Even if specific permission has not been sought to re-file the proceedings on the cause of action having arisen in favour of the Operational Creditor, once the Corporate Debtor has failed to comply with the terms and conditions fixed in the settlement agreement, the right of the Operational Creditor still subsists and he has all the rights to file a petition for enforcing the settlement agreement – Jai Balaji Industries Ltd. Vs. BST Infratech Ltd. -NCLT Kolkata Bench

In this case, terms of the settlement agreement contain that operational creditor shall be entitled to issue fresh notice and initiate fresh proceedings. The AA held that specific use of selected words “fresh notice” and “fresh proceedings” visibly and clearly expose the design of the Corporate Debtor intending to put the Operational Creditor on the long track and frustrate the claim/proceedings pending before this Adjudicating Authority, which however cannot be allowed to happen in these proceedings. We find that none of the Judgments cited by the Corporate Debtor help it in any way, either as regards its claim of pre-existing disputes or as regards seeking permission from the Adjudicating Authority for filing an application in case of failure of the Settlement, because it was not a “withdrawal simpliciter” but had been allowed on the joint request of counsel for the parties pursuant to the Settlement Agreement.

Even if specific permission has not been sought to re-file the proceedings on the cause of action having arisen in favour of the Operational Creditor, once the Corporate Debtor has failed to comply with the terms and conditions fixed in the settlement agreement, the right of the Operational Creditor still subsists and he has all the rights to file a petition for enforcing the settlement agreement – Jai Balaji Industries Ltd. Vs. BST Infratech Ltd. -NCLT Kolkata Bench Read Post »