Liquidation-Managing the Affairs

If workers are not specifically includes in the list of Stakeholders, under Liquidation Regulation 31, they cannot be made a part of the SCC under Regulation 31A(1) of Liquidation Process Regulations – Varrsana Employee Welfare Association Vs. Anil Goel, The Liquidator of Varrsana Ispat Ltd. – NCLAT New Delhi

/ 20 minutes of reading

NCLAT held that Regulation 31A flows from 31 and has to be read together and interpreted in its truest sense keeping the objective of the Code. Read congruously, Regulations 31 & 31A specify that when the Employees have no subsisting Claim, they cannot be included in the list of Stakeholders, thereby meaning that if the Workers are not specifically includes in the list of Stakeholders, under Regulation 31, they cannot be made a part of the SCC under Regulation 31A(1).
It also held that Claim of Gratuity is payable only at a future date in the happening of any event like retirement, resignation, termination, death, etc., and therefore, it cannot be construed as a Claim subsisting to be included in the list of Stakeholders and consequently seeking a place in the SCC.

If workers are not specifically includes in the list of Stakeholders, under Liquidation Regulation 31, they cannot be made a part of the SCC under Regulation 31A(1) of Liquidation Process Regulations – Varrsana Employee Welfare Association Vs. Anil Goel, The Liquidator of Varrsana Ispat Ltd. – NCLAT New Delhi Read Post »

Whether the Adjudicating Authority has the powers to pass Orders under Section 60(5)(b) of the Code for recovery of amounts by the Corporate Debtor against its Sundry Debtors – Shri Ramachandra D. Choudhary RP of M/s. Oasis Tradelink Ltd. Vs. Bansal Trading Company – NCLAT New Delhi

/ 18 minutes of reading

The only point which is to be examined is whether the Adjudicating Authority was justified in dismissing the Applications preferred by the Liquidator as not maintainable. Keeping in view the ratio in Gujarat Urja Vikas Nigam Ltd. Vs. Mr. Amit Gupta (2021) ibclaw.in 44 SC, NCLAT held that the remedy for recovery of debts, disputed or not, cannot be determined in summary proceedings and the Code does not contemplate adjudication of any such nature. Any such steps taken under Section 60(5) of the Code before the Adjudicating Authority, would tantamount to bypassing/short-circuiting the Judicial Proceedings. The Appellant is well within its powers to take appropriate steps to file legal proceedings, if the circumstances so warrant. The Code expressly provides for the Liquidator to institute or defend any Suit, Prosecution or other Legal Proceedings, Civil or Criminal, in the name or on behalf of the Corporate Debtor.

Whether the Adjudicating Authority has the powers to pass Orders under Section 60(5)(b) of the Code for recovery of amounts by the Corporate Debtor against its Sundry Debtors – Shri Ramachandra D. Choudhary RP of M/s. Oasis Tradelink Ltd. Vs. Bansal Trading Company – NCLAT New Delhi Read Post »

Being custodian of the account of corporate debtor it was duty on the part of the Liquidator to immediately distribute accumulated profit lying in the said account – Yogesh Singh Vs. Mr Supriyo Kumar Chaudhuri, Liquidator of M/s JVL Agro Industries Ltd. – NCLAT New Delhi

/ 33 minutes of reading

NCLAT held that so far as question of law which has been raised by the learned counsel for the appellant regarding distribution of sale proceeds as contemplated under Section 53 IBC as well as Regulation 32 and 42 of Regulation 2016 is concerned, we are of the opinion that by the impugned order no sale proceed was directed to be distributed. In the present case there was accumulation of profit in the account of corporate debtor regarding which account as per Regulation 41 in the account of corporate debtor the word “liquidation is to be added” being custodian of the said account. Being custodian of the said account it was duty on the part of the Liquidator to immediately distribute accumulated profit lying in the said account. Had it been not done by the liquidator after noticing accumulation of huge accumulated profit amounting to the tune of Rs.96 crores, question would have raised as to why the said amount was lying in the bank account. In such situation in all fairness it would be the duty on the part of the liquidator to take immediate steps to distribute the accumulated profit in terms of Section 53 of the Act under the waterfall mechanism.

Being custodian of the account of corporate debtor it was duty on the part of the Liquidator to immediately distribute accumulated profit lying in the said account – Yogesh Singh Vs. Mr Supriyo Kumar Chaudhuri, Liquidator of M/s JVL Agro Industries Ltd. – NCLAT New Delhi Read Post »

Nomination of a Representative as to represent Shareholders-in-class in the Stakeholders Consultation Committee(SCC) of the Corporate Debtor cannot be rejected by the Liquidator on the ground that the said nomination was not made unanimously by all the shareholders – Vivek Shukla Vs. Mohan Lal Jain, Liquidator – NCLT New Delhi Bench Court-II

/ 3 minutes of reading

The Adjudicating Authority held that from perusal of the Regulation 31A(3), which reads as “The liquidator may facilitate the stakeholders of each class to nominate their representatives for inclusion in the consultation committee”, we observe that the said Regulation is silent on both “the criteria as well as process of nomination” of a Representative. However, the Regulation 31A(3) has bestowed a duty on the Liquidator to facilitate the stakeholders of each class to nominate their representatives for inclusion in the SCC. Therefore, the nomination of the Applicant as the Representative of Shareholders cannot be rejected by the Liquidator on the ground that the said nomination was not made unanimously by all the shareholders.

