The basic foundation on which the Insolvency and Bankruptcy Code 2016 (IBC) is laid, is that of a default by a Corporate Entity in it’s payment to any Creditor. This could be any creditor, be it a Loan providing Bank / NBFC or any Goods and Services Creditor. Thus if a Corporate Debtor (CD) defaults...
Pre Packaged Insolvency Resolution Process (PPIRP) was introduced for Micro, Small, and Medium Enterprises (MSME) by way of the Promulgation of Ordinance by the President of India on 4th April 2021. The Ordinance was subsequently enacted by Parliament by way of Insolvency and Bankruptcy Code (Amendment) Act 2021 and after receiving the assent of the...
With much hope and anticipation, to resolve long outstanding issues of stressed assets, the Insolvency and Bankruptcy Code was brought in 2016. Expectations were that timelines of six to nine months for rescuing the Corporate Debtors will be adhered to. Unfortunately, the hopes were belied and things went like the old ways of BFIR and...
India’s bankruptcy ecosystem needs to be more efficient to develop a market for stressed assets in a post-covid world, chief economic adviser (CEA) to the government Krishnamurthy Subramanian said on Wednesday. The bankruptcy framework can be improved by enabling bankers to take economically efficient decisions, which entail assessing the fair value of sinking firms with the...
An authorized signatory, Mr. Sanjay Gupta on behalf of M/s. Neesa Infrastructure Limited filed the petition under Section 10 of The Insolvency and Bankruptcy Code, 2016 read with Rule 7 of The Insolvency and Bankruptcy (Application to Adjudicating Authority) Rules, 2016, as operational creditor/applicant. The National Company Law Tribunal (NCLT) dismissed the application for the Corporate...
The Bench of Justices L Nageswara Rao, Hemant Gupta, and Ajay Rastogi issued a notice in a batch of over 11 transfer petitions filed by IBBI. IBBI was represented by Additional Solicitor General Madhavi Divan with Advocates Vikas Mehta, Apoorv Khator, and Sahil Monga. The Supreme Court recently agreed to consider the plea filed by Insolvency...
The Supreme Court held that an admission made in a counter-affidavit of the Corporate Debtor, in a prior S.7 application, can be relied upon by the creditor in future S.7 applications for the purpose of establishing that a default has occurred. A document filed in the earlier petition that was dismissed as withdrawn can be...
NCLAT in a case recently held that any objection on the net worth certificate provided by Successful Resolution Applicant cannot be raised by the suspended Board of Directors after the Resolution Plan has been approved by the CoC with a huge majority of voting share. It was pointed out that the Appellant has participated in the...
“The Corporate Debtor had no right to claim the margin money after the invocation of Bank Guarantee during the Moratorium under Section 14 of IBC” Facts The Appellant is one of the Financial Creditors of the CD from whom the CD had availed various loans including an irrevocable Bank Guarantee. The CD deposited margin money of Rs.40,50,000/-...
Lok Sabha passed the Bilateral Netting of Qualified Financial Contracts Bill, 2020, which allows for the enforcement of netting for qualified financial contracts. This bill is passed with the aim to bring financial stability. ‘Bilateral netting’ refers to offsetting claims arising from dealings between two parties to determine the net amount payable or receivable from one...
In Edelweiss Asset Reconstruction Co. Ltd. v. M/S K.K. Kadri Paper Mills Pvt. Ltd., the NCLT Ahmedabad held that even though the CoC is empowered under S.33 of the Code to authorize liquidation of the corporate debtor, they need to show relevant material to throw light on the need for liquidation, and in the absence...
This case brings us to the important issue of the involvement of adjudicating authority in the finalization of the resolution plan. Where once a resolution plan has been approved by the committee of creditors, the statutory mandate on Adjudicating Authority under section 31(1) is to ascertain that a resolution plan meets 37 requirements of sub-sections (2)...
In the case of Hindustan Construction co. ltd. Vs. state of Bihar and ors an important issue was confronted in front of the Supreme Court and that is the difference between conditional and unconditional guarantee. Since, a Bank Guarantee is the common mode, of securing payment of money in commercial dealings as the beneficiary, under...
Lok Sabha passed the Bilateral Netting of Qualified Financial Contracts Bill, 2020, which allows for enforcement of netting for qualified financial contracts. This bill is passed with aim to bring financial stability. ‘Bilateral netting’ refers to offsetting claims arising from dealings between two parties to determine the net amount payable or receivable from one party to...
Key amendments: Applications u/s 7,9,10, the applicant shall serve a copy of application to the registered office of the corporate debtor and to the IBBI, by the registered post or speed post or by hand or by electronic means, before filing with the Adjudicating Authority; The Application form 1, Form 5, and form 6 has been amended...
The Hon'ble NCLAT set aside the order passed by the Adjudicating Authority (NCLT Mumbai Bench) and restored the insolvency petition (Corporate Insolvency Resolution) against Mittal Corporation Ltd. NCLAT rejected the plea filed by Punjab Natioanl Bank to initiate insolvency proceedings against Mittal Corp and directed it to decide afresh “expeditiously”. It was raised that PNB...
Recently Supreme Court had directed banks not to label the loans as non-performing assets even if there is default. It is important to stabilise and uplift the economy and the financial system is of utmost importance. Thus, a 3- member panel experts called as Mehrishi committee is set up by finance ministry headed by former comptroller...
Ex-Chairman of Bhushan Power and Steel Ltd Sanjay Singhal had filed petition challenging the validity of the Insolvency and Bankruptcy Code and has further sought relief on similar grounds as that of the relief granted to Anil Ambani and striking sections 95, 96, 97, 99, 100 and 101 from the Insolvency and Bankruptcy Code. The...
As per our reports, in the matter of Reliance communications (RCom) chairman Anil Ambani, there has been lately some remarkable orders. In late August, Delhi High Court had put on hold the insolvency resolution process (IRP) proceedings against Anil Ambani in relation to the recovery of Rs 1,200 crore loans given by SBI to his...
PNB Housing finance ltd. decided to auction the project of Supertech to recover its dues. One of the buyer approached RERA on this decision. The RERA authorities stayed the auction. About 950 homebuyers have invested Rs 328.19 crore in the project. “The financial institutions/lending banks/creditors have to take prior approvals from the authority at two stages...
Three year old insolvency proceeding of Auto Amtek may now move into liquidation due to winning bidder invokes “force Majeure” clause of its Resolution plan. Amtek’s Committee of Creditors (CoC) in January approved Deccan Value's resolution plan with the force majeure option for the first time ever, and the NCLT approved it in July 2020. Deccan...
NCLAT set aside Insolvency proceeding of Sarda Agro Oils by stating reason that the claims were filed three years after declaring the account non- performing asset. This 3 judge- bench gave the ruling that, “the date of default is computed from the date of declaration of account as a NPA (Non-Performing Asset) and such date...
The petition was filed by the two flat buyers who had jointly booked a unit in APIL Sushant Golf City Lucknow and one of them has also booked separate unit in same project, against the Ansal Properties and Infrastructure Ltd (APIL), In the said petition It admitted the insolvency plea against APIL based on the recovery...
Introduction India is on the verge of becoming one of the fastest growing economies of the world. India being in its developing stages in a number of sectors, yet, it has never looked back & has continued to excel rapidly. For a fast-growing economy like India, where even multinational companies are investing rigorously, it is imperative...
In 2016, the 9 (“Code”) was introduced in India. In such a short span of time, the Code has established its jurisprudence. However, the code requires reforms to keep up with the insolvency regime across the globe and to help the Indian economy overcome territorial boundaries. In January 2019, the centre set up an 11-member...
Looking at the challenges in the Company Law, the Government of India came up with The Insolvency & Bankruptcy Code, 2016 (“IBC”), a mechanism for time-bound resolution of dispute of corporate entities in financial distress. Since, this code has been an evolving legislation therefore, in past few years it is noticed that many ordinances and...
