04/01/2023

Ritu Rastogi RP for Eon Electric Ltd. Vs. Mr. Surinder K. Bansal and Co. LLP – NCLT Chandigarh Bench

In the present case, the applicant/RP has sought directions against the statutory auditors of the corporate debtor to provide the audit report and audited financial statements for FY 2019-20. The respondent has also not provided the resignation letter as sought by the applicant by Email dated 20.04.2021 and no audit report and financial statements for the FY 2019-20 has been provided by the statutory auditor. Section 17(2)(e) of the Code casts a duty upon the Resolution Professional for complying with the requirements under any law for the time being in force on behalf of the corporate debtor which includes getting the balance sheets and financial statements of the corporate debtor prepared as stipulated under the law.

Ritu Rastogi RP for Eon Electric Ltd. Vs. Mr. Surinder K. Bansal and Co. LLP – NCLT Chandigarh Bench Read Post »

Whether a judgment creditor can withdraw decretal amount/money deposited by Corporate Debtor (judgment debtor) in a Trial Court during moratorium under Section 14 of IBC – Reliance Communication Ltd. Vs. Rajendra P. Bansal – Bombay High Court

Hon’ble High Court held that NCLT could never sit in appeal over the judgment/decree of a Civil Court. Such a judgment/decree can only be corrected in appeal and, therefore, the NCLT would not have jurisdiction to hear and decide the First Appeal. Section 231 creates a bar on the jurisdiction of a civil court only where the Adjudicating Authority (i.e., NCLT in this case) has the jurisdiction over a given issue. The moratorium that is imposed under Section 14 applies only to proceedings against the corporate debtor and only applies qua the assets and properties of the corporate debtor. If monies deposited in court or any other asset/property does not belong to the corporate debtor, the moratorium would not preclude/prevent a creditor from enforcing its rights against the monies/assets/properties.

Whether a judgment creditor can withdraw decretal amount/money deposited by Corporate Debtor (judgment debtor) in a Trial Court during moratorium under Section 14 of IBC – Reliance Communication Ltd. Vs. Rajendra P. Bansal – Bombay High Court Read Post »

There is no concept of automatic restoration of any water connection and a proper application is required to be made following the procedure and only benefit Successful Resolution Applicant can claim is extinguishment of the dues which are not part of the Resolution Plan – Maharashtra Industrial Development Corporation Vs. Bhadrashree Steel & Power Ltd. & Ors. – NCLAT New Delhi

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There is no concept of automatic restoration of any water connection and a proper application is required to be made following the procedure and only benefit Successful Resolution Applicant can claim is extinguishment of the dues which are not part of the Resolution Plan – Maharashtra Industrial Development Corporation Vs. Bhadrashree Steel & Power Ltd. & Ors. – NCLAT New Delhi Read Post »

Whether the provisions of Section 11B of the Central Excise Act, 1944 are inconsistent with Section 33 of the IBC so as to be overridden by virtue of provisions of Section 238 of the IBC – Office of the Assistant Commissioner of Central Tax & Anr. Vs. Mr. Rakesh Singala, Liquidator of M/s. Apple Industries Ltd. – NCLAT New Delhi

NCLAT held hat Section 11B is enabling provision which entitles the Corporate Debtor to make an Application for refund of duty. The Moratorium which becomes operative after liquidation order has been passed is for the purpose for protecting the Corporate Debtor from any legal proceeding. Present is not a case where any legal proceeding has been initiated against the Corporate Debtor under the Central Excise Act, 1944. Present is a case where for refund, to which the Corporate Debtor is entitled, whether the Application is required to be made by the Corporate Debtor in accordance with the Central Excise Act, 1944 or not. The statutory provision of the Central Excise Act, 1944 does not contemplate automatic refund of any duty to which company may be entitled. Section 11B of the Central Excise Act, 1944 contemplates a procedure for availing refund and we do not see any inconsistency in Section 11B of the Central Excise Act, 1944 with Section 33(5) of the IBC.

Whether the provisions of Section 11B of the Central Excise Act, 1944 are inconsistent with Section 33 of the IBC so as to be overridden by virtue of provisions of Section 238 of the IBC – Office of the Assistant Commissioner of Central Tax & Anr. Vs. Mr. Rakesh Singala, Liquidator of M/s. Apple Industries Ltd. – NCLAT New Delhi Read Post »

Scope of the rectificatory jurisdiction of the NCLT under Section 59 of the Companies Act, 2013 – IFB Agro Industries Ltd. Vs. SICGIL India Ltd. and Others – Supreme Court

The short question for our consideration in this appeal relates to the scope of the rectificatory jurisdiction of the NCLT under Section 59 of the Companies Act, 20131 . In this context, we are called upon to determine the appropriate forum for adjudication and determination of violations of the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeover) Regulations, 19972, and Securities and Exchange Board of India (Prohibition of Insider Trading) Regulations, 19923, framed under the Securities and Exchange Board of India Act, 19924. We have answered both the questions. On the first issue, following the decision of this Court in Ammonia Supplies Corporation (P) Ltd. v. Modern Plastic Containers Pvt. Ltd. & Ors., we have held that the rectificatory jurisdiction under Section 59 of the 2013 Act is summary in nature and not intended to be exercised where there are contested facts and disputed questions. On the second issue, we have held that transactions falling within the jurisdiction of Regulatory bodies created under a statute must necessarily be subjected to their ex-ante scrutiny, enquiry and adjudication. We have, therefore, rejected the contention that the National Company Law Tribunal under Section 59 exercises a parallel jurisdiction with Securities and Exchange Board of India6 for addressing violations of the Regulations framed under the SEBI Act.

Scope of the rectificatory jurisdiction of the NCLT under Section 59 of the Companies Act, 2013 – IFB Agro Industries Ltd. Vs. SICGIL India Ltd. and Others – Supreme Court Read Post »

The right to apply under the IBC would accrue on the date when default occurs and it is extendable only by application of Section 5 of the Limitation Act and it is incumbent on the Adjudicating Authority to consider the claim for condonation of the delay when once the proceeding concerned is found filed beyond the period of limitation – Sabarmati Gas Ltd. Vs. Shah Alloys Ltd. – Supreme Court

Hon’ble Supreme Court held that when the limitation period for initiating CIRP under Section 9, IBC is to be reckoned from the date of default, as opposed to the date of commencement of IBC and the period prescribed therefor, is three years as provided by Section 137 of the Limitation Act, 1963 and the same would commence from the date of default and is extendable only by application of Section 5 of the Limitation Act, 1963 it is incumbent on the Adjudicating Authority to consider the claim for condonation of the delay when once the proceeding concerned is found filed beyond the period of limitation. The Hon’ble Court held that ‘Sufficient Cause’ is the cause for which a party could not be blamed.

The right to apply under the IBC would accrue on the date when default occurs and it is extendable only by application of Section 5 of the Limitation Act and it is incumbent on the Adjudicating Authority to consider the claim for condonation of the delay when once the proceeding concerned is found filed beyond the period of limitation – Sabarmati Gas Ltd. Vs. Shah Alloys Ltd. – Supreme Court Read Post »

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