Faq’s – IBC – Decided Cases- Series - 401
Faq’s – Ibc – Decided Cases
A.
CASE A:
Whether Pendency of
Proceedings or initiation of action under SARFAESI Act is a ground for
rejection of application u/s 7 of IBC?
NCLT Bench
|
New Delhi Bench
|
Corporate Debtor
|
Basic India Limited
|
Operational Creditor
|
Bank of India
|
Dated
|
12th October, 2018
|
FACTS:
The corporate debtor approached the applicant
(Bank of India) for sanction of various credit facilities to the corporate
debtor. Consequently, applicant bank sanctioned financial facilities to the
corporate debtor, which had been renewed / enhanced from time to time. The
corporate debtor acknowledged sanction of the facilities and the same was
continued to be enjoyed by the corporate debtor against hypothecation and
mortgage of properties and creation of charge on the entire fixed and current
assets of the company.
As the corporate debtor failed to pay the debt,
the petitioner bank issued a demand notice under section 13(2) of SARFAESI Act,
2002.
The corporate debtor raised objections
challenging maintainability of the instant application filed under section 7 of
the Code that action had already been initiated by applicant under the
provision of SARFAESI Act; hence, instant application was not maintainable.
RULLING:
It is well settled that pendency of proceedings
and initiation of action under SARFAESI Act cannot be an impediment or bar to
initiate the Corporate Insolvency Resolution Process under Section 7 of the
Code.
Therefore, one can opine that pendency or
initiation of action under SARFAESI ACT is not an ground for rejection of
application under IBC.
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B.
CASE B:
Whether
non-cooperation of suspended management and non –availability of assets in
Company can be an ground for initiation of Liquidation process?
Bench
|
NCLT, Ahmedabad
Bench
|
Corporate Debtor
|
J.R. Diamonds (P.) Ltd.
|
Operational Creditor
|
Vinod Tarachand Agarwal
|
Dated
|
1st October, 2018
|
|
|
FACTS:
The Counsel for the applicant submitted that
there remained no possibility to bring a revival plan for the Corporate Debtor
Company, because RP did not receive
adequate cooperation/necessary assistance from the member of suspended
management/board because of their non-availability. Moreover, the company at present does not possess
immovable/tangible assets and there are some assets only in form of
stock, shares, etc. and it is expecting some refund of income tax paid from the
Income Tax Department.
RULLING:
Having heard arguments of the Ld. Counsel for
the applicant and by going through the material available on record in respect
of the present IA, this Adjudicating Authority is of a considered view that a
liquidation order may be passed in respect of Corporate Debtor J.R. Diamonds
Pvt. Ltd. Since there is 100% voting of the members of the CoC favouring
liquidation process, the present IA No. 309 of 2018 deserves to be allowed.
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C.
CASE C:
Whether pendency of
proceedings before DRT can be bar to initiate CRP?
Bench
|
NCLT, New Delhi Bench
|
Corporate Debtor
|
Pixion Media (P.) Ltd.
|
Operational Creditor
|
Indian Overseas Bank
|
Dated
|
9th October, 2018
|
FACTS:
The respondent
corporate debtor approached the applicant bank for sanction of term loan. By
that time the corporate debtor was already availing credit facilities from a
number of financial institutions. The applicant financial creditor after
perusing the documents and information as submitted by the corporate debtor,
sanctioned a term loan, which was subsequently brought under the consortium of
bank
However, soon after
the Joint documentation the corporate debtor started committing default in
servicing of the interest and committed default in repayment of loan.
Consequently the account of the corporate debtor was declared as a Non
Performing Asset on 2-3-2012 in terms of RBI guidelines
The respondent
corporate debtor failed to clear the outstanding dues and did not adhere to the
terms and conditions of the loan agreements. Consequently, applicant bank had
initiated action against the corporate debtor under DRT.
RULLING:
Pendency of
proceedings before Debt Recovery Tribunal an cannot be an impediment or bar to
initiate Corporate insolvency resolution process.
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D. CASE D:
In case where winding
up proceedings are pending with High Court, then whether a Creditor not being
part of such petition can approach to Tribunal
under IBC?
Bench
|
NCLT, Kolkata Bench
|
Jai
Balaji Industries Ltd
|
|
Dated
|
10th October, 2018
|
FACTS:
The State Bank of
India filed application under section 7 for initiating Corporate Insolvency
Resolution Process (CIRP) against the corporate debtor alleging existence of
default in repayment of loan advanced to the corporate debtor.
The applicants being
operational creditor of corporate debtor were opposing petition on ground that
petition wending against same corporate debtor had already been admitted and is
already in progress before the High Court and unless the said petition pending
before High Court was finally decided, there could not be a parallel proceeding
continuing before Tribunal.
The financial creditor
submitted that winding up proceedings filed before the High Court had two
stages namely: First stage, wherein application for winding up was filed and
the High Court may admit such application on reasonable grounds, directing
issue of advertisement inviting all creditors to participate in the winding up
process. And the Second stage, wherein the High Court, after hearing all
creditors who participated in the winding up process, on being reasonably
satisfied, pased final orders of winding up/liquidation. According to the SBI
the winding up proceeding in the present case was in the first stage whereby
the creditors were invited to participate in the said proceeding post
advertisement. And so, the Tribunal was not barred in any manner from hearing
the application filed under section 7.
The winding up
proceeding as against the corporate debtor has been initiated long before the
date of filing of the Application by the financial creditor in this case in
hand. It is significant note here that in pursuance of the advertisement, the
financial creditor did not join in the winding up proceedings and approached
Tribunal for invoking section 7 as against the corporate debtor pending winding
up proceedings initiated by the High Court.
The corporate debtor
was undergoing winding up proceedings and winding up petitions being already
admitted and the High Court has not transferred the winding up proceeding
before the NCLT, all the creditors are bound to join in the winding up
proceedings so as to make their claims in the said proceedings. Secured and unsecured
creditors have already joined in the said proceedings. Where a winding up
proceedings is initiated in an application under section 433(e) of the
Companies Act, 1956 by the High Court, an application filed under section 9 was
held not maintainable in the above cited order.
(Author – CS Divesh Goyal, GOYAL DIVESH & ASSOCIATES
Company Secretary in Practice from Delhi and can be contacted at csdiveshgoyal@gmail.com). Disclaimer:
The
entire contents of this document have been prepared on the basis of relevant
provisions and as per the information existing at the time of the preparation.
Although care has been taken to ensure the accuracy, completeness and
reliability of the information provided, I assume no responsibility therefore.
Users of this information are expected to refer to the relevant existing
provisions of applicable Laws. The user of the information agrees that the
information is not a professional advice and is subject to change without
notice. I assume no responsibility for the consequences of use of such
information. IN NO EVENT SHALL I SHALL BE LIABLE FOR ANY DIRECT, INDIRECT,
SPECIAL OR INCIDENTAL DAMAGE RESULTING FROM, ARISING OUT OF OR IN CONNECTION
WITH THE USE OF THE INFORMATION
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