Moratorium Period Under IBC Does Not Bar Payment Of Compensation Under NI Act: J&K High Court Orders ₹4 Crore Interim Compensation

The Jammu and Kashmir High Court held that the declaration of a moratorium would not bar the complainant from filing a complaint under the NI Act. The court said that the debtor cannot take refuge under the Code to frustrate proceedings under the NI Act if he is found liable to pay compensation in the proceedings.Justice Puneet Gupta held that Section 14 of the IBC, which places a moratorium...

Supreme Court Wonders Why NCLAT Wrote Long Order On Delay Condonation Application Despite High Pendency

The Supreme Court recently expressed surprise that the National Company Law Appellate Tribunal (NCLAT), despite having a high pendency of cases, devoted extensive time and effort to writing a 17-page order on a delay condonation application.A bench of Justice Abhay Oka and Justice Ujjal Bhuyan remarked that lengthy submissions and pleadings by members of the Bar often contribute to...

IBC Moratorium Does Not Bar Execution Of Penalties Imposed Under Consumer Protection Act : Supreme Court

In a significant development, the Supreme Court today (March 4) ruled that an interim moratorium under Section 96 of the Insolvency & Bankruptcy Code, 2016 (“IBC”) does not apply to penalty proceedings under Section 27 of the Consumer Protection Act, 1986 (“CP Act”). The Court explained that Section 79(15) of the IBC excludes certain liabilities, such as fines and penalties, from...

NCLT Admits Insolvency Proceedings Against Ansal Properties And Infrastructure U/S 7 Of IBC, Declares Moratorium

The National Company Law Tribunal (NCLT), New Delhi bench of Shri Manni Sankariah Shanmuga Sundaram (Judicial Member) and Dr. Sanjeev Ranjan (Technical Member) has admitted insolvency proceedings under section 7 of the Insolvency and Bankruptcy Code, 2016 (IBC/ Code) against Ansal Properties and Infrastructure Limited. The Tribunal declared moratorium under section 14 of...

[Noida Sports City Scam] Allahabad HC Lays Down Guidelines Regarding Rights Of Other Members Of Consortium When One Member Goes Into Insolvency

While directing CBI inquiry against officials of New Okhla Development Authority and various allottes/ builder involved in development of the Sporty City project in Noida, the Allahabad High Court laid down guidelines regarding the rights of other members of consortium, when one member goes into insolvency as the same is not provided in the Insolvency and Bankruptcy Code, 2016.Holding that...

Banks Can Initiate Proceedings Under SARFAESI Act To Recover Loan If It Wasn't Party To Resolution Plan: Kerala High Court

The Kerala High Court bench of Justice Gopinath P. has held that a bank can initiate proceedings under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (SARFAESI Act) to recover outstanding dues if it was not a party to the resolution plan approved under the Insolvency and Bankruptcy Code, 2016. The Court clarified that the bar...

Serving Demand Notice To Personal Guarantor Under Rule 7 Of Personal Guarantors Rules Cannot Be Considered Invocation Of Guarantee: NCLAT

The National Company Law Appellate Tribunal (NCLAT) New Delhi bench of Justice Ashok Bhushan (Judicial Member), Mr. Barun Mitra (Technical Member) and Mr. Arun Baroka (Technical Member) has held that a Notice served to the personal guarantor under Rule 7 of Insolvency and Bankruptcy (Application to Adjudicating Authority for Insolvency Resolution Process for Personal Guarantors to...

Order Approving Resolution Plan Passed Beyond 330 Days Cannot Be Questioned When Application Seeking Approval Was Filed Within CIRP Period: NCLAT

The National Company Law Appellate Tribunal (NCLAT) New Delhi bench of Justice Ashok Bhushan (Judicial Member) and Mr. Barun Mitra (Technical Member) has held that when an order approving the Resolution Plan is passed by the Adjudicating Authority after expiry of 330 days but the application seeking approval was filed within the stipulated time period, it cannot be said the plan...

Interest Free Maintenance Fee Deposited By Allottees Under Conveyance Deed Cannot Be Considered As Financial Debt U/S 5(8) Of IBC: NCLAT

The National Company Law Appellate Tribunal (NCLAT) New Delhi bench of Justice Ashok Bhushan (Judicial Member), Mr. Barun Mitra (Technical Member) and Mr. Arun Baroka (Technical Member) has held that interest free maintenance fee to be paid by the allottees to the corporate debtor under the Conveyance Deed cannot be considered as financial debt under section 5(8) of the...

NCLT Has No Jurisdiction To Convict Person For Offence U/S 68 Of IBC In View Of Section 236 Of IBC: NCLAT

The National Company Law Appellate Tribunal (NCLAT) New Delhi bench of Justice Yogesh Khanna and Mr. Ajai Das Mehrotra (Technical Member) has held that the National Company Law Tribunal (NCLT) has no jurisdiction to convict a person for an offence under Section 68 under Chapter VII of Part II of the Insolvency and Bankruptcy Code, 2016 (Code) in view of the express provision contained...

When Debt Is Not Unequivocally Admitted By Corporate Debtor, Application U/S 9 Of IBC Must Not Be Entertained: NCLAT

The National Company Law Appellate Tribunal (NCLAT) New Delhi bench of Justice Ashok Bhushan (Judicial Member), Mr. Barun Mitra (Technical Member) and Mr. Arun Baroka (Technical Member) has held that the application under section 9 of the Insolvency and Bankruptcy Code, 2016 (Code) cannot be entertained when the debt is not unequivocally admitted by the Corporate...

Gratuity Dues Of Workers Do Not Form Part Of 'Liquidation Estate' Of Corporate Debtor, Must Be Paid In Full: Calcutta High Court

The Calcutta High Court bench of Justice Shampa Dutt (Paul) has held that gratuity dues are statutorily protected under the Payment of Gratuity Act, 1972, and do not form part of the liquidation estate of the Corporate Debtor under the Insolvency and Bankruptcy Code, 2016 (IBC). The court held that gratuity payments are outside the waterfall mechanism under Section 53 of the IBC and must be...