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1. Anil Kumar Sharma v Ridhiraj Builders and Promoters LLP
Citation: Anil Kumar Sharma Vs. Ridhiraj Builders and Promoters LLP (16.11.2022 – Jaipur Bench): 2021 SCC OnLine NCLT 8960 C.P. (IB) 102/2019; Decided by Hon’ble Justice Deep Chandra Joshi (Judicial) and Hon’ble Member Prasanta Kumar Mohanty (Technical).
Ratio: The National Company Law Tribunal held that it has been held time and again in judgments that deducting Tax Deducted at Source (TDS) does not amount to acknowledgement of Debt. TDS can be deducted for various reasons and mere payment of TDS towards interest payable does not amount to acknowledgement of debt. The same cannot be treated as an acknowledgement of debt, more so a default of the alleged loan.
2. Ms. Teena Saraswat Pandey v M/s Jhanvi Rajpal Automotive Pvt. Ltd
Citation: Ms. Teena Saraswat Pandey Vs. M/s Jhanvi Rajpal Automotive Pvt. Ltd (11.11.2022 – NCLT Indore Bench): IA (I.B.C) – 200/2022; Decided by Hon’ble Justice Dr. Madan B. Gosavi (Judicial) Hon’ble Member Kaushalendra Kumar Singh (Technical).
Ratio: In the above matter, the Adjudicating Authority noted that the corporate debtor’s only immovable property was in the possession of respondent no. 1, and without surrendering the property, the resolution plan could not be executed by respondent no. 2. As the Corporate Insolvency Resolution Process (CIRP) is time-bound, requiring the successful resolution applicant to seek relief from various forums to regain possession would cause unnecessary delays and defeat the purpose of the code.
In the interest of justice, respondent no. 1 was directed to vacate the premises within 15 days from the order so that the resolution plan can be properly implemented. If respondent no. 1 fails to comply, the monitoring committee can seek assistance from the local police authority, which will assist in reclaiming possession of the premises from respondent no. 1.
3. Maharashtra State Board of Waqfs v Shaikh Yusuf Bhai Chawla
Citation: Maharashtra State Board of Waqfs vs Shaikh Yusuf Bhai Chawla (20.10.2022 – Supreme Court of India): (2012) 6 SCC 328, Civil Appeal No 7812 – 7814 of 2022; Decided by Hon’ble Justice K.M. Joseph and Hon’ble Justice Hrishikesh Roy.
Ratio: Existence of an alternate remedy cannot exclude Writ Jurisdiction of High Court. In the present case, challenge was also laid to the proceedings of the Charity Commissioner. However, the court held that a constitutional remedy cannot be barred or excluded as when the High Court exercises its power Under Article 226
4. Guneet Bhasin v State of NCT of Delhi & Anr. & Ors.
Citation: Guneet Bhasin vs State of NCT of Delhi & Anr. & Ors: 2022 SCC OnLine Del 3967, Criminal Miscellaneus Case 4100 of 2022 and Criminal Miscellaneus Appeal 16919 of 2022 (14.11.2022 – High Court New Delhi); decided by Hon’ble Justice Sudhir Kumar Jain.
Ratio: Any infirmity in the Cheque Return Memo doesn’t render entire trial u/s 138 of the Negotiable Instruments Act, 1881 as nullity. The cheque return memo is not a document which is not required to be covered under section 4 of the Bankers Book (Evidence) Act, 1891.
In the present case, the cheque return memo was not found to have the official stamp of the Bank. The Hon’ble Court held that a cheque return memo is a notice of dishonour of cheques sent to the encasher of the cheque and there is no standard format for such memo under the NI Act. Any illegality or irregularity with regard to the format of such return memo can be addressed at trial. The petitioner has not disputed the issuance of cheque under his signature and the dishonour of the cheque by the concerned Banker.
5. Insolvency And Bankruptcy Board of India v State Bank Of India & Ors
Citation: Insolvency and Bankruptcy Board of India vs State Bank of India & Ors: 2018 SCC OnLine Del 13380, Writ Petition (Civil) 10189 of 2018
(28.11.2022 – High Court New Delhi); Decided by Hon’ble Justice Prathiba M Singh.
(28.11.2022 – High Court New Delhi); Decided by Hon’ble Justice Prathiba M Singh.
