31/01/2018

When it is a question of merger and the provisions require and give discretion to the NCLT with regard to calling of meetings, it is a discretion to be exercised judiciously by NCLT – Mega Corporation Ltd. – NCLAT New Delhi

NCLAT held that Section 233 referred to initially by NCLT has a speedier process but if appellant keeping in view sub-section (14), preferred to resort to Section 232 the applicants cannot be faulted with. Only thing is that, then they have to go through the procedure as u/s 232 of the Act. Section 232 gives powers to NCLT to consider & decide calling of meeting of creditors etc. Appellant cannot claim “dispensing” meetings as a right. When it is a question of merger and the provisions require and give discretion to the NCLT with regard to calling of meetings, it is a discretion to be exercised judiciously by NCLT. NCLT is duty bound to follow procedure laid down by law. The NCLT recorded reasons why it finds that calling of the meetings is necessary and we do not find that the reasons recorded are arbitrary. The Law provides and the NCLT has exercised discretion that the meetings are required to be called. We do not wish to substitute our discretion over the discretion exercised by the NCLT. We do not find any substance in the appeal. The appeal is rejected. The appellant is given liberty to move NCLT to request resetting of the schedule and dates specified in the operative order as it appears that certain steps were to be taken on 29th January, 2018 and the said date has passed.

When it is a question of merger and the provisions require and give discretion to the NCLT with regard to calling of meetings, it is a discretion to be exercised judiciously by NCLT – Mega Corporation Ltd. – NCLAT New Delhi Read Post »

Adjudicating Authority is also empowered to remove the Resolution Professional, apart from the Committee of Creditors, but it should be for the reasons & in the manner as provided under the relevant provisions – Mr. Devendra Padamchand Jain RP VNR Infrastructure Limited Vs. State Bank of India – NCLAT New Delhi

NCLAT highlights the provision of appointment and replacement of RP/Liquidator:

a) Interim resolution profession can be appointed as a resolution professional; [Refer sub-section (2) of Section 22]

b) The Committee of Creditors can replace the interim resolution professional by another resolution professional; [Refer sub-section (2) of Section 22]

c) The Committee of Creditors can replace resolution professional by requisite board if it is of opinion that the resolution professional appointed under section 22 is required to be replaced is to be made in the manner as prescribed under Section 27; [ Refer: Section 27]

d) The Adjudicating Authority is also empowered to replace resolution professional in case the resolution plan submitted under Section 13 is rejected for failure to meet the requirement mentioned sub-section (2) of Section 30. [ Refer : sub-section (4) of Section 34]

e) Normally the resolution professional appointed is to act as liquidator for the purpose of liquidation unless replaced by the Adjudicating Authority under sub-section (4) of Section 34. [Refer : sub-section (1) of Section 34]

and held that the Adjudicating Authority is also empowered to remove the resolution professional, apart from the Committee of Creditors, but it should be for the reasons and in the manner as provided under the relevant provisions

Adjudicating Authority is also empowered to remove the Resolution Professional, apart from the Committee of Creditors, but it should be for the reasons & in the manner as provided under the relevant provisions – Mr. Devendra Padamchand Jain RP VNR Infrastructure Limited Vs. State Bank of India – NCLAT New Delhi Read Post »

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