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Insolvency and Bankruptcy - Case Laws
Showing 1 to 20 of 188 Records
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2020 (9) TMI 1280
Jurisdiction exercised by the National Company Law Tribunal (NCLT), Kolkata - Respondent No.2/the Company in liquidation is being also proceeded against under the Prevention of Money Laundering Act, 2002 - Section 32A of the IBC - HELD THAT:- This Court is satisfied that the petitioners have made out a prima facie case for grant of an interim order.
Application allowed.
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2020 (9) TMI 1265
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 - acknowledgement of the debt in the balance sheets of the corporate debtor - HELD THAT:- It is not in dispute that in this case the loan account was declared to be an NPA on 10.04.2014. This proceeding was filed on 19.09.2018. So it appears that it was filed beyond the period of three years from the date on which the right to apply was accrued to the Bank. Having noted so, we have to consider whether the period of Limitation said to be extended because the corporate debtor's balance sheets show that the debt is still to be payable.
In case of 'V. Padmakumar' [2020 (3) TMI 1244 - NATIONAL COMPANY LAW APPELLATE TRIBUNAL, NEW DELHI], Hon. NCLAT dealt with this aspect and held that If the argument is accepted that the Balance Sheet / Annual Return of the 'Corporate Debtor' amounts to acknowledgement under Section 18 of the Limitation Act, 1963 then in such case, it is to be held that no limitation would be applicable because every year, it is mandatory for the 'Corporate Debtor' to file Balance Sheet/ Annual Return, which is not the law."
Thus, the acknowledgement of the debt in the balance sheets of the corporate debtor does not help the financial creditors to maintain this time barred application.
OTS Proposal submitted by the Corporate Debtor - HELD THAT:- Admittedly it was submitted to the bank on 18/9/2017 i.e., beyond a period of three years from the date of default. Hence it does not bring the claim of the financial creditor within limitation. In view of the above facts, it is not felt necessary to enter into resolving the controversy whether the OTS proposal given by the corporate debtor without prejudice to its rights to contest the claim can be said to be acknowledgement of the debt or not?
In this case also the debt of default is 10.06.2014 (i.e., the date of NPA). This application under Section 7 IBC is filed on 19.09.2018. Hence it is filed beyond the period of Limitation.
Application dismissed.
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2020 (9) TMI 1264
Seeking to pass an order of injunction restraining the Respondent from leaving the jurisdiction of this Tribunal without its leave - seeking direction to Respondent to extend necessary cooperation in discharge of his functions under the provisions of Code - Sections 19 & 33 of the I & B Code, R/w Rule 11 & 13 of NCLT Rules.
Extension of co-operation - HELD THAT:- Though more than one year was over, the Applicant could not make substantial progress in liquidation process in order to follow time lines as prescribed under the Provisions the Code. So far as extending co-operation by the Respondent is concerned, it is settled position of law that all the concerned people, which includes Directors/MD, in respect of the affairs of the Corporate Debtor, and Managing Directors are required to extend co-operation to IRP/RP/Liquidator. The Applicant himself states in the Application that the Respondent was extending cooperation to him except for the last 20 (twenty) days, which is nothing but un-tenable contention/allegation made for the reasons best known to him. It (sic) goes without saying that the Respondent is under legal obligation to extend his co-operation.
Seeking restraint on Respondent from leaving the Country - HELD THAT:- The presence of Respondent is not required before the Adjudicating Authority, but may be required before Arbitral Authorities. And Arbitral Authorities, by law have judicial powers to ensure witness in the case pending before them. It is relevant to point out here that proceedings pending here are only liquidation proceedings, wherein presence of Respondent is not required. It is for the Applicant to initiate Criminal proceedings against the Respondent, if circumstances so warrant and thus seek appropriate relief which include to prohibit the Respondent to leave the Country.
Application dismissed.
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2020 (9) TMI 1262
Condonation of delay of 358 days in the application which has already been tiled under Section 9 of IB Code - HELD THAT:- The instant application is the original application and the delay cannot he condoned as prayed in the application.
The instant application is dismissed as not maintainable.
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2020 (9) TMI 1261
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 - Conflicting orders have been passed by the two Members comprising the Bench of Adjudicating Authority (National Company Law Tribunal) - mandate of Section 419(5) of the Companies Act, followed by the two members or not - HELD THAT:- It is deemed appropriate to dispose of this appeal with direction to the same Bench of the Adjudicating Authority, which passed two conflicting orders, to make a reference to Hon’ble President, NCLT, if not already made, in terms of Section 419(5) of the Companies Act, 2013, for hearing on the issues and points on which the two Members of the Bench had divergent view in the split verdict so that the matter is placed before a third Member for hearing and the Company Petition is decided in accordance with the opinion of the majority of the Members who heard the case including the member before whom it is placed.
