Insolvency Resolution Process against a Corporate Debtor cannot be interdicted on the on fact that asset of Corporate Debtor is not sufficient to resolve the insolvency of the Corporate Debtor – Ashok Tiwari Vs. DBS Bank India Ltd. (DBIL) and Anr. – NCLAT New Delhi
Hon’ble NCLAT held that the submission of counsel for the appellant is that the corporate debtor has only one asset which may not be sufficient to clear the debt of financial creditor nor sufficient for the resolution of insolvency does not commend us. Initiation of CIRP process is consequent to debt and default on the part of the corporate debtor who was corporate guarantor. The debt and default by the corporate debtor is writ large on the record. The corporate debtor having unable to pay its debt, insolvency resolution process against such corporate debtor cannot be interdicted on the submission that asset of the corporate debtor is not sufficient to resolve the insolvency of the corporate debtor. These are the issues which have to be addressed in the CIRP of the corporate debtor and cannot be ground to set aside an order of admission under Section 7.