2019

Section 9 Application are application which has to be decided in timely manner and exercise of discretion by the Adjudicating Authority can not be faulted – Baba Baidnath Spinners Pvt. Ltd. Vs. Textile Solutions – NCLAT New Delhi

Section 9 Application was filed by the Operational Creditor where he has relied on some documents dated 11.02.2020 and 16.03.2021. Application was filed for inspection and discovery asking for certain documents to be produced which was objected. The Adjudicating Authority has observed that if any documents are not filed the consequences will be faced by the Corporate Debtor, with these observations the Application was not entertained. NCLAT held that what is worth of the document has to be considered at the time of considering Section 9 Application and it is for the Operational Creditor to file relevant documents in support of his case and the Adjudicating Authority did not commit any error in rejecting the Application filed by the Appellant for discovery and inspection. Section 9 Application are application which has to be decided in timely manner and exercise of discretion by the Adjudicating Authority cannot be faulted.

Section 9 Application are application which has to be decided in timely manner and exercise of discretion by the Adjudicating Authority can not be faulted – Baba Baidnath Spinners Pvt. Ltd. Vs. Textile Solutions – NCLAT New Delhi Read Post »

Whether liability of the personal guarantor stand consequently reduced or extinguished on the secured financial creditor receiving the payments in terms of a Resolution Plan in respect of a company undergoing a process of CIRP under the provisions of the IBC, 2016- Gouri Shankar Jain Vs. Punjab National Bank & Anr. – Calcutta High Court

The Hon’ble High Court has clarified lots of questions including right to apply for insolvency does not arise out of a contract between the parties; Resolution plan is neither nor a compromise or composition nor voluntary compromise with the corporate debtor; Section 14 of the Code of 2016 does not apply to a personal guarantor; The existing contracts between the surety, principal debtor and the creditor remains unaffected during the moratorium under Section 14; Principal debtor has gone into liquidation would not have any effect on the liability of the guarantor; Pre insolvency right of the creditor does not undergo any metamorphosis on the principle; When, the creditor is dealing with the principal debtor in terms of the Code of 2016, the consent of the surety is not required; The sanctioned Resolution Plan cannot be construed to be a variation of the terms of the contract between the principal debtor and the creditor and held that the issue is answered in the negative and liability of the personal guarantor is not extinguished upon approval of the resolution plan. In view of the answer to the issue being in the negative, no relief can be granted to the writ petitioner.

Whether liability of the personal guarantor stand consequently reduced or extinguished on the secured financial creditor receiving the payments in terms of a Resolution Plan in respect of a company undergoing a process of CIRP under the provisions of the IBC, 2016- Gouri Shankar Jain Vs. Punjab National Bank & Anr. – Calcutta High Court Read Post »

High Court ought not to have proceeded with the auction of the property of the Corporate Debtor, once the proceedings under the IBC had commenced, and an Order declaring moratorium was passed by the NCLT- Mr. Anand Rao Korada vs M/s. Varsha Fabrics (P) Ltd. & Ors-Supreme Court

The Supreme Court set aside the impugned Interim Orders dated 14.08.2019 and 05.09.2019 passed by the Odisha High Court and held that in view of the provisions of the IBC, the High Court ought not to have proceeded with the auction of the property of the Corporate Debtor, once the proceedings under the IBC had commenced, and an Order declaring moratorium was passed by the NCLT. The High Court passed the impugned Interim Orders dated 14.08.2019 and 05.09.2019 after the CIRP had commenced in this case.

High Court ought not to have proceeded with the auction of the property of the Corporate Debtor, once the proceedings under the IBC had commenced, and an Order declaring moratorium was passed by the NCLT- Mr. Anand Rao Korada vs M/s. Varsha Fabrics (P) Ltd. & Ors-Supreme Court Read Post »

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