15/09/2022

Once the CIRP was initiated, the amount lying in the no lien account belongs to the Corporate Debtor and under Section 18(f) of the Code, the IRP/RP is obligated to take control and custody of all the assets and properties of the Corporate Debtor – Bank of India Vs. Mr. Vinod Kumar P. Ambavat (RP) of Actif Corporation Ltd. – NCLAT New Delhi

Once the CIRP was initiated, keeping in view that the OTS had failed, the amount lying in the ‘no lien account’ belongs to the Corporate Debtor and under Section 18(f) of the Insolvency and Bankruptcy Code, 2016, (hereinafter referred to as ‘The Code’), the IRP/RP is obligated to take control and custody of all the assets and properties of the ‘Corporate Debtor’. Further, the Bank could not have appropriated this money once the period of Moratorium has commenced on 26.11.2019. As per Section 3(27), ‘Property’ includes money and therefore RP’s action of claiming the money lying in the ‘no lien account’ of the ‘Corporate Debtor’ is within the provisions of Section 18(f) of the Code. The contention of the Learned Counsel for the Appellant Bank that the Bankers lien over the money held in a customer’s account is a Statutory Right, is unable, keeping in view the facts of the attendant case and also that CIRP had commenced on 26.11.2019, and having regard to the fact that the amount was deposited with a specific understanding that the amount shall not be used by the Bank until approval of OTS.

Once the CIRP was initiated, the amount lying in the no lien account belongs to the Corporate Debtor and under Section 18(f) of the Code, the IRP/RP is obligated to take control and custody of all the assets and properties of the Corporate Debtor – Bank of India Vs. Mr. Vinod Kumar P. Ambavat (RP) of Actif Corporation Ltd. – NCLAT New Delhi Read Post »

The power of the Adjudicating Authority to take proceeding for prosecution are ample and at any stage the Adjudicating Authority can direct for the prosecution of either of the parties – Enkay Brand Distribution Pvt. Ltd. Vs. Nike India Pvt. Ltd. – NCLAT New Delhi

Two IAs have been filed under Section 76 of the IBC and Section 340 of CRPC in a pending matter where Section 9 application has been filed by the Operational Creditor. The Adjudicating Authority while deciding one IA has observed that similar application was withdrawn by the Corporate Debtor. With regard to another IA, Adjudicating Authority has observed that no sufficient ground has been made out to allow the application.
NCLAT held that it is true that the application under Section 76 was not listed and was laying in defect, as has been submitted by learned counsel for the Appellant, however, the order record the statement of counsel for the Corporate Debtor that they shall withdraw the application. The Adjudicating Authority has heard the parties and has to decide finally. The power of the Adjudicating Authority to take proceeding for prosecution are ample and at any stage the Adjudicating Authority can direct for the prosecution of either of the parties.

The power of the Adjudicating Authority to take proceeding for prosecution are ample and at any stage the Adjudicating Authority can direct for the prosecution of either of the parties – Enkay Brand Distribution Pvt. Ltd. Vs. Nike India Pvt. Ltd. – NCLAT New Delhi Read Post »

Rejoinder was filed subsequently amendments in CIRP Regulation 2A shall not put any statutory obligation on the Appellant to file the documents of evidence of default as provided in CIRP Regulation 2A – Abhijit Sinha Vs. Asset Reconstruction Company (India) Ltd. – NCLAT New Delhi

NCLAT held that CIRP Regulation 2A cannot come to the help of the Appellant in any manner since the Application was filed in 2019, at that time Regulation 2A was not there. The Financial Creditor was not obliged to comply the Regulation. The mere fact that Rejoinder was filed subsequently shall not put any statutory obligation on the Appellant to file the documents of evidence of default as provided in Regulation 2A. It also held that the question under admission of Section 7 Application is not as to what is correct liability of the Corporate Debtor when admission was there that the amount of more than One Crore was due, it was sufficient for admission of Section 7 Application.

Rejoinder was filed subsequently amendments in CIRP Regulation 2A shall not put any statutory obligation on the Appellant to file the documents of evidence of default as provided in CIRP Regulation 2A – Abhijit Sinha Vs. Asset Reconstruction Company (India) Ltd. – NCLAT New Delhi Read Post »

Default of instalment of Settlement Agreement does not come within the definition of Operational Debt as it does not fall within the definition of additional debt as per Section 5(21) of the IBC – Trafigura India Pvt. Ltd. Vs. TDT Copper Ltd. – NCLAT New Delhi

NCLAT held that the Adjudicating Authority has considered the Settlement Agreement and rightly come to the conclusion that default of instalment of Settlement Agreement does not come within the definition of ‘operational debt’ as it does not fall within the definition of additional debt as per Section 5(21) of the IBC and further prayer made by the Corporate Debtor that the matter be referred to the Arbitration under Section 8 of the Arbitration and Conciliation Act, the Adjudicating Authority has also rightly held that the role of National Company Law Tribunal is very limited while exercising its power under Section 7, 9 and 10 of the IBC, 2016, it is beyond the scope of Section 9 of the IBC.

Default of instalment of Settlement Agreement does not come within the definition of Operational Debt as it does not fall within the definition of additional debt as per Section 5(21) of the IBC – Trafigura India Pvt. Ltd. Vs. TDT Copper Ltd. – NCLAT New Delhi Read Post »

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