Monthly Digest Of IBC Cases: July 2023
Pallavi Mishra
3 Aug 2023 1:30 PM GMT
Supreme Court IBC Overrides Electricity Act; Dues To Secured Creditors At Higher Footing Than Electricity Dues : Supreme Court Case Title: Paschimanchal Vidyut Vitran Nigam Ltd vs Raman Ispat Private Limited Citation: 2023 LiveLaw (SC) 534 | 2023 INSC 625 The Supreme Court Bench comprising of Justices S. Ravindra Bhat and Dipankar Datta, has observed that Section 238...
Supreme Court
IBC Overrides Electricity Act; Dues To Secured Creditors At Higher Footing Than Electricity Dues : Supreme Court
Case Title: Paschimanchal Vidyut Vitran Nigam Ltd vs Raman Ispat Private Limited
Citation: 2023 LiveLaw (SC) 534 | 2023 INSC 625
The Supreme Court Bench comprising of Justices S. Ravindra Bhat and Dipankar Datta, has observed that Section 238 of the Insolvency and Bankruptcy Code, 2016 overrides the provisions of the Electricity Act, 2003. It was opined that the provisions of the IBC treat the dues payable to secured creditors are at a higher footing than dues payable to Central or State Government.
In this case, the NCLT had set aside an attachment of the property of the respondent Raman Ispat Pvt. Ltd. (“Corporate Debtor”) which was over electricity charge dues to Paschimanchal Vidyut Vitran Nigam Limited (PVVNL) and held that PVVNL can realise its dues by participating in the liquidation process as per the IBC. The NCLAT also approved this view.
Further, noting that State Tax Officer v. Rainbow Papers Ltd. 2022 LiveLaw (SC) 743 dealt with a case relating to resolution process and not liquidation process, the Court opined that the judgment in Rainbow Papers has to be confined to the facts of that case.
High Court
Case Title: M/s ESL Steel Limited Versus Principal Commissioner
Case No.: W.P.(T) No. 1995 of 2023
The Jharkhand High Court Bench comprising of Justice Rongon Mukhopadhyay and Justice Deepak Roshan, has rejected ESL Steel’s Input Tax Credit (ITC) claim prior to the approval of the resolution plan by the National Company Law Tribunal (NCLT).
ESL Steel Limited (Petitioner) contended that no recovery or proceeding can be continued against the petitioner for any alleged dues prior to April 17, 2018, i.e., the date on which the NCLT approved the petitioner's resolution plan. The Petitioner urged that it is only the past obligations of the past period that get extinguished once the new management has taken over the Company as part of the Resolution Plan. There is no statute or judgement that says that past credit due to the company gets expunged.
The Bench held that the current management was not a taxpayer for the period prior to June 4, 2018. i.e., the date of the change of management and therefore the liability of the earlier management should not be shifted to the current management. Likewise, the credit available to the earlier management will also not be available to the current management, as the current management is not a taxpayer.
IBC | No Writ Can’t Be Issued To Creditor, Free To Proceed Against Personal Guarantor Under IBC : Delhi High Court
Case Title: Vineet Saraf v Rural Electrification Corporation Ltd.
Case No.: 2023 LiveLaw (Del) 639 | W.P.(C) 3293/2023 & CM APPL 12815/2023
The Delhi High Court Bench comprising of Justice Purushaindra Kumar Kaurav, has refused to issue a Writ of Prohibition to prevent the creditor from approaching the NCLT under Section 95 of IBC against the personal guarantor.
On the issue of whether a writ of prohibition can be issued to prevent creditor from approaching NCLT, the Bench opined that when an alternative remedy exists, then the Petitioner must prove, (i) that the proceedings or actions being taken are wholly without jurisdiction; and (ii) as to why the alternate forum must be deprived of an opportunity to decide upon its own jurisdiction.
IBC | Sending Demand Notice Under Rule 7(1) To Personal Guarantor Cannot Be Termed As Arbitrary: Delhi High Court
Case Title: Vineet Saraf v Rural Electrification Corporation Ltd.
Case No.: 2023 LiveLaw (Del) 639 | W.P.(C) 3293/2023 & CM APPL 12815/2023
The Delhi High Court Bench comprising of Justice Purushaindra Kumar Kaurav, has declined to quash a Demand Notice sent to a personal guarantor under Rule 7(1) of the Insolvency and Bankruptcy (Application to Adjudicating Authority for Insolvency Resolution Process for Personal Guarantors to Corporate Debtors) Rules, 2019. It has been held that mere issuance of a Demand Notice to personal guarantor does not reek of arbitrariness, since it has been done to comply with the statutory requirement of Section 95 of IBC, to agitate before the NCLT that there is a debt owed by the personal guarantor to the creditor.