Given, the limitations of the 9, 2016 (“IBC”) in determining the value of disputed claims during the resolution process, most resolution plans admit the disputed claims with their repayment being dependent on the adjudication of the claim post the approval of the resolution plan. Such an admission of claims has been seen as a method to improve insolvency procedure by...
The time-bound resolution of distressed corporate entities is the most important objective of the Insolvency & Bankruptcy Code, 2016 (“IBC”). The Corporate Insolvency Resolution Process (“CIRP”) introduced by the IBC was supposed to lead the charge in achieving this end. Unfortunately, the average time taken for CIRPs that yielded resolution is more than the statutory...
Facts: The question of law which was framed by the National Company Law Appellate Tribunal (NCLAT) for its decision: “Whether the time limit prescribed in Insolvency & Bankruptcy Code, 2016 for admitting or rejecting a petition or initiation of insolvency resolution process is mandatory?” The question before the NCLAT was as to whether time of fourteen days...
When a company goes into liquidation its assets are sold to repay the creditors and business closes down. The liquidation process in India is governed by Insolvency and Bankruptcy Code, 2016. The liquidation process in India is initiated by filing an application as per the terms and requirement by IBC, 2016. Once the order is...
When a company goes into liquidation its assets are sold to repay the creditors and business closes down. The liquidation process in India is governed by 9, 2016. The liquidation process in India is initiated by filing an application as per the terms and requirement by IBC, 2016. Once the order is approved and given by...
The COVID- 19 pandemic & its consequential lockdown has affected businesses all over the world. To mitigate its impact, governments of various countries have amended their respective insolvency laws & adjudicatory processes. India too has taken certain steps to modify its insolvency law i.e., the Insolvency & Bankruptcy Code (IBC), 2016. Section 10A was introduced...
As per our reports, financial consultancy firm Duff & Phelps has dragged the Insolvency & Bankruptcy Board of India (IBBI) to court, over an order against a senior advisor in its restructuring practice. The Insolvency Regulator, IBBI penalized Vijay Kumar Garg, the Resolution Professional (RP) for Gitanjali Gems, Nakshatra World & other companies which were...
As per our reports, in a judgement, the Adjudicating Authority has allowed the liquidator to sell the assets of a company which were attached by the investigative agencies. As per the order of the National Company Law Tribunal, Kolkata Bench, passed on 22nd July, 2020, the liquidator is permitted to sell the assets of the...
Ruling of the National Company Law Appellate Tribunal (NCLAT) in Flat Buyers Association v. Umang Realtech Pvt. Ltd. is of significance. It not only affects the existing corporate insolvency resolution process (CIRP) with respect to real estate developers, but it also grants the promoter of the group an opportunity to participate in the process as...
Due to poor management of cash or less cash inflow than what is expected, the company can be declared as insolvent by performing certain insolvency proceedings where the liquidator would acquire all the assets of the company, evaluate them & liquidate those assets in order to pay off the debts. Cross-Border Insolvency refers to treatment...
Insolvency is a situation where a legal person (including companies) is not able to pay to debts to its creditors, when they become due & payable. Corporate insolvency may involve several parties such as creditors, shareholders, directors & managers of the company, employees & customers etc. Financial & management consultants, advocates, bankers etc. also play...
As per our reports, the Reserve Bank of India recently introduced Fair Practices Code for asset reconstruction companies (ARCs) to deal with prospective buyers under Section 29A of the Insolvency & Bankruptcy Code, 2016. These Fair Practices Code will be periodically reviewed by the Insolvency & Bankruptcy Board of India to know if ARCs are...
Recently, the Insolvency & Bankruptcy Board of India (IBBI) has proposed to issue guidelines for imposing a limit on the number of assignments to be handled by an Insolvency Professional (IP) at a certain point of time. Setting a limit on the number of assignments to be taken up by Insolvency Professionals (IPs) is an...
As per our reports, The National Company Law Tribunal (NCLT) approved the resolution plan on 09th July for bankrupt firm ‘Amtek Auto’, which was submitted by US-based security fund Deccan Value Investors LP (DVIL). The insolvency proceedings were initiated three years ago when the subsidiary company of Amtek Auto ‘ARGL’ (Amtek Ring Gears Limited) was...
As per our reports, the National Company Law Tribunal, Mumbai Bench, on 03rd June, 2020 has held that in view of Section 3(23) of Insolvency & Bankruptcy Code, 2016, a foreign entity can also file a petition for initiation of Corporate Insolvency Resolution Process under Section 9 of IBC. A plea under Section 9 of...
As per our reports, in an insolvency proceedings, the right to continue with the IRP as a Resolution Professional or to replace the IRP with some other RP is with the Committee of Creditors (CoC), as observed by the National Company Law Tribunal. The power to replace an RP is solely & absolutely vested with...
As per our reports, the Insolvency & Bankruptcy Board of India (IBBI) recently in a discussion paper, restricted the number of assignments to be handled by Insolvency Professional (IPs) under the Corporate Insolvency Resolution Process & Liquidation (including Voluntary Liquidation Process under Section 59 of the Insolvency & Bankruptcy Code, 2016. Restriction has not...
As per our reports, the special insolvency resolution framework for MSMEs recommends a lot shorter time period for resolution of a company in 90 days rather than 300 days as provided under the Insolvency & Bankruptcy Code for completion of the procedure and permits promoters of a defaulting MSME enterprise to present a resolution plan....
As per the reports, the National Company Law Appellate Tribunal (NCLAT) has held that liquidation process of a company under the IBC holds precedence over the result of arbitration proceedings under IBC. Objections raised to Bharat Heavy Electricals Limited (BHEL) liquidation of Tamil Nadu-based Surana Power were invalid as majority of secured creditors consented to...
As per our reports, in a cash bargain, Sanjeev Gupta which claims Liberty House, has acquired bankrupt companies Adhunik Metaliks and Zion Steel for ?425 crores under the Insolvency and Bankruptcy Code. Liberty House neglected to finish Adhunik's acquisition in its first endeavor. It was given another opportunity by the National Company Law Appellate Tribunal,...
The Bankruptcy Court ordered the revenue department that if the liquidator has taken in account his/her tax dues, they cannot attach the assets of a company in liquidation. Under the Insolvency & Bankruptcy Code, liquidator has powers to take over the assets of the Corporate Debtor, including cash balances etc. as it was ruled by...
As per the reports, The National Company Law Tribunal (NCLT) has approved the insolvency resolution plan for Aircel. UV Asset Reconstruction Co. Ltd (UVARCL) to take control over the Aircel’s assets. Aircel's resolution professional Deloitte had checked cases to Rs. 20,000 crore, which means recoveries for lenders of about Rs. 2,000 crore-Rs 3,000 crore cash...
As per the reports, resolution & recoveries through cases pending in bankruptcy courts may hit 30-40% this year as courts have stopped accepting new cases. Suspension of new proceedings under the Insolvency & Bankruptcy Code (IBC) is expected to cause 30-40% downfall in realization to creditors of a company in Financial Year 20-21. The number...
As per our reports, the Finance Minister ordered suspension of new insolvency proceedings for a year. This has made the companies turn to ‘schemes’ under Companies Act, 2013. The Companies Act gives the composition to a system of 'bargain’ between 'an organization and its banks or any class of them' or 'an organization and its...
As per the reports, the Union Cabinet on 3rd June, 2020 cleared the proposal to suspend insolvency proceedings under the Insolvency & Bankruptcy Code (IBC) to avoid companies at large from being forced into insolvency proceedings for Non-Performing Assets (NPAs) during the COVID-19 period starting from 25th March, 2020. This move has been proposed as...
Some of the challenges to the IBC process faced by professional are as follows: The proposed Ordinance suspending filing of fresh insolvency under IBC for six months will have to consider allowing existing companies to do their own restructuring under IBC in the present environment. There is no sense to restrain (prevent) a corporate...
As per the reports, financial creditors realized 64% of their admitted claims through insolvency process in January-March which is much higher than average of about 46% over the period up to December 2019. The realization was due in large part to the resolution of Jaypee Infratech (JIL), where financial creditors recovered Rs. 23,223 crore, over...
