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Insolvency and Bankruptcy - Case Laws
Showing 1 to 20 of 147 Records
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2019 (12) TMI 1673
Jurisdiction - power of 'Directorate of Enforcement' to attach the property of the 'Corporate Debtor' or part thereof - CIRP process undergoing - Operational Creditor or not - Proceeds of crime - it was held by NCLAT that The Director, Deputy Director and other officers of 'Directorate of Enforcement' are prohibited from attachment of any property of the 'Corporate Debtor' (Bhushan Power and Steel Limited) without prior approval of this Appellate Tribunal.
HELD THAT:- Issue notice returnable in February, 2020.
In the meantime, there shall be stay of Provisional Attachment Order No.11/19 dated 10.10.2019 passed by the Directorate of Enforcement (ED).
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2019 (12) TMI 1658
Maintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - Operational Creditors - existence of debt and dispute or not - time limitation - HELD THAT:- As the application under Section 9 is barred by limitation and there is a pre-existence of dispute, it is held that application under Section 9 was rightly rejected by the Adjudicating Authority.
The appeal is dismissed
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2019 (12) TMI 1650
Exclusion of period of 100 days only with effect from 1st May, 2019 to 9th August, 2019, i.e., the date of pendency of the proceedings before the National Company Law Tribunal and the Hon’ble Supreme Court - HELD THAT:- In the case of Y. SHIVRAM PRASAD AND ASSET RECONSTRUCTION COMPANY (INDIA) LTD. VERSUS S. DHANAPAL & ORS. AND SERVALAKSHMI PAPER LTD. & ORS [2019 (5) TMI 386 - NATIONAL COMPANY LAW APPELLATE TRIBUNAL, NEW DELHI], this Appellate Tribunal observed and held that As the liquidation so taken up under the ‘I&B Code’, the arrangement of scheme should be in consonance with the statement and object of the ‘I&B Code’. Meaning thereby, the scheme must ensure maximisation of the assets of the ‘Corporate Debtor’ and balance the stakeholders such as, the ‘Financial Creditors’, ‘Operational Creditors’, ‘Secured Creditors’ and ‘Unsecured Creditors’ without any discrimination. Before approval of an arrangement or Scheme, the Adjudicating Authority (National Company Law Tribunal) should follow the same principle and should allow the ‘Liquidator’ to constitute a ‘Committee of Creditors’ for its opinion to find out whether the arrangement of Scheme is viable, feasible and having appropriate financial matrix. It will be open for the Adjudicating Authority as a Tribunal to approve the arrangement or Scheme in spite of some irrelevant objections as may be raised by one or other creditor or member keeping in mind the object of the Insolvency and Bankruptcy Code, 2016.
The ‘Liquidator’ to first act in accordance with the decision in Y. Shivram Prasad by following the procedure of Sections 230-232 of the Companies Act, 2013. It is noticed that for the purpose of proceedings under Sections 230 to 232 of the Companies Act, 2013, it is open to the Adjudicating Authority to grant more than 90 days of period - for completion of the ‘Liquidation Process’, average two years’ time has been granted. The sale of assets can be done only if the ‘Liquidator’ fails to revive the Company by pursuing the proceedings under Section 230 vis-à-vis 232 of the Companies Act, 2013 as a going concern.
Appeal disposed off.
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2019 (12) TMI 1649
Entitlement for recovery of advances interest (by Bank) - classification of the loan account as Non Performing Assets - amount payable in conditional interim order - HELD THAT:- This Court is of the considered view that a prima facie case has been made out for grant of interim orders for the reason that the petitioner appearsto have made substantial payments and despite that further action is contemplated against the properties of the petitioner Company, which may result in irreparable loss and grave hardship to him and balance of convenience as on today lies in favour of the petitioner. Hence there shall be an order of adinterim injunction, as prayed for till 21.01.2020. However it is made clear that till the disposal of the writ petition, the writ petitioners shall not create any third party rights in respect of the properties in question.
Call on 21.01.2020.
