CA(AT)(I)-1323/2022-NCLAT

Once CIRP admission order under Section 7 of IBC has been stayed by NCLAT, IRP is not entitled to discharge any function and the Corporate Debtor also cannot be restored as it was functioning prior to admission of Section 7 application – Ashok Kumar Tyagi Vs. UCO Bank – NCLAT New Delhi

The difference between stay of an Order and quashing of any Order are well settled. In event on the stay of the admission of Section 7 Application, the Corporate Debtor is allowed to function and position as was existing prior to 28.10.2022(CIRP admission order) is restored, there shall be no difference in staying an Order and quashing of an Order. What the Appellants are asking/praying is restoration of the position as was prior to admission of Section 7 Application. We cannot accept such request made by the Appellant. The Admission Order of Section 7 Application has only been stayed and not quashed thus the Corporate Debtor cannot be permitted to function as it was functioning prior to 28.10.2022. However, in view of the stay of the Order dated 28.10.2022, the IRP can not carry on any functions since the IRP was appointed by the same order and by stay of the Order, no further action can be taken by the IRP in pursuance of the Order dated 28.10.2022.

Once CIRP admission order under Section 7 of IBC has been stayed by NCLAT, IRP is not entitled to discharge any function and the Corporate Debtor also cannot be restored as it was functioning prior to admission of Section 7 application – Ashok Kumar Tyagi Vs. UCO Bank – NCLAT New Delhi Read Post »

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