Matter to be referred to Hon’ble President, NCLT - the appeal is accordingly disposed of.
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2020 (9) TMI 1244
Liquidation process - validity of admission of claims of respondent Nos. 2 to 5 - HELD THAT:- Issue notice to the respondents and the applicant counsel shall collect the same from the Registry and send along with copy of the application and the entire paper book to the respondents by Speed Post immediately as well as at the e-mail address available and file affidavit of service along with postal receipt, tracking report and copy of e-mail within 10 days.
Issue notice to the respondents and the applicant counsel shall collect the same from the Registry and send along with copy of the application and the entire paper book to the respondents by Speed Post immediately as well as at the e-mail address available and file affidavit of service along with postal receipt, tracking report and copy of e-mail within 10 days.
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2020 (9) TMI 1243
Approval of the Resolution Plan which has been approved by the Committee of Creditors by a voting share of 82.75% - Section 60(5) and Sec 30 of the Insolvency and Bankruptcy Code, 2016 - HELD THAT:- There is provision made to make payment of debt of the Operational Creditors. Mechanism is suggested for the management of the affairs of the Corporate Debtor. Mechanism is also provided for effective supervision and implementation of the plan - the resolution plan meets the requirements under section 30(2) of the Code.
The Resolution Plan as approved by the CoC Under Section 30(4) of the Code, meets the requirements, as referred to under Sub-Section (2) of Section 30 of the Code - the resolution plan is approved - application allowed.
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2020 (9) TMI 1235
Seeking grant of Regular Bail - Tripartite Off-take Agreement - misuse of Working Capital Demand Loan - amount transferred to the other sister concerns/shell companies in order to square off its credit facility with the Corporation Bank - HELD THAT:- It is an admitted fact that the co-accused namely Navin Kumar Jain and Hulash Chand Jain were the other Directors and shareholders of SALL as well as LMJIL. They also signed/undertook personal guarantee to the complainant company in their capacity as Directors of the SALL against the “Working Capital Demand Loan”. Navin Jain had also signed the Tripartite Off-take Agreement in the capacity of Director of LMJIL. Both of them were not even arrested and the charge sheet against them was filed without arrest.
During two years of enquiry/investigation, the petitioner joined investigation on multiple occasions. After his arrest, the EOW sought only one day PC remand. Neither in the Status Report nor during the course of arguments, any apprehension was shown that the petitioner is a “flight risk”. The case arises out of a commercial transaction and is based on documents that already stand seized. The petitioner has already approached the NCLT where a moratorium on the assets/properties has been declared and an IRP has been appointed. The complainant has already approached NCLT.
The petitioner is directed to be released on regular bail on his furnishing a personal bond in the sum of ₹ 25 lacs alongwith two sureties of the like amount each to the satisfaction of the trial court and subject to further conditions imposed - the bail is granted - application allowed.
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2020 (9) TMI 1230
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 - HELD THAT:- It can be said that the amount which the petitioner claimed or mentioned in the application was paid by the petitioner lastly in the month of June 2014 and according to the petitioner, the last payment was received by the petitioner on 15.03.2016 and we further noticed that the present application is filed on 20.03.2020 and the contention of the petitioner is that since the respondent in its balance sheet for the Financial Year 2016-17, which ended on 31.03.2017 acknowledged that amount therefore, from that period the debt is not barred by limitation and in support of its contention, the petitioner has not placed any law before us that the amount mentioned in the balance sheet comes under the definition of acknowledgement of debt under Section 18 of the Limitation Act.
In view of Section 18 of the Limitation Act, there must be any acknowledgement in writing and signed by the person by the borrower or any person authorised on his behalf, the statement made in the balance sheet, in our considered view does not comes under the purview of Section 18 of the Limitation Act, therefore, on this ground, petitioner is not entitled to take the advantage that since the acknowledgement is made in the balance sheet, therefore, the date of default runs when the balance sheet was signed for the Financial Year 2016-2017 - the date of default is 11.06.2015 and the last payment was received on 15.03.2016, hence, the petitioner was required to file application if any within 3 years from 11.06.2015 which comes to end on 10.06.2018, whereas the present application was filed on 20.03.2020 that is beyond the 3 years, when the right to apply accrues under Article 137 of the Limitation Act.