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2019 (12) TMI 1643
Maintainability of petition - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - Operational Creditors - threshold limit of salary not being paid - Appellant submits that even if the salary of recent year is taken into consideration, which is more than Rs.1 Lakh, it having not been paid by the Corporate Debtor, the application under Section 9 was maintainable.
HELD THAT:- From application under Section 9 filed by the Appellant, it is found that the appellant has shown particulars of the claim under following heads - Salary for the period December, 2014 to March, 2015, which is barred by limitation; Reimbursement of amount for FY 2014-15 as per SAP Ledger Statement, which is also barred by limitation; Salary for the period August, 2016 to March, 2017 plus TDS; TDS of certain period; Leave encashment for July, 2013 - March, 2017 - however, the Adjudicating Authority noticed that the claim for the period April, 2016 to March, 2017 do not pertain to the Corporate Debtor - 'M/s DSC Ltd.' but to M/s DSCL - FENGSHUN-WANAG Consortium' as stated by Appellant in Form-5.
The application was filed by the Appellant with an intent to receive the dues from the Corporate Debtor and not with intention for resolution or liquidation, therefore, the Adjudicating Authority rightly rejected the prayer of the Appellant - So far as the question as to whether the documents are forged or not is concerned, it cannot be determined by the Adjudicating Authority (National Company Law Tribunal) or this Appellate Tribunal and therefore, the Adjudicating Authority rightly not deliberated on such issue.
Appeal dismissed.
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2019 (12) TMI 1623
CIRP - Seeking direction to RP to accept its claim - The Adjudicating Authority noticed that earlier claims of the Appellant were dealt with by the ‘Resolution Professional’ and were rejected. - HELD THAT:- we are not inclined to decide any matter relating to claim of one or the other claimant entitled to premises as a Home buyer as no proof was laid before the Adjudicating Authority reflecting that against such claims monies were paid to the ‘Corporate Debtor’. As regards the plea that if one or the other individual including the Appellant has made full payment, the learned Counsel may bring it to the notice of the ‘Resolution Professional’ or the ‘Successful Resolution Applicant’. We are not inclined to express any opinion with regard to the same.
Appeal dismissed.
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2019 (12) TMI 1610
Recovery of dues - priority of claims - whether the second charge holder has any right to claim priority over the first charge holder? - HELD THAT:- This question has already been answered in the court itself and the Liquidator is directed to distribute the funds strictly adhering to the ratios as arrived by him for the first charge holder as per the Code. If at all any grievance on the part of the second charge holder, they may approach the competent court but they have no authority to approach this Bench.
Application disposed off.
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2019 (12) TMI 1605
Vacation of ex-parte interim relief granted - arising of hardship as the company's project i.e. construction of hospital is going on - HELD THAT:- Looking to the undertaking given by the Respondent the appeal is disposed off. This order will continue till the disposal of the main Company Petition which is pending before NCLT. No order as to cost.
Respondent is directed to file reply to the Company Petition No.98/CB/2019 which is pending before NCLT, Cuttack Bench, Cuttack before 19th December, 2019.
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2019 (12) TMI 1596
Maintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - Financial Creditors - existence of debt and dispute or not - Time Limitation - guarantor of the loan is the individual and not the corporate person - HELD THAT:- Section 5A of IBC, 2016 states Corporate Guarantor means the corporate person who is surety in contract guarantee to a Corporate Debtor. Section 3(8) of IBC defines Corporate Debtor means corporate person who owes a debt of any person. In this case, It is not in dispute that by virtue of deed of guarantee, the Corporate Debtor herein who is the corporate person owes debt to the Bank. Hence, the Corporate definition in Section 5A of IBC, 2016 of corporate guarantor cannot be considered for exclusion of this proceeding from consideration for a simple reason that the definition Is just explanatory definition as to who could be called as corporate guarantor. In this case, the Corporate Debtor is the guarantor of the individual.
The definition of the corporate guarantor relied on by him in Section 5A cannot be used to show applicability or Inapplicability of provisions of IBC against him as it hi just explanatory definition - the Financial Creditor proved that the financial debt is due and payable by the Corporate Debtor and he has committed default in paying the same.
