IBC | Defunct Scheme Of Arrangement Under Companies Act Cannot Stall Corporate Insolvency Resolution Process : Supreme Court

The Supreme Court on Tuesday (February 24) held that a defunct Scheme of Arrangement under the Companies Act cannot stall the Corporate Insolvency Resolution Process proceedings under the Insolvency & Bankruptcy Code, 2016. A bench of Justices Sanjay Kumar and K Vinod Chandran set aside the NCLAT's decision, which had kept in abeyance the CIRP initiated under Section 7 of IBC against...

S.7 IBC | Corporate Debtor's Ability To Pay Debt Not To Be Considered Before Admitting Insolvency Petition : Supreme Court

If debt and default are established, then Section 7 application must be admitted.

Bank's Internal Classification Of Debt As NPA Won't Determine Limitation Under IBC: Supreme Court

The Supreme Court on Thursday clarified that a bank's internal classification of a loan as a non-performing asset for accounting or provisioning purposes does not by itself determine the commencement of limitation under the Insolvency and Bankruptcy Code, especially where the debt has subsequently been restructured and acknowledged through fresh agreements.The Court observed that the manner...

Telecom Spectrum Community Resource, IBC Can't Determine Its Ownership & Control : Supreme Court

The Supreme Court today held that the ownership and control of telecom spectrum cannot be determined by the Insolvency and Bankruptcy Code (IBC), since it is a common good. A bench of Justice PS Narasimha and Justice Atul Chandurkar held that the spectrum is a material resource of the community in the Constitutional sense. Hence, the spectrum must benefit the common good, so its control...

IBC | Single Insolvency Petition Maintainable Against Corporate Entities Which Are Intricately Linked : Supreme Court

No need to file a separate insolvency application against multiple corporate entities if they are intrinsically linked in the development of the project, the Court said.

S. 60(5)(c) IBC | NCLT Cannot Decide Trademark Ownership Dispute Which Isn't Related To Insolvency Proceedings: Supreme Court

The Supreme Court has held that the National Company Law Tribunal (NCLT), while exercising jurisdiction under Section 60(5) of the Insolvency and Bankruptcy Code (IBC), cannot adjudicate disputed questions of title to intellectual property if such determination goes beyond the scope of the approved resolution plan.The Court held that NCLT cannot decide title disputes over assets,...

Is An Insolvency Professional A 'Public Servant' Under The Prevention Of Corruption Act, 1988?

India's Insolvency and Bankruptcy Code, 2016 (IBC), relies on Insolvency Professionals (IPs) or Resolution Professionals (RPs) as neutral persons for distressed entities and creditors to maximise the output value of stressed assets. IPs' discretion over billions in assets is fuelled with multiple corruption allegations. Hence, to invoke the stringent Prevention of Corruption Act, 1988 (PC...

Residents Welfare Association Or Homebuyers' Society Can't Intervene In Insolvency Petition Against Builder : Supreme Court

The Supreme Court on Thursday (January 15) held that Resident Welfare Associations (RWAs) representing homebuyers cannot intervene in the Corporate Insolvency Resolution Process unless the RWA itself has disbursed funds or is directly a party to the financial transaction, as only then can it claim the status of a financial creditor. “A society or Resident Welfare Association, not being...

'To Safeguard Homebuyers' Interests' : Supreme Court Issues Directions For CoC In Insolvency Cases Against Builders

The Supreme Court on Thursday (January 15) issued a set of directions regarding the functioning of the Committee of Creditors (CoC) under the Insolvency & Bankruptcy Code, noting that while the commercial wisdom of the CoC is paramount, such power must be exercised with responsibility, transparency and proper application of mind, particularly in real estate insolvencies where...

Supreme Court To Examine If NCLT President Has Power To Transfer Cases Across States

The Supreme Court is set to examine the scope of National Company Law Tribunal President's power to transfer a case across states by way of an administrative order.A bench of CJI Surya Kant and Justice Joymalya Bagchi recently issued notice on a plea challenging the Gujarat High Court order which held that the NCLT President has no authority to transfer cases from one State to another...

S.126 Indian Contract Act | Promoter's Undertaking To Infuse Funds Won't Amount To 'Guarantee' : Supreme Court

To be construed as a guarantee, there must be a clear and direct obligation to discharge the debts of the original debtor.

Suspended Director Who Is A Prospective Resolution Applicant Not Entitled To Valuation Reports : NCLT Mumbai

The National Company Law Tribunal (NCLT) at Mumbai has dismissed a challenge by a suspended director seeking disclosure of valuation reports and other Corporate Insolvency Resolution Process (CIRP) documents. The court held that valuation reports are confidential and cannot be shared with persons who are themselves potential or competing resolution applicants. “Valuation reports...