Ratio: The Hon’ble High Court observed that the Insolvency and Bankruptcy Board of India (IBBI) is responsible for implementing various functions under the Insolvency and Bankruptcy Code (IBC), while the National Company Law Tribunal (NCLT) is established under Section 60 of the IBC and primarily adjudicates applications, claims, and questions arising from insolvency resolution or liquidation proceedings. The Court noted that the power to declare a regulation as ultra vires does not fall within the jurisdiction of the NCLT. Regulations framed by the Central Government, or the IBBI are required to be presented before Parliament. The Court emphasized the need to minimize judicial intervention and maintain the foundational principles of the IBC. In the present case, the NCLT declared Regulation 36A as ultra vires while considering an application for an extension of time to complete the Corporate Insolvency Resolution Process (CIRP), despite there being no challenge to the regulation before the NCLT. The Court held that the NCLT lacks the authority to declare provisions of the IBC or its regulations illegal or ultra vires. Therefore, the NCLT’s order declaring Regulation 36A as ultra vires was set aside. However, no challenge was raised regarding the validity or legality of Regulation 36A in the above case.
6. Shailaja Vaibhav Patil v CMA Harshad S. Deshpande
Citation: Shailaja Vaibhav Patil Vs. CMA Harshad S. Deshpande: 2022 SCC OnLine NCLAT 2806, Company Appeal (Appellate Tribunal) (Insolvency) No. 1122 of 2020 (05.12.2022 – NCLAT New Delhi); Decided by Hon’ble Justice Rakesh Kumar Jain (Judicial) and Hon’ble Member Kanthi Narahari.
Ratio: In the above matter, the resolution plan submitted by M/s Galactico Cooperative Services Ltd. and P.L. Adke was opposed by Nashik Merchant Cooperative Bank Ltd., leading to the initiation of liquidation proceedings. During the appeals, the appellant acquired the voting share of Nashik Merchant Cooperative Bank Ltd.
However, the National Company Law Appellate Tribunal (NCLAT) stated that previous decisions cited by the appellant were not applicable to the current case, as there was a change in voting share after the order of liquidation. The NCLAT also emphasized that the Insolvency and Bankruptcy Code (IBC) does not provide provisions for such a situation. Therefore, the appeals were dismissed, and the impugned order was upheld.
7. M/s. Aswathi Agencies v Bijoy Prabhakaran Pulipra, RP PVS Memorial Hospital Pvt. Ltd
Citation: M/s. Aswathi Agencies Vs. Bijoy Prabhakaran Pulipra, RP PVS Memorial Hospital Pvt. Ltd: 2022 SCC OnLine NCLAT 1758, Company Appeal (Appellate Tribunal) (Chennai) (Insolvency) No. 179 of 2021 (05.12.2022 – NCLAT Chennai); Decided by Hon’ble Justice M Venugopal (Judical) and Hon’ble Member Kanthi Narahari (Techinical).
Ratio: In the above case, the Hon’ble Tribunal held that the scope of judicial review by an adjudicating authority in the context of a resolution plan under the Insolvency and Bankruptcy Code, 2016 (I&B Code) is limited and narrow. In the present case, the resolution plan submitted by the resolution applicant has satisfied the requirements of the I&B Code and the applicable regulations.
The commercial wisdom of the Committee of Creditors is generally not interfered with, except within the limited scope provided by the I&B Code. The decisions of the Committee of Creditors, approved by a thumping majority, are given paramount importance, and the adjudicating authority or the appellate tribunal cannot consider any other features beyond those specified in the relevant provisions of the I&B Code. The Supreme Court of India has emphasized the importance of maximizing the value of assets, maintaining the corporate debtor as a going concern, and balancing the interests of all stakeholders. The judicial review of a resolution plan is to ensure that these key features have been considered by the Committee of Creditors.
Furthermore, the fact that the resolution applicant is a charitable public trust does not preclude it from submitting a resolution plan, as the I&B Code includes trusts within the definition of “person.”
The validation of an approved resolution plan involves the demerger of assets from the corporate debtor and their amalgamation with the resolution applicant in the same field. The resolution plan in question has been fully implemented according to the monitoring agency, and the adjudicating authority approved it after satisfying itself of compliance with the I&B Code.