The application is filed well within period of limitation - application filed by the Financial Creditor under section 7 of the Insolvency & Bankruptcy Code, 2016 for initiating Corporate Insolvency Resolution Process against the Corporate Debtor, M/s Surana Metals Ltd. is hereby admitted - moratorium declared.
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2019 (12) TMI 1595
Approval of Resolution Plan - section 31(1) of the IBC, 2016 - discharge or provide immunity from all the liabilities/Disputes/proceedings/penalties/suits/attachments/cases whether civil or criminal filed against the Corporate Debtor whether accounted/known or not on payment of the agreed consideration by Resolution Applicant - approval for waiver of Cost of transfer if any payable under respective statues - HELD THAT:- Section 30(6) of the Code enjoins the resolution professional to submit the resolution plan as approved by the committee of creditors to the Adjudicating Authority. Section 31 of the Code deals with the approval of the resolution plan by the Adjudicating Authority, if it is satisfied that the resolution plan as approved by the committee of creditors under section 30(4) meets the requirements as referred to in section 30(2) - the Resolution Plan includes a statement under regulation 38(lA) of the CIRP Regulations as to how it has dealt with the interest of the stakeholders in compliance with the Code and Regulations thereunder.
The 'Resolution Plan' filed with the Application meets the requirements of Section 30(2) of the I&B Code, 2016 and Regulations 37, 38, 38(1A) and 39 (4) of IBBI (CIRP) Regulations, 2016. The 'Resolution Plan' is also not in contravention of any of the provisions of Section 29A. Hence, this Adjudicating Authority is satisfied that the Resolution Plan is in accordance with Law - the Resolution Plan approved shall not construe any waiver to any statutory obligations/liabilities arising out of the approved Resolution Plan and same shall be dealt in accordance with the appropriate Authorities as per relevant Laws.
Application disposed off.
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2019 (12) TMI 1593
Maintainability of appeal before Appellate Tribunal - HELD THAT:- If the revision petitioner intends to assail the impugned order, he has to file an appeal before the appellate Tribunal.
Under these circumstances, the Civil Revision Petition is dismissed.
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2019 (12) TMI 1591
Cancellation of agreement - cancellation of agreement - maintainability of the application as an allottee - HELD THAT:- Let notice be issued on Respondents by Speed Post. Requisites alongwith process fee, if not already filed, be filed by tomorrow. If the Appellant provides email address of the Respondents, let notice be also issued through email.
Post the appeal ‘for orders’ on 14th January, 2020 for disposal.
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2019 (12) TMI 1589
Maintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - Operational Creditors - existence of debt and dispute or not - HELD THAT:- The ‘Purchase Orders’, which makes it clear that ‘M/s. Consolidated Construction Consortium Limited’ is a ‘Purchaser’ and do not come within the meaning of ‘Operational Creditor’ having not supplied any goods nor given any services to ‘M/s. Hitro Energy Solutions Private Limited’. In any case, whether ‘M/s. Hitro Energy Solutions Private Limited’ or ‘M/s. Hitro Energy Solutions’ all ‘Purchase Orders’ having issued on 24th June, 2013 and advance cheques have been issued for subsequently such orders, ‘M/s. Consolidated Construction Consortium Limited’ cannot move application under Sections, 7 or 9 or the ‘I&B Code’.
As the application under Section 9 was not maintainable at the instance of ‘M/s. Consolidated Construction Consortium Limited’, we set aside the impugned order dated 6th December, 2018. The application under Section 9 preferred by ‘M/s. Consolidated Construction Consortium Limited’ is dismissed.
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2019 (12) TMI 1584
Seeking Liquidation of the Corporate Debtor - Section 33 of the Insolvency & Bankruptcy Code, 2016 - Committee of Creditors meeting has approved for Liquidation - HELD THAT:- In the CoC meeting dated 01.08.2019, the CoC unanimously decided to liquidate the Corporate Debtor under section 33(1) of the I&B Code. The CoC decided that the RP Mr. Dhanshyam Patel be appointed as liquidator subject to approval of this Bench.
