GBJ Hotels Pvt. Ltd.

Promoter/Suspended Director of the Corporate Debtor have no locus standi in regard to CIRP Costs, the said issue is only between a Resolution Professional and CoC and NCLT/NCLAT is not empowered to have the jurisdiction of a Civil Court to determine all controversies, touching upon the formation/members/constitution of SRA – Mr. G. Balasubramaniam Vs. CA Mahalingam Suresh Kumar RP for GBJ Hotels Pvt. Ltd. – NCLAT Chennai

Hon’ble NCLAT held that:

(i) A Trust can furnish the Resolution Plan and a Trust can be a Resolution Applicant.
(ii) It is not out of place for this Tribunal, to make a pertinent mention, that Section 3(23)(d) of the Code, under the caption person includes Trust and the General Clauses Act defines person includes Trust.
(iii) An Adjudicating Authority/Tribunal is not to determine the matters, pertaining to a ‘disputed question of fact’. It must be borne in mind, that Section 60(5) of the Code, 2016 is not an all pervasive section, showering jurisdiction, to the Appellate Authority/Tribunal to determine any question pertaining to the Corporate Debtor.
(iv) If a law, is laid down under the Code, 2016, to do a ‘particular act’ in a ‘certain manner’, an Adjudicating Authority/Tribunal cannot exercise this jurisdiction, under sub-Section (2) Section 60 of the Code, to override the specification already mentioned in the Code, by giving interpretation, quite contra, to the mandate, in the particular section.
(v) In regard to CIRP costs, the Appellants’ have no locus standi, because of the fact that the said issue is only between a Resolution Professional and the Committee of Creditors.
(vi) One cannot remain in oblivion of the prime fact that nowhere in the code or in the Regulations, there is a specification that the Resolution Applications is to match the Liquidation value, of the Corporate Debtor.

Promoter/Suspended Director of the Corporate Debtor have no locus standi in regard to CIRP Costs, the said issue is only between a Resolution Professional and CoC and NCLT/NCLAT is not empowered to have the jurisdiction of a Civil Court to determine all controversies, touching upon the formation/members/constitution of SRA – Mr. G. Balasubramaniam Vs. CA Mahalingam Suresh Kumar RP for GBJ Hotels Pvt. Ltd. – NCLAT Chennai Read Post »

A sum of money which is certainly and in all events payable is a debt, without regard to the fact, whether it is payable immediately or at a future date – Mr. G. Balasubramaniam Vs. Indian Overseas Bank – NCLAT Chennai

NCLAT held that a Financial Creditor, under the Code, is an individual, who has a right to Financial Debt. Unlike, the Companies Act, which provides inability to pay Debt, as a ground for Winding up of a Company, the Code, 2016, provides that an action for an Insolvency may be initiated, if default is really / actually committed by a person or the Corporate Debtor. No wonder, an application is not to be turned down, on the basis that, the account of the Corporate Debtor is eligible for Restructuring, in the teeth of Master Circular, of the Reserve Bank of India. In reality, it is not the property, which is at the root of the Code, 2016. Further, a just dispute, about the quantum of payment, does not affect the Right of a Financial Creditor. It is to be remembered that the Cash Liquidity, is only the basis for triggering a CIRP, in the considered opinion of this Tribunal. A sum of money which is certainly and in all events, payable is a debt, without regard to the fact, whether, it is payable immediately or at a future date. The term receivable means any sum, which a person, is entitled to receive or received from another person.

A sum of money which is certainly and in all events payable is a debt, without regard to the fact, whether it is payable immediately or at a future date – Mr. G. Balasubramaniam Vs. Indian Overseas Bank – NCLAT Chennai Read Post »

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