8. Krishna Hi-Tech Infrastructure Pvt. Ltd v Bengal Shelter Housing Development Pvt. Ltd
Citation: Krishna Hi-Tech Infrastructure Pvt. Ltd VS Bengal Shelter Housing Development Pvt. Ltd: 2021 SCC OnLine NCLT 4567, Company Appeal (Appellate Tribunal) No. 10375 of 2022 (06.12.2022 – NCLAT New Delhi); Decided by Hon’ble Justice Ashok Bhushan (Judicial), Hon’ble Member Dr. Alok Srivastava (Technical) and Hon’ble Member Barun Mitra (Technical).
Ratio: This is an appeal filed against the rejection of a Section 9 application under the Insolvency and Bankruptcy Code. The appellant, a contractor, had a contract with the respondent, but payment issues arose. The appellant issued a notice under Section 8 of the I&B Code and subsequently filed the Section 9 application claiming a debt of Rs. 1.39 crores. The Adjudicating Authority rejected the application, citing pre-existing disputes between the parties. The Tribunal examined email correspondences indicating deficiencies in work raised prior to the notice. The Tribunal concluded that these issues were not a mere defense and that the Adjudicating Authority had not erred in rejecting the application.
9. Urvashi Infrastructure Limited v Registrar of Companies, Delhi & Haryana
Citation: Urvashi Infrastructure Limited VS Registrar of Companies, Delhi & Haryana: 2022 SCC OnLine NCLAT 2967, Company Appeal (Appellate Tribunal) No. 28 of 2021 (07.12.2021 – NCLAT New Delhi); Decided by Hon’ble Justice M. Venugopal (Judicial), Hon’ble Member Dr. Ashok Kumar Mishra (Technical).
Ratio: While restoring a company name to Registrar of Companies, the Court has no jurisdiction to fasten any penalty for the defaults under the Companies Act, 2013.
10.Bhoj Raj Garg v Goyal Education And Welfare Society & Ors
Citation: Bhoj Raj Garg VS Goyal Education And Welfare Society & Ors: Special Leave to Appeal (Civil) No. 19654 of 2022 (18.11.2022 – Supreme Court of India); Decided by Hon’ble Justice K.M. Joseph and Hon’ble Justice Hrishikesh Roy.[{{type}} Annotation]
Ratio: Court must dispose of the Execution Proceedings within six months from date of filing, which may be extended only by recorded in writing for such delay.
11.Mr. Thomas George v K. Easwara Pillai RP M/s. Mathstraman Manufacturers and Traders Pvt. Ltd
Citation: Mr. Thomas George Vs. K. Easwara Pillai RP M/s. Mathstraman Manufacturers and Traders Pvt. Ltd: Company Appeal (Appellate Tribunal) (Chennai) (Insolvency) No. 293 of 2021 (05.12.2022 – NCLAT Chennai); Decided by Hon’ble Justice M. Venugopal (Judicial) and Hon’ble Member Ms. Shreesha Merla.
Ratio: Upon reviewing the grounds of the above appeal, the National Company Law Tribunal found no valid reason for the appellant’s failure to file a reply despite receiving notice. The appellant cannot now dispute the observations made by the Adjudicating Authority after choosing not to contest the matter earlier. The respondent’s activities were found to continue with all assets of the corporate debtor, and the appellant and his wife were directors and shareholders of the respondent company. It was held that the Impugned Order was passed on merits and after hearing the relevant parties. The Tribunal concluded that Section 66 of the Insolvency and Bankruptcy Code, 2016 does not specify a look-back period for fraudulent transactions, and the appellant failed to deny taking over the assets of the corporate debtor. Therefore, no additional opportunity was granted, and the Tribunal deemed the appellant liable for fraudulent acts.
12.M/s Bimal Kothatri v Assistant Commissioner (DSGST) & Ors
Citation: M/s Bimal Kothatri vs Assistant Commissioner (DSGST) & Ors.: 2022 SCC OnLine Del 4005, Writ Petition (Civil) 9207 of 2019 (01.11.2022 – Delhi High Court); Decided by Hon’ble Justice Ravi Shakdher and Hon’ble Justice Tara Vitasta Ganju.
Ratio: Petitioner’s GST registration was cancelled as he was not found to be in existence in address as stated with GST Office. Held, notice is mandatory for physical verification of place of business under Rule 25 of the CGST Rules, 2017 and GST registration was restored.