As per the reports, the Insolvency & Bankruptcy Board of India (IBBI) has reconstituted its Advisory Committee on Service Providers and its Chairman would now be Mr. Mohandas Pai of Manipal Global Education Services. The 12- member panel would advise and provide professional support on regulation & development of the service providers dealt with by...
As per the reports, banks are indecisive over the resolution of stress among the corporate borrowers as they find themselves caught between the recommendation of the Central Government to suspend the Insolvency and Bankruptcy Code for a year and the reluctance of the Reserve Bank of India to allow for a one-time loan restricting in...
As per the reports, banks in India have made 124 companies go into liquidation despite resolution plans that promised higher recovery of money. At the end of March 2020, insolvency process for about 914 companies were closed. About 57% of the total insolvency cases which were closed ended by passing orders of liquidation by the...
Facts of the case: The applicant/ operational creditor in this case, Foseco India filed an application under Section 9 of the Insolvency and Bankruptcy Code, 2016 (IB Code, 2016) for initiation of Corporate Insolvency Resolution Process (CIRP) against the Corporate Debtor, i.e., Om Boseco Rail Products Limited for alleged default in payment of operational debt...
As per the reports, the Appellate Tribunal has upheld order passed by Honourable NCLT which prohibits appointment of an ex-bank official as Resolution Professional of a bankrupt company due to the possibility of bias. The NCLAT has upheld an order passed by NCLT, Delhi bench over the appointment of a former official of State Bank of...
As per the reports, a pre-packaged insolvency or a pre-pack is a pre-planned process in which a financially distressed company and its creditors tries to reach an agreement with a buyer for its sale prior to initiating insolvency proceedings. This is done by an insolvency practitioner or an Insolvency Resolution Professional (IRP) who is appointed...
In this case, the operational creditor filed an application under Section 9 of the IBC, 2016 for initiation of CIRP against the corporate debtor, i.e., Durga Enterprises. The Adjudicating Authority admitted the said application and, a Resolution Professional was appointed. The resolution plan submitted by the resolution applicant was approved by 92.65% of voting by...
As per the reports, non-bank lenders want the government to revise the terms of Rs. 75,000 crore package to help the industry, saying that the sovereign guarantee available for loans and bond sales should be for a longer period of time. The lenders want a long-term window of at least three years to access credit as...
As per the reports, the NCLT on 12th May, 2020 by way of an ‘order’ directed that any new insolvency application filed by a financial creditor under Section 7 of the IBC, 2016 must be accompanied by a default record from an Information Utility. Not only did it make such filing mandatory for new applications, but...
As per the reports, banks are now hamstrung with regard to resolution and recovery as the government has suspended fresh insolvency cases for 12 months concerned over deteriorating asset quality post COVID-19. While the effect of the lockdown is expected to lead to a pile-up of bad assets, the lack of effective recovery mechanisms outside the...
As per the reports, the dedicated bankruptcy court, i.e., NCLT has approved the revival plan for Mumbai-based Trimax IT Infrastructure & Services from the local subsidiary of Nasdaq-listed Ebix Inc. Ebix Software India Private Limited (ESIPL) will pay upfront Rs. 75 crore to acquire the company. The company owed over Rs. 1,918 to its lenders, including...
As per the reports, stressed- asset companies, banks and other creditors, and insolvency, as well as resolution professionals, are in a quandary in the absence of any clarity about the fate of applications filed under the IBC before the Covid-19 outbreak in India. Lawyers, resolution professionals and stakeholders said that the announcements made by the Central...
As per the reports, NCLT has refused to admit insolvency petition filed by India Resurgence Asset Reconstruction Company, a joint venture between Piramal Enterprises and Bain Capital against Indian Steel Corporation, calling the petition to be ‘defective’. “For all reasons, the preset Company Petition… fails and therefore, we are constrained not to admit the same as...
As per the records, the NCLT has directed filing of default record from Information Utility along with new petitions under Section 7 of IBC, 2016. As per the order of the NCLT, all concerned are directed to file default record from Information Utility alongwith the new petition being filed under Section 7 of IBC, 2016, positively. It...
In an organizational reshuffle, the NCLT has transferred eight members to different benches across India with immediate effect. According to a notification issued by the NCLT Registrar on 30th April, 2020, the list comprises of four judicial members and four technical members. The notification said that “the members shall move to their new stations of posting,...
As per the reports, experts said that investors who have bid for assets under the IBC are expected to reassess their offers as cash flow projections have gone awry mid the covid-19 pandemic and the ensuing nationwide lockdown. The IBBI has already said that the period of lockdown imposed by the government will not be reckoned...
Continuing efforts to ensure a more conducive regulatory framework for stakeholders, IBBI has sought comments from the public on existing regulations under the Insolvency law. IBBI is a key entity in implementing the IBC. IBBI said that they may contemplate, at leisure, the important issues in the extant regulatory framework that hinder transactions and offer alternative...
A five- judge bench of the Supreme Court held on 5th May, 2020 in Pandurang Ganpatii Chaugule v. Vishwasrao Patil Murgud Sahakari Bank Ltd. that co-operative banks come under the Securitization and Reconstruction of Financial Assets and Enforcement of Security Act, 2002 (SARFAESI Act, 2002). The bench held that co-operative banks are “banks” for the purposes...
The National Company Law Tribunal (NCLT) has cancelled the summer vacation, 2020 for all its benches, in view of loss of work due to the lockdown imposed by the Central Government in the wake of pandemic of COVID- 19. A notification issued by the Registrar of NCLT in this behalf states that “the Honourable President...
India expects bad debts of its banks could double after the Coronavirus crisis brought to the economy a sudden halt. Indian banks are already grappling with 9.35 trillion rupees ($123 billion) of sourced loans, which was equivalent to about 9.1% of their total assets at the end of September 2019. The Government of India considers...
The date of closure of the Corporate Insolvency Resolution Process (CIRP) of the financially distressed real estate project, Dewan Housing Finance Corporation Limited (DHFL) is expected to be extended to June 30th, 2020 from May 31st, 2020. This will give more time to the investors (resolution applicants) who have participated in the Expression of Interest...
The Resolution Professional (RP) of the grounded Jet Airways has served a notice to SpiceJet in order to seek payment for engines that were leased out to the latter, i.e., SpiceJet. Jet Airways was dragged to the National Company Law Tribunal (NCLT)/ Adjudicating Authority over unpaid dues in June 2019. The NCLT had considered Jet Airways...
Resolutions under IBC may run into rough weather after the pandemic of COVID- 19 as bankers fear that winning bidders will review their interest in the companies which have been bankrupt and re-negotiate bids or pull out altogether. Bankers now fear that other winning bidders will similarly invoke the force majeure or material adverse effect...
The Union Cabinet has cleared a proposal on 22nd April, 2020 from the Ministry of Corporate Affairs to give companies relief from insolvency for the next six months i.e., October, 2020 by amending the Insolvency and Bankruptcy Code, 2016. This amendment has been proposed to give a six month window. Lenders or creditors during these six...
The National Company Law Appellate Tribunal (NCLAT) on April 22, 2020 refused to stay the execution of the resolution plan submitted by NBCC to take over embattled firm Jaypee Infratech and complete 20,000 stuck housing units. It also allowed the IRP to proceed with constituting the interim monitoring committee for execution of the plan. IRP...
Issues Raised in this case (2020 SCC Online SC 292)- Whether the Maharashtra Housing & Area Development Act (MHDA Act, 1976) would be prevailing over the Bankruptcy & Insolvency Code? It is held by the Honourable Supreme Court that on the plain terms of Section 238 of the Bankruptcy & Insolvency Code, 2016, the Code must...
The Honourable High Court of Delhi has held that it is clear from the express language of the provision of Section 32A of the IBC, 2016 that a Corporate Debtor would not be liable for any offence which was committed prior to the commencement of CIRP and the corporate debtor would not be prosecuted if...
