Once Plausibility Of Pre-Existing Dispute Is Established, Application U/S 9 Of IBC Must Be Rejected: NCLAT

The NCLAT New Delhi bench of Justice Rakesh Kumar Jain (Judicial Member), Barun Mitra (Technical Member) and Indevar Pandey (Technical Member) has held that IBC bestows only summary jurisdiction upon the Adjudicating Authority. Once plausibility of a pre-existing dispute is noticed, it is not required of the Adjudicating Authority to make further detailed investigation. It is well...

Guarantor Cannot Become Financial Creditor Without Making Any Payment In Discharge Of Guarantee: NCLAT

The NCLAT New Delhi bench of Mr. Justice Ashok Bhushan (Chairperson), Mr. Barun Mitra (Technical Member) and Mr. Arun Baroka (Technical Member) has held that guarantor cannot become a financial creditor without paying any amount towards discharging the liability of the principal borrower for whom the guarantee was given. Brief Facts This appeal has been filed against an order...

Threshold Limit For Initiating Insolvency Process Against Personal Guarantors Is Also ₹1 Crore: NCLT New Delhi

The NCLT New Delhi bench of Shri Subrata Kumar Dash (Technical Member) and Shri Ashok Kumar Bhardwaj (Judicial Member) had held that the threshold limit for initiating insolvency process against the personal guarantors under section 95 of the Code would be the same as is with respect to the corporate debtor under section 4 of the IBC i.e. 1 crore. Brief Facts The moot...

Only Assets Are Transferred In Going Concern Sale Of Corporate Debtor Under Liquidation, Liabilities Must Be Settled U/S 53 Of IBC: NCLT Mumbai

The NCLT Mumbai bench of Ms. Reeta Kohli (Judicial Member) and Ms. Madhu Sinha (Technical Member) has held that in a sale of the corporate debtor in liquidation as a going concern, only assets are transferred and liabilities have to be discharged as per section 53 of the Code. Brief Facts The Present Application is preferred by the Applicant for seeking various concessions...

Mere Possession Over Assets Of Corporate Debtor Under SARFAESI Act Does Not Bar Filing Of Petition U/S 7 Of IBC: NCLT Kolkata

The NCLT Kolkata bench of Ms. Bidisha Banerjee (Judicial Member) and Shri Arvind Devanathan (Technical Member) have held that mere possession over assets of the corporate debtor under the SARFAESI Act does not prevent the financial creditor from preferring an application under section 7 of the IBC. Brief Facts The Corporate Debtor Roadwings International Pvt. Ltd. by way...

Impleadment Of Party After Closure Of Initial CIRP Plea Against Corporate Debtor: NCLAT Chennai Protects Operational Creditor's Claims

The National Company Law Appellate Tribunal (NCLAT), Chennai bench of Justice Sharad Kumar Sharma (Judicial Member) and Mr Jatindranath Swain (Technical Member) allowed the impleadment application filed by an Operational Creditor, on the ground that its application to initiate CIRP proceedings against the Corporate Debtor were closed due to initiation of CIRP by another creditor....

Petition U/S 9 Of IBC Cannot Be Rejected On Grounds Of Raising Spurious Claim Of Pre-Existing Dispute: NCLAT

The NCLAT New Delhi bench of Mr. Justice Ashok Bhushan (Chairperson) and Mr. Barun Mitra (Technical Member) has held that making belated entries in the books of account to show that goods were misappropriated cannot escape the conclusion that the dispute raised by the corporate debtor was merely a moonshine just to avoid the liability. Brief Facts The present appeal filed under...

Share Application Money Deposited With Corporate Debtor Cannot Be Treated As Financial Debt U/S 5(8) Of IBC: NCLAT

The NCLAT New Delhi bench of Mr. Justice Ashok Bhushan (Chairperson), Mr. Barun Mitra (Technical Member) and Mr. Arun Baroka (Technical Member) has held that share application money deposited with the corporate debtor cannot be treated as financial debt under section 5(8) of the IBC. In this case, share application money was given for the allotment of shares but neither were shares...

Information Memorandum Based On Which Resolution Plan Is Submitted And Approved By CoC Cannot Be Modified: NCLAT

The NCLAT New Delhi bench of Mr. Justice Ashok Bhushan (Chairperson), Mr. Barun Mitra (Technical Member) and Mr. Arun Baroka (Technical Member) has held that Information Memorandum prepared by the Resolution Professional based on which the Resolution Plan was submitted and later approved by the CoC, cannot be modified.In this case, the allotment units to homebuyers were cancelled...

Reduction Of Share Capital Does Not Exempt Company From Fulfilling Other Statutory Obligations: NCLT Ahmedabad

The National Company Law Tribunal, Ahmedabad comprising of Dr V.G Venkata Chalapathy (Member Technical) and Chitra Hankare (Member Judicial) approved a Section 66 application of Companies Act, 2013 filed by the Mahan Industries, seeking confirmation in the reduction of its share capital. Background of the Case The following case involves an application filed by Mahan Industries...

Sale Certificate Issued In Favor Of Successful Bidder Can Be Cancelled If Bid Amount Is Not Paid Within 90 Days: NCLAT

The NCLAT New Delhi bench of Mr. Justice Ashok Bhushan (Chairperson), Mr. Barun Mitra (Technical Member) and Mr. Arun Baroka (Technical Member) has held that as per Liquidation Regulations, the bid amount has to be paid within 90 days. If the amount is not paid, sale certificate issued in favor of the Successful Bidder can be cancelled and the security amount be...

No Part Of Resolution Plan Can Be Given On Application Of Operational Creditor Till Plan Is Approved By Adjudicating Authority: NCLAT

The NCLAT New Delhi bench of Mr. Justice Ashok Bhushan (Chairperson), Mr. Barun Mitra (Technical Member) and Mr. Arun Baroka (Technical Member) has held that no part of the Resolution Plan can be given to the operational creditor till the Resolution Plan pending for approval before the Adjudicating Authority is approved. However, any objections to the approval of the plan can...