10/06/2022

While a written contract cannot be treated as a pre-requisite to proving the existence of Financial Debt, the AA must be satisfied that the Corporate Debtor is not being dragged into CIRP mala fide for any purpose other than the resolution of the Insolvency – Gateway Offshore Pvt. Ltd. Vs. Runwal Realtors Pvt. Ltd. – NCLT Mumbai Bench

The Adjudicating Authority observed that it is the contention of the Corporate Debtor’s that there is no written contract regarding any loan being sanctioned to the Corporate Debtor by the Financial Creditors. In this regard, we would like to rely on the stand taken by the NCLAT in Narendra Kumar Agarwal and Ors. v Monotrone Leasing Private Limited and Ors. (2021) ibclaw.in 25 NCLAT (Order dated 19.01.2021) wherein it was held that the written contract cannot be treated as an essential element or prerequisite to prove the existence of Financial Debt. However, the Financial Creditor has failed to bring on record any other evidence in the form of a loan agreement, promissory note, contract or any document to substantiate its claim that there was a financial debt and a default of the same. The Financial Creditor has produced the Corporate Debtor’s Annual reports for the Financial Years 2016-17 and 2017-18. However, the same do not reflect any debt due specifically to the Financial Creditor.

While a written contract cannot be treated as a pre-requisite to proving the existence of Financial Debt, the AA must be satisfied that the Corporate Debtor is not being dragged into CIRP mala fide for any purpose other than the resolution of the Insolvency – Gateway Offshore Pvt. Ltd. Vs. Runwal Realtors Pvt. Ltd. – NCLT Mumbai Bench Read Post »

Project wise Insolvency Resolution of the Real Estate Company, M/s. Supertech Ltd. – Ram Kishor Arora Suspended Director of M/s. Supertech Ltd. Vs. Union Bank of India & Anr. – NCLAT New Delhi

NCLAT held that when Promoters are ready to extend all cooperation with all its staffs and employees to the IRP, we see no reason for not to direct the IRP to proceed with construction of all the projects under the overall supervision and control of the IRP. In CIRP Process, Project-Wise Resolution to be started as a test to find out the success of such Resolution. It directed that CoC be constituted for the Eco Village II Project only with all Financial Creditors including Financial Creditors/Banks/Home Buyers. The Committee of Creditors of Eco Village II Project shall start process for Resolution of Eco Village II Project. The IRP shall separate the claims received with regard to the Eco Village II Project and prepare an Information Memorandum accordingly and proceed for meeting of the CoC as per the Code. It is further directed that even for Eco Village II Project, the IRP shall carry the Project and continue the project as ongoing project by taking all assistance from the ex-management, employees, workmen etc. It cleared that other projects apart from the Eco Village II Project shall proceed as ongoing project basis under the overall supervision of the IRP. IRP in his report stated that with regard to the projects, there are separate accounts as per RERA Guidelines.

Project wise Insolvency Resolution of the Real Estate Company, M/s. Supertech Ltd. – Ram Kishor Arora Suspended Director of M/s. Supertech Ltd. Vs. Union Bank of India & Anr. – NCLAT New Delhi Read Post »

Resolution Professional and the representative of the CoC who are the Chairman/Members of the Monitoring Committee should assist the Resolution Applicant in sorting out the issues pending at various forums be it Excise Authority, Enforcement Directorate etc. – Amit Gupta Vs. Anil Kohli RP for Dunar Foods Ltd. – NCLAT New Delhi

NCLAT held that the CIRP shall mandatorily be completed within a period of 330 days from the insolvency commencement date. Including the extension of CIRP Period and time taken in legal proceedings. Liability for prior offences etc. particularly removing/lifting attachments/liens/charges/encumbrances existing prior to CIRP needs to be dealt with in accordance with the provisions of Section 32(A) of the Code. It is also not in dispute that the object of the IBC would be defeated if the responsibility for prior offences is put on the Resolution Appellant. The Resolution Appellant is supposed to get a clean slate and all dues of the Corporate Debtor prior to commencement of CIRP stand extinguished. The Successful Resolution Applicant is supposed to get all the assets of the Corporate Debtor free from any encumbrances and would be available for use by the Resolution Applicant without any fetters or brevity and clarity.

Resolution Professional and the representative of the CoC who are the Chairman/Members of the Monitoring Committee should assist the Resolution Applicant in sorting out the issues pending at various forums be it Excise Authority, Enforcement Directorate etc. – Amit Gupta Vs. Anil Kohli RP for Dunar Foods Ltd. – NCLAT New Delhi Read Post »

IBC cannot be used for forum shopping – Partha Paul Vs. Kotak Mahindra Bank Ltd. – NCLAT New Delhi

NCLAT set aside CIRP admission order of the Adjudicating Authority and held that the Bank/R1 is involved in forum shopping to the multiple Courts/Tribunals just to harass the Guarantor as it has moved the Hon’ble High Court of Calcutta at Calcutta to coerce the trust into paying of its debts and involving the Appellant in time consuming and expensive litigation at the behest of this concerned branch of the Bank/Respondent No.1. It is a settled law that the practice of Forum Shopping be condemned as it is an abuse of law. This case is beyond doubt falls under the category of Forum Shopping as it is a classic example of Forum Shopping when the Respondent Bank has approached one Court for relief but does not get the desired relief and then approached another court for the same or similar relief.

IBC cannot be used for forum shopping – Partha Paul Vs. Kotak Mahindra Bank Ltd. – NCLAT New Delhi Read Post »

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