Green Gateway Leisure Ltd.

Important judgment on Commercial Wisdom of Committee of Creditors(CoC) and its Judicial Review, decision of CoC for liquidation and Shareholders/Promoters legal right to oppose Liquidation order – Air Travel Enterprises India Ltd. and Anr. Vs. Mr. Lukose Joseph, Liquidator of Green Gateway Leisure Ltd. and Ors. – NCLAT Chennai

In this landmark judgment, Hon’ble NCLAT holds that:
(i) The commercial wisdom can be exercised only when all the relevant information is available before the CoC and is duly discussed/deliberated by all its members, who have a direct and substantial interest in the survival of the Corporate Debtor and in the whole CIRP.
(ii) The commercial wisdom of the CoC is to be respected subject to the limited judicial review, that was available to the Adjudicating Authority/Tribunal. Also that the commercial wisdom of CoC is beyond the ambit of challenge, pertaining to the decision taken for liquidation of the Corporate Debtor being essentially a ‘business decision’ based upon the commercial wisdom and keeping in view the ingredients of Section 33(2) of the Code, 2016 and the explanation thereto.
(iii) Merely because there were no assets and no option for revival of the Corporate Debtor an unanimous 100% decision was taken by the CoC in its commercial wisdom to liquidate the Corporate Debtor.
(iv) Undoubtedly, the Liquidation like an Insolvency is collective in character.
(v) The Code, 2016 does not any way spell out ‘any such opportunity’ being provided to the Appellants (Promoters/Shareholders), at the time of passing of the Liquidation order and they don’t have any semblance of any legal right or vested right to oppose the Liquidation order before the Adjudicating Authority/Tribunal in the considered opinion of this Tribunal.
(vi) Moreover, the Appellants/Shareholders/Promoters have no ‘Locus’ to even raise an objection or to be furnished with an opportunity to air their views, at the time of passing the Liquidation Order.

Important judgment on Commercial Wisdom of Committee of Creditors(CoC) and its Judicial Review, decision of CoC for liquidation and Shareholders/Promoters legal right to oppose Liquidation order – Air Travel Enterprises India Ltd. and Anr. Vs. Mr. Lukose Joseph, Liquidator of Green Gateway Leisure Ltd. and Ors. – NCLAT Chennai Read Post »

Initiation of CIRP of the Corporate Debtor is not a prerequisite for maintainability of an application under Section 95 of the IBC, 2016 filed for initiating Insolvency Resolution Process against the Personal Guarantor of that Corporate Debtor before the NCLT – E. Iqbal Vs. State Bank of India – NCLT Kochi Bench

The Adjudicating Authority holds that in a situation where Application(s) in relation to the Corporate Debtor for initiation of CIRP is pending at National Company Law Tribunal (NCLT) then, initiation of CIRP of the Corporate Debtor is not a prerequisite for maintainability of an application under Section 95 of the IBC, 2016 filed for initiating Insolvency Resolution Process against the Personal Guarantor of that Corporate Debtor before the NCLT.

Initiation of CIRP of the Corporate Debtor is not a prerequisite for maintainability of an application under Section 95 of the IBC, 2016 filed for initiating Insolvency Resolution Process against the Personal Guarantor of that Corporate Debtor before the NCLT – E. Iqbal Vs. State Bank of India – NCLT Kochi Bench Read Post »

A plea of limitation is a mixed question of law and fact. It cannot be decided as an abstract principle of law devoid from facts as in every case, the starting point of limitation is entirely a question of fact – Air Travel Enterprises India Ltd., Founder, Promoter and Shareholder of M/s. Green Gateway Leisure Ltd. Vs. Union Bank of India -NCLAT New Delhi

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A plea of limitation is a mixed question of law and fact. It cannot be decided as an abstract principle of law devoid from facts as in every case, the starting point of limitation is entirely a question of fact – Air Travel Enterprises India Ltd., Founder, Promoter and Shareholder of M/s. Green Gateway Leisure Ltd. Vs. Union Bank of India -NCLAT New Delhi Read Post »

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