C & C Construction Ltd.

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 »

Banks can release the fund to the extent of full value of the Bank Guarantee minus Margin Money provided by the Corporate Debtor to the banker for the Bank Guarantee – C & C Construction Ltd. Vs. Power Grid Corporation of India Ltd. – NCLAT New Delhi

The RP is aggrieved by the Adjudicating Authority order as it has vacated an ad-interim injunction which it has previously granted against encashment of bank guarantee issued on behalf of Appellant to its various customers.
NCLAT referred the Hon’ble Supreme Court in SBI Vs. Rama Krishnan [2018] ibclaw.in 29 SC and held that the bank guarantee issued by the bankers are also the responsibility of the bankers and the fund will go out of the fund of the banks and not directly the fund from the corporate debtor. However, in order to keep the corporate debtor alive during moratorium, keeping in minds the provisions of Section 14(1) (c) r/w Section 14(3)(b), if any, such bank guarantee is liquidated, it can be restricted to the full value of the guarantee minus margin money provided by corporate debtor to the banker for taking that bank guarantee and accordingly, banks can release the fund to the extent of full value of the bank guarantee minus margin money provided by the corporate debtor to the banker for the bank guarantee.

Banks can release the fund to the extent of full value of the Bank Guarantee minus Margin Money provided by the Corporate Debtor to the banker for the Bank Guarantee – C & C Construction Ltd. Vs. Power Grid Corporation of India Ltd. – NCLAT New Delhi Read Post »

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