Nomination of a Representative as to represent Shareholders-in-class in the Stakeholders Consultation Committee(SCC) of the Corporate Debtor cannot be rejected by the Liquidator on the ground that the said nomination was not made unanimously by all the shareholders – Vivek Shukla Vs. Mohan Lal Jain, Liquidator – NCLT New Delhi Bench Court-II Read Post »

NCLT allowed the Liquidator to continue the proceedings in the two Commercial Suits before the Hon’ble Bombay High Court – Ashish Singh, as Liquidator of RRC International Freight Services Limited – NCLT Mumbai Bench

/ 8 minutes of reading

The Liquidator seeks leave of the court to continue the proceedings in the two Commercial Suits bearing No.842/2017 and No.310/2018 before the Hon’ble Bombay High Court.
The enforcement of the settlement entered into between the litigating parties in the two commercial suits would require legal proceedings to be instituted, which would squarely fall within the meaning “other legal proceeding” mentioned in the proviso to sub-section (5) of section 33. The terms of the settlement entered into in the two Commercial Suits bearing No.842/2017 and No.310/2018 before the Hon’ble Bombay High Court will inure to the benefit of the Corporate Debtor, thus increasing its liquidation value.

Therefore, this Adjudicating Authority hereby accords its approval to the Liquidator to take appropriate legal steps to enforce the settlement in the two Commercial Suits bearing No.842/2017 and No.310/2018 before the Hon’ble Bombay High Court, for the benefit of the Corporate Debtor.

NCLT allowed the Liquidator to continue the proceedings in the two Commercial Suits before the Hon’ble Bombay High Court – Ashish Singh, as Liquidator of RRC International Freight Services Limited – NCLT Mumbai Bench Read Post »

Liquidator for JVL Agro Industries Limited filed CP u/s 33(5) & 60(5) of IBC praying for a direction to the District Magistrate to ensure for taking steps as may be necessary to protect the properties & the assets of the Corporate Debtor & further to ensure that there is no restraint and unlawful obstruction by the erstwhile officers and employees – Supriyo Kumar Chaudhary (Liquidator for JVL Agro Industries) Vs. The District Magistrate Purba Medinipur & Ors. – NCLT Allahabad Bench

/ 2 minutes of reading

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

Liquidator for JVL Agro Industries Limited filed CP u/s 33(5) & 60(5) of IBC praying for a direction to the District Magistrate to ensure for taking steps as may be necessary to protect the properties & the assets of the Corporate Debtor & further to ensure that there is no restraint and unlawful obstruction by the erstwhile officers and employees – Supriyo Kumar Chaudhary (Liquidator for JVL Agro Industries) Vs. The District Magistrate Purba Medinipur & Ors. – NCLT Allahabad Bench Read Post »

Even if bar under Section 33(5) of the Code is there, it is not appropriate for the Adjudicating Authority to quash the concerned suit which is filed in the Civil Court, it would be for the Liquidator to move the concerned Civil Court pointing out the provision of IBC or to move the District Court in the hierarchy for quashing of the Suit concerned – E.C. John Vs. Jitender Kumar Jain & Ors. – NCLAT New Delhi

/ 11 minutes of reading

NCLAT held that a person coming on property to manage the school would require to show legal status so as to avoid Liquidator taking action when the property is in liquidation. In law, possession would require two elements – one, ‘corpus’ and the other is ‘animus’. Even if corpus is there, but animus to hold property by way of a confirmed right or title does not appear to be there. Merely being on property does not give title. The letter is not based on any resolution of Trust. The Appellant does not show that he is in possession as owner or tenant, or licensee as such. Only giving property to manage school at the place would not be sufficient for the Appellant, to claim possession, when the Corporate Debtor goes in liquidation. Even if bar under Sec. 33(5) is there, it is not appropriate for the Adjudicating Authority to quash the concerned suit which is filed in the Civil Court. It would be for the Liquidator to move the concerned Civil Court pointing out the provision of IBC or to move the District Court in the hierarchy for quashing of the Suit concerned.

Even if bar under Section 33(5) of the Code is there, it is not appropriate for the Adjudicating Authority to quash the concerned suit which is filed in the Civil Court, it would be for the Liquidator to move the concerned Civil Court pointing out the provision of IBC or to move the District Court in the hierarchy for quashing of the Suit concerned – E.C. John Vs. Jitender Kumar Jain & Ors. – NCLAT New Delhi Read Post »

When the company is under liquidation, how the suspended management can seek direction from AA to allow him to run the company till it is not being sold as a going concern – Himanshu Prafulchandra Varia Vs. Sunil Kumar Agarwal Liquidator Of Varia Engieering Pvt. Ltd. & Ors. – NCLT Ahmedabad

/ 2 minutes of reading

When the liquidation process is in the verge of completion, the applicant (Suspended Management) filed the instant application with above prayers having no locus standi. It is quite unheard that how the suspended management can seek direction from this Adjudicating Authority to allow him to run the company till it is not being sold as a going concern, when the company is under liquidation. In fact, the suspended management has no locus standi to move such kind of application, when Corporate Debtor company is under the control of the liquidator. Moreover, there is no such statutory provision which allows the Corporate Debtor to run the company till it is sold as going concern. The application so filed by the applicant is not only bad in the eye of law but is blatant misuse of the process of law.

When the company is under liquidation, how the suspended management can seek direction from AA to allow him to run the company till it is not being sold as a going concern – Himanshu Prafulchandra Varia Vs. Sunil Kumar Agarwal Liquidator Of Varia Engieering Pvt. Ltd. & Ors. – NCLT Ahmedabad Read Post »

Scroll to Top