2021 (9) TMI 1302 - AT - Insolvency and Bankruptcy

Seeking to exclude the period commencing from 25.03.3020 to 30.06.2020 i.e. 98 days on the ground of Lockdown imposed by the Central Government as well as State Government while calculating the total period of Corporate Insolvency Resolution Process - HELD THAT - Where Ld. Adjudicating Authority excluded only 98 days, we hereby exclude 221 days (the period from 25.03.2020 to 31.10.2020) from the CIRP period as prayed by the Appellant on the ground of Lockdown imposed by the Central Government as well as State Government. Thus, the impugned order is hereby set aside. The time spent in pursuing the instant Appeal i.e. Company Appeal (AT) (Insolvency) No. 444 of 2021 filed by Resolution Professional (Appellant herein) on 18.06.2021 to till the date of Judgment is also excluded from the CIRP period. Appeal allowed - Registry to upload the Judgment forthwith on the website of this Appellate Tribunal.

Summary

Issues:
Exclusion of lockdown period from Corporate Insolvency Resolution Process calculation.

Analysis:
The Appellant filed an application seeking exclusion of 221 days from the Corporate Insolvency Resolution Process (CIRP) period of 180 days due to the lockdown imposed by the Central and State Governments. The Adjudicating Authority partially allowed the application, excluding only 98 days. The Appellant appealed this decision, arguing that the entire lockdown period should be excluded as per the Insolvency and Bankruptcy Board of India notification. The Appellant contended that strict adherence to the notification would extend the CIRP period. The Appellate Tribunal agreed with the Appellant, setting aside the Adjudicating Authority's decision and excluding the full 221 days of the lockdown period from the CIRP calculation. The Tribunal also excluded the time spent on the appeal process from the CIRP period. The judgment was to be uploaded on the Tribunal's website, and a copy was to be sent to the Adjudicating Authority.

This case involved a dispute over the exclusion of the lockdown period from the calculation of the Corporate Insolvency Resolution Process. The Appellant sought an extension of the CIRP period by excluding the days affected by the lockdown. The Adjudicating Authority granted a partial exclusion, which the Appellant challenged in the appeal. The Tribunal, considering the legislative intent behind the insolvency laws, ruled in favor of the Appellant, excluding the entire lockdown period from the CIRP calculation. The decision aimed to prevent prejudice to the Corporate Debtor and ensure the effective conduct of the resolution process.