CIRP Initiation- Revival/ Restoration CIRP application when no liberty

Whether a company petition which has been dismissed on account of withdrawal or in view of a settlement between the parties can be revived when no liberty was granted in the earlier order of dismissal? – Surya Dealtrade Pvt. Ltd. Vs. Vipul Ltd. – NCLT New Delhi Bench

/ 5 minutes of reading

The Hon’ble NCLT New Delhi Bench held the object and intent of CIRP is to rescue the Corporate Debtor and to put it back to its feet. The same is not to facilitate the recovery of debt. Therefore, granting the relief being sought by the Applicant in the present application would result in turning the IBC, 2016 into a debt recovery proceeding where a party would repeatedly approach this Tribunal for recovery of the same debt.

Whether a company petition which has been dismissed on account of withdrawal or in view of a settlement between the parties can be revived when no liberty was granted in the earlier order of dismissal? – Surya Dealtrade Pvt. Ltd. Vs. Vipul Ltd. – NCLT New Delhi Bench Read Post »

Revival/restore of CIRP petition even no liberty was granted to the Applicant to get the Petition revived nor there was any stipulation in the consent terms – OCS Group (India) Pvt. Ltd. Vs. Mystical Constructions Pvt. Ltd. – NCLT Mumbai Bench

/ 6 minutes of reading

Hon’ble NCLT Mumbai Bench held that the Corporate Debtor cannot be allowed to take advantage of its own wrongs. The said liberty in the given situation can be construed to be a liberty to get the Petition revived and it would be just and equitable if the Petition under Section 9 of the Insolvency and Bankruptcy Code, 2016 filed by the Applicant, which was dismissed on the basis of consent terms, is revived to be decided on merits. In case neither the Petition is revived nor a contempt is issued against the Corporate Debtor, it will cause grave injustice to the Applicant who would be rendered remediless.

Revival/restore of CIRP petition even no liberty was granted to the Applicant to get the Petition revived nor there was any stipulation in the consent terms – OCS Group (India) Pvt. Ltd. Vs. Mystical Constructions Pvt. Ltd. – NCLT Mumbai Bench Read Post »

Liberty by withdrawing the restoration application cannot be treated to be liberty to file fresh application under Section 94(1) of IBC – Gursev Singh, Personal Guarantor Vs. IDBI Bank and Anr. – NCLAT New Delhi

/ 16 minutes of reading

In this case, Personal Guarantor filed an application under Section 94 of the IBC. Adjudicating Authority dismissed the application for non-compliance after granting several opportunities to Personal Guarantor to comply the provisions of Section 94(4) and 94(5) of the IBC.

Thereafter, Personal Guarantor filed an IA for recall and restoration of the application. The AA permitted to withdraw with liberty to re-file as per law as prayed.
Thereafter, Personal Guarantor filed a fresh application under Section 94 which was dismissed as not maintainable.

Hon’ble NCLAT held that no liberty to file fresh petition was granted when order was passed under Sec. 94. At a time of withdrawal of IA only liberty was granted to re-file as per law. Liberty by withdrawing the restoration application cannot be treated to be liberty to file fresh application under Section 94(1) wiping out the earlier order. The 1st order dismissing Section 94 application for reasons stares in the face of the Appellant which order has neither been modified nor appealed.

Liberty by withdrawing the restoration application cannot be treated to be liberty to file fresh application under Section 94(1) of IBC – Gursev Singh, Personal Guarantor Vs. IDBI Bank and Anr. – NCLAT New Delhi Read Post »

Operational Creditor is not entitled for benefit of Section 14 of the Limitation Act where the Suit filed by Operational Creditor was withdrawn on its own application without any liberty to institute a fresh suit – GRI Towers India Pvt. Ltd. Vs. Inox Wind Ltd. – NCLAT New Delhi

