Offences & Penalties [Main]

Proviso of Rule 48 of the NCLT Rules clearly envisages that where the case was disposed of on merits the decision shall not be re-opened – Bhagwati Singh Vs. Leader Universal (Mauritius) Company Ltd. and Ors – NCLT Kolkata Bench

(2025) ibclaw.in 77 NCLT IN THE NATIONAL COMPANY LAW TRIBUNALKolkata Bench Bhagwati Singhv.Leader Universal (Mauritius) Company Ltd. and Ors […]

Proviso of Rule 48 of the NCLT Rules clearly envisages that where the case was disposed of on merits the decision shall not be re-opened – Bhagwati Singh Vs. Leader Universal (Mauritius) Company Ltd. and Ors – NCLT Kolkata Bench Read Post »

Can an application under Section 73 of the IBC be filed after dissolution of the Corporate Debtor under Section 54 of the Code? – New India Color Company Ltd. Vs. Samtex Desinz Pvt. Ltd. (In CIRP) and Anr. – NCLAT New Delhi

The Hon’ble NCLAT held that since the Corporate Debtor has already been dissolved, the present appeal, against the order passed by NCLT by which an IA filed by the Appellant under Section 60(5) r/w Section 73 of the IBC has been dismissed, has become infructuous.

Can an application under Section 73 of the IBC be filed after dissolution of the Corporate Debtor under Section 54 of the Code? – New India Color Company Ltd. Vs. Samtex Desinz Pvt. Ltd. (In CIRP) and Anr. – NCLAT New Delhi Read Post »

When a fraudulent CIRP proceeding is initiated, Adjudicating Authority has jurisdiction under the IBC to consider allegations of fraudulent and malicious initiation of CIRP proceedings under Section 65 of IBC and to recall the CIRP admission order/ terminate CIRP (even if a Resolution Plan approval application has been filed before the NCLT) – Acute Daily Media Pvt. Ltd. and Ors. Vs. Rockman Advertising and Marketing (India) Ltd. and Ors. – NCLAT New Delhi

The Hon’ble NCLAT held that:

(i) There is no statutory embargo on the Adjudicating Authority to exercise its discretion carefully and judiciously in a Section 65 application to prevent and protect the Corporate Debtor from being dragged into CIRP.
(ii) When no interest income had been reflected in the balance sheet, yet computing the interest amount in the Section 7 application to cross the threshold hurdle lends credence to the narrative of precipitation of fraud.
(iii) As non- compliance under the Companies Act cannot negate a petition filed under Section 7 as long as there is a valid debt and default in payment of the said debt.
(iv) Debt and default cannot always be seen in isolation. AA is also required to take care that the provisions of Section 7 of IBC are not misused or abused in any manner either by the financial creditor or the promoters of the Corporate Debtor to take undue advantage at the cost of insolvency resolution.

When a fraudulent CIRP proceeding is initiated, Adjudicating Authority has jurisdiction under the IBC to consider allegations of fraudulent and malicious initiation of CIRP proceedings under Section 65 of IBC and to recall the CIRP admission order/ terminate CIRP (even if a Resolution Plan approval application has been filed before the NCLT) – Acute Daily Media Pvt. Ltd. and Ors. Vs. Rockman Advertising and Marketing (India) Ltd. and Ors. – NCLAT New Delhi Read Post »

Can Adjudicating Authority recall the CIRP admission order? – Vidyadhar Sarfare and Anr. Vs. CS Anagha Anasingharaju and Ors. – NCLAT New Delhi

Hon’ble NCLAT held that:

(i) In the present case, Section 7 Application has been filed by Respondent Nos.6 to 9 and unless an Application is filed by the Applicant, who has initiated Section 7 Application, compliance of Section 12A read with Section 30A, cannot be made.
(ii) In a case where Adjudicating Authority comes to the conclusion that ingredients of Section 65 are attracted, i.e. Application has been filed with fraudulent or/ with malicious intent for the purpose other than the resolution of the Corporate Debtor, the Adjudicating Authority may impose on such person penalty.

Can Adjudicating Authority recall the CIRP admission order? – Vidyadhar Sarfare and Anr. Vs. CS Anagha Anasingharaju and Ors. – NCLAT New Delhi Read Post »

Merely filing a weak case is not ground to exercise power under Section 65 of IBC or merely on the basis that Operational Creditor has relied on certain facts without substantiating documents, an action under Section 65 of Insolvency Code cannot be initiated against the Operational Creditor – Mahi Buildhome Pvt. Ltd. Vs. Kaveri Technobuild Pvt. Ltd. – NCLT New Delhi Bench

(2024) ibclaw.in 1132 NCLT IN THE NATIONAL COMPANY LAW TRIBUNALNew Delhi Bench Mahi Buildhome Pvt. Ltd.v.Kaveri Technobuild Pvt. Ltd.

Merely filing a weak case is not ground to exercise power under Section 65 of IBC or merely on the basis that Operational Creditor has relied on certain facts without substantiating documents, an action under Section 65 of Insolvency Code cannot be initiated against the Operational Creditor – Mahi Buildhome Pvt. Ltd. Vs. Kaveri Technobuild Pvt. Ltd. – NCLT New Delhi Bench Read Post »

Merely because proceeding under Section 13(2) and 13(4) of the SARFAESI Act, 2002 has been initiated by the creditor prior to filing of Section 10 application under IBC, cannot be a ground to hold that Section 10 application is filed with malicious and fraudulent intent as per Section 65 of the IBC – Getz Cables Pvt. Ltd. Vs. State Bank of India and Anr. – NCLAT New Delhi

In this judgment, Hon’ble NCLAT referring various judgment held that for proving fraudulent and malicious intent, something more is required to be pleaded and proved apart from initiation of proceedings under Section 13(2) and 13(4) of SARFAESI Act by the creditor against the Corporate Applicant.

Necessary ingredients, which required to be proved under Section 65(1) of IBC are that proceedings are initiated fraudulently or with malicious intent for any purpose other than for the resolution of insolvency. Both expression – fraudulent and malicious has definite connotation.

Merely because proceeding under Section 13(2) and 13(4) of the SARFAESI Act, 2002 has been initiated by the creditor prior to filing of Section 10 application under IBC, cannot be a ground to hold that Section 10 application is filed with malicious and fraudulent intent as per Section 65 of the IBC – Getz Cables Pvt. Ltd. Vs. State Bank of India and Anr. – NCLAT New Delhi Read Post »

Once it has been proved that Corporate Debtor was duly served with a notice of insolvency petition, and given opportunities to show up and file reply to the said petition, the ignorance of the Corporate Debtor cannot be termed as a fraud played upon by the Operational Creditor – Rajnishpal Singh Dhaliwal Vs. Nilkamal Ltd. and Ors. – NCLT Chandigarh Bench

Hon’ble NCLT Chandigarh Bench held that the present IA is nothing, but a tactic played by the Applicant to terminate the CIRP of the Corporate Debtor, on a sham ground that the order admitting the Corporate Debtor into CIRP was obtained by the Operational Creditor by playing fraud.

Once it has been proved that Corporate Debtor was duly served with a notice of insolvency petition, and given opportunities to show up and file reply to the said petition, the ignorance of the Corporate Debtor cannot be termed as a fraud played upon by the Operational Creditor – Rajnishpal Singh Dhaliwal Vs. Nilkamal Ltd. and Ors. – NCLT Chandigarh Bench Read Post »

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