Whether the Adjudicating Authority while considering Application of Pre-packaged Insolvency under Section 54C of the Code can, before admission of the Application, hear Objectors/Interveners – Krrish Realtech Pvt. Ltd. – NCLAT New Delhi
This Appeal raises a limited issue as to whether the Adjudicating Authority while considering Application of pre-packaged insolvency(PPIRP) under Section 54C of the Code can, before admission of the Application, hear Objectors/ Interveners.
NCLAT held that the statutory scheme delineated by Chapter III-A of the Code as well as the Regulations, 2021 as observed above does not indicate any prohibition on the Adjudicating Authority to hear any objector or intervener before admitting an application of PPIRP. When there is no prohibition in hearing an objector or interveners by the Adjudicating Authority, the orders passed by the Adjudicating Authority giving time to the objectors to file objection cannot be said to be in breach of any statutory provisions. We may hasten to add that hearing of objectors or interveners in each case where PPIRP application has been filed is not a matter of course and has to be limited to exceptional cases. We are cautious that proceeding under the Code are time bound procedure where unnecessary delay has to be avoided by the Adjudicating Authority and giving time to objections which are meritless and giving time to objectors and interveners has to be exercised on sound discretion on valid grounds.
