2020 (10) TMI 320 - Tri - IBC

Exclusion of 30 days from the statutory period of 270 days - CIRP process - HELD THAT - Reliance can be placed in the decision of the Hon ble NCLAT in QUINN LOGISTICS INDIA PVT. LTD. VERSUS MACK SOFT TECH PVT. LTD. MOHD. SABIR PARVEZ AND MR. M.L. JAIN (RESOLUTION PROFESSIONAL) 2018 (6) TMI 904 - NATIONAL COMPANY LAW APPELLATE TRIBUNAL NEW DELHI wherein the Hon ble NCLAT has dealt with the question of exclusion of certain time period for the purpose of counting the total CIRP period - it was held that If an application is filed by the Resolution Professional or the Committee of Creditors or any aggrieved person for justified reasons it is always open to the Adjudicating Authority/Appellate Tribunal to exclude certain period for the purpose of counting the total period of 270 days if the facts and circumstances justify exclusion in unforeseen circumstances. In addition to the above judgement the judgement of Apex Court Committee of Creditors of Essar Steel India Limited Vs. Satish Kumar Gupta Ors. 2019 (11) TMI 731 - SUPREME COURT has conferred power on the Adjudicating Authority to consider issue of exclusion time from statutory period prescribed under the provisions of Code basing on justification for the same - The facts and circumstance as stated supra would justify for exclusion of time as prayed for. It is granted further exclusion of 30 (Thirty) days period from the statutory period of 180 90 days in addition to earlier exclusion 154 54 days already granted in the case to complete the Corporate Insolvency Resolution Process - application disposed off.

Summary

Issues:
- Exclusion of time period in Corporate Insolvency Resolution Process (CIRP) under IBC, 2016.

Analysis:
The judgment by the National Company Law Tribunal, Bengaluru Bench, involved the consideration of I.A. No. 92/2020 in C.P.(IB) No. 51/BB/2018, filed by the Resolution Professional seeking exclusion of 30 days from the statutory period of 270 days to conclude the CIRP of the Corporate Debtor. The Application was based on the need for justice and equity in the resolution process. The Resolution Professional highlighted that two Resolution Plans were received, one from a foreign company, causing delays due to communication challenges. The recent judgment by the Supreme Court on the timely resolution of stressed assets was cited, emphasizing the importance of completing the CIRP within the outer limit of 330 days, with provisions for extension in exceptional cases.

The Tribunal, after hearing the arguments, referred to the judgment of the NCLAT in a similar case, emphasizing the authority's power to exclude certain periods for counting the total CIRP period based on justified reasons and unforeseen circumstances. The Tribunal also referenced the Supreme Court's judgment, which empowered the Adjudicating Authority to consider exclusion of time from the statutory period prescribed under the Code, depending on the justifications presented. In this case, the Tribunal found the facts and circumstances justified the exclusion of time as requested, aligning with the interest of justice.

Consequently, the Tribunal exercised its powers under the Code and Rules to grant further exclusion of 30 days from the statutory period of 180+90 days, in addition to the previous exclusions granted. The Resolution Professional was directed to expedite the CIRP process, ensuring timely completion and submission of the necessary applications before the extended period expires. The judgment focused on balancing the need for timely resolution with the flexibility to extend time in exceptional cases, ultimately aiming to facilitate the successful resolution of stressed assets within the legal framework provided by the IBC, 2016.