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Test of genuine Homebuyers v/s Speculative Homebuyers is relevant only at the stage for the admission of CIRP under Section 7 of the IBC – Everlike Real Estate and Developers Pvt. Ltd Vs. Mr. Mohit Goyal, CA RP of Aadi Best Consortium Pvt. Ltd. and Anr. – NCLAT New Delhi

Hon’ble NCLAT held that:

(i) The Code or the RERA Act, 2016 do not differentiate anywhere between the Homebuyers who purchase units for his own consumption or the Homebuyers or unit purchaser who purchase the multiple units for commercial purposes.
(ii) The issue regarding the genuine Homebuyers v/s Speculative Homebuyers is relevant only at the stage for the admission of CIRP under Section 7 of the Code.
(iii) It becomes clear that whether the homebuyer/ allottee is genuine homebuyer or genuine allottee or speculative homebuyers/ allottee but if he has paid the money for acquisition of such properties or given the advance, such allottee/ homebuyer shall be treated as Financial Creditor in terms of Section 5(8)(f) of the Code.
(iv) No individual homebuyers has any locus to challenge resolution plan if the Resolution Plan which has been approved by voting of more than 50% of voting shares of homebuyers as a class.

Test of genuine Homebuyers v/s Speculative Homebuyers is relevant only at the stage for the admission of CIRP under Section 7 of the IBC – Everlike Real Estate and Developers Pvt. Ltd Vs. Mr. Mohit Goyal, CA RP of Aadi Best Consortium Pvt. Ltd. and Anr. – NCLAT New Delhi Read Post »

Operational Creditor using a forum shopping cannot misuse insolvency proceedings as an alternative for alleged debt enforcement where he could not get success in the proceedings under the MSME Act and Commercial Courts Act – Dotcom Pharma Pvt. Ltd. Vs. Mylan Pharmaceuticals Pvt. Ltd. – NCLT Hyderabad Bench

The IBC is not intended to be a substitute for a recovery forum. However, the Applicant is on a forum shopping and when he could not get success in the proceedings under the MSME Act and Commercial Courts Act, he approached this Forum. This Forum cannot be misused as an alternative for alleged debt enforcement.

Operational Creditor using a forum shopping cannot misuse insolvency proceedings as an alternative for alleged debt enforcement where he could not get success in the proceedings under the MSME Act and Commercial Courts Act – Dotcom Pharma Pvt. Ltd. Vs. Mylan Pharmaceuticals Pvt. Ltd. – NCLT Hyderabad Bench Read Post »

Merely seeking an extension of the timeline to submit a scheme of arrangement under section 230 of the Companies Act, 2013 without showing any evidence of sincere and serious efforts in preparation and formulation of such a scheme clearly shows that the request for extension of timeline is not supported by concrete action – Harish Sharma Vs. M/s. C & C Constructions Ltd. – NCLAT New Delhi

NCLAT observed that the Appellant has not shown any proof of a scheme of compromise and arrangement that is formulated and ready, and proposed for consideration nor has the Appellant obtained the consent of 75% of the secured creditors of the corporate debtor in support of such a scheme. Merely seeking an extension of the timeline without showing any evidence of sincere and serious efforts in preparation and formulation of such a scheme clearly shows that the request for extension of timeline is not supported by concrete action. In view of the fact that the 90 days’ timeline prescribed under the Regulation 2-B of the Liquidation Process Regulations, 2016 had expired on 4.1.2023 and no evidence about readiness of the scheme was shown, we are of the clear opinion that the Adjudicating Authority has not committed any error in passing the Impugned Order.

Merely seeking an extension of the timeline to submit a scheme of arrangement under section 230 of the Companies Act, 2013 without showing any evidence of sincere and serious efforts in preparation and formulation of such a scheme clearly shows that the request for extension of timeline is not supported by concrete action – Harish Sharma Vs. M/s. C & C Constructions Ltd. – NCLAT New Delhi Read Post »

Bank cannot report the name of Willful Defaulters directly to RBI/CIBIL without providing copy of the order passed by Identification Committee and giving opportunity of hearing – Hans Ispat Ltd. Vs. Bank of Baroda – Gujarat High Court

In this case, the notice was issued by the respondent bank to which the petitioners filed detailed reply but the order passed by the Identification Committee recording that the petitioners have committed willful default was never provided to the petitioners. The petitioners came to know about declaring them as willful defaulter only from the website of CIBIL. Hon’ble High Court held that the respondent bank while declaring the petitioners as willful defaulter has violated the provisions contained in the Revised Master Circular and has also acted in violation of principles of natural justice. As the impugned action which is penal in nature has been taken causing serious implication to the petitioners without following the basis of principles of natural justice, the impugned action of the respondent bank identifying the account of the petitioners as willful default and subsequent reporting of name of the petitioners to the RBI/CIBIL as willful defaulters are liable to be quashed and set aside.

Bank cannot report the name of Willful Defaulters directly to RBI/CIBIL without providing copy of the order passed by Identification Committee and giving opportunity of hearing – Hans Ispat Ltd. Vs. Bank of Baroda – Gujarat High Court Read Post »

Extension of CIRP time as the Successful Resolution Applicant may submit Performance Guarantee – G. Satyanarayana RP Ajanta Offset and Packaging Ltd. Vs. Govind Prasad Todi Successful Resolution Applicant – NCLAT New Delhi

The Adjudicating Authority has noticed earlier proceedings in the case and has refused to extend the time and rejected the Application which was filed by the IRP/RP for extension of 15 days’ time as the Successful Resolution Applicant may submit Performance Guarantee.
NCLAT set aside the Order holding that when the Resolution Plan was approved on 30.12.2021, the CIRP proceedings were virtually completed and only for the purpose of submission of Performance Guarantee, time was prayed for. We are of the view that the Adjudicating Authority ought to have extended the time as prayed for to give effect the Resolution Plan which was approved by the CoC on 30.12.2021. The observation of the Adjudicating Authority that 45 days’ extension was granted till 30.12.2021 which was also noticed in the order itself was sufficient for accepting the prayer for extension of 15 days and Adjudicating Authority committed error in rejecting the said prayer.

Extension of CIRP time as the Successful Resolution Applicant may submit Performance Guarantee – G. Satyanarayana RP Ajanta Offset and Packaging Ltd. Vs. Govind Prasad Todi Successful Resolution Applicant – NCLAT New Delhi Read Post »

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