28/06/2021

DRT is not a wrong forum for exclusion of time under section 14 of the Limitation Act since a financial creditor is perfectly entitled to maintain the proceedings initiated by it under the RDDB Act before a DRT for recovery of its dues – The Federal Bank Limited Vs. Uniworth Limited – NCLT Kolkata Bench

The Adjudicating Authority observed that the fundamental difference between the facts of Sesh Nath Singh (2021) ibclaw.in 49 SC and the present case is this: in Sesh Nath Singh (supra), the financial creditor was a cooperative bank. The Hon’ble Calcutta High Court, before whom the SARFAESI proceedings were challenged, was prima facie of the view that a cooperative bank could not invoke the provisions of the SARFAESI Act. Therefore, the proceedings were stayed pending a final decision on the writ petition. Therefore, both the appellate courts felt that a case was made out for exclusion of time under section 14 of the Limitation Act, 1963. In case the writ proceedings confirmed the prima facie view of the Hon’ble Calcutta High Court that a cooperative bank could not initiate SARFAESI proceedings, then it would have resulted in the proceedings before DRT being quashed. That would have left the creditor therein with only one remedy: to approach the civil court. In these circumstances, the Hon’ble Supreme Court thought it fit to hold that section 14 of the Limitation Act, 1963 would have applicability.
As noticed by the Hon’ble Supreme Court in Sesh Nath Singh (supra) in para 77 thereof, section 14 provides that an applicant who has prosecuted another civil proceeding with due diligence before a forum which is unable to entertain the same on account of jurisdiction or any other cause of like nature, is entitled to exclusion of time spent in prosecuting such proceeding in computing the period of time. However, such is not the case here. The financial creditor is perfectly entitled to maintain the proceedings initiated by it under the RDDB Act before the learned DRT-I, Kolkata, for recovery of its dues. Neither is the DRT a wrong forum. Therefore, in this conspectus, it is not a fit case for exclusion of time under section 14.

DRT is not a wrong forum for exclusion of time under section 14 of the Limitation Act since a financial creditor is perfectly entitled to maintain the proceedings initiated by it under the RDDB Act before a DRT for recovery of its dues – The Federal Bank Limited Vs. Uniworth Limited – NCLT Kolkata Bench Read Post »

NCLT grants 30 days more time to complete compromise or arrangement proposed under Section 230 of the Companies Act, 2013 r/w Reg. 2B of Liquidation Process Regulations, 2016 – Goodwin Packpet Pvt. Ltd. Vs. Mr. Balakrishnan Baburajan IP – NCLT Kochi Bench

NCLT held that to arrive at a conclusion whether further time can be granted to the applicants to settle the matter by restructuring the company, we have gone through the 2005 Report of the Expert Committee on Company Law (JJ Irani Committee Report) and in the matter S.C. Sekaran vs. Amit Gupta and Ors. [2019] ibclaw.in 02 NCLAT, in this case, the Hon’ble Tribunal directed the liquidator appointed under the IBC, to “take steps in terms of Section 230” for the revival of the corporate debtor before undertaking the sale of its assets.
NCLT exercising the discretionary power of this Tribunal under Rule 11 of the NCLT Rules, 2016, disposed of the IA with the order that the Applicants are granted 30 days’ time from today to clear off the debt due to the Respondent in the IBA and another Creditor CSB Bank, so as to get re-structured the Applicant Company.

NCLT grants 30 days more time to complete compromise or arrangement proposed under Section 230 of the Companies Act, 2013 r/w Reg. 2B of Liquidation Process Regulations, 2016 – Goodwin Packpet Pvt. Ltd. Vs. Mr. Balakrishnan Baburajan IP – NCLT Kochi Bench Read Post »

When the Transferor and Transferee Company involve a parent Company and a Wholly Owned Subsidiary the meeting of Equity Shareholders, Secured Creditors and Unsecured Creditors can be dispensed with as the facts of this case substantiate that the rights of the Equity Shareholders of the Transferee Company are not being affected – Mohit Agro Commodities Processing Pvt Ltd. & Gujarat Ambuja Exports Ltd.- NCLAT New Delhi

It is seen that Section 232(1) of the Companies Act, 2013 uses the word ‘may’ which introduces an element of discretion to the Tribunal to be exercised in the interest of justice in appropriate situations. It is evident from the aforesaid citations that the High Courts have exercised this discretion dispensing with the requirement of convening the meetings, if the Bench is satisfied in all respects. Section 232 is a specific provision carved out by the Legislature when both conditions maintained in clauses (a) and (b) of sub- Section (1) of Section 232 are met. In the instant case the amalgamation sought for is between a Wholly Owned Subsidiary and the Holding Company. The point which needs to be noted is whether such an arrangement alters the rights of the Stakeholders of the Company; whether such an amalgamation has any bearing internally on Creditors/Members of both the Companies; whether not holding the subject meeting would amount to violation of any of the provisions of the Companies Act, 2013; whether the Tribunal can exercise their discretion when the ‘Transferor Company’ is a Wholly Owned Subsidiary of the ‘Transferee Company’ and financial position of the ‘Transferee Company’ is positive and the merger is not affecting the rights of the Shareholders or the Creditors.

When the Transferor and Transferee Company involve a parent Company and a Wholly Owned Subsidiary the meeting of Equity Shareholders, Secured Creditors and Unsecured Creditors can be dispensed with as the facts of this case substantiate that the rights of the Equity Shareholders of the Transferee Company are not being affected – Mohit Agro Commodities Processing Pvt Ltd. & Gujarat Ambuja Exports Ltd.- NCLAT New Delhi Read Post »

NCLAT declines to entertain the appeal in DHFL Resolution Plan matter as pre-mature stage – Prudential International Insurance Holdings Ltd. Vs. The Administrator, Dewan Housing Finance Corporation Ltd. – NCLAT New Delhi

NCLAT declined to entertain the appeal and held that we are not elaborating or commenting on the same for the reason that I.A. No. 449 of 2021 is admittedly stated to be coming up before the Adjudicating Authority on 30.06.2021. Without rights claimed by Appellant being adjudicated before Adjudicating Authority, Appellant cannot maintain challenge to approval of Resolution Plan by way of Appeal.

NCLAT declines to entertain the appeal in DHFL Resolution Plan matter as pre-mature stage – Prudential International Insurance Holdings Ltd. Vs. The Administrator, Dewan Housing Finance Corporation Ltd. – NCLAT New Delhi Read Post »

Dinesh Vatsayan (Suspended Director BBN Foods Hi-Tech Processing Pvt. Ltd.) Vs. Gurdev Bassi (Liquidator, BBN Foods Hi-Tech Processing Pvt. Ltd.) & Anr. – NCLAT New Delhi

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Dinesh Vatsayan (Suspended Director BBN Foods Hi-Tech Processing Pvt. Ltd.) Vs. Gurdev Bassi (Liquidator, BBN Foods Hi-Tech Processing Pvt. Ltd.) & Anr. – NCLAT New Delhi Read Post »

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