25/08/2023

Regional Provident Fund Commissioner cannot take any coercive action during moratorium period as per Section 14 of the IBC, 2016 – Shirani Automotive Pvt. Ltd. – NCLT Indore Bench

NCLT Indore Bench held that this is the moratorium period as per Section 14 of the IBC, 2016. Therefore, in view of the provisions of Section 14 of the IBC, 2016, the Regional Provident Fund Commissioner-II, Indore shall not take any coercive action during this moratorium period against the Liquidator until any further orders.

Regional Provident Fund Commissioner cannot take any coercive action during moratorium period as per Section 14 of the IBC, 2016 – Shirani Automotive Pvt. Ltd. – NCLT Indore Bench Read Post »

Can a Secured Creditor withhold the amount received under an Insurance Policy after the date of approval of the Resolution plan? – SMC Infrastructures Pvt. Ltd. Vs. State Bank of India – NCLT Hyderabad Bench

The Bank submitted that the policy amount was payable prior to initiation of the CIRP process but was only remitted post approval of Rplan. Resolution Professional failed to collect and monitor the Policy, as a result, it did not reflect in the assets of the Corporate Debtor and the SRA bid for the company without taking the amount into consideration. The CoC also approved the plan without having any knowledge about this amount. Surrender of policy and payments due occurred prior to approval of the Resolution Plan, therefore, the Bank being a secured creditor is entitled to the amount.
NCLT Hyderabad Bench held that any money with the third parties like creditors in form of security deposits, margin moneys, term deposit receipts or retention money will be released to corporate debtor. Further this amount can be considered as retention money also as this was retained by insurance company on account of lock in period clause in the Insurance Policy. From the above it is very clear that the amount payable by the insurance company belongs to the corporate debtor and the corporate debtor which is under the new management is entitled for the same. Further in terms of the approved resolution plan there is no such clause which provides for payments of receivables to the creditors.

Can a Secured Creditor withhold the amount received under an Insurance Policy after the date of approval of the Resolution plan? – SMC Infrastructures Pvt. Ltd. Vs. State Bank of India – NCLT Hyderabad Bench Read Post »

IBC does not contain any provision for reopening of CIRP process once it is stood concluded at one point of time – Amluckie Investment Company Ltd. – NCLT Mumbai Bench

NCLT Mumbai Bench held that the Hon’ble NCLAT disposed of the appeal after taking notice of settlement “by directing closing of the case before the adjudicating authority. Corporate Debtor is released from the rigour of Corporate Insolvency Resolution Process. Moratorium will cease to have effect, forthwith.” This Bench is of the considered view that the Hon’ble NCLAT had closed the Company Petition meaning thereby the CIRP process stood closed thereat. We are of the view that the words “to reopen the Corporate Insolvency Resolution Proceedings in accordance with Law” only warrants restoration of company petition for fresh admission, because the code does not contain any provision for reopening of CIRP process once it is stood concluded at one point of time.

IBC does not contain any provision for reopening of CIRP process once it is stood concluded at one point of time – Amluckie Investment Company Ltd. – NCLT Mumbai Bench Read Post »

NCLT directs to conduct valuation of shares held by a wholly owned foreign subsidiary company of Corporate Debtor, which were sold by SBI Singapore – Mr. Shantanu Prakash Vs. Mr. Mahendar Singh Khandelwal, RP, Educomp Solutions Ltd. – NCLT New Delhi Bench Court-II

In this case, Ex-Director of Educomp Solutions Limited, Corporate Debtor raised the issue that shares of The Learning Internet Inc. (TLI) held by Educomp Asia Pacific Pte Limited (a wholly owned subsidiary of Corporate Debtor and also gone into Liquidation as per order passed by High Court of Singapore) has been sold by SBI, Singapore at lower value.
NCLT New Delhi Bench Court-II held that:
(i) The RP shall approach IBBI for the appointment of Registered Valuers to do the valuation of shares of The Learning Internet Inc. owned by the Educomp Asia Pacific Pte Limited and pledged with State Bank of India, Singapore.
(ii) If the valuation done by the two valuators or third valuator so appointed, as the case may be is found more than the value of USD 7.1 million for which the shares were sold on 03.09.2021, the claim of SBI Singapore against the Corporate Debtor would stand reduced to the equal or that extent.
(iii) The CIRP qua the Educomp Solution Limited (CD) would continue unhindered and uninfluenced by the aforementioned direction (a & b) The secured financial claim of the State Bank of India (Singapore) qua the CD would be subject to the outcome of the valuation result/report.

