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Landmark Judgments by the Hon’ble NCLAT 16th May to 31st May, 2021

  1. Executive Engineer Uttar Gujrat VIJ Company Ltd v. Devang P Samapat RP of Kanoovi Foods Pvt Ltd (DOJ: 27.05. 2021)

In the instant matter, Hon’ble NCLAT held that as per Regulation 32 of IBBI (Insolvency Resolution Process for Corporate Persons) Regulations, 2016 (CIRP Regulations), if the consumption of the electricity is for manufacturing and output of the normal operations of the corporate debtor, then the dues arising from such supply of electricity during moratorium shall have to be paid within the moratorium period.

It was further clarified that the Section 14, sub-section 2A r/w the above stated Regulation 32 makes it amply clear that if the supply is for managing the operations of the CD, the supply cannot be interrupted during the moratorium except where the CD has not paid dues for supply during such moratorium period.

In the present matter, it was stated that the consumption was for running of office and security of CD and hence, the same will be part of the CIRP Costs which can be recovered when the Resolution Plan is approved or would form part of Section 53 in case Liquidation process is initiated.

Judgement link:https://nclat.nic.in/Useradmin/upload/188256414860afaa959e3a2.pdf

 

  1. Antanium Holdings Pte Ltd v. Sujana Universal Industries Limited & Anr (DOJ: 17.05.2021)

Hon’ble NCLAT in the instant matter held that the Adjudicating Authority is required to record analytical subjective satisfaction which is a precondition to granting an approval to a Resolution Plan. The order stated that the approval of Resolution Plan is to be judged with utmost care, caution, circumspection and diligence. The threadbare examination of the scheme is to be studied in detail before arriving at a subjective satisfaction by the Adjudicating Authority.

The Appellant preferred this appeal contending that the Adjudicating Authority in the impugned order has travelled beyond the purview of its jurisdiction by imposing additional conditions, as a result of which the same stands to be set aside.

Hon’ble NCLAT came to a resultant conclusion that the said observations are not in the form of ‘imposed additional conditions’ but only a way to open up the plan in regard to ‘undecided claims.’ Hence, the Adjudicating Authority is well within its limit. Accordingly, the appeal was held to be sans merit and was dismissed.

Judgment link: https://nclat.nic.in/Useradmin/upload/51371866760a2038aa4e5c.pdf

 

  1. Ronak Kundanlal Bhagat & Ors v. Parthiv Parikh RP of Sanghvi Forging and Engineering Ltd & Ors (DOJ: 21.05.2021)

In the current matter, Hon’ble NCLAT rejected the plea by the Promoters of the corporate debtor wherein they are ready to pay the equal amount which was accepted by the Successful Resolution Applicant. The Hon’ble Tribunal further held that the Shareholders did not raise any objections before the Adjudicating Authority and therefore, they have no locus standi to file this appeal.

Since the Adjudicating Authority under the impugned order approved the Resolution Plan, it was observed that, as per Section 61(3)(ii), an appeal can only be filed on the grounds of material irregularity in exercise of powers by the Resolution Professional during the CIRP.

Hon’ble Tribunal while concluding the order held that the Appellants failed to point out any material irregularity and hence there is no ground to interfere in the impugned order. Accordingly, the appeal was summarily dismissed.

Judgment link: https://nclat.nic.in/Useradmin/upload/180634310160acabbfb955e.pdf

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