“It is not the case that the reliefs prayed for cannot be granted by the concerned NCLT. The petitioner‟s claim of the guarantor getting a right to be heard at a belated stage, is not sufficient to entertain the present petition. The legislature, in its wisdom, thought it fit to give the right of hearing at belated stage. Indeed, if in the present case the petition is entertained, it would subvert the procedure laid down under the IBC. The respondent in turn would be denied the opportunity to present their case before the concerned NCLT.”
S.220 IBC | Prima Facie Disciplinary Committee Can Consist Only Of Whole Time Members: Bombay High Court Stays Insolvency Professional's Suspension
Case Title: Kairav Anil Trivedi v. Union of India and Ors.
Case No.: Writ Petition (L) No. 16317 of 2023
The Bombay High Court Bench comprising of Justice BP Colabawalla and Justice MM Sathaye has stayed the suspension of registration of Insolvency Professional, who is accused of misrepresentation and entering into unauthorised agreement in a Corporate Insolvency Resolution Process (CIRP).
The Bench observed that prima facie, the order against the Insolvency Professional was passed by the Chairperson of the Insolvency and Bankruptcy Board of India (IBBI) and not its Whole Time Member who is empowered to pass a disciplinary order.
“…prima facie we are of the opinion that the Disciplinary Committee can consist only of Whole Time Member(s), who can then pass orders. In the present case, the impugned order dated 23.05.2023 is passed by Mr. Ravi Mital, who, at least on the Website of the IBBI, is shown as the Chairperson of the IBBI and not its Whole Time Member”, the Court observed.
NCLAT
Case Title: Punit Goenka v Indusind Bank Ltd. & Anr.
Case No.: Company Appeal (AT) (Insolvency) No. 232/2023.
The National Company Law Appellate Tribunal (“NCLAT”), Principal Bench, comprising of Justice Ashok Bhushan (Chairperson) and Shri Barun Mitra (Technical Member), has closed the Corporate Insolvency Resolution Process against Zee Entertainment Enterprises Ltd. The Bank and Zee Entertainment Enterprises Ltd. have entered into a Settlement Agreement and the latter has paid the amount towards the same.
No Provision In IBC For Constitution Of COC With A Single Operational Creditor: NCLAT Chennai
Case Title: V. Duraisamy v Jeyapriya Fruits and Vegetables Commission Agent
Case No.: Company Appeal (AT)(CH)(Ins) No.25/2022
The National Company Law Appellate Tribunal (“NCLAT”), Chennai Bench, comprising of Justice M. Venugopal (Judicial Member) and Ms. Shreesha Merla (Technical Member), has held that IBC does not contain any provision for constitution of the Committee of Creditors (CoC) with a single Operational Creditor, when no claims are received by the IRP after public announcement. The Bench has terminated the CIRP of a Corporate Debtor in which claim was received from the only Operational Creditor and there was no Financial Creditor to constitute the CoC.
Section 7 IBC | Ruling In ‘Vidarbha Industries’ Inapplicable When Corporate Debtor Admits Due Debt Amount: NCLAT Delhi
Case Title: Mohan Nathuram Sakpal v State Bank of India
Case No.: Company Appeal (AT) (Insolvency) No. 1527 of 2022
The National Company Law Appellate Tribunal (“NCLAT”), New Delhi Bench, comprising of Justice Rakesh Kumar Jain (Judicial Member) and Shri Naresh Salecha (Technical Member), has held that the ruling given in Vidarbha Industries Power Limited v. Axis Bank Limited is inapplicable to proceedings under Section 7 of IBC when the Corporate Debtor has clearly admitted the due debt amount. The Bench held as under:
“We have heard Counsel for the parties and are of the considered opinion that in the given facts and circumstances of the case Vidarbha Industries Power Limited (Supra), relied upon by the Appellant, is not applicable because there is a clear admission on the part of the Corporate Debtor of the amount of debt due in view of the letter dated 31.01.2018.”