As per the Notification No. 11/2020- Central Tax issued by the Ministry of Finance dated 21st March, 2020, it has been made mandatory for individuals to get themselves registered for done aadhar authentication/ verification from the website of the UIDAI of the Central Government of India. They shall follow the procedure of getting themselves registered...
The IBBI has inserted a new regulation 47A under IBBI (Liquidation Process) Regulations, 2016 from excluding the COVID- 19 lockdown period from the computation of the time-line for any task that could not be completed in relation to any liquidation process. The Regulation starts with “Subject to the provisions of the Code” as follows: Exclusion...
The Registrar of NCLT, Shiv Ram Bairwa has issued a notice dated 14.04.2020, due to further extension of lockdown announced by the Central Government until 03.05.2020 issued by NCLT. The Honourable President of India has with regards to the functioning of NCLT during lockdown, in addition to the notices issued earlier, will be taking further steps...
Facts of the Case: Ultra Tech was one of the Resolution Applicants in the CIRP of Binani Cement Ltd. initiated by the financial creditor, Bank of Baroda, for non-payment of debt under Section 7 of the Insolvency and Bankruptcy Code, 2016 and filed before the Kolkata Bench of National Company Law Tribunal. UltraTech Nathdwara...
About SRS Limited: SRS Limited, a public Listed Company registered under Companies Act, 1956 is a diversified Company with a business portfolio comprising of Gold and Jewelry (retailing, wholesaling and manufacturing), Cinema Exhibition, Retail and F&B. The Company was incorporated on August 29, 2000 with the objective of trading in FMCG Goods and it later...
It was held by the Honourable Supreme Court that: Section 13 of the IBC, 2016 specifically bars the jurisdiction of the Civil Courts. This means that powers vested in a Civil Court under the Arbitration & Conciliation Act, 1996, such as the powers to grant interim relief in terms of Section 9 of the Arbitration &...
Ultra Tech Nathdwara Cement Ltd. (formerly known as Binani Cement) suffered huge losses and was unable to pay the debts to the Financial Creditor i.e., Bank of Baroda, which preferred an insolvency application before the NCLT, Kolkata Bench/Adjudicating Authority under Section 7 of the IBC, 2016. A Corporate Insolvency Resolution Process was initiated by the...
The NCLT has appealed to the litigants and stakeholders under the Companies Act, 2013 and IBC, 2016 to file Joint Memo of Written Statements (WS) to expedite virtual hearings and for dispensation of justice without any delay during the Novel Coronavirus, COVID-19 lockdown. It has stated that the Memo will be a user-friendly document that...
1. Form INC-28 is to be filed after the appointment: The IRP/RP/Liquidator would have to first file the order of the NCLT in order to approve him as the IRP/RP/Liquidator in form INC-28 on the MCA-21 portal. Following points must be kept in mind while filing the form: Form No. INC-280 Select the drop down box...
NCLAT held that: the procedure as followed in “Flat Buyers Association Winter Hills- 77, Gurgaon” shows curtailment of period of resolution without asking for resolution plan from the third party before finalization of the resolution plan. The resolution can be taken even during the corporate insolvency resolution process, if any promoter agrees as an investor...
The Resolution Plan of Gurgaon-based Dhankua Laboratories for the revival of Chennai- based debt-ridden company Orchid Pharma Ltd. has been implemented, which is potentially fetching secured lenders around 32.3 per cent of recovery. The culmination of the long-drawn resolution process for the pharmaceutical company, Dhankua Lab, which saw its first approved resolution plan by the NCLT,...
The Finance Minister Nirmala Sitharaman suggested that if the situations prevailing in the country due to the outbreak of pandemic disease of Novel Coronavirus, COVID- 19, changes for the worse in the coming future, the Central Government will consider to suspend Sections 7, 9 and 10 of the IBC, 2016 for the next 6 months...
In the view of the Advisory on Social Distancing Measure in view of the spread of pandemic disease of Novel Coronavirus, COVID- 19, it has been decided by the Examination Division of the IBBI to suspended all the enrolments for the Limited Insolvency Examination and the Valuation Examinations form 21st March, 2020 to 31st March,...
The National Company Law Appellate Tribunal (NCLAT) approved the resolution framework proposed by the Government on 12th March, 2020 in the final judgement on the insolvency proceedings against Infrastructure Leasing & Financial Services (ILFS). The money invested in IL&FS by the Life Insurance Corporation of India, State Bank of India, Central Bank of India and...
As a measure to prevent the spread of the transmission of Novel Coronavirus (COVID- 19), the Central Government has declared a lockdown of twenty-one days w.e.f. 25th March, 2020. Since, it is difficult for the Insolvency Professionals (IPs) to continue carrying out the activities of Corporate Insolvency Resolution Process (CIRP), for the members of the...
The learned counsel for the Appellant takes a forceful stand that the Corporate Debtor as a Corporate Person being a company under the Companies Act, 2013 and had given surety but in relation to a Contract or Guarantor or Corporate suffice it to make a pertinent mention that a corporate debtor had guaranteed surety in...
As per Sub-regulation 3 of regulation 40B of the Insolvency & Bankruptcy Board of India (Insolvency Resolution Process for the Corporate Persons) Regulations, 2016, an IP shall ensure that the Forms and its enclosures filed under this regulation are accurate and complete. Sub- regulation (4) enables to modify either by way of correction or updation...
The Central Government has notified a raise in the threshold of default which was earlier at Rs. 1 lakh under Section 4 of IBC, 2016 to Rs. 1 crore for the initiation of insolvency proceedings under the Code. As per the gazette notification, it has been said that: “In the exercise of the powers conferred by...
It was in Bimal Kumar v. Bank of India (Company Appeal (AT) (Insolvency) No. 1166 of 2019) held that the National Company Law Appellate Tribunal (NCLAT) has held that the proceedings before the Debt Recovery Tribunals (DRT) under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (SARFAESI Act, 2002)...
The real global emergency is compaies and industries getting bankrupt. Though human lives are more precious and they are of grave concern.But we must not forget that the food, economy, daily needs, and everything for survival will be from the market, the companies and different industries. Corona Virus or rather the panic because of Corona Virus...
It has been identified that IBC and cases at NCLT are rising with the growing conditions of the economy. The importance as well as the burden on NCLT is on hike. A recommendation of separate bench of the National Company Law Appellate Tribunal will be set up at Chennai. It is aimed that the new NCLAT...
The Parliament on 12th March 2020 passed a bill to amend the Insolvency & Bankruptcy Code, 2016. The Insolvency and Bankruptcy Code (Amendment) Bill, 2020 was approved by Lok Sabha on 6th March 2020. This bill replaces an ordinance. This is the 4th time that the IBC Code is proposed to be amended. It aims...
The National Company Law Appellate Tribunal (NCLAT) has dismissed the telecom department’s plea, citing delay in appeal against the order of the National Company Law Tribunal. The appeal is time- barred and for want of jurisdiction, the NCLAT dismissed. DoT had raised an issue in its plea that whether licence/ spectrum to run a telecom company...
The insolvency condition of Yes bank has provoked the whole country. The central government has been acting as the saviour and RBI as the resolution applicant by introducing the Insolvency Resolution Plan. There is anticipation of moratorium ending soon ie. maybe before the designated time given as SBI acquires 49% stake. If the Resolution process of...
Ministry of Corporate Affairs (‘MCA’) has vide Notification dated January 24, 2020, notified the Companies (Winding-Up) Rules, 2020 in order to provide a systematic procedure of winding up of a Company under Cos Act. The Rules cover both types of Companies that have applied for winding up under section 271 as well as the companies...
New Delhi: The National Company Law Appellate Tribunal (NCLAT) has dismissed an order of the dedicated bankruptcy court initiating insolvency proceedings against e-commerce major Flipkart. A three-member bench of the NCLAT has directed the interim resolution professional (IRP) appointed by the Bengaluru bench of the National Company Law Tribunal (NCLT) to hand over the records as...
Mumbai: NCLT to intervene - The Enforcement Directorate (ED) has sought permission from the dedicated bankruptcy court to intervene in the insolvency resolution pleas against Sterling group companies Sterling International Enterprises and Sterling SEZ & Infrastructure. ED on Wednesday sought more time from the Mumbai bench of the National Company Law Tribunal (NCLT) to file its...
