01/04/2024

Despite its name being struck off from the Register of Companies, a Corporate Debtor is liable to meet its liabilities – Creditors/Homebuyers of Earth Towne Infrastructure Pvt. Ltd. Vs. Registrar of Companies, NCT of Delhi & Haryana and Anr. – NCLT New Delhi Bench

In this case, since the CD defaulted to allot flats/dwelling units to the Appellants, they instituted CP(IB)-196/ND/2023 for ordering commencement of CIRP in respect of the CD, but there could be a semblance in the proceedings that the application filed under Section 7(2) of IBC, 2016 may not lie against a company which stands struck off from the Register of Companies.

Hon’ble NCLT New Delhi Bench held that since the Directors of the concerned company are in jail/judicial custody, there is no appearance on their behalf. In any case the company is an independent juristic person and in terms of the provisions of Section 250 of the Companies Act, 2013, despite its name being struck off from the Register of Companies, a company is liable to meet its liabilities and in the present case the Homebuyers who paid subscription for allotment of dwelling units to the company are unable to pursue the application filed under Section 7 of IBC, 2016 on account of the company being struck off from the Register of Companies. In the facts and circumstances, it would be just and proper to restore the Earth Towne Infrastructure Pvt. Ltd. to Register of Companies.

Despite its name being struck off from the Register of Companies, a Corporate Debtor is liable to meet its liabilities – Creditors/Homebuyers of Earth Towne Infrastructure Pvt. Ltd. Vs. Registrar of Companies, NCT of Delhi & Haryana and Anr. – NCLT New Delhi Bench Read Post »

As on date guarantee has not been invoked cannot be a ground for Corporate Debtor to be liquidated under Section 59 of the IBC (Voluntary Liquidation) – Iskon Infra Engineering Pvt. Ltd. Vs. Central Bank of India – NCLAT New Delhi

Hon’ble NCLAT held that:

(i) The fact that guarantee has not been invoked, does not absolve the Corporate Guarantor from debt. The debt which is Corporate Guarantor, the Company has been given corporate guarantee and undertaken to pay the debt.
(ii) The liability of Corporate Guarantor is co-extensive with the Lenders and the Lenders are at liberty to require the performance by the Guarantor of its obligation.
(iii) The submission of the Appellant that since guarantee has not been invoked there is no debt cannot be accepted. Guarantee continues to bind the Corporate Guarantor to discharge its liability and the fact that as on date, guarantee has not been invoked, cannot be a ground for Appellant to be liquidated under Section 59 of the IBC.

As on date guarantee has not been invoked cannot be a ground for Corporate Debtor to be liquidated under Section 59 of the IBC (Voluntary Liquidation) – Iskon Infra Engineering Pvt. Ltd. Vs. Central Bank of India – NCLAT New Delhi Read Post »

Whether in case of phase wise registration of Real Estate Projects under RERA, 2016, each RERA Registration constitutes a Real Estate Project for the purpose of calculation of threshold under Section 7 of IBC, 2016 for filing of Insolvency Petition? – Pankaj Mehta Vs. Ansal Hi-tech Township Ltd. – NCLAT New Delhi

In this important judgment, Hon’ble NCLAT held that:

(i) The provisions of RERA are beneficial to the Home Buyers and are meant to protect them, from any Deviant / Fraudulent Action.
(ii) A mere perusal of Section 3(1) Explanation of the Real Estate (Regulation & Development) Act, 2016, points out that where the real estate project is to be developed in phases, every such phases shall be considered a standalone real estate project and the Promoter shall obtain Registration under RERA Act, for each phase separately.
(iii) In the present case on hand, the foremost aspect to be taken into account is the RERA Registration of the Projects of the Corporate Debtor for ensuring the initial limit for pressing into service of the ingredients of Section 7 of the Code.
(iv) In the present case, the Financial Creditors are from different numerous projects and they have not established their case, as Creditors of a class concerning any particular project registered with the Real Estate (Regulation & Development) Act, 2016 with a view to fulfil the requirement of 10% or 100 Allottees as envisaged as per Section 7 (1) of the Code, 2016.

Whether in case of phase wise registration of Real Estate Projects under RERA, 2016, each RERA Registration constitutes a Real Estate Project for the purpose of calculation of threshold under Section 7 of IBC, 2016 for filing of Insolvency Petition? – Pankaj Mehta Vs. Ansal Hi-tech Township Ltd. – NCLAT New Delhi Read Post »

Can issue of appointment of Nominee Director be referred to arbitration as per Shareholders Agreement which provides for Arbitration or fall under Oppression and Mismanagement under Sections 241-242 of Companies Act, 2013 as per Articles of Association (AoA)? – Mr. Puthucode Vaidyanathan Balasubramanian and Ors. Vs. Metmin Investments Holdings Ltd. – NCLT Bengaluru Bench

In this case, Clause 11.2 of the Shareholders’ Agreement (SHA) provides for Arbitration in case of any dispute arising out of the SHA. However, the Petitioner contends that this dispute was not arising out of the SHA; but was a violation of Article 13 of the Articles of Association (AoA), according to which it had a right to appoint one nominee Director. Therefore, it is stated that it squarely falls under Oppression and Mismanagement under Sections 241-242 of Companies Act, 2013, which was not Arbitrable.

Can issue of appointment of Nominee Director be referred to arbitration as per Shareholders Agreement which provides for Arbitration or fall under Oppression and Mismanagement under Sections 241-242 of Companies Act, 2013 as per Articles of Association (AoA)? – Mr. Puthucode Vaidyanathan Balasubramanian and Ors. Vs. Metmin Investments Holdings Ltd. – NCLT Bengaluru Bench Read Post »

The liquidator’s fees is contingent upon the time taken to realise/ distribute the amounts amongst stakeholders – Stakeholders Consultation Committee of Punjab Basmati Rice Ltd. Vs. Mr. Sanjay Kumar Aggarwal, Liquidator of Punjab Basmati Rice Ltd. – NCLAT New Delhi

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The liquidator’s fees is contingent upon the time taken to realise/ distribute the amounts amongst stakeholders – Stakeholders Consultation Committee of Punjab Basmati Rice Ltd. Vs. Mr. Sanjay Kumar Aggarwal, Liquidator of Punjab Basmati Rice Ltd. – NCLAT New Delhi Read Post »

In a Petition under Section 9 of the Insolvency and Bankruptcy Code, 2016, it is not for the Adjudicating Authority/NCLT to determine the exact amount due, by quantifying it, with mathematical precision – K. Lakshma Reddy Vs. Telangana State Rajiv Swagruha Corporation Ltd. – NCLAT Chennai

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In a Petition under Section 9 of the Insolvency and Bankruptcy Code, 2016, it is not for the Adjudicating Authority/NCLT to determine the exact amount due, by quantifying it, with mathematical precision – K. Lakshma Reddy Vs. Telangana State Rajiv Swagruha Corporation Ltd. – NCLAT Chennai Read Post »

The amount to be paid under Resolution Plan to Operational Creditor under Section 30(2)(b) of IBC has to be paid in priority only by way of cash payment and not by way of issuing equity/partly paid Redeemable Preference Shares – Gupta Textiles Vs. Darshan Patel and Ors. – NCLAT New Delhi

In this case, Hon’ble NCLAT observed that when the Resolution Plan amount is distributed as per Section 30(2)(b)(ii) and as per the priority under Section 53(1) by excluding the amount paid to the Financial Creditor, in CIRP Rs.15 lakhs earmarked for the Government Departments, there being no other creditors, the balance amount of the Resolution Plan was to be distributed on pro-rata basis to the Operational Creditors, whereas cash amount offered to the Operational Creditor is only 2.16% and the rest amount, which is payable to the Operational Creditor as per Section 30(2)(b) is sought to be subsumed by offering option of partly paid redeemable preference shares.

The amount to be paid under Resolution Plan to Operational Creditor under Section 30(2)(b) of IBC has to be paid in priority only by way of cash payment and not by way of issuing equity/partly paid Redeemable Preference Shares – Gupta Textiles Vs. Darshan Patel and Ors. – NCLAT New Delhi Read Post »

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