NCLT directs to conduct valuation of shares held by a wholly owned foreign subsidiary company of Corporate Debtor, which were sold by SBI Singapore – Mr. Shantanu Prakash Vs. Mr. Mahendar Singh Khandelwal, RP, Educomp Solutions Ltd. – NCLT New Delhi Bench Court-II Read Post »

Can CoC allow all Resolution Applicants to enhance their plan with an object of maximization of value of assets? – CoC of Tamra Dhatu Udyog Pvt. Ltd. Vs. Ms. Mamta Binani RP – NCLT Kolkata Bench

NCLT Kolkata Bench held that:
(i) It is settled position of law that Adjudicating Authority can return the plan for reconsideration, to the COC albeit on limited grounds.
(ii) The Adjudicating Authority should have the power to allow the prayer of the COC of the Corporate Debtor of permitting all the PRAs to enhance their plans financially giving them a level playing field.
(iii) allowed this application and allow all the Participating Resolution Applicants by giving a last, equal and fair opportunity to submit their revised and/or enhanced resolution plans to the RP of the Corporate Debtor. If required fresh timelines may be provided to all the Participating Resolution Applicants who wish to enhance and/or revise their resolution plans, keeping in view the prescribed timelines of completion of the CIR Process and voting period may also be extended if necessary.

Can CoC allow all Resolution Applicants to enhance their plan with an object of maximization of value of assets? – CoC of Tamra Dhatu Udyog Pvt. Ltd. Vs. Ms. Mamta Binani RP – NCLT Kolkata Bench Read Post »

Suspended Director has no vested right to recommend the removal of the liquidator – Kulwinder Singh Makhni (Ex-Director Punjab Basmati Rice Ltd.) Vs. Mr. Sanjay Kumar Aggarwal Liquidator of Punjab Basmati Rice Ltd. – NCLT Chandigarh Bench

The present application has been filed by Ex-Director of the Corporate Debtor against the Liquidator seeking direction for the removal of the Liquidator and for appointment of a new Liquidator of the corporate debtor prior to the date of sale of assets of the corporate debtor, fixed for 29.03.2023.
NCLT Chandigarh Bench held that in the case at hand, the applicant’s suspended director has made certain allegations against the liquidator. In view of the Liquidation Regulation 31A(11), the power to remove the liquidator lies squarely with the Stakeholders Consultation Committee(SCC). The Suspended Director has no vested right to recommend the removal of the liquidator. The IA filed by SCC, it nowhere recommends the removal of the liquidator and has only prayed for directions to the liquidator to immediately distribute the amount recovered by him from the sale of liquidation of assets of the corporate debtor after retaining the disputed amount with respect to his alleged liquidator fee plus liquidation expenses.

Suspended Director has no vested right to recommend the removal of the liquidator – Kulwinder Singh Makhni (Ex-Director Punjab Basmati Rice Ltd.) Vs. Mr. Sanjay Kumar Aggarwal Liquidator of Punjab Basmati Rice Ltd. – NCLT Chandigarh Bench Read Post »

The date of default is to determine with reference to each invoice and invoices which are beyond the period of 3 years of the date of filing are to be excluded – Laxmi Trading Corporation Vs. Hindustan Construction Company Ltd. – NCLT Mumbai Bench

NCLT Mumbai Bench held that on perusal of invoice by details listed for purpose of computation it is found that default dates varies from the year 2012 to 2014 in many of the cases. The Corporate Debtor has also submitted that out of 234 invoices annexed to the petition 224 invoices are of the period are ex facie time barred.
The Bench referred the judgment in M/s. Next Education India Pvt. Ltd. Vs. M/s. K12 Techno Services Pvt. Ltd. (2023) ibclaw.in 39 SC and held that the ratio of this decision is that the date of default is to determine with reference to each invoice and invoices which are beyond the period of 3 years of the date of filing are to be excluded, unless the period of limitation is extended u/s 18 of the Limitation Act by way of acknowledgement. The Operational Creditor has maintained project wise ledger account of the Corporate Debtor in its books of accounts and each of the payment received from the Corporate Debtor has been appropriated towards a specific project account.

The date of default is to determine with reference to each invoice and invoices which are beyond the period of 3 years of the date of filing are to be excluded – Laxmi Trading Corporation Vs. Hindustan Construction Company Ltd. – NCLT Mumbai Bench Read Post »

Scroll to Top