Discuss insolvency law - MUMBAI: Member of Parliament and Chairman of Standing Committee on Finance Jayant Sinha met representatives of homebuyers to discuss their objections to amendment to the Insolvency & Bankruptcy Code, 2016. The proposed amendment requires a minimum threshold of homebuyers to come together in order to initiate proceedings under the code against an...
Benjamin Disraeli presciently said that debt is a prolific mother of folly, and of crime. When a company runs into debt, it is the creditor who inarguably suffers more than the debtor. Insolvency laws aim to assist both the debtor and the creditor in the management and disposition of the debtor’s assets. Recent months have...
The Gurgaon-based company approached the court claiming it has reached a settlement with the financial creditors. The NCLAT, however, said that the insolvency proceedings can be resumed in case the company fails to clear its dues. “The appellant is directed to comply with the ‘Terms of Settlement’, failing which it will be open to the first...
NCLT Extends Videocon - "This is for the extension of the CIRP process as it ends on 4th of February. Public notices are being given for the submission of bids on 31st of Jan and we see a lot of it coming in, so we request the CIRP process be extended further," said the counsel...
NEW DELHI: The Supreme Court on Friday stayed the National Company Law Appellate Tribunal's order dismissing the Registrar of Companies (RoC) plea seeking modification of its verdict in the Tata-Cyrus Mistry matter. A bench comprising Chief Justice S A Bobde and Justices B R Gavai and Surya Kant agreed to hear Tata Sons Pvt Ltd's...
The National Company Law Appellate Tribunal (NCLAT) on Friday asked the UK-based Liberty House to file a revised affidavit by January 20, outlining specific time-frame and other details of its resolution plan for insolvent steelmaker Adhunik Metaliks and group firm Zion Steel. On January 7, the two-member NCLAT bench, headed by chairperson Justice SJ Mukhopadhaya, gave...
NEW DELHI: CBI has arrested an insolvency resolution professional (IRP) appointed by the NCLT and another person for allegedly receiving a bribe of Rs 3.5 lakh from a consultant by threatening him with a criminal case, officials said on Monday. In what is likely to be the first corruption case by the CBI against an NCLT-appointed...
NEW DELHI: NTPCNSE 1.85 % has outbid the Adani Group for the Avantha Group’s 600 MW Jhabua power plant in Madhya Pradesh, with a Rs 1,900-crore offer that was two and-a-half times more than the rival bid, people in the know said. State-run NTPC’s offer is also the highest on a per-megawatt basis so far...
NCLAT Dismisses ROC - The National Company Law Appellate Tribunal on Monday dismissed the Registrar of Companies' petition seeking modification of the judgement in the Tata-Mistry case and said its ruling had not cast any aspersions on the RoC. "There is no ground to amend judgement dated December 18, 2019," a two-member NCLAT bench said....
Mumbai: Lenders to Karvy Stock Broking Ltd have started exploring other avenues after failing to secure any relief from the Securities and Exchange Board of India (Sebi) on client shares pledged by the brokerage. The options include filing pleas with the Debt Recovery Tribunal (DRT) and Insolvency and Bankruptcy Board of India (IBBI), and selling minority...
Bharti Infratel Ltd’s decision to extend the long stop date of its proposed merger with Indus Towers Ltd again does not come as a surprise. The stock lost less than 1% on Thursday. What’s more, the management commentary and delay in approvals is leading to the belief that the merger may be called off eventually....
Impact of Insolvency - It has been highlighted that an economy to be competitive needs free entry and free exit of companies. In the past, in the absence of an exit mechanism, several private sector companies were nationalized. The relationship ensured that the promoters would not exit companies irrespective of their performance and conduct. However,...
Resolution of Bhushan Power & Steel (BPSL), which is tied in legal knots, may stretch further even with the latest set of amendments to the Insolvency and Bankruptcy Code (IBC) approved by the Cabinet. The National Company Law Appellate Tribunal (NCLAT) that is hearing an appeal from JSW Steel — the winning bidder — on Thursday...
In a move that will remove the final hurdle for companies taking over stressed firms, the Union Cabinet on Wednesday approved an amendment to the Insolvency and Bankruptcy Code (IBC) that prohibits attaching assets of companies resolved under the mechanism for offences committed by the previous management or promoters. The decision assumes significance as there have...
The National Company Law Appellate Tribunal (NCLAT) on Tuesday stayed an order passed by NCLT to make the Ministry of Corporate Affairs a party to all applications filed under the Insolvency and Bankruptcy Code as well as the Companies Act. An NCLAT bench headed by Chairperson Justice S J Mukhopadhaya stayed the order passed by the...
MUMBAI : Having burnt their fingers in the Essar Steel insolvency case, lenders are looking for a speedier and time-bound resolution for Dewan Housing Finance Corp Ltd (DHFL) in the bankruptcy tribunal. Stuck in the tribunal since August 2017, the Essar Steel insolvency case was finally resolved by the Supreme Court last month. DHFL is the first...
Cases under IBC - As many as 10,860 cases under the Insolvency and Bankruptcy Code were pending before the National Company Law Tribunal (NCLT) at the end of September 2019, Parliament was informed on Tuesday. "As per the data provided by National Company Law Tribunal (NCLT), total 19,771 cases were pending with NCLT benches on 30.09.2019,...
Insolvency petition filed - Hyderabad: The National Company Law Tribunal’s bench in Amaravati, Andhra Pradesh, received the first personal insolvency petition in the country on Monday, the day the amended Insolvency and Bankruptcy Code (IBC) bringing personal guarantor under its purview came into effect. Omkaram Venkata Ramana, who had stood personal guarantor to five firms that...
On 28th November 2019, The Insolvency and Bankruptcy Board of India published the Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) (Third Amendment) Regulations, 2019. Certain amendments made by these Regulations are resulting in the Insolvency and Bankruptcy Code (Amendment) Act, 2019, which came into force on 5th August 2019. Certain amendments...
The Insolvency and Bankruptcy Code, 2016 foresees Insolvency Proceedings, restructuring, and insolvency resolution of corporate persons, partnership firms and individuals in a time-bound manner. The main purpose of Insolvency and Bankruptcy Code is to maximize the value of assets of such persons, to promote entrepreneurship, to increase the availability of credit and stabilizing the interests...
Aircel's Spectrum License - The National Company Law Tribunal (NCLT) has ruled that Aircel has the "right to use" its spectrum and directed the Department of Telecommunications (DoT) not to suspend the bankrupt telco’s licenses. The verdict offers huge relief to Aircel, which, under an insolvency process, is on the verge of selling its assets, of...
Lenders to Refer more Cases to NCLT - MUMBAI: The overloaded National Company Law Tribunal is set to receive a huge chunk of resolution plans in early January as banks scramble to come up with a plan for loans worth Rs 3 lakh crore under the June 7 circular. Lenders need to come up with...
MUMBAI: There seems no slowdown in the business of law as the country’s legal sector has increased its fee income by more than 62% in two years at $2.1 billion, or about Rs 15,000 crore, a recent report shows. A slew of cases involving litigation on account of new laws such as Insolvency and Bankruptcy Code...
Finance Minister Nirmala Sitharaman has declared that National Insurance, Oriental Insurance, United India will be merged, to create India’s biggest non-life insurance company. General Insurance Business Nationalisation Act in Budget 2019-20 will be modified for executing the same. However, as per some estimations, 10-15,000 jobs can be lost, once this merger is completed. The Mega Merger...
Taking forward their plan to formulate a resolution plan for McLeod Russel outside the scope of NCLT, the company's lenders, led by ICICI Bank, which has the largest exposure, have appointed LSI Financial Services to undertake a techno-economic feasibility study based on which the creditors will decide the way forward. The study primarily focusses on the...
