IBC

1. Tek Travels Pvt. Ltd. v. Altius Travels Pvt. Ltd (DOJ 19.04.2021)

Hon’ble NCLAT in the present matter deliberated upon the liberty to rectify the defects in a Section 9 application. While adjudicating upon the same, Hon’ble NCLAT determined the act of rectifying the defects under Section 9 (5) of the I&B Code to be directory and not mandatory. It was of the view that rejecting the application in the first instance would not serve any purpose and shall be considered only an administrative order.

The present matter was an appeal filed before the Hon’ble NCLAT contending the Adjudicating Authority’s order of rejecting a Section 9 application on the grounds that an authorization annexed with the application was of the year 2013 i.e., prior to the commencement of the I&B Code and was consequently rejected as not maintainable for want of proper authorization.

Accordingly, the impugned order was set aside and the present appeal was allowed.

Judgment link: https://nclat.nic.in/Useradmin/upload/1793409372607d8a08ad38c.pdf

 

2. Sunil Parmanand Kewalramani v. Kestrel Import & Export Pvt Ltd (DOJ 19.04.2021)

In the present appeal, subject to the facts and circumstances of the case, Hon’ble NCLAT set aside Adjudicating Authority’s finding regarding the malicious intent of the applicant to initiate insolvency proceedings as the same cannot be treated as valid by any stretch of imagination. Remarks/observations made by the Adjudicating Authority were expunged the remarks

In the said matter, the Adjudicating Authority dismissed the Section 7 application not strictly on the grounds of merit but rather made additional remarks and alleged presence of a “collusion” arrangement between the parties. It stemmed from the reason that the petitioner and the respondents were three family-owned companies by three brothers and sibling having one-third shareholding in each other’s company.

Judgment link: https://nclat.nic.in/Useradmin/upload/69938678607d3e95a9672.pdf

 

3. Decan Value Investors LP v. Dinkar T Venkatasubramanian & Ors RP of Amtek Auto Ltd (DOJ 16.04.2021)

Hon’ble NCLAT in this long-drawn judgment held that situations where a long-term deed is to be executed with “acceptable conditions” cannot be a condition precedent in regard to approval of a resolution plan. While looking the facts and circumstances it was observed that the said condition is only an effective date condition.

It was further observed that the  condition in regard to execution of a long term lease for the Appellant’s land has already been complied with by Resolution Professional who executed the lease at an earlier occasion, when the prior lease has expired on 31st March, 2019 and the respondent while not having assailed the impugned order for any material irregularity in the insolvency resolution process resulting in prejudice, the Appellant would not be justified in assailing the impugned order which, in effect, is nothing but yet another effort to wriggle out of its obligations and seek withdrawal of Resolution Plan in a different garb. Hon’ble NCLAT while holding the appeal to be frivolous, dismissed the appeal imposing a cost of Rs.1 Lakh on the Appellant.

Judgment link: https://nclat.nic.in/Useradmin/upload/201535617860794b12acfb9.pdf

 

4. New Okhla Industrial Development Authority Through Mr. Tejveer Singh, Authorized Representative v. Mr. Anand Sonbhadra, Resolution Professional (DOJ: 16.04.2021)

The Hon’ble NCLAT while passing the order held that the Lease Deed of the development authority is righteous to an extent that its object & purpose is development of township in a controlled manner of housing construction. However, such lease does not fit in with the requirements of the referred Indian Accounting Standards.  With the intention to just be a part of COC, the lease of land between the developing authority and the builders cannot be considered or treated as a financial lease.

Accordingly, the appeal was dismissed by the Hon’ble NCLAT for the lack of substance.

Judgment link: https://nclat.nic.in/Useradmin/upload/636315549607d2fae3391a.pdf

 

 

5. Solutions Business Centre LLP v. Renu Kumar & Ors (DOJ: 16.04.2021)

 

In the present matter the CIRP was initiated against the company and there is a dispute with respect to the company being converted into LLP and in context to the same the Adjudicating Authority directed certain persons to be present. The said order was challenged and the Hon’ble NCLAT held that if in a matter, the Adjudicating Authority finds it necessary to hear the particular side or particular person in order to give them opportunity to respond, it is more appropriate to give option to the concerned parties/person to appear in person or through Advocate.

 

Holding that it was not a criminal case or contempt proceeding, the Appeal was disposed of with modifications.

Judgment link: https://nclat.nic.in/Useradmin/upload/392454276607d40d19293f.pdf

 

6. AKJ Fincap Ltd v. Bank of India (DOJ: 16.04.2021)

 

The Hon’ble NCLAT in the present matter held that the Adjudicating Authority have the power to set aside an ex-parte Order provided, it is satisfied that there was sufficient cause with respect to service of Notice.

The Adjudicating Authority dismissed the IA on the ground that the Tribunal has no power to review or set aside its own Company Petition Admission Order as per settled proposition of law. The Hon’ble Tribunal set aside the impugned order stating Rule 49(2) of the NCLT Rules, 2016 under which the Adjudicating Authority has sufficient powers to set aside an ex-parte Order provided, it is satisfied that there was sufficient cause with respect to service of Notice. It was further noted that the Appellant herein is silent about the service of Notice which was effected upon them by e-mail. Accordingly, the Hon’ble Tribunal imposed a cost of Rs. 25,000/- on the Appellant to be paid to the Respondent before the next date of Hearing.  The Appeal was allowed and the Order of the Adjudicating Authority was set aside, both parties directed to appear before Adjudicating Authority and the Appellant to pay the respondent the costs on before 26^th April 2021.

 

Judgment link: https://nclat.nic.in/Useradmin/upload/379288195607946c53a138.pdf