/ 36 minutes of reading

Hon’ble NCLAT held that:
(i) Suit was withdrawn without any liberty from the Court to institute a fresh proceeding and termination of suit cannot be held on ground of defect of jurisdiction on cause of like nature.
(ii) The proceedings under IBC are not proceedings for recovery of contractual dues, as is apparent from the facts of the present case the Operational Creditor has initiated proceeding for recovery of its contractual dues arising out of contract between the parties. Suit for recovery of dues was already filed by the Operational Creditor which was withdrawn by the Operational Creditor.
(iii) It is, however, relevant to notice that withdrawal of the suit was not on the ground contended by the Operational Creditor nor any liberty was granted by the Civil Court to institute a fresh suit nor Operational Creditor at any point of time resorted to the proceeding of arbitration which according to the Operational Creditor was reason for withdrawal of suit.
(iv) Upheld decision of the NCLT Chandigarh Bench.

Operational Creditor is not entitled for benefit of Section 14 of the Limitation Act where the Suit filed by Operational Creditor was withdrawn on its own application without any liberty to institute a fresh suit – GRI Towers India Pvt. Ltd. Vs. Inox Wind Ltd. – NCLAT New Delhi Read Post »

When settlement consent term itself contemplates a clause for revival in event of default and default having been committed by the Corporate Debtor, the CIRP can be restored – IDBI Trausteeship Services Ltd. Vs. Nirmal Lifestyle Ltd. – NCLAT New Delhi

/ 19 minutes of reading

On Corporate Debtor subsequent to the withdrawal of the Company Petition defaulted in making payment towards the second tranche as per consent term, the Appellant filed an I.A. seeking revival of the Company Petition which has been rejected by Adjudicating Authority observing that when the Company Petition was withdrawn after settlement there is no specific provision anywhere in the Code for reopening of the Company Petition.
NCLAT held that Adjudicating Authority committed error in rejecting the revival application 3196 of 2022 when the consent term itself contemplates a clause for revival in event of default and default having been committed by the Corporate Debtor, rejection of revival is to deny the Financial Creditor rightful remedy. Non-mention of specific liberty in the Order is inconsequential in view of the clear terms in the settlement which was the basis of withdrawal of Company Petition.

When settlement consent term itself contemplates a clause for revival in event of default and default having been committed by the Corporate Debtor, the CIRP can be restored – IDBI Trausteeship Services Ltd. Vs. Nirmal Lifestyle Ltd. – NCLAT New Delhi Read Post »

Once an Applicant forfeits his right to seek revival of the petition before NCLT and prefers to keep the application dismissed, there was no occasion to again approach the NCLT to seek restoration of the application – Adhunik Niryat Ispat Ltd. Vs. Truvolt Engineering Company Pvt. Ltd. – NCLAT New Delhi

/ 11 minutes of reading

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

Once an Applicant forfeits his right to seek revival of the petition before NCLT and prefers to keep the application dismissed, there was no occasion to again approach the NCLT to seek restoration of the application – Adhunik Niryat Ispat Ltd. Vs. Truvolt Engineering Company Pvt. Ltd. – NCLAT New Delhi Read Post »

Whether the Adjudicating Authority(NCLT) can grant liberty to restore the petition which was finally disposed of as withdrawn – AVANT Garde Clean Room & Engg. Solutions Pvt. Ltd. Vs. HLL Biotech Ltd. – NCLT Kochi Bench

/ 8 minutes of reading

NCLT held that in the IBC 2016 or in NCLT Rules 2016 there is no provision available to grant liberty to restore the finally disposed of petition as withdrawn. Not only in IBC, 2016 there is no such provision available in any other Act, In this situation it is better to see the provisions available in Code of Civil Procedure,1908. Of course, CPC is not applicable to the proceedings under IBC, 2016 but an analogy enshrined in Code of Civil Procedure 1908 can be applied. Further, it held that there is no legal backing to grant liberty to restore the petition which was finally disposed of as withdrawn.
Further the default of payment of settlement agreement do not come under the default of operational debt, this also might be the reason to refuse to grant main relief and granted only an alternative prayer of the memo. When there is no specific order granting liberty to approach this Authority (NCLT), for restoration of dismissed petition, this application cannot be entertained. It is established position of law that if any relief claimed in the petition/memo, which is not expressly granted by the order, shall be deemed to have been refused.

