Home Case Index All Cases Insolvency and Bankruptcy Insolvency and Bankruptcy + AT Insolvency and Bankruptcy - 2022 (1) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2022 (1) TMI 262 - AT - Insolvency and BankruptcyWithdrawal of CIRP Application filed u/s 12 A of IBC - settlement between the Appellants and the Corporate Debtor - two Financial Creditors out of which one having 17% of voting shares has dissented to allow withdrawal - requirement of consent/approval form CoC for withdrawal of Application - HELD THAT:- The Hon’ble Supreme Court in SWISS RIBBONS PVT. LTD. AND ANR. VERSUS UNION OF INDIA AND ORS. [2019 (1) TMI 1508 - SUPREME COURT] has held that at any stage, before a Committee of Creditors is constituted, a party can approach National Company Law Tribunal (NCLT) directly and that the Tribunal may, in exercise of its inherent powers under Rule 11 of NCLT Rules, allow or disallow an application for withdrawal or settlement - The Hon’ble Supreme Court held that Approval of ninety percent voting share is mandated when Committee of Creditors is already constituted and is in existence. In the present case, the Application under Section 12A was filed on 25.08.2021 on which date settlement between the Appellants and the Corporate Debtor had already been entered. On the day when the Application was filed, there was no requirement of approval of ninety percent of voting share of Committee of Creditors - entire dues of the Appellant were paid by the Corporate Debtor under Memorandum of Settlement dated 25.08.2021. An Application was also filed on 25.08.2021 i.e. before the constitution of the Committee of Creditors. There was no requirement of directing for obtaining approval of ninety percent vote of Committee of Creditors for considering the Application. There was no fresh Application before the Adjudicating Authority apart from Application dated 25.08.2021 which was filed prior to the constitution of Committee of Creditors. The Adjudicating Authority without considering the facts and sequence of the events had refused to entertain the Application on the ground that it is not supported by ninety percent vote of Committee of Creditors - present is a case where the Application for withdrawal ought to be allowed permitting withdrawal of Corporate Insolvency Resolution Process. Appeal allowed.
|