Troubled wind turbine maker Suzlon Energy may head to National Company Law Tribunal (NCLT) as lenders see no possibility of resolution, two people familiar with the matter told FE. “There were two investors who showed interest in Suzlon, but both of them have backtracked. We have no option but to refer this account to NCLT”, a...
Ever since homebuyers were given the status of financial creditors under the Insolvency and Bankruptcy Code (IBC), a lot of them have moved the National Company Law Tribunal (NCLT) against the developers of stalled and delayed projects. “Since June 2018 (after getting the financial creditor status), a total 1,821 cases have been filed by homebuyers...
Builders continue to ask for a hefty cash pay-out in property and land purchases forcing customers to either drop plans or raise cash from other sources. And all this is happening when large property markets with established realty developers are moving towards cheque payment in a big way. Smaller cities like Ahmedabad, Chandigarh, Jaipur, Noida,...
The National Company Law Appellate Tribunal(NCLAT) has allowed Reliance Industries to delist textile manufacturer Alok Industries, which it has acquired through insolvency process. A two-member NCLAT bench headed by Chairperson Justice S J Mukhopadhaya has modified the order passed by the National Company Law Tribunal (NCLT), Ahemdabad, which denied such permission. While approving Rs 5,052-crore bid of...
Homebuyers have opposed a move by real estate developers to get the Insolvency and Bankruptcy Code (IBC) amended, saying the move is not only “illogical and illegal but also regressive” and would send a wrong message and derail the government’s efforts to reform the sector. “Having failed legally, these builders are now mounting pressure on your...
Citing the information received from NCLT, Minister of State for Corporate Affairs Anurag Singh Thakur said that a total 1,821 cases have been filed by homebuyers against builders since June 2018 under the Code. New Delhi: Homebuyers have filed more than 1,800 cases against builders under the Insolvency and Bankruptcy Code (IBC) since June 2018, the...
More than two years ago, the Reserve Bank of India ordered local banks to take Essar Steel and 11 other borrowers to ‘trials’ under a revamped bankruptcy law enacted in late 2016. The jury is finally out on India’s most significant piece of bad loan legislation: It has, unequivocally, recognised the primacy of secured creditors...
NBFCs with Assets - The Reserve Bank can now seek resolution of non-banking financial companies having assets worth of at least ?500 crore under the insolvency law, a move that is likely to help in addressing woes in the NBFC sector. After discussions with the central bank, the corporate affairs ministry on Monday issued a notification...
Consider Haldiram Snacks - The National Company Law Tribunal (NCLT) has directed the lenders of Kwality Ltd to reconsider the revised ?145-crore offer by Haldiram Snacks to acquire the debt-ridden dairy firm. The Delhi-based bench of the tribunal has also extended the Corporate Insolvency Resolution period by another three weeks and directed the Committee of Creditor...
New Delhi: NCLAT Rejects PepsiCo - NCLAT has rejected the plea of beverages giant Pepsico India Holdings seeking release its machinery from Oceanic Tropical Fruits, which is under the insolvency process. The beverages major had moved the NCLAT against the order passed on May 28, 2019, by the Chennai bench of National Company Law Tribunal (NCLT)...
Ruling on the long fought Essar Steel insolvency case, the Supreme Court on November 15 set aside NCLAT judgement and said that the ultimate discretion on distribution of funds was with the Committee of creditors. The Committee of Creditors (COC) consists of banks. The NCLAT had earlier said that the funds from the winning bid should be...
NEW DELHI: The government is considering a formula for distributing the proceeds of insolvency resolution among financial and operational creditors in a fixed proportion, said people with knowledge of the matter. The goal is to protect the interests of operational creditors and reduce delays due to litigation, ensuring that the objective of the Insolvency and...
Aviva Life Insurance has become the first financial company to be admitted into Insolvency and Bankruptcy Code (IBC) proceedings after the National Company Law Tribunal (NCLT) upheld a landlord’s claim accusing the insurer of failing to meet its payment obligations and ordered the commencement of the company’s insolvency process, court documents were seen by ET...
The government is mulling a special window for resolution of stressed non-banking finance companies (NBFCs) under the Insolvency and Bankruptcy Code (IBC), a senior government official said. A special window is certainly something which is being examined closely, the official added. The move comes against the backdrop of financial sector players like Dewan Housing Finance Corporation Ltd...
The Bengaluru bench of the National Company Law Tribunal (NCLT) has sent Flipkart under insolvency proceedings for a payment default of Rs 26.95 crore to one of its creditors. However, the company claims that the Karnataka High Court has granted a stay on the order. A detailed statement by the company said through the NCLT...
The first national meet of officials of the Real Estate Regulatory Authority (RERA) is likely to brainstorm among others issues the scenario emerging out of the August 9 order of the Supreme Court, where it upheld the validity of the IBC, which conferred the ‘financial creditor’ status on homebuyers. Besides RERA officials from the states, the...
The National Company Law Appellate Tribunal (NCLAT) has set aside an order of admission under the Insolvency and Bankruptcy Code, 2016 on the ground that the order was passed by a member singly after the retirement of the fellow member of the Division Bench. The order was passed by a three-member bench of NCLAT comprising Chairperson,...
The IBBI data also shows about 56.17 per cent of the CIRPs, which were closed, ended in liquidation, and only 14.93 per cent ended with a resolution plan. In over three years of the Insolvency and Bankruptcy Code, the number of bankrupt companies liquidated under the regime has far exceeded the number of corporate resolutions, by...
There is perhaps a ray of hope for the distressed bank account holders of PMC Bank. In a move aimed at giving a huge relief to the PMC Bank account holders, the administrator appointed by the Reserve Bank has reportedly asked the Mumbai Police to release the seized assets in connection with the bank scam for...
Gurugram-based Alok Kumar Agarwal has been appointed the interim resolution professional by the NCLT to oversee the travel company's affairs. The National Company Law Tribunal (NCLT) has admitted a plea to initiate insolvency proceedings as well as appointed a resolution professional for Cox & Kings for defaulting on a loan. The NCLT admitted the plea by...
The resolution plan so reached can then be placed before the NCLT for approval, so that it can be implemented. The pre-packaged resolution scheme is expected to aid the existing insolvency framework and cut costs and time of the resolution process. The practice of opting for pre-packs is a standard approach in the UK, on whose...
Sitharaman’s comments came amidst the alleged Rs 4,355 crore fraud at Punjab and Maharashtra Co-operative (PMC) Bank. Finance Minister Nirmala Sitharaman has said that uncertainty arising out of one case should not be generalised about the efficiency and effectiveness of Insolvency and Bankruptcy Code. Sitharaman was responding to a question on a particular recent case which many...
Companies Under NCLT - The total outstanding duty saved amount / dues along with interest, and any penalty imposed under Foreign Trade (Development and Regulation) Act, or any other dues, shall be counted as part of the dues to the govt against the said firm / company. Under the Insolvency and Bankruptcy Code, NCLT deals with...
State Bank chairman Rajnish Kumar on Tuesday said the Enforcement Directorate and other central law enforcement agencies should restrict to attaching personal assets while investigating a promoter and keep off the company which is under the insolvency process. Speaking a day after NCLAT asked the ED to release the attached properties of Bhushan Power & Steel...
Introduction of Insolvency and Bankruptcy Code has drastically restructured the current situation of debtor and creditor equation. Post implementing the code creditors are not needed to pursuit the debtor, the situation has reversed now. The insolvency resolution process for individuals includes filing of an application for insolvency by paying requisite fees and following the valuation...
New Delhi: The government is planning to raise the threshold for invoking bankruptcy proceedings to prevent businesses being dragged into bankruptcy tribunals for minor defaults, corporate affairs secretary Injeti Srinivas said on Monday. Injeti was referring to cases where it has been observed that in few sectors, particularly where there has been large number of applications...
While dealing with an appeal filed by the Registrar of Companies against a batch of LLPs, the National Company Law Appellate Tribunal (NCLAT) has remarked that adoption of a bloodthirsty approach by Authorities against compliant entities is unwarranted. The remark was made by two-member Bench of Member (Judicial) Bansi Lal and Member (Technical) Balvinder Singh...