13.Ms. Manju Agarwal v M/s. Shree Maru Tradelink Ltd
Citation: Ms. Manju Agarwal Vs. M/s. Shree Maru Tradelink Ltd.: 2022 SCC OnLine NCLAT 392, Company Appeal (Appellate Tribunal) (New Delhi (Insolvency) No. 1203 of 2022 (12.12.2022 – NCLAT New Delhi); Decided by Hon’ble Justice Ashok Bhushan (Chairperson), Hon’ble Member Dr. Ashok Srivastava (Technical) and Hon’ble Member Mr. Barun Mitra (Technical).
Ratio: In proceedings under Section 9 of the IBC, 2016, the Adjudicating Authority should not make a final decision on the existence of a dispute regarding the operational debt. Instead, it should determine whether the defense raises a dispute that requires further adjudication by a competent court. The Adjudicating Authority failed to apply the Supreme Court’s judgment in the “Mobilox Innovations Pvt. Ltd.” case to the present case. The Authority did no consider an email sent by the operational creditor prior to the demand notice. The last invoice was issued on June 2, 2016, and there were no transactions between the parties after that date. The operational creditor did not provide a valid reason for not demanding payment for over 22 months. Considering these facts, the Tribunal concluded that genuine disputes were raised by the corporate debtor in the reply notice, and the Section 9 application should not have been admitted. The appeal was allowed, the Adjudicating Authority’s order was set aside, and the Section 9 application filed by the operational creditor was dismissed.
14.Excise and Taxation Commissioner, Haryana Sales Tax Department v Jalesh Kumar Grover, RP of M/s Dinesh Polytubes Pvt. Ltd
Citation: Excise and Taxation Commissioner, Haryana Sales Tax Department Vs. Jalesh Kumar Grover, RP of M/s Dinesh Polytubes Pvt. Ltd.: Company Petition (Insolvency Bankruptcy) (Chandigarh/Haryana) No. 104 of 2017 (08.12.2022 – NCLT Chandigarh); Decided by Hon’ble Justice Harnam Singh Thakur (Judicial) and Hon’ble Member Subrata Kumar Dash (Technical).
Ratio: The Adjudicating Authority concluded that the claim filed by the Haryana Sales Tax Department was submitted more than one year after the approval of the resolution plan, and therefore, it lacked jurisdiction to review its own order. It was emphasized that allowing a claim after the approval of the plan would disrupt the post- Corporate Insolvency Resolution Process and undermine the objectives of the Insolvency and Bankruptcy Code, 2016.
15.Mr. Keshav Kantamneni Ex Managing Director Uniply Industries Ltd. v M/s. Kishan Chand Suresh Kumar
Citation: Mr. Keshav Kantamneni Ex Managing Director Uniply Industries Ltd. Vs. M/s. Kishan Chand Suresh Kumar: 2022 SCC OnLine NCLAT 2361, Company Appeal (Appellate Tribunal) (Chennai) (Insolvency) No. 260 of 2021 (12.12.2022 – NCLAT Chennai); Decided by Hon’ble Justice M. Venugopal (Judicial) and Hon’ble Member Kanthi Narahari (Technical).
Ratio: The Appellant in the above case failed to provide any evidence of a pre- existing dispute regarding the interest claimed. The documents submitted by the operational creditor, including a memorandum of compromise and ledger account, supported their claim. The Appellant could not present any documents to demonstrate the existence of a pre-existing dispute before or during the pendency of the application under sec 9 of the IBC, 2016. After considering the arguments, the Tribunal concluded that the debt was established, and the Section 9 application was valid.
16.Andhra Pradesh State Financial Corporation v Kalptaru Steel Rolling Mills Ltd
Citation: Andhra Pradesh State Financial Corporation Vs. Kalptaru Steel Rolling Mills Ltd.: 2018 SCC OnLine NCLT 32429, Company Appeal (Appellate Tribunal) (Insolvency) No. 584 of 2020 (13.12.2022 – NCLAT New Delhi); Decided by Hon’ble Justice Ashok Bhushan (Chairperson) and Hon’ble Member Mr. Braun Mitra (Technical).
Ratio: The Appellant cannot challenge the initiation of Corporate Insolvency Resolution Process (CIRP) on the ground of limitation since their challenge to the Section 7 application was already rejected by the Supreme Court. The focus of the appeal is on the approval of the Resolution Plan and subsequent orders. The objections raised by the appellant regarding the plan were adequately considered and rejected by the Adjudicating Authority. The Authority found equitable treatment among secured creditors and determined that the Corporate Debtor was a going concern. The appellant’s reliance on a specific judgment was deemed irrelevant to the case. The distribution of amounts to financial creditors as decided by the Committee of Creditors cannot be challenged, as per a Supreme Court ruling. Overall, there are no valid grounds to interfere with the order approving the Resolution Plan, and the subsequent order is merely consequential and requires no intervention from the Appellate Tribunal.
