forecast from 5.1% to 2%, making it the dimmest growth rate over the past 30 years. Subsequently, businesses are facing Spartan monetary distress. Although at present it is very difficult to anticipate the full impact on the economy, it is...

NCLAT Sets aside NCLT Order To Add MCA As Party In All IBC Cases And Company Petitions [Read Order]

The National Company Law Appellate Tribunal (NCLAT) set aside an order of National Company Law Tribunal (NCLT) which mandated the impleadment of the Union Ministry of Corporate Affairs (MCA) as a party in all Insolvency and Bankruptcy Code (IBC) matters and Company petitions. NCLAT was of the view that the order was tantamount to the imposition of a new rule, which was beyond the...

Filing Of Default Record Necessary For News Sec 7 IBC Filings : NCLT

The National Company Law Tribunal has directed filing of default record from Information utility along with new petitions under Section 7 of the Insolvency and Bankruptcy Code, 2016.The order issued in this regard said :"All concerned are directed to file default record from Information Utility alongwith the new petition being filed under Section 7 of Insolvency & Bankruptcy Code,...

IBC Amendment,2020: Constitutional Vires Of The Minimum Threshold On The Allottees

The Legislature of India enacted the Insolvency and Bankruptcy Code, 2016 ("the Code") for the speedy revival of companies and consolidation of laws relating to liquidation. The Code provided Financial Creditors and Operation Creditors a right to initiate the Corporate Insolvency Resolution Process ("the CIRP") against a Corporate Debtor, before the National Company Law Tribunal ("the Tribunal"). The evolution of the allottee(s) of a real estate project as Financial Creditors under the ...

IBC: Retrospective Application of Revised Threshold- An Alternate Perspective

INTRODUCTION 1.1In an apparent bid to avoid large-scale insolvencies, especially against the MSMEs, as a result of the financial stress caused by Covid-19 pandemic, the Central Government had, vide notification bearing no. SO 1205(E) dated March 24, 2020 ("Notification"), increased the threshold of the minimum amount of default for the purpose of maintainability of an application for initiation of corporate insolvency resolution process ("CIRP") under Insolvency and Bankruptcy...

NCLAT Directs NBCC To Implement Resolution Plan Pending Appeal in Jaypeee Infratech matter

While hearing an urgent petition during the extended lockdown period moved by the NBCC, the National Company Law Appellate Tribunal ('NCLAT') declined to stay the implementation of the modified resolution plan and directed the state - run NBCC to acquire the debt ridden Jaypee Infratech and complete over 20,000 pending flats, but said the direction was subject to its final order.Justice...

Liquidation Value vis a vis Dissenting Financial Creditors: Aftermath Of Maharashtra Seamless And Orchid Pharma

The Insolvency Bankruptcy Code, 2016 ("Code") has gone through a myriad of changes since its inception and introduction. Although it has been held by the Supreme Court in the case of Embassy Property Developments Pvt. Ltd. vs State of Karnataka, that the IBC is a complete Code by itself and in Innoventive Industries Ltd. vs ICICI Bank that the Code is a single Unified Umbrella, covering the entire gamut of law relating to insolvency resolution of corporate persons and others in a time...