Section 61(2) | Holidays Can Be Excluded Only From Limitation Period Of 30 Days, Inapplicable To Further 15 Days Period: NCLAT Delhi
Case Title: Sandeep Anand v Gopal Lal Baser
Case No.: Company Appeal (AT) (Ins) No. 767 of 2023
The National Company Law Appellate Tribunal (“NCLAT”), New Delhi Bench, comprising of Justice Ashok Bhushan (Chairperson) and Shri Barun Mitra (Technical Member), has held that while computing limitation in filing of appeal, the benefit of excluding public holiday or holiday is only available with respect to 30 days limitation period given under Section 61(2). Such benefit would not apply to the further 15 days period given under Proviso to Section 61(2) of IBC.
Notice Period Of 30 Days Should Be Given For E-Auction, Even Though There Are No Timelines Under Liquidation Regulations: NCLAT Delhi
Case Title: Naren Seth v Sunrise Industries & Ors.
Case No.: Company Appeal (AT) (Insolvency) No. 401 of 2023
The National Company Law Appellate Tribunal (“NCLAT”), Principal Bench, comprising of Justice Ashok Bhushan (Chairperson) a nd Shri Naresh Salecha (Technical Member), has held that a notice period of thirty days should be given in e-auction to obtain best value, even though Insolvency & Bankruptcy Board of India (Liquidation Process) Regulations, 2016 do not provide any timelines. The Bench has set aside an e-auction which was concluded by the Liquidator within five days of issuing Sale Notice.
Case Title: Imtiyaz Javed Siddiqui v Bank of India & Anr.
Case No.: Company Appeal (AT)(Insolvency) No. 819 of 2023
The National Company Law Appellate Tribunal (“NCLAT”), Principal Bench, comprising of Justice Ashok Bhushan (Chairperson) and Shri Barun Mitra (Technical Member), has stayed the Corporate Insolvency Resolution Process (“CIRP”) proceedings initiated against DB Realty Ltd. The Bench has granted DB Realty Ltd. an opportunity to deposit the amount offered in their One Time Settlement (“OTS”) proposal with the Tribunal. The matter is next listed on 06.09.2023.
Payment Of Performance Linked Incentive Fee By COC Is Discretionary, NCLT Or NCLAT Can’t Interfere With COC’s Decision: NCLAT Delhi
Case Title: Ravindra Kumar Goyal v Committee of Creditors of Yashasvi Yarns Limited & Anr.
Case No.: Company Appeal (AT) (Insolvency) No. 809 of 2023
The National Company Law Appellate Tribunal (“NCLAT”), Principal Bench, comprising of Justice Ashok Bhushan (Chairperson) and Shri Barun Mitra (Technical Member), has held that the payment of performance linked incentive fee to the IRP/RP under Regulation 34B of CIRP Regulations lies within the discretion of CoC. If the CoC refuses to pay such incentive fee, then the NCLT or NCLAT do not possess the jurisdiction to interfere with CoC’s decision.
Homebuyers of 'Lotus Aren 1' Noida Are Given Flats In Lieu Of Their Claims, Approves Resolution Plan: NCLAT Delhi
Case Title: M/s. Dhankalash Distributors Pvt. Ltd. v Arena Superstructures Pvt. Ltd.
Case No.: CP (IB) No.875(PB)/2020
The National Company Law Tribunal (NCLT), Principal Bench, comprising of Chief Justice (Retd.) Ramalingam Sudhakar (President) and Shri Avinash K Srivastava (Technical Member), has approved the resolution plan of M/s. Purvanchal Projects Pvt. Ltd. for M/s. Arena Superstructures Pvt. Ltd (Lotus Group company). The Resolution Plan is valued at Rs. 584 Crores. The Homebuyers/Allottees of Lotus Arena I project would be given flats in lieu of their dues.
The resolution plan proposes to pay the Secured Financial Creditors an amount of Rs. 70 Crores against an admitted claim of Rs. 200.27Crores. The Unsecured Financial Creditors would be paid Rs. 50 Lakhs against their admitted claim of Rs. 2 Crores. The admitted claim of Homebuyers/Allottees amounts to Rs. 497.8 Crores. The Resolution plan proposes to pay off these dues by delivering flats to the homebuyers. The timeline for completion of construction of the Project and delivery of Flats to homebuyers is 36 months (after the Transfer Date).
Dissenting Financial Creditor Entitled To Liquidation Value Commensurate Only With Security Interest: NCLT Delhi
Case Title: M/s. Dhankalash Distributors Pvt. Ltd. v Arena Superstructures Pvt. Ltd.
Case No.: CP (IB) No.875(PB)/2020
The National Company Law Tribunal (NCLT), Principal Bench, comprising of Chief Justice (Retd.) Ramalingam Sudhakar (President) and Shri Avinash K Srivastava (Technical Member), has held that a co-joint reading of Sections 52, 53 and 30(2)(b) of IBC reveals that a Dissenting Financial Creditor is at best entitled to the liquidation value commensurate with its security interest. Any amount unpaid thereafter, would fall under Section 53(1)(e)(ii) of IBC, which would rank below the unsecured creditors.
There Can’t Be Discrimination Between One Class Of Creditors’; NCLAT Delhi Directs Modification Of Resolution Plan
Case Title: Akashganga Processors Pvt. Ltd. v Shri Ravindra Kumar Goyal & Ors.
Case No.: Company Appeal (AT) (Insolvency) No.1148 of 2022
The National Company Law Appellate Tribunal (“NCLAT”), Principal Bench, comprising of Justice Ashok Bhushan (Chairperson) and Shri Barun Mitra (Technical Member), has directed the Successful Resolution Applicant to allocate funds to Operational Creditors in the Resolution Plan, who were left unpaid while other Operational Creditors were proposed to be paid. “However, when the Successful Resolution Applicant was making payment to other two Operation Creditors, there cannot be any discrimination between payment of one class of Creditors.”
The Resolution Plan was earlier rejected by the NCLT for being violative of Section 30(2)(e) and 30(2)(f) of IBC. However, the NCLAT permitted its implementation post modification.
Case Title: Akashganga Processors Pvt. Ltd. v Shri Ravindra Kumar Goyal & Ors.
Case No.: Company Appeal (AT) (Insolvency) No.1148 of 2022
The National Company Law Appellate Tribunal (“NCLAT”), Principal Bench, comprising of Justice Ashok Bhushan (Chairperson) and Shri Barun Mitra (Technical Member), has directed the Successful Resolution Applicant to allocate funds to Operational Creditors in the Resolution Plan, who were left unpaid while other Operational Creditors were proposed to be paid. “However, when the Successful Resolution Applicant was making payment to other two Operation Creditors, there cannot be any discrimination between payment of one class of Creditors.”
The Resolution Plan was earlier rejected by the NCLT for being violative of Section 30(2)(e) and 30(2)(f) of IBC. However, the NCLAT permitted its implementation post modification.
Case Title: Container Corporation of India Ltd. (CONCOR) v Roadwings International Pvt. Ltd. & Anr.
Case No.: Company Appeal (AT) (Ins.) No. 887 of 2023
The National Company Law Appellate Tribunal (“NCLAT”), Principal Bench, comprising of Justice Ashok Bhushan (Chairperson) and Shri Barun Mitra (Technical Member), has stayed the insolvency proceedings against Container Corporation of India Ltd., which is a navratna enterprise of Government of India. The alleged default was based on an Arbitral Award which was challenged before the High Court and the matter is pending adjudication.
Container Corporation of India Ltd. (CONCOR) is a public sector company, engaged in transportation and handling of containers and is listed with the NSE and BSE on stock exchange.
Liquidator To Fix The Reserve Price Based On Average Of Two Valuation Reports Received In The CIRP Process: NCLAT Delhi
Case Title: Amit Ahirrao v Anagha Anasingharaju & Anr.
Case No.: Company Appeal (AT) (Insolvency) No. 842 of 2022
The National Company Law Appellate Tribunal (“NCLAT”), New Delhi Bench, comprising of Justice Ashok Bhushan (Chairperson) and Shri Barun Mitra (Technical Member), has held that the Liquidator while auctioning the assets has to fix the reserve price based on average of two valuation reports received in the CIRP process.
“We, however, are of the view that the Liquidator while proceeding to sell the assets in accordance with Liquidation Process Regulation, 2016 has to take the reserve value as per Schedule-I of the Liquidation Regulation. The reserve price has to be value of assets arrived at as per Regulation 35(1), as noted above. We, thus, are of the view that the Liquidator while proceeding to sell the assets has to take reserve price on the basis of average of two valuation reports received in the CIRP process.”
NCLT
File Refund Claims Before Resolution Professional; NCLT Delhi Tells Go First Passengers
File No. 25/02/2023-NCLT
The National Company Law Tribunal (“NCLT”) has issued Advisory dated 03.07.2023 in reference to the refund claims of the passengers of Go-Air. The Advisory states that the passengers of Go Air have been contacting the NCLT officials for seeking refund of their booked/cancelled tickets of Go Air airlines.
The NCLT has informed the ticket holders (passengers) that Mr. Shailendra Ajmera has been appointed as the Resolution Professional of Go Air (India) Ltd., which has been admitted into Corporate Insolvency Resolution Process (“CIRP”) under the Insolvency and Bankruptcy Code, 2016 (“IBC”).
Case Title: Rani Agro Private Limited v S & H Gears Private Limited
Case No.: C.P.(IB) No. 3703/MB/2019
The National Company Law Tribunal (NCLT), Mumbai Bench, comprising of Shri. Kuldip Kumar Kareer (Judicial Member) and Smt. Anuradha Sanjay Bhatia (Technical Member), has held that the lien created on the Corporate Debtor’s account prior to initiation of CIRP cannot sustain after moratorium is imposed under Section 14 of IBC post CIRP commencement, as it will hinder the entire resolution process. The Bench has set aside the lien created by Regional Provident Fund Commissioner on the Corporate Debtor’s bank account prior to commencement of CIRP.
Case Title: Rani Agro Private Limited v S & H Gears Private Limited
Case No.: C.P.(IB) No. 3703/MB/2019
The National Company Law Tribunal (NCLT), Mumbai Bench, comprising of Shri. Kuldip Kumar Kareer (Judicial Member) and Smt. Anuradha Sanjay Bhatia (Technical Member), while adjudicating a petition filed in the matter of Rani Agro Private Limited v S & H Gears Private Limited, has held that if the Corporate Debtor had not opened a separate Bank Account for the `Provident Fund', then even IRP/RP/Liquidator cannot provide for it except under Section 53 of IBC.
“However, it is important to note that such `Provident Fund’, has to be an `Establishment Fund’, kept separately by the company and only then this proviso will be applicable. If even wrongly and in violation of the laws of the land, the company fails to establish such `Provident Fund’, in that event `Interim Resolution Professional/Resolution Professional/Liquidator’ is not expected to provide for same, except under Section 53 of the I & B Code, 2016.”
NCLT Hyderabad Approves Resolution Plan For Indu Projects Ltd.
Case Title: Bank of India v Indu Projects Ltd.
Case No.: CP (IB) No. 372/7/HDB/2018
The National Company Law Tribunal (“NCLT”), Hyderabad Bench, comprising of Justice Telaprolu Rajani (Judicial Member) and Shri Charan Singh (Technical Member), has approved the Resolution Plan submitted by a consortium of B. Subba Reddy and C. Venkateswara Reddy for Indu Projects Ltd. The Resolution Plan is valued at Rs. 501 Crores.
The resolution plan proposes to pay the Financial Creditors an amount of Rs. 394 Crores against an admitted claim of 3890 Crores. The Workmen and Employees of the Corporate Debtor would receive Rs. 1 Crore as against an admitted claim of Rs. 4.21 Crores. The Operational Creditors other than workmen and employees will be paid Rs. 4.9 Crores as against an admitted claim of Rs. 178 Crores. The Government will receive Rs. 18,432 towards their admitted dues of Rs. 1.82 Lakhs. The Related Party of the Corporate Debtor have been paid NIL.
NCLT New Delhi To Conduct Virtual Hearings Till Further Orders
File: 25/02/2023-NCLT
The National Company Law Tribunal (“NCLT”) has issued a Circular dated 11.07.2023, intimating that NCLT New Delhi would be conducting hearing through Video Conferencing till further orders.
The NCLT New Delhi is awaiting logistic clearance from CPWD in terms of “Fit for Use” for its premises situated at Block III, CGO Complex, Lodhi Road, New Delhi.
Management Dispute In Dainik Jagran Group; NCLT Allahabad Issues Notice
Case Title: Mahendra Mohan Gupta & Ors. v Devendra Mohan Gupta & Ors.
Case No.: CP No.64/ALD/2023
The National Company Law Tribunal (NCLT), Allahabad Bench, comprising of Shri Praveen Gupta (Judicial Member) and Shri Ashish Verma (Technical Member), has issued notice in a company petition filed by the Director (Mr. Mahender Mohan Gupta) of Jagran Media Network Investment Pvt. Ltd. and Jagran Prakashan Limited, alleging oppression by the majority shareholders.
The Dainik Jagran Group is presently being run by the families of the Late Mr. Puran Chandra Gupta’s sons. One of the sons have filed a company petition alleging oppression by majority shareholders, who happen to be the other members of the Gupta Family.
NCLT Mumbai Approves Resolution Plan For Lavasa Corporation; Homebuyers Can Opt For Completed Units
Case Title: Raj Infrastructure Development India Pvt. Ltd. v Lavasa Corporation Limited
Case No.: C.P.(IB)/1765(MB)2018
The National Company Law Tribunal (NCLT), Mumbai Bench, comprising of Shri Kuldip Kumar Kareer (Judicial Member) and Shri Shyam Babu Gautam (Technical Member), has approved the resolution plan of Darwin Platform Infrastructure Limited for Lavasa Corporation Limited and its four subsidiaries. The consolidated Resolution Plan is valued at Rs. 1,814 Crores.
The Homebuyers would get fully constructed properties within five (5) years from the receipt of the Environmental Clearance, on an actual cost basis. Two exit alternatives have also been given to the Homebuyers, i.e. (i) Homebuyers can undertake self-construction of their properties, entirely at their own responsibility, costs and expenses; and (ii) Homebuyers not willing to wait for delivery of fully-constructed property, can seek final settlement of 40% of entire admitted claims.
Newly Appointed NCLT Members Take Oath
File No. 10/13/2023-NCLT
The National Company Law Tribunal (“NCLT”) had issued a circular dated 18.07.2023, intimating that the oath taking ceremony of newly appointed NCLT Members will take place on 19.07.2023.
In a ceremony held on 19.07.2023, the following newly appointed NCLT Members have taken oath:
JUDICIAL MEMBERS
- Mrs. Lakshmi Gurung
- Manni Sankariah Shanmuga Sundaram
- KR Saji Kumar
- Jyoti Kumar Tripathi
- Rajeev Bhardwaj
- Smt. Chitra Ram Hankare
- Ms. Reeta Kohli
- Khetrabasi Biswal
- Justice (Retd.) Mr. Virendrasingh Gyansingh Bisht
TECHNICAL MEMBERS
- Venkataraman Subramaniam
- Umesh Kumar Shukla
- Arvind Devanathan
- Charanjeet Singh Gulati
- Anil Raj Chellan
- Ravichandran Ramasamy
- Sanjiv Dutt
- Sanjay Puri
- Shunmugakani Ravindran
- Velamur Govindan Venkata Chalapathy
- Rajeev Mehrotra
- Dr. Sanjeev Ranjan
Go Airlines | NCLT Delhi Imposes Moratorium On Leased Aircrafts, Categorize Them As ‘Property’ U/S 3(27) Of IBC
Case Title: Go Airlines (India) Limited
Case No.: Company Petition No. (IB)-264(PB)/2023
The National Company Law Tribunal (“NCLT”), New Delhi Bench, comprising of Shri Mahendra Khandelwal (Judicial Member) and Shri Rahul Bhatnagar (Technical Member), has held the aircrafts leased to Go Airlines (India) Ltd. by Lessors come within the definition of ‘Property’ under Section 3(27) of IBC and thus moratorium can be imposed over leased aircrafts.
The Bench observed that leasing aircrafts in aviation industry is a prevalent practice. When a Corporate Debtor under IBC is in Airlines business, the act of taking way aircrafts from the such Corporate Debtor would lead to corporate death.
Go Airlines| NCLT Delhi Permits Go Airlines To Resume Operations
Case Title: Go Airlines (India) Limited
Case No.: Company Petition No. (IB)-264(PB)/2023
The National Company Law Tribunal (“NCLT”), New Delhi Bench, comprising of Shri Mahendra Khandelwal (Judicial Member) and Shri Rahul Bhatnagar (Technical Member), has permitted Go Airlines to operate the leased aircrafts in order to maintain the company’s status as a going concern.
While considering the Lessor’s plea to refrain Go Airlines from operating or flying the leased aircrafts, the Bench observed that the Directorate-General of Civil Aviation (“DGCA”) has not deregistered the aircrafts. Therefore, it is open for Go Airlines to resume flight operations. In order to maintain Go Airlines as a going concern, the Bench has permitted it to operate the aircrafts. However, the safety norms prescribed by the Regulators have to be adhered.
NCLT Bengaluru Admits Café Coffee Day’s Parent Company Into Insolvency
Case Title: Indus Ind Bank Limited v M/s Coffee Day Global Limited
Case No.: C.P (IB) No. 132/BB/2022
The National Company Law Tribunal (“NCLT”), Bengaluru Bench, comprising of Justice (Retd.) T Krishnavalli (Judicial Member) and Shri Manoj Kumar Dubey (Technical Member), has initiated Corporate Insolvency Resolution Process against M/s Coffee Day Global Ltd., which is the parent company of the Coffee Day Group and Coffee Day Enterprises Ltd., which runs a multinational coffeeshop named ‘Café Coffee Day’. Mr. Shailendra Ajmera has been appointed as the Interim Resolution Professional (IRP).
NCLT New Delhi Admits ‘Brij Gopal Construction Co.’ Into Insolvency
Case Title: M/s Geocon Infra Pvt. Ltd. v M/S. Brij Gopal Construction Company Pvt. Ltd.
Case No.: IB – 514(ND)/2022
The National Company Law Tribunal (“NCLT”), New Delhi Bench, comprising of Shri Bachu Venkat Balaram Das (Judicial Member) and Shri Atul Chaturvedi (Technical Member), has initiated Corporate Insolvency Resolution Process (CIRP) against Brij Gopal Construction Company Pvt. Ltd. (“Corporate Debtor”) Mr. Mukesh Kumar Jain has been appointed as the Interim Resolution Professional (IRP).
The Corporate Debtor is a company engaged in the business of infrastructure development works, such as Roads & Highways, Sewerage, Storm Water, Drain Water Supply, Works Management and Housing Projects. It is one of the top Contracting Companies in the State of Haryana.
NCLT Kochi Imposes Rs. 50,000/- Cost On GST Department For Raiding Corporate Debtor During Moratorium
Case Title: Kosamattam Finance Ltd. v Mangomeadows Agriculture Pleasure Land Pvt. Ltd.
Case No.: CP (IBC)/06/KOB/2022
The National Company Law Tribunal (“NCLT”), Kochi Bench, comprising of Shri P. Mohan Raj (Judicial Member) and Shri Satya Ranjan Prasad (Technical Member), has imposed a cost of Rs. 50,000/- on the Goods and Services Tax Department (GST) for raiding the premises of Corporate Debtor during the moratorium period and seizing account documents. The Bench held the raid and seizure of documents by GST Department during CIRP is violative of moratorium under Section 14 of IBC. The summons issued to the Resolution Professional by the GST Department have also been set aside.
Greater Noida Industrial Development Authority Is A Secured Creditor Under Sec. 3(30) Of IBC: NCLT Delhi
Case Title: VMS Equipment v Primrose Infratech Private Limited
Case No.: Company Petition No. (IB)-995(ND)/2018
The National Company Law Tribunal (“NCLT”), New Delhi Bench, comprising of Shri Ashok Kumar Bhardwaj (Judicial Member) and Shri L.N. Gupta (Technical Member), has held that the Greater Noida Industrial Development Authority (GNIDA) is a secured operational creditor under Section 3(30) of IBC.
The definition of Security Interest in Section 3(31) of IBC includes a ‘charge’ and as per the Supreme Court judgment in State Tax Officer (1) v Rainbow Papers Limited, the definition of secured creditor in the IBC does not exclude any Government or Governmental Authority. Therefore, the charge created in favour of GNIDA is a security interest and thus GNIDA is a secured creditor.
No Inconsistency Between IBC And Sec. 13 & 13A Of U.P. Industrial Area Development Act: NCLT Delhi
Case Title: VMS Equipment v Primrose Infratech Private Limited
Case No.: Company Petition No. (IB)-995(ND)/2018
The National Company Law Tribunal (“NCLT”), New Delhi Bench, comprising of Shri Ashok Kumar Bhardwaj (Judicial Member) and Shri L.N. Gupta (Technical Member), has held that there is no inconsistency between IBC and Sections 13 and 13A of the UP Industrial Area Development Act, 1976. If security interest was created in favour of Greater NOIDA Authority prior to commencement of moratorium/CIRP, then IBC would not override UP Industrial Area Development Act, 1976 in terms of Section 238 of IBC.
“Since, in the instant case, the security interest of GNIDA was created by virtue of the operation of law prior to the commencement of CIRP/Moratorium, we see no inconsistency between the provision of Sections 13 and 13A of the Uttar Pradesh Industrial Area Development Act, 1976 and IBC 2016, hence the provisions of Section 238 of IBC, 2016 do not get attracted to.”
