Adjudicating Authority cannot direct the parties either to execute the agreement of settlement or to deposit the consideration as per the settlement agreement which has not been produced before us – Santanu Bhattacharjee (IRP of New Kolkata International Development Pvt. Ltd.) Vs. Prasun Sengupta – NCLT Kolkata Bench
The Applicant’s case is that a settlement has been arrived between the Operational Creditor and the Corporate Debtor on 24.03.2020. However, more than a year has passed since the Corporate Debtor was admitted into the CIRP, there is neither a settlement agreement nor an application under section 12A for withdrawal of the underlying Company Petition before this Adjudicating Authority.
The Adjudicating Authority observed that this appears to be a classic case of wastage of time. The lockdown had been lifted long before the application under consideration had been filed. If there had been a settlement at all, an application under section 12A should have been filed. Unless an application for withdrawal were filed, it was IRP’s duty to conduct the CIRP in the time bound manner. However, nothing seems to have moved in the present case expect for publication or Form A after the admission of the Corporate Debtor into CIRP. All the parties involved have taken the CIRP proceedings for a ride. Even if a settlement has been arrived at, the prayers made by the Applicant herein do not fall within the ambit of powers of this Adjudicating Authority.
It is our understanding that under section 12A of the Insolvency and Bankruptcy Code, 2016, this Adjudicating Authority may allow an application for withdrawal of the underlying Company Petition, however, the Adjudicating Authority cannot direct the parties either to execute the agreement of settlement or to deposit the consideration as per the settlement agreement which has not been produced before us.