The government-appointed Insolvency Law Committee (ILC) will meet on October 15 to deliberate on various proposed reforms to the existing insolvency and bankruptcy code (IBC), including new concepts such as group insolvency, said a member of the panel. “ILC will be meeting on October 15 to discuss the various reforms,” MS Sahoo, Chairperson, Insolvency and Bankruptcy...
The NCLAT has held that the pendency of a suit filed by the corporate debtor against a financial creditor, cannot bar it from initiating insolvency proceedings under Section 7 of the Insolvency and Bankruptcy Code, 2016 (IBC). The Appellate Tribunal headed by Justice S J Mukhopadhyay also reiterated that pre-existing dispute cannot be a subject matter...
JSW Steel has offered to pay Rs 19,350 crore to financial creditors and Rs 350 crore to operational creditors in its bid that was approved by the National Company Law Tribunal (NCLT) on September 5. Lenders to Bhushan Power and Steel (BPSL) have urged the National Company Law Appellate Tribunal (NCLAT) to direct the bankrupt...
Delhi High Court has held that a winding up order passed by a Company Judge is not irrevocable and the proceedings can be later transferred to NCLT under IBC if the same is in the interest of the company and the creditors. The Division Bench of Justice Vipin Sanghi and Sanjeev Narula also held that...
Home-grown snack maker Haldiram has emerged as the sole bidder for acquiring loss-making Kwality Dairy with a bid worth Rs 130 crore after global private equity giant KKR & Co. dragged the company to bankruptcy court, a report in PTI stated, citing sources in the know. The lenders are likely to vote on Haldiram's bid later...
The finance ministry has recommended the closure of struggling telecom companies BSNL and MTNL, Financial Express has reported. The cost of closing the two state-run companies would not be as high as Rs 95,000 crore, a number put out by the Department of Telecommunications (DoT), the report said. The sum of Rs 95,000 crore factored...
The National Company Law Appellate Tribunal ("NCLAT") reversed the order of NCLT while adjudicating upon the matter concerning insolvency of Sterling Biotech. The NCLAT allowed the creditors to withdraw the insolvency petition as per section 12A of the Insolvency and Bankruptcy Code ("IBC"), 2016 and to settle with the promoters of the Corporate Debtor. Thereby,...
Once considered the third-largest realty developer in India, Mumbai-based Housing Development and Infrastructure Ltd (HDIL) has only spiraled down over the last few years, with the latest knock being the arrest of its promoters in connection to one of the country’s biggest bank scams. On Thursday, Mumbai Police’s economic offenses wing (EOW) arrested HDIL’s executive...
Lucknow The National Company Law Tribunal (NCLT) has imposed a moratorium on Rohtas projects in Lucknow and appointed an interim resolution professional (IRP) on the complaint of home-buyers who had moved an application against the defaulting realtor under the Indian Bankruptcy Code (IBC). The tribunal has appointed Kamal Piyush as interim resolution professional (IRP) to...
The National Company Law Tribunal, New Delhi has held that a ‘Sole Proprietary Concern’ is not a person within the meaning of Section 3(23) of Insolvency and Bankruptcy Code, 2016 (IBC). It was hence not entitled to initiate insolvency proceedings before the Adjudicating Authority under IBC, it held. The Order was passed by a two-member...
Tata Steel has walked away with a profit of ?5,000 crore made by Bhushan Steel during the insolvency period stretching over 18 months. This contrasts with the National Company Law Tribunal (NCLT) ruling that the profit made by Bhushan Power and Steel during the insolvency period belongs to the financial and operational creditors. JSW Steel moves NCLAT JSW...
NEW DELHI: The National Company Law Tribunal (NCLT) Mumbai on Tuesday initiated corporate insolvency resolution process against Kasata Hometech under Section 7 of the Insolvency and Bankruptcy Code 2016. The court has appointed Jugraj Bedi as the interim resolution professional (IRP) for the case. The court directed the IRP to make public announcement. The financial creditor said...
According to him, innovative ways need to be looked at to ensure that homebuyers do not abuse the insolvency resolution framework. The government is looking into setting a minimum threshold of allottees for homebuyers to be able to initiate insolvency proceedings against real estate developers according to a senior government official. Under the Insolvency and Bankruptcy...
The ministry had earlier proposed the appointment of Chitale & Co, CNK & Associates LLP, Borkar & Mazumdar & Co, and GM Kapadia &Co as auditors. The Ministry of Corporate affairs on September 27 moved the National Company Law Tribunal to file an application seeking a change in the auditors of Infrastructure Leasing and Financial Services...
The National Company Law Appellate Tribunal (NCLAT) on Thursday allowed the Dutch court administrator of Jet Airways to attend the meetings of the bankrupt airline's Committee of Creditors (CoC). With this ruling, the NCLAT has finalised the cross-border insolvency protocol for the airline. The order comes after the counsel representing both the resolution professional (RP) of Jet...
Turns out, a number of multiplexes and food chains may have been fudging up the amounts of various snacks and food items they dole out against payment taken. And now, the legal metrology dept has sent out notices to the likes of Domino’s Pizza, McDonald’s, Cinepolis, E-Square and more Ever wondered if the size of your popcorn tub...
In a landmark judgement delivered earlier this month, the National Company Law Appellate Tribunal has allowed Group Insolvency of six real estate companies in order to arrive at a consolidated Resolution Plan for the total development of a township project undertaken by them in Haryana. The Companies referred to group insolvency are Sachet Infrastructure Pvt. Ltd,...
The company had earlier sold its tea estates in Assam and the Dooars to reduce huge debt. Currently, its short and long-term debts stand at around Rs 1,700 crore. Providing some relief to debt-laden McLeod Russel, the Kolkata Bench of the National Company Law Tribunal (NCLT) has modified its interim order of “status quo” on...
The resolution professional of Jet Airways India Ltd. moved the National Company Law Tribunal today seeking direction against certain members of the committee of creditors for speedy release of funds for interim financing. “Jet Airways is facing complications in receiving funds from abroad,” the counsel representing the resolution professional said, adding that without timely interim financing,...
The NCLAT has allowed an appeal filed by financial creditor Hero Fincorp Ltd., on the ground of discriminatory treatment with similarly situated 'Financial Creditors'. The NCLAT Bench, headed by S J Mukhopadhay, took this view while hearing an appeal Hero Fincorp against the NCLT's approval of the resolution plan for the corporate debtor 'Rave Scans...
Under legislation included in the draft Finance Bill, the Government is planning that, from 6 April 2020, certain tax debts owed by an insolvent company – including VAT, PAYE, and employee NICs – will be repaid to HMRC in priority to debts owed to floating charge holders and unsecured creditors, including a company’s pension scheme...
MUMBAI: HIGHLIGHTS CARE Ratings has downgraded businessman Anil Ambani-led Reliance Home Finance's long-term debt programme, market-linked debentures, subordinated debt, non-convertible debentures (NCDs) and upper tier-11 NCDs to ''D''. CARE said the action is primarily due to delay in servicing of principal on one of the NCDs. Reliance Home Finance said the rating action is "untimely...
The National Company Law Tribunal (NCLT) has initiated a corporate insolvency resolution process against ABW Infrastructure under Section 7 of the Insolvency and Bankruptcy Code 2016. The court has appointed Anand Chandra Swain as the interim resolution professional (IRP) for the case. It directed the IRP to make a public announcement within three days of the...
Emkay Global has reiterated its sell call on developer financiers such as L&T Finance Holdings and LIC Housing Finance after another unlisted non-banking finance company (NBFC) Altico Capital defaulted on interest payment on overseas loans. The brokerage also has a cautious stance on Edelweiss Financial, where it maintained hold rating. Shares of L&T Finance Holdings...
-By Satvik Varma The insolvency proceedings against Jet Airways in India and the Netherlands bring to fore the lacunae in the Insolvency and Bankruptcy Code (IBC), 2016 to deal with cross-border insolvencies. Cross-border insolvency involves the handling of distressed debtors who have assets and/or creditors in several countries, and become subject to insolvency proceedings in multiple jurisdictions....