The company is ordered to be liquidated - the Process of Liquidation shall commence as per the Chapter III of the Code from date of this Order - application allowed.
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2019 (12) TMI 1583
Maintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - Financial Creditors - time limitation - HELD THAT:- The Corporate Debtor, Jayant Vitamins Ltd. committed default on 13th September, 1996. Thereafter, Appellant filed suit for recovery which was decreed on 17th October, 2005 and a case for execution is pending. Therefore, it is found that the application under Section 7 was barred by limitation.
An application under Section 7 was filed with malicious intent, not for resolution of insolvency or liquidation, as covered under Section 65 of the I&B Code - appeal dismissed.
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2019 (12) TMI 1582
Maintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - Operational Creditors - existence of debt and dispute or not - HELD THAT:- From the records it is noticed that the Corporate Debtor has not submitted any proof to substantiate its claim that the dispute is pre-existing in accordance with the provisions of IBC 2016 - Further there is no record to substantiate/justify the counter claim made by the Corporate Debtor for an amount of ₹ 23,97,616/- as claimed by Corporate Debtor. Further the said quantum of amount has also not been adjudicated by any relevant Authority.
The application made by the Operational Creditor is complete in all respects as required by law. The Corporate Debtor is in default of a debt due and payable, and the default is in excess of minimum amount of one lakh rupees stipulated under section 4(1) of the IBC. Therefore, the default stands established and there is no reason to deny the admission of the Petition. In view of this, this Adjudicating Authority admits this Petition and orders initiation of CIRP against the Corporate Debtor.
Petition admitted - moratorium declared.
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2019 (12) TMI 1580
Maintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - Corporate Applicant/Financial Creditors - existence of debt and dispute or not - HELD THAT:- Hon'ble High Court of Delhi in Liberty House Group Pte Ltd. Vs. State Bank of India and Ors. [2019 (2) TMI 1453 - DELHI HIGH COURT] which dealt with the issue regarding the jurisdiction of the Civil Court to entertain any suit or proceedings and grant interim injunction restraining encashment of bank guarantees and the objection of the defendants to the subject jurisdiction of the Civil Court was for consideration and whether NCLT has the jurisdiction under the I &B Code, 2016 - it can be said that the ratio laid down in the above judgement clearly states that no Civil Court shall have the jurisdiction to entertain any suit or proceedings in respect of any matter on which the National Law Company Tribunal has jurisdiction under the I & B Code, 2016.
The Core issue is whether NCLT can order possession of the property of Corporate Applicant to facilitate the CIRP process and allow the Resolution Professional to take possession of the assets of Corporate Applicant, pending adjudication of pending suit filed by Corporate Applicant seeking possession of the shed from the applicant.
Section 60(5) and (b)(c) of the Code empowers NCLT to entertain the dispute raised in the suit, section 63 of the Code further bars the jurisdiction of the civil court in matters pertaining to the NCLAT, section 231 of the Code also bar the jurisdiction of the civil court from granting any injunction in respect of any action taken or in pursuance of any order passed by the Adjudicating authority under this Code - Upon conjoint reading of section 60(5), section 63, section 231 and section 238, the jurisdiction of Civil Court is excluded related to the matters related to I & B code. Therefore, it can be held that NCLT can order possession of the property of Corporate Applicant to facilitate the CIRP process and allow the Resolution Professional to take possession of the assets of Corporate Applicant.
The principles of comity would be affected if conflicting order were passed by the Civil Court and the NCLT the same would be detrimental to the resolution process. The office of Resolution Professional has become functus officio, the Liquidator has been appointed, the liquidator subject to the directions of the Adjudicating Authority under section 35(1)(b) has the power to take into his custody or control all the assets, property effects an actionable claim of the Corporate Applicant - the non-obstante clause as prescribed section 238 of the I & B Code, 2016, provides that the provisions of the Code shall have effect notwithstanding anything inconsistent therewith contained in any other law for the time being in force or any instrument having effect by virtue of any such law.
It is the case of Corporate Applicant that he is seeking possession in the suit, whereas the Applicant is only claiming recovery of monies in his suit. There are no restraint orders passed in both the cases. Therefore, the Resolutions Professional's claim for possession of shed before the adjudicating authority in view of CIRP order, can be entertained under the I & B Code - the applicant has also filed his claim before the Resolution Professional and has subjected himself to the jurisdiction of the CIRP. His claim was rejected by the RP. In view of the moratorium, the suit filed by the applicant was temporarily stayed, but the suit filed for recovery of possession filed by the Corporate Applicant would deemed to continue. With the given factual matrix, the CIRP period of 270 days having come to an end, the office of IRP has become functus officio.
In view of the overriding powers under section 238 of the Code and Rule 11 of NCLT Rules 2016, and it is directed that Resolution Professional/ Liquidator shall be allowed to take possession of the Shed from the Applicant - the RP/ Liquidator is directed to take possession of the Shed - application disposed off.
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2019 (12) TMI 1578
Liquidation of the Corporate Debtor - Section 33 of the Insolvency and Bankruptcy Code, 2016 read with Regulation 33(2) of the Insolvency and Bankruptcy Board of India (Liquidation Process) Regulations, 2016 and Section 60(5) of the Insolvency and Bankruptcy Code, 2016 - HELD THAT:- It is evident that no resolution plan has come because no Expression of Interest was issued by the Resolution Professional for the reasons aforementioned. However, since the CoC has taken a decision for liquidation of the company, the same being permitted and explicitly stated u/s. 33(2) of the Code as amended on 16.08.2019 since the CoC has already passed resolution for liquidation of the Corporate Debtor with 73.44% voting share on 18.10.2019, the liquidation order is passed.
Application allowed.
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2019 (12) TMI 1576
Permission for withdrawal of petition - recording of terms and conditions of settlement agreement - Constitution of CoC - HELD THAT:- Mere plain reading of the provisions shows that Section 12A inserted by the amendment dated 06.06.2018 under which an application which was admitted under Section 7, 9 or 10 can be withdrawn and regulation 30A which has been amended recently provides how the withdrawal applications filed under Section 12A can be entertained by the Adjudicating Authority while considering the prayer of withdrawal of applications which has been admitted under Section 7, 9 or 10.
Mere plain reading of the amended provision made in the regulations shows that there are two circumstances under which withdrawal is permissible. One is before the admission of the application under Section 7, 9 or 10 and before the constitution of COC and second one is after the admission of the application under Section 7, 9 or 10 and after the constitution of the COC and appointment of IRP. The present application herein is admitted on 01.11.2019 and IRP was appointed and the Operational Creditor was also directed to deposit of ₹ 2 lacs to meet the immediate expense of the IRP but here in the place of IRP the applicant directly filed the application under Rule 11 of the NCLT rules - the applicant has not filed the application under Section 12A read with Regulation 30A through TRP rather it is filed without following the procedure laid down in Section 12A of IBC, 2016 read with Regulation 30A of CIRP Regulations. So, in our opinion, the present application is not maintainable and liable to dismissed.
Application dismissed.
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2019 (12) TMI 1575
Maintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - Financial Creditors - existence of debt and dispute or not - HELD THAT:- The Financial Creditor has established beyond doubt that the loan was duly sanctioned and duly disbursed to the Corporate Debtor and that there has been default in payment of the Debt by the Corporate Debtor.
The application made by the Financial Creditor is complete in all respects as required by law. It clearly shows that the Corporate Debtor is in default of a debt due and payable, and the default is in excess of minimum amount of one lakh rupees stipulated under section 4(1) of the IBC. Therefore, the default stands established and there is no reason to deny the admission of the Petition. In view of this, this Adjudicating Authority admits this Petition and orders initiation of CIRP against the Corporate Debtor.
Application admitted - moratorium declared.
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