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Whether an order of arbitrator dismissing an application under Section 16 of the Arbitration and Conciliation Act, 1996 raising objection as to its jurisdiction can be intervened upon rejection or the aggrieved party has to wait till passing of the final arbitral award and then challenge the same under Section 34 – M.D. Creations & Others Vs. Ashok Kumar Gupta – Calcutta High Court

On first issue, whether rejection of jurisdictional objections can be intervened upon rejection or the aggrieved party has to wait till passing of the final award and then challenge the same under Section 34 of the Act, Hon’ble High Court held that (i) any challenge to the jurisdiction of the arbitrator necessarily has to be determined by the arbitrator in the first instance and then it can only be challenged under Section 34 after passing of the final arbitral award. (ii) There is no segregated challenge permissible only on the question of the competency of the Arbitral Tribunal. On second issue, whether Article 227 of the Constitution of India can be invoked in the circumstances at hand where jurisdictional objections raised has been rejected by the learned arbitrator, Hon’ble Court held that (i) A petition under Article 227 of the Constitution of India can be filed challenging the order of the arbitral tribunal dismissing application under Section 16 of the Act, only if the possible conclusion is that there is a patent lack in inherent jurisdiction. (ii) The remedy under Article 227 of the Constitution of India can be invoked on the ground of exceptional circumstances or ‘bad faith’ on the part of the other party.

Whether an order of arbitrator dismissing an application under Section 16 of the Arbitration and Conciliation Act, 1996 raising objection as to its jurisdiction can be intervened upon rejection or the aggrieved party has to wait till passing of the final arbitral award and then challenge the same under Section 34 – M.D. Creations & Others Vs. Ashok Kumar Gupta – Calcutta High Court Read Post »

Without adding the principal amount, can CIRP u/s 7 of IBC be initiated only on the defaulted amount of interest accrued on the principal amount (debentures)? – Aadi Buildwell Pvt. Ltd. Vs. Focus Realcon Pvt. Ltd. – NCLT New Delhi Bench Court-II

The Adjudicating Authority held that in order to initiate a CIRP u/ s 7 of the IBC, the prime consideration is that there must be existence of debt and only thereafter interest shall be added in the principal debt amount. Only the interest amount claimed by the applicant, in our considered view, does not come under the definition of financial debt. Since the present application is filed only on the ground of interest accrued on the principal amount, and the payment of the principal amount is not due and payable as yet, therefore, the present petition filed under Section 7 of the IBC is not maintainable.

Without adding the principal amount, can CIRP u/s 7 of IBC be initiated only on the defaulted amount of interest accrued on the principal amount (debentures)? – Aadi Buildwell Pvt. Ltd. Vs. Focus Realcon Pvt. Ltd. – NCLT New Delhi Bench Court-II Read Post »

From the last payment the limitation of three years shall again begin – Sanjeev Agraj, Suspended Director of M/s. Amzen Transportation Industries Pvt. Ltd. Vs. IDBI Bank Ltd. & Anr. – NCLAT New Delhi

NCLAT held that there is no dispute to the preposition that Application under Section 7 should be filed within three years from the date of NPA but if there are materials on record to indicate that there is an acknowledgment within the meaning of Section 18 of the Code the limitation get extended. The present is the case where there is acknowledgment within the meaning of Section 18 hence the Limitation got extended hence the Application filed on 06.12.2019 was well within time. No other argument is raised. We do not find any merit in the Appeal, the Appeal is dismissed.

From the last payment the limitation of three years shall again begin – Sanjeev Agraj, Suspended Director of M/s. Amzen Transportation Industries Pvt. Ltd. Vs. IDBI Bank Ltd. & Anr. – NCLAT New Delhi Read Post »

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