Related Party Can't Assign Debt To Bypass Disqualification From Participating In CoC: NCLAT

The National Company Law Appellate Tribunal (NCLAT), New Delhi bench comprising Justice Ashok Bhushan (Chairperson), Barun Mitra (Technical Member) and Arun Baroka (Technical Member) has held that a 'related party' cannot assign its debt only with the object of securing a seat in the Committee of Creditors (CoC), to affect the interest and rights of...

Deposit Of Security Under Memorandum Of Understanding Without Intention Of Commercial Effect Of Borrowing Cannot Be Categorised As Financial Debt: NCLAT

The National Company Law Appellate Tribunal (“NCLAT”) New Delhi bench of Justice Rakesh Kumar Jain (Judicial Member), Mr. Naresh Salecha (Technical Member) and Mr. Indevar Pandey (Technical Member) has held that the security amount deposited under a Memorandum of Understanding ('MoU') without any intention of commercial effect of borrowing and time value of money cannot be...

Bankrupt Individual Cannot Seek Discharge U/S 138(1) Of IBC: NCLT New Delhi

The National Company Law Tribunal (NCLT), New Delhi bench comprising Bachu Venkat Balaram Das (Judicial Member) and Atul Chaturvedi (Technical Member) has held that under Section 138(1) of the Insolvency and Bankruptcy Code, 2016 (IBC), only the Bankruptcy Trustee has the authority to apply for the discharge of a bankrupt individual before the Adjudicating Authority. The Tribunal held...

Once Resolution Plan Is Approved By CoC & Submitted To Adjudicating Authority For Approval, No Other Plan Can Be Considered By CoC: NCLAT

The 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 Resolution Plan even prior to the approval of the Adjudicating Authority is binding inter se the Committee of Creditors (CoC) and the SRA. It also held that the CoC is clearly not entitled to consider any other request...

Application U/S 7 Of IBC Must Be Decided First When Application U/S 54C Is Filed 14 Days After S.7 Application: NCLAT

The NCLAT New Delhi bench of Justice Ashok Bhushan (Judicial Member) and Mr. Barun Mitra (Technical Member) has held that when an application under section 54C of the IBC is filed after 14 days from the date of the application filed under section 7 of the IBC, the application under section 7 must be decided first as per section 11A(3) of the code. Brief Facts: The corporate...

IBC Weekly Round-Up [2nd February-9th February 2025]

Nominal Index: Damodar Valley Corporation vs. Mackeil Ispat & Forging Ltd. & Anr., Company Appeal (AT) (Insolvency) No. 1663 of 2023 M/s Power Mech Projects Ltd. Versus Essar Power (Jharkhand) Ltd. and Anr., Company Appeal (AT) (Insolvency) No.106 of 2025 Ankur Kumar Versus Sustainable Agro-Commercial Financial Ltd., Company Appeal (AT) (Insolvency) No. 484...

Constitution Of Project Management Committee Under Settlement Agreement Does Not Absolve Corporate Debtor From Repayment Obligations: NCLAT

The NCLAT New Delhi bench of Justice Ashok Bhushan (Judicial Member), Mr. Barun Mitra (Technical Member) and Mr. Arun Baroka (Technical Member) has held that any dispute even pending in the arbitration does not in any manner prohibit the financial creditor to take remedy under Section 7 of the code. It also held that the constitution of a Project Management Committee comprising...

Business Arrangement Involving Joint Profit-Sharing, Exclusive Supply Agreement Does Not Establish Creditor-Debtor Relationship Under IBC: NCLT

The National Company Law Tribunal (NCLT), Delhi, has held that a petitioner cannot initiate the Corporate Insolvency Resolution Process (CIRP) under Section 9 of the Insolvency and Bankruptcy Code, 2016 (IBC) if the business arrangement between the parties involves joint participation and profit-sharing rather than a straightforward operational debt. The Tribunal ruled that such an...

NCLAT Orders NCLT To Decide BCCI's Plea For Settlement And Withdrawal Of CIRP Against Byju's Within One Week

The National Company Law Appellate Tribunal (NCLAT), Chennai bench comprising Justice (retd) Rakesh Kumar Jain (Judicial Member) and Jatindranath Swain (Technical Member) have directed the National Company Law Tribunal (NCLT) to decide the application filed by Board of Control for Cricket in India (BCCI) to withdraw the corporate insolvency resolution process (CIRP) against Byju's within...

Pre-CIRP Electricity Dues Stand Extinguished Upon Approval Of Resolution Plan: NCLAT

The National Company Law Appellate Tribunal (NCLAT) bench comprising Justice Ashok Bhushan (Chairperson), Barun Mitra (Technical Member) and Arun Baroka (Technical Member) have reiterated that all claims which are not included in the approved Resolution Plan stand extinguished upon its approval. The Tribunal held that Damodar Valley Corporation (DVC/ Appellant) was not entitled to...

IBC Monthly Digest: January 2025

NOMINAL INDEX: Adroit Pharmaceuticals Pvt. Ltd. Through Its Director Sanjay Kukreja Vs. Amit Poddar Resolution Professional & Ors., Company Appeal (AT) (Insolvency) No. 1274 of 2024 Super Floorings Pvt. Ltd. Vs. Napin Impex Ltd., Company Appeal (AT) (Insolvency) No. 1928 of 2024 & I.A. No.7115 of 2024 Mr. Tajinder Singh Bhathal vs. MRF Limited & Ors., Company Appeal...

Decision Taken By Liquidator To Proceed With Private Sale By 'Swiss Challenge Method' Cannot Be Said To Be Beyond Jurisdiction: NCLAT

The 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 decision taken by the Liquidator to proceed with private sale by adopting Swiss Challenge Mechanism, cannot be said to be a decision beyond the jurisdiction or authority of the Liquidator and that too when the said decision came...