Mere plain reading of the provisions shows that the debt means a liability or obligation in respect of a claim, which is due from any person and includes a financial debt and operational debt and when we shall read the definition of debt and financial debt together then, the debt includes the Financial Debt and Operational Debt but all the debts are not Financial Debt or Operational Debt, only debt defined under Section 5(8) of the IBC, comes under the definition of Financial Debt and debt defined under Section 5(21) of the IBC comes under the definition of Operational Debt.
The present application is not maintainable - Application dismissed.
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2020 (9) TMI 1229
Seeking extension of time limit for completion of Insolvency Resolution Process of the Corporate Debtor - Section 12 of the Insolvency and Bankruptcy Code, 2016 read with Regulation 40 of the Insolvency and Bankruptcy Board of India (Insolvency Resolution process for Corporate Persons) Regulations, 2016 - HELD THAT:- It is submitted that since there is a possibility of getting a resolution plan and since the CoC members have approved extension of 90 days beyond 180 days with 100% voting majority as required under Sec 12 (3) of IBC read with Regulation 40 of CIRP Regulations, 2016, it is humbly submitted that an extension of 90 days be permitted along with exclusion of 115 days on account of lockdown.
The extension of CIRP by 90 days is granted and the period of 98 days from March 25, 2020 to June 30, 2020 is also considered for being excluded while calculating the number of available days for CIRP calculation.
Application allowed.
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2020 (9) TMI 1224
Seeking extension of time for implementation of plan which was granted by Committee of Creditors (CoC) for 180 days - HELD THAT:- The Resolution provides for appointment of RP as the person incharge to look after the implementation of Resolution Plan. The Resolution Plan has also addressed the issues which resulted into Insolvency of the Corporate Debtor and future business plan so as to such situation does not arise.
The revised ‘Resolution Plan’ filed with the Application meets the requirements of Section 30(2) of 1&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. The Resolution Professional has also certified that the Resolution Plan’ approved by the CoC does not contravene any of the provisions of the law for the time being in force. The Compliance Certificate is placed on record. The ‘Resolution Plan’ has been approved by the CoC with 100% voting share.
The revised ‘Resolution Plan’ is hereby approved, which shall be binding on the Corporate Debtor and its employees, members, creditors, guarantors and other stakeholders involved in the Resolution Plan including Resolution Applicant - Application disposed off.
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2020 (9) TMI 1221
Contempt application for invoking Section 425 of the Companies Act 2013 for contempt jurisdiction against the Respondents - seeking direction to Respondents to pay advocate fees for the services rendered by the applicant during CIRP period to the respondent - HELD THAT:- Contempt jurisdiction is an extraordinary jurisdiction, not exercisable by ordinary courts/ Tribunals, unless it is specifically conferred upon. NCLT, when it deals with IBC matters, it is Adjudicating Authority created by IBC, no way connected with Companies Act, and the jurisdiction is not interchangeable between Adjudicating Authority under IBC and the Tribunal under Companies Act 2013, except to the extent law permits.
Contempt jurisdiction is in fact a jurisdiction conferred upon Constitutional Courts, which is hardly percolated down. It is given in a few enactments, it cannot be stretchable in the way we perceive, therefore it is made clear that IBC is devoid of contempt jurisdiction, accordingly this Application is dismissed leaving it open to the Applicant to seek remedy through recourses available.
Contempt application dismissed.
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2020 (9) TMI 1220
Seeking approval of Resolution Plan - HELD THAT:- The applicant is seeking relief which was not considered by the Bench at the time of approval of Resolution Plan by this Bench as well as denied any relief by the Income Tax Authority and hence, they approach this Bench by filing present application.
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2020 (9) TMI 1219
Maintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - Financial Creditors - existence of debt and dispute or not - pendency of the claim filed by the applicant in other CIRP proceeding - time limitation - HELD THAT:- Mere plain reading of the provision shows that Section 18(1) of Limitation Act says that Where, before the expiration of the prescribed period for a suit or application in respect of any property or right, an acknowledgment of liability in respect of such property or right has been made in writing signed by the party against whom such property or right is claimed, or by any person through whom he derives his title or liability, a fresh period of limitation shall be computed from the time when the acknowledgment was so signed.
Whether the acknowledgement of debt can change the date of default in view of Section 18 of the Limitation Act or not? - HELD THAT:- Specially Sub Section 18(1) of the Limitation Act, which says that the Where, before the expiration of the prescribed period for a suit or application in respect of any property or right, an acknowledgment of liability in respect of such property or right has been made in writing signed by the party against whom such property or right is claimed, or by any person through whom he derives his title or liability, a fresh period of limitation shall be computed from the time when the acknowledgment was so signed.