Asking for maintaining the status quo, the NCLT said if SBI is allowed to execute the sale as advertised, the Videocon Group may suffer an irreparable losses The order came after SBI has advertised to sell the upstream oil and gas assets of Videocon in Brazil and Indonesia inviting EOIs MUMBAI : The National Company Law...
Equitas Holdings Ltd (EHL) has proposed a new scheme of arrangement to list its small financing bank arm ESFB after being denied an extension to the listing deadline by the RBI as well as approval to reverse merger proposal by SEBI. Under the new scheme, EHL has proposed to capitalise free reserves of Equitas Small...
The Insolvency and Bankruptcy Code, 2016 seeks to combine the prevailing framework by forming the bankruptcy law. The main motive behind execution Insolvency and Bankruptcy Code is to maximize the value of the assets and to find solutions for worried assets risen out of non-performing asset. Key features of Insolvency and Bankruptcy Code 2016: Resolution of Insolvency: The...
RBI told Equitas that 'its request for extension of timeline for listing of share of ESFB cannot be acceded to' In September last year, the Reserve Bank of India (RBI) had barred Bandhan Bank from opening new branches without its approval The Reserve Bank of India (RBI) has turned down a proposal by Equitas Holdings...
Equitas Small Finance Bank (SFB), which completed three years of operations on Wednesday, has missed its listing timeline. While the holding company — Equitas Financial Holdings, which owns 100 per cent stake in Equitas SFB — is a listed entity, the Reserve Bank of India (RBI) rules mandate that the SFB be listed separately within...
New Delhi: The finance ministry expects the remaining four public sector lenders to be out of the RBI's prompt corrective action (PCA) framework with the recent round of capital infusion. Currently, Indian Overseas BankNSE 2.00 % (IOB), Central Bank of India, UCO Bank and United Bank of India are under this framework which puts several...
The shipyard controlled by Anil Ambani (pictured) is facing the prospect of bankruptcy after failing to get creditors’ approval for restructuring Rs 70 billion ($970 million) of debt, people familiar with the matter said. The bankruptcy tribunal will consider putting Reliance Naval & Engineering in bankruptcy on Wednesday as no new repayment plan was submitted after...
HIGHLIGHTS Finance Minister Nirmala Sitharaman said there will not be a single job loss due to merger of banks Nirmala Sitharaman on Friday unveiled a plan to merge 10 public sector banks into four The All India Bank Employees Union said the amalgamation would lead to the closure of banks besides job losses Finance Minister Nirmala Sitharaman on Sunday...
The government on Friday said that it would merge 10 public sector banks into four, bringing down the number of PSU banks to 12 from 21. The PSU bank mergers would help in better management of capital, said Finance Minister Nirmala Sitharaman while announcing the proposal as a part of a package of ‘reforms’ for...
In what is seen as another sign of impending economic crisis, the National Company Law Tribunal (NCLT) has ordered insolvency proceeding against the Mumbai based housing giant, Housing Development and Infrastructure Ltd (HDIL). To run the insolvency process, the debt-ridden realty firm, has appointed Abhay Narayan Manudhane as the interim resolution professional (IRP) on Friday. In a...
What should the domestic company law tribunals do when a foreign court has already triggered insolvency proceedings against an Indian entity – this question has popped up before the NCLAT in the Jet Airways insolvency proceedings. In an interesting turn of events, the NCLAT while hearing an appeal filed by the Administrator appointed in the...
NEW DELHI: The government has notified the Insolvency and Bankruptcy Code (Amendment) Act, 2019, under which a deadline of 330 days has been set for completion of corporate insolvency resolution process (CIRP), including litigation and other judicial processes. The new law aims to provide greater clarity on the permissibility of corporate restructuring schemes, rights and...
Amtek Auto was among the first list of the 12 companies that were referred by the Reserve Bank of India (RBI) in 2017 to respective banks for the initiation of insolvency process for defaults The National Company Law Appellate Tribunal (NCLAT) on Friday ordered liquidation of debt-ridden Amtek Auto as it declined lenders' request for extension...
GE stock fell sharply on Thursday after a whistle blower report accused the company of perpetrating a “bigger fraud than Enron”, according a website set up specifically to address the issue, gefraud.com. The report’s author, Harry Markopolos, was also a whistle blower during the Enron fraud. In the report, Markopolos alleges that GE, which the website refers...
Parliament on Thursday passed the Insolvency and Bankruptcy Code (Amendment) Bill 2019, which brought in eight amendments as part of efforts to ensure that the code remains vibrant and not lend itself to any interpretative ambiguities. The Bill — which was earlier this week passed by the Rajya Sabha — was on Thursday passed by the...
Insolvency and Bankruptcy Board of India came into practice on 1st of October 2016 to control and secure diverse bad loan cases revealed by different creditors, which particularly engaged banks in India. The IBBI comes under Insolvency and Bankruptcy Code, 2016 and controls the profession of indebtedness and bankruptcy. It undertakes the job of governing body...
Jet Airways under insolvency - The National Company Law Tribunal on Thursday admitted lenders move for bankruptcy proceedings for Jet Airways. A consortium of 26 bankers led by State Bank had taken the grounded Jet Airways to the NCLT to recover their dues of over Rs 8,500 crore. The announcement came hours after stocks of the...
Unable to close many insolvency cases successfully in 270 days has resulted in passing many Litmus tests by IBC. This has created a symbol of the dark storm and greater strikes over the Insolvency and Bankruptcy Code (IBC). Several causes are involved behind the missing of timelines according to the drafted IBC legislation report. Gaps...
The regulator put forward some significant changes in the regulations of Insolvency Professionals. This proposal may require to acquire a Certificate of Practice for all Resolution Professionals, Liquidation, or Interim Resolution Professional that authorize the IPs practice. The Insolvency and Bankruptcy Board of India (IBBI) is of the idea that Certification of Practice will enhance supervising...
The orders of Liquidation of debt-ridden pharmaceutical company Sterling Biotech by National Company Law Tribunal has created hindrance for its Lenders. The Lenders were expecting that they could easily withdraw the proceedings of insolvency and accept (OTS) One-time Settlement offered by the promoters. The (CoC) Committee of Creditors had permitted to the promoters One-Time Settlement offered by...
With the increase in bankruptcy and bad loans in India, companies are overburdened with fraud loans and the risk of insolvency. Industries also spend most of their time and effort in fixing macroeconomic risks. To resolve and restructure failing businesses, the Government introduced the Insolvency and Bankruptcy Code, 2016. The introduction of the law has given...
According to IBBI chief M S Saboo, a recent judgment by the Supreme Court will encourage creditors to be more active and responsible for their actions as well as inactions. He further said that the judgment does not affect the rights of creditors in any way. The apex court, on April 2, rejected a circular...
The Insolvency and Bankruptcy Board of India has recently released a charter which has been prepared with inputs from three difference insolvency professional agencies. The charter is not mandatory and is aimed at providing responsibilities as well as guidelines for Insolvency Resolution Professionals and Committee of Creditors (CoC). The charter is an effort to ensure...
Recently, Ms. Anju Agarwal, Director at ASC Group and head of Insolvency Services paneled a discussion held by INSOL India. An independent leadership body, INSOL India represents and brings together practitioners and associated professionals from the field of restructuring and insolvency. An annual conference was organized on the 13 – 14 November, 2018 where Ms....
Webinar: Bankers Perspective on Insolvency & Bankruptcy Code, 2016 Mr. Deepak Maini, Vice President under the Insolvency Services vertical presided over a webinar which presented the perspective of bankers on the Insolvency & Bankruptcy Code of 2016. The presentation answered persisting questions and brought in much clarity on the code. You can watch the video as well...
India ushered into a new bankruptcy regime in 2017 with the enactment of Insolvency and Bankruptcy Code 2016 (“Code”). The Code is currently going through initial stages of teething issues, which every law has to endure especially during the early phases. This article discusses important judgments delivered by the Supreme Court, which settled certain major...
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