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 had gone to NCLT on the basis of a circular issued by RBI on Feb 12, 2018.
The appellate tribunal said there was no evidence suggesting that PNB had moved NCLT to initiate insolvency proceedings based on the said circular, under which it was not eligible to file as the default amount was less than Rs 2,000 crore.
“In the absence of any cogent evidence to show that the Appellant (PNB) has filed the Application only pursuant to the ‘Circular’ issued by Reserve Bank of India, which we hold at the outset, was not applicable to the facts of the instant case, it was not open to the Adjudicating Authority (NCLT) to reject the application on this ground,” appellate tribunal said.
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