24/07/2024

NCLT allows distribution of Intangible Assets being Book Debts which remain unsold (Unsold Assets), amongst the stakeholders under Regulation 38 of Liquidation Process Regulations – Pratap Mukherjee Liquidator of Janpragati Commodities Pvt. Ltd. – NCLT Kolkata Bench

Hon’ble NCLT Kolkata Bench observed that in the instant matter the intangible assets being the book debts remain unsold and hence the Liquidator is seeking to distribute the same amongst the stakeholders. Since the efforts of the Liquidator in realizing the intangible assets have borne no fruit, the options remaining with the SCC are to either identify the asset as not readily realizable assets under Regulation 37A of the Liquidation Process Regulations or to distribute the aforesaid unsold assets among the stakeholders under Regulation 38 of the Liquidation Process Regulations. The Liquidator, with the consent of the SCC in the 6th SCC Meeting, has decided to take the latter route.

NCLT allows distribution of Intangible Assets being Book Debts which remain unsold (Unsold Assets), amongst the stakeholders under Regulation 38 of Liquidation Process Regulations – Pratap Mukherjee Liquidator of Janpragati Commodities Pvt. Ltd. – NCLT Kolkata Bench Read Post »

The provisions under which action was earlier taken under the Companies Act, 1956, as also the action subsequently taken under the Companies Act, 2013, are not inconsistent with one another – Karmyogi Builders Pvt. Ltd. Vs. Registrar of Companies (ROC) – Delhi High Court

Hon’ble Delhi High Court referring Section 465 of the Companies Act, 2013 held that the provisions under which action was earlier taken under the old Act, as also the action subsequently taken under the new Act, are not inconsistent with one another. The new enactment rather provides for a more detailed procedure for striking off the name of a company as also an effective remedy for dealing with the de-registration of a company, which is not running its business or in operation. Further, the registers maintained under the old Act are also deemed to be registers maintained under the new Act and can be relied upon for seeking any legal remedy.

The provisions under which action was earlier taken under the Companies Act, 1956, as also the action subsequently taken under the Companies Act, 2013, are not inconsistent with one another – Karmyogi Builders Pvt. Ltd. Vs. Registrar of Companies (ROC) – Delhi High Court Read Post »

Can invocation of Bank Guarantee issued by Corporate Debtor be treated as Preferential Transaction under Section 43 of IBC? – West Bengal State Electricity Distribution Company Ltd. (WBSEDCL) Vs. Punjab National Bank and Ors. – NCLT Kolkata Bench

Hon’ble Kolkata NCLT held that one of the necessary conditions for any transaction to be labelled as a Preferential transaction relates to the assets of the Corporate Debtor, so to say that any transaction done in the relevant time by the Corporate debtor would be eligible for being called so only if done by the Corporate debtor i.e. out is its assets. However, since the Bank guarantee is a separate contract and the encashment thereof is not relatable to the assets of the Corporate Debtor, the encashment cannot be termed as Preferential transaction.

Hon’ble Bench also held that Electricity Distribution Company/the applicant has the right to invoke Bank Guarantee and the Bank should not come in the way of invoking the same. It shall not amount to dual claim as the amount recovered by invoking such Bank Guarantee can be adjusted and the admitted claim shall be revised accordingly.

Can invocation of Bank Guarantee issued by Corporate Debtor be treated as Preferential Transaction under Section 43 of IBC? – West Bengal State Electricity Distribution Company Ltd. (WBSEDCL) Vs. Punjab National Bank and Ors. – NCLT Kolkata Bench Read Post »

The protection under Section 32A of IBC is restricted only to Corporate Debtor and not to its Directors who were in-charge of the affairs of the Company when the offence committed or the signatory of the cheque – Vasan Healthcare Pvt. Ltd. Vs. India Infoline Finance Ltd. – Madras High Court

Hon’ble Madras High Court held that from the law laid in Ajay Kumar Radheyshyam Goenka vs. Tourism Finance Corporation of India Ltd. (2023) ibclaw.in 30 SC, it is clear that the Corporate Debtor cannot be prosecuted for the prior liability after the approval of the Resolution Plan. At the same time, it is to be bear in mind the protection under Section 32A of Insolvency & Bankruptcy Code, 2016 is restricted only to the Corporate Debtor and not to its Directors who were in-charge of the affairs of the Company when the offence committed or the signatory of the cheque.

The protection under Section 32A of IBC is restricted only to Corporate Debtor and not to its Directors who were in-charge of the affairs of the Company when the offence committed or the signatory of the cheque – Vasan Healthcare Pvt. Ltd. Vs. India Infoline Finance Ltd. – Madras High Court Read Post »

Repayment of borrowings during look back period, after classification of account of Corporate Debtor as NPA, falls within the exception provided in Section 43(3) of IBC – Mr. Anish Niranjan Nanavaty RP of Reliance Communications Ltd. Vs. RPL Aditya Power Ltd. – NCLT Mumbai Bench

Hon’ble NCLT Mumbai Bench held that:

(i) Section 43(3) of the Code provides certain exceptions, whereby even a transaction falling within the mischief of Section 43(2) read with Section 43(4) of the Code are excluded from the scope of section 43 calling for orders u/s 44 of the Code.
(ii) Ordinarily, every borrower makes sure that the amounts borrowed are paid as and when it becomes due or with least delay. The loans taken from Respondents are stated to be paid in multiple tranches of odd amounts and the loan was repayable on demand.
(iii) Hence, such repayment of loan was in Ordinary Course of financial affairs of the Corporate Debtor as well. Since, the impugned transaction was in Ordinary Course of financial affairs of Corporate Debtor and the Respondent, we are of considered view that it squarely falls within the exception provided in Section 43(3) of the Code.

Repayment of borrowings during look back period, after classification of account of Corporate Debtor as NPA, falls within the exception provided in Section 43(3) of IBC – Mr. Anish Niranjan Nanavaty RP of Reliance Communications Ltd. Vs. RPL Aditya Power Ltd. – NCLT Mumbai Bench Read Post »

IBC Section 95 application cannot be rejected solely on the ground of non-stamping and/or insufficient stamping of the deeds of Guarantee – State Bank of India Vs. Mamta Apparao – NCLT Mumbai Bench

Hon’ble NCLT Mumbai Bench held that:

(i) In the present case, the liability to pay the stamp duty on the above-referred Deeds of Guarantee is on the Respondent and not the Petitioner. Therefore, if the Respondent herself has not paid sufficient stamp duty on the above-referred Deeds of Guarantee, she cannot now resist this Petition on the ground that the aforesaid deeds have not been sufficiently stamped.
(ii) The provisions of the Code of Civil Procedure, 1908 and the Indian Evidence Act, 1872 do not strictly apply to the proceedings before the Adjudicating Authority while adjudicating an application u/s 95 read with Section 100 of the Code.
(iii) In view of the law laid down by the Hon’ble Apex Court in Innoventive Industries Ltd. v. ICICI Bank and Anr. (2017) ibclaw.in 02 SC, this Petition cannot be rejected solely on the ground of non-stamping and/or insufficient stamping of the deeds of guarantee especially when the debt does not cease to be due and payable on account of such deficient stamping of documents when the default has otherwise been satisfactorily established from the records.

IBC Section 95 application cannot be rejected solely on the ground of non-stamping and/or insufficient stamping of the deeds of Guarantee – State Bank of India Vs. Mamta Apparao – NCLT Mumbai Bench Read Post »

The date of e-filing of the Appeal has to be taken as the date on which the Appeal is filed, and the date on when the Appeal is refiled after curing the defects, cannot be taken for computation for the purposes of limitation – Commercial Tax Department Vs. Naveen Kumar Sood and Anr. – NCLAT New Delhi

Login with GoogleOR Username Password Remember Me     Forgot Password In case you’ve already logged in, click here

The date of e-filing of the Appeal has to be taken as the date on which the Appeal is filed, and the date on when the Appeal is refiled after curing the defects, cannot be taken for computation for the purposes of limitation – Commercial Tax Department Vs. Naveen Kumar Sood and Anr. – NCLAT New Delhi Read Post »

Computation of limitations has to be taken from the date of e-filing of the Appeal under Section 61 of IBC and not from the date of re-filing after curing the defects – Innovators Cleantech Pvt. Ltd. Vs. Pasari Multi Projects Pvt. Ltd. – NCLAT New Delhi

In this important judgment, Hon’ble NCLAT clarifies two issues:

1. Computation of limitations starts from the date of e-filing of the Appeal under Section 61 of IBC or from the date of re-filing after curing the defects?
2. Whether without applying a certified copy of the order, whether an Appeal can be filed under Section 61 of IBC or not?

Computation of limitations has to be taken from the date of e-filing of the Appeal under Section 61 of IBC and not from the date of re-filing after curing the defects – Innovators Cleantech Pvt. Ltd. Vs. Pasari Multi Projects Pvt. Ltd. – NCLAT New Delhi Read Post »

Company Director or Authorised Signatory of cheque is not a Drawer in terms of Section 143A of NI Act and cannot be directed to pay interim compensation under Section 143A – Shri Gurudatta Sugars Marketing Pvt. Ltd. Vs. Prithviraj Sayajirao Deshmukh and Ors. – Supreme Court

In this Landmark Judgment, the Hon’ble Supreme Court upheld the ratio of Lyka Labs Limited and Anr. v. The State of Maharashtra and Anr. (2023) ibclaw.in 131 HC and held that:

(i) The general rule against vicarious liability in criminal law underscores that individuals are not typically held criminally liable for acts committed by others unless specific statutory provisions extend such liability.
(ii) The High Court rightly emphasized that liability under Section 141 arises from the conduct or omission of the individual involved, not merely their position within the company.
(iii) The distinction between legal entities and individuals acting as authorized signatories is crucial.
(iv) This principle, fundamental to corporate law, ensures that while authorized signatories can bind the company through their actions, they do not merge their legal status with that of the company.
(v) The drawer under Section 143A of NI Act refers specifically to the issuer of the cheque, not the authorized signatories.
(vi) The judgment in Aneeta Hada v. Godfather Travels & Tours Pvt. Ltd. (2017) ibclaw.in 821 SC nowhere lays down that directors or authorised signatories would come under the ambit of ‘drawer’ for the purposes of Section 143A.
(vii) An authorized signatory is not a drawer of the cheque, as established in N. Harihara Krishnan Vs. J. Thomas (2017) ibclaw.in 964 SC.

Company Director or Authorised Signatory of cheque is not a Drawer in terms of Section 143A of NI Act and cannot be directed to pay interim compensation under Section 143A – Shri Gurudatta Sugars Marketing Pvt. Ltd. Vs. Prithviraj Sayajirao Deshmukh and Ors. – Supreme Court Read Post »

Doctrine of necessity: NCLAT too can extend its powers under section 60(5) of IBC, 2016 to meet out the ends of Justice in order to avoid liquidation of the Corporate Debtor – Mr. C. Sivasami Vs. Mr. A.R. Ramasubramania Raja, Liquidator of Topknit Processing Mills Pvt. Ltd. and Anr. – NCLAT Chennai

Hon’ble NCLAT held that:

(i) The concept of the ‘doctrine of necessity’, which has to be read in accordance with the provisions contained under section 60(5) of I & B Code, 2016, it provides for meeting out such inevitable circumstances in form of the powers vested with the Tribunals and particularly the NCLT as referred to in Section 60(5) of I & B Code, 2016, to pass any appropriate order for fruitfully disposing of any application or proceedings in order to meet the purpose of CIRP, as against the Corporate Debtor.

(ii) When the provisions contained under section 60(5) of I & B Code, 2016, it starts with a non-obstinate clause, that means it has an overriding effect to any of the provisions to the contrary, of the Code as contained therein and that the exercise of inherent powers have been vested with the Tribunal to carry out the exceptions in order to meet out the objective of the Code in order to avoid liquidation and to enable the Corporate Debtor to transition into position of being a going concern.

(iii) The NCLAT too can extend its powers under section 60(5) to meet out the ends of Justice in order to avoid liquidation of the Corporate Debtor.

Doctrine of necessity: NCLAT too can extend its powers under section 60(5) of IBC, 2016 to meet out the ends of Justice in order to avoid liquidation of the Corporate Debtor – Mr. C. Sivasami Vs. Mr. A.R. Ramasubramania Raja, Liquidator of Topknit Processing Mills Pvt. Ltd. and Anr. – NCLAT Chennai Read Post »

Scroll to Top