17.Siti Networks Ltd. v Assets Care and Reconstruction Enterprises Ltd. & Anr
Citation: Siti Networks Ltd. Vs. Assets Care and Reconstruction Enterprises Ltd. & Anr.: Company Appeal (Appellate Tribunal) (Insolvency) No. 1449 of 2022 (13.12.2022 -NCLAT New Delhi) Decided by Hon’ble Justice Ashok Bhushan (Chairperson) and Hon’ble Member Mr. Braun Mitra (Techinical).
Ratio: The National Company Law Appellate Tribunal (NCLAT) in the above matter, has ruled that a creditor who has assigned its debt to another party can continue with insolvency proceedings against the debtor, with the leave of the court.
The NCLAT cited Order XXII Rule 10 of the Code of Civil Procedure (CPC), which allows a party to continue with legal proceedings even after its rights have been assigned to another party, with the leave of the court. The NCLAT held that the assignee, Assets Care and Reconstruction Enterprise Limited, stepped into the shoes of HDFC Limited as a financial creditor and had the right to continue the proceeding initiated by Respondent No.2. The NCLAT found no error in the Adjudicating Authority’s decision to allow the assignment and dismissed the appeal.
18.Cholamandalam Investment and Finance Company Ltd. v Navrang Roadlines Pvt. Ltd. Through its Liquidator Mr. Sachin Dinkar Bhattbhatt
Citation: Cholamandalam Investment and Finance Company Ltd. Vs. Navrang Roadlines Pvt. Ltd. Through its Liquidator Mr. Sachin Dinkar Bhattbhatt: Original Side Application (Commercial Appellate Division) No.115 of 2022 (01.12.2022 – Madras High Court); Decided by Hon’ble Justice T.Raja and Hon’ble Justice D.Krishnakumar.
Ratio: Liability arising out of an arbitral award, or a court decree would be categorized as either financial or operational debt depending on the nature of the underlying claim which stands crystallized through the arbitral or court proceedings.
19.Bijoy Prabhakaran Pulipra, Monitoring Agent, PVS Memorial Hospital Pvt. Ltd. v Special Officer (Revenue), Kerala State Electricity Board Ltd
Citation: Bijoy Prabhakaran Pulipra, Monitoring Agent, PVS Memorial Hospital Pvt. Ltd. Vs. Special Officer (Revenue), Kerala State Electricity Board Ltd.: Mergers & Acquisitions (Insolvency & Bankruptcy Code) (Kochi Bench) 14 of 2022 (30.11.2022 – NCLT Kochi); Deciced by Hon’ble Justice P. Mohan Raj (Judicial) and Hon’ble Member Satya Ranjan Prasad (Technical).
Ratio: In the above matter, the applicant requested that the electricity bills be raised in the name of the successful resolution applicant instead of the corporate debtor. However, the successful resolution applicant had not filed a name transfer application as required by the Kerala State Electricity Supply Code 2014. The bills can only be raised in the name of the consumer as registered with the electricity supply company. The corporate debtor no longer exists as a legal entity, so the successful resolution applicant must submit a name transfer application to the electricity supply company. The company should consider the application without demanding any payment or arrears from the corporate debtor.
20.Dr. K.V. Srinivas RP, Sainath Estates Pvt. Ltd.
Citation: Dr. K.V. Srinivas RP, Sainath Estates Pvt. Ltd.: Company Appeal (Appellate Tribunal) (Chennai) (Insolvency) No. 319 of 2022 (15.12.2022- NCLAT Chennai) Decided by Hon’ble Justice M. Venugopal (Judicial) Hon’ble Member Naresh Salecha (Technical).
Ratio: In the above matter, it was held that unless specified in Section 34(4) of the Insolvency and Bankruptcy Code (2016), the Adjudicating Authority is not required to replace a Resolution Professional. The authority has the power to reject the appointment of a Resolution Professional as a Liquidator for reasons other than those mentioned in the code. If the authority is dissatisfied with the performance of the Resolution Professional, it can appoint another Insolvency Professional as the Liquidator. In the present case, the Adjudicating Authority, after considering the lenders’ request, allowed the replacement of the current Resolution Professional as