Article 137 of the Limitation Act says that if there is no period is prescribed then an application or suit shall be filed within 3 years when the right to apply accrues, it means a person may file an application within 3 years from the date when the right to apply accrues and here in this case, the right to apply accrues, when the default has occur and the NPA was declared on 31.12.2015, therefore, right to file an application under Section 7 accrues within 3 years from the date of NPA i.e. on 31.12.2015 but when we shall consider the Section 18 in which it is clearly mentioned the word property or right, which means the acknowledgement in respect of property or right, if it is made in writing then the period of limitation shall be computed from the date when the acknowledgement in writing was made.
As per the NPA the period of limitation comes to an end on 30.12.2018 but prior to that an acknowledgement of debt was made in writing by the Corporate Debtor on 18.07.2017.
Under Section 18 of the Limitation Act, if the acknowledgement of debt in writing and signed by the person before the expiration of prescribed period of limitation then the limitation shall be computed from the time when the acknowledgment was so signed and in this case, the acknowledgement was signed by the Corporate Debtor on 18.07.2017, therefore, the limitation runs from that day and the present application was filed by the corporate Debtor on 04.03.2020 hence, the application is within time.
Whether during the pendency of the claim filed by the applicant in other CIRP proceeding, this application is maintainable or not? - HELD THAT:- Section 12A is not applicable, so far the claim filed by the person before the IRP is concerned. The decisions upon which, the petitioner has placed reliance, in our considered view the facts of that decision is different from the facts of the case in hand, therefore, none of the decision will help the respondent to substantiate its submission that a person can withdraw its claim only under Section 12A of the IBC with the approval of the 90% of the member of the CoC - there are no option but to hold that there is no force raised on behalf of Ld. Counsel for respondent that the petition filed by this applicant is not maintainable because he had already filed its claim before the RP in the CIRP initiated against the parent company of the respondent i.e. EIEL.
The applicant has succeeded to establish that there is a financial debt and Corporate Debtor is in default in making the payment of that financial debt, the application is complete - Application admitted - moratorium declared.
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2020 (9) TMI 1213
Seeking issuance of directions against the respondent not to threaten the applicant or the security personnel at the site of the corporate debtor and not to enter into the premises of the land belonging to the corporate debtor - Section 19(2) of the Insolvency and Bankruptcy Code, 2016 - HELD THAT:- The respondent and their men or anybody claiming through them shall not create any hindrance or obstacle to the applicant or any personnel working under his control in any manner. The respondents cannot claim any right on the common road. If the respondent or its employees or anybody claiming through them create any disturbance or hindrance to the Resolution Professional or to any of his staff or security personnel in any manner, he may approach this Authority by filing an appropriate application for appropriate directions.
Application disposed off.
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2020 (9) TMI 1210
Maintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - default in payment of conducting fees, water bills, electricity bills and property tax - Operational creditors or not - Operational debt or not - existence of debt and dispute or not - HELD THAT:- When the enhanced rent payable under a tenancy agreement by the Corporate Debtor itself does not amounts to an Operational Debt, the municipal taxes and the Electricity Bills payable by Corporate Debtor under a business conducting agreement/lease agreement stands on lesser footing and cannot be considered as Operational Debt. Therefore, there are no hesitation in holding that the above amounts claimed by the Operational Creditor does not fall within the definition of Operational Debt and the petitioner cannot be termed as “Operational Creditor”.
Time Limitation - HELD THAT:- The company petition is filed on 12.03.2018. All the claims prior to 12.03.2015 are barred by limitation, since we are dismissing the above Company Petition on the very nature of the claim and the locus of the applicant, we are not dealing with each and every contention raised by the respondents.
The Company Petition is not maintainable before this Tribunal and is liable to be dismissed - petition dismissed.
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2020 (9) TMI 1207
Maintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - Financial Creditors - share purchase agreement with the Corporate Debtor - existence of debt and dispute or not - HELD THAT:- This Tribunal admitted the application appointing Mr. Amier Hamsa Ali Abbas Rawther as the Interim Resolution Professional.
Now the Corporate Debtor namely M/s Sree Bhadra Parks and Resorts Limited filed an application under Rule 11 of the NCLT Rules to recall the order passed by this Tribunal and permit them to settle the matter. Along with the application “Form FA” for withdrawal of Corporate Insolvency Resolution Process has been filed, duly signed by the applicant stating that on 26.8.2020 settlement has been arrived for a total sum of ₹ 2,25,00,000/- as full and final settlement of the entire claim between the Corporate Debtor M/s Sree Bhadra Parks and Resorts Limited.
In view of the settlement arrived between the parties by filing Form FA before this Tribunal and that the IRP stated that he has received his fees, the application stands disposed of.
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2020 (9) TMI 1205
Maintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - Operational Creditors - Appeal under Section 37 of Arbitration and Conciliation Act, 1996 was pending challenging the award, on the date on which the operational debt became due against the Corporate Debtor, or not? - HELD THAT:- From the plain reading of un-disputed facts in this proceeding, it is clear that on the date on which the Corporate Debtor was served with demand notice under Section 8 of the Insolvency and Bankruptcy Code, 2016 or on the date on which the application is filed against the Corporate Debtor, no arbitration proceedings was pending challenging the award.
Operational debt become due and payable on 29.02.2012 i.e on the date of which the Learned District Judge confirmed the award under Section 34 of A & C Act. The Corporate Debtor filed Appeal under Section 37 of the Act. It was dismissed in default. 90 days thereafter, on 14.02.2020, Operational Creditor gave the Corporate Debtor notice under Section 9 of the Insolvency and Bankruptcy Code, 2016. On 28.02.2020 - the operational creditor sent a demand notice three months after the Corporate debtor's appeal was dismissed by Hon'ble high Court. As soon as the Corporate Debtor received the demand notice, its officers swung into action and get the appeal restored. Meantime, the operational creditor had filed this application. It appears from record that the officers of the Corporate Debtor using the proceedings under the law either to delay or to avoid the legitimate dues of the Corporate Debtor on one or the other ground.
Operational Creditor has established that the Corporate Debtor committed default in paying the operational debt of ₹ 5,62,01,258/- inspite of receipt of demand notice. There was no dispute pending (by way of arbitral proceeding or otherwise) on the date on which the default occurred or on the date on which the application is filed to initiate Corporate Insolvency Resolution Process of the Corporate Debtor - Also, no disciplinary proceeding is pending against the proposed Insolvency Resolution Professional. It is not in dispute that the corporate debtor did not pay the operational debts.
Application admitted - moratorium declared.
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2020 (9) TMI 1202
Cancellation of the sale effected by respondent - reversal of sale transaction - Whether the sale of the secured asset in public auction as per Section 13(4) of SARFAESI Act, which ended in issuance of a sale certificate as per Rule 9(7) of the Security Interest (Enforcement) Rules, 2002 is a complete and absolute sale for the purpose of SARFAESI Act or whether the sale would become final only on the registration of the sale certificate? - scope of SARFAESI Act.
HELD THAT:- The SARFAESI Act is concerned since the sale is by public auction, therefore, the moment bid is accepted and authorised officer confirmed the sale in favour of purchaser, the sale become absolute and the title vests in the purchaser. A sale certificate is issued only when the sale become absolute. Purpose of registration is to pay only the stamp duty and registration charge and due to non registration of sale certificate, sale shall not be treated void and liable to set aside.
In this case, auction was conducted on 24/10/2019 and on the same day, Sale confirmation Advice was issued in favour of Respondent no. 3 Alucom Penals Pvt. Ltd. and subsequently on 30/12/2019, sale certificate was issued, therefore, the sale become absolute on the day, when his bid was accepted and sale confirmation advice was issued, i.e. on 24/10/2019 and title is vested with the purchaser and issuance of sale certificate on 30/12/2019 is merely an evidence of that title and the registration of the sale certificate is merely the formality, which is required under the Registration Act. Unlike the transfer of the immovable property made under the TP Act, the sale under the public auction is completed, the moment the bid is accepted and sale confirmation advice is issued.
The contention of the Ld. Counsel for petitioner the sale can only be completed when the registration of the sale certificate is made, is not liable to be accepted.
Section 52 T.P. Act - HELD THAT:- Although this point has not been raised by the Ld. Counsel for petitioner in course of his arguments but since it is stated in the application, therefore, we wanted to make comments on this issue also. It is the settled principle of law that the transactions made during the pendency of the suit or proceeding under Section 52 of the TP Act is not void ab-initio, rather it depends upon the result of the suit.
There is no merit in the application filed by the applicant, and there is no violation of Moratorium declared u/s 14 of IBC - application dismissed.
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2020 (9) TMI 1200
Seeking extension of the CIR Process - the Bank is one of the constituents of the COC - HELD THAT:- At this stage, the IRP along with the Counsel caused appearance and submitted that on an earlier point of time, the HDFC Bank had declined to seek the extension of the CIR Process.
In the circumstances, it is deemed appropriate to direct the IRP to send short notice to all the members of the COC for convening the meeting for deliberating on the issue with regard to extension of the CIR Process. The meeting shall be convened on 13th October, 2020 through visual hearing and the report shall be filed on 16th October, 2020.
List on 16.10.2020.
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