Whether the Adjudicating Authority(NCLT) can grant liberty to restore the petition which was finally disposed of as withdrawn – AVANT Garde Clean Room & Engg. Solutions Pvt. Ltd. Vs. HLL Biotech Ltd. – NCLT Kochi Bench Read Post »

Failing to adhere to terms and conditions of one time settlement, the Financial Creditor is entitled to file fresh Company Petition u/s 7 of IBC is justifiable? – M/s. ICICI Bank Limited Vs. M/s. OPTO Circuits (India) Ltd. – NCLAT Chennai

/ 13 minutes of reading

NCLAT held that the Adjudicating Authority in the impugned order with regard to sub para 4 of para 9 of the impugned order regarding the observation/liberty to file a fresh Company Petition by the Appellant Bank is erroneous and without application of mind and without following the Principles of Natural Justice and not adhering to the decision of this Tribunal being the Appellate Authority, is hereby quashed and set aside.

Failing to adhere to terms and conditions of one time settlement, the Financial Creditor is entitled to file fresh Company Petition u/s 7 of IBC is justifiable? – M/s. ICICI Bank Limited Vs. M/s. OPTO Circuits (India) Ltd. – NCLAT Chennai Read Post »

Whether a proceeding that has been withdrawn without leave to revive the proceeding, can be restored & Whether a settlement agreement can constitute a financial debt or an operational debt – Pawan Putra Securities Pvt. Ltd. Vs. Wearit Global Ltd. – NCLT Kolkata Bench

/ 3 minutes of reading

The Adjudicating Authority has held the fact in the present I.A. is for restoration of the main Company Petition that was originally filed for default in payment of Inter Corporate Deposit and not for default in a settlement agreement. The present I.A. has not been filed to initiate CIRP proceedings against the Corporate Debtor but only to restore the Company Petition. The Company Petition will be dealt with on its merits but at this stage we find it prudent to restore the Company Petition and allow the I.A.

Whether a proceeding that has been withdrawn without leave to revive the proceeding, can be restored & Whether a settlement agreement can constitute a financial debt or an operational debt – Pawan Putra Securities Pvt. Ltd. Vs. Wearit Global Ltd. – NCLT Kolkata Bench Read Post »

Even if specific permission has not been sought to re-file the proceedings on the cause of action having arisen in favour of the Operational Creditor, once the Corporate Debtor has failed to comply with the terms and conditions fixed in the settlement agreement, the right of the Operational Creditor still subsists and he has all the rights to file a petition for enforcing the settlement agreement – Jai Balaji Industries Ltd. Vs. BST Infratech Ltd. -NCLT Kolkata Bench

/ 3 minutes of reading

In this case, terms of the settlement agreement contain that operational creditor shall be entitled to issue fresh notice and initiate fresh proceedings. The AA held that specific use of selected words “fresh notice” and “fresh proceedings” visibly and clearly expose the design of the Corporate Debtor intending to put the Operational Creditor on the long track and frustrate the claim/proceedings pending before this Adjudicating Authority, which however cannot be allowed to happen in these proceedings. We find that none of the Judgments cited by the Corporate Debtor help it in any way, either as regards its claim of pre-existing disputes or as regards seeking permission from the Adjudicating Authority for filing an application in case of failure of the Settlement, because it was not a “withdrawal simpliciter” but had been allowed on the joint request of counsel for the parties pursuant to the Settlement Agreement.

Even if specific permission has not been sought to re-file the proceedings on the cause of action having arisen in favour of the Operational Creditor, once the Corporate Debtor has failed to comply with the terms and conditions fixed in the settlement agreement, the right of the Operational Creditor still subsists and he has all the rights to file a petition for enforcing the settlement agreement – Jai Balaji Industries Ltd. Vs. BST Infratech Ltd. -NCLT Kolkata Bench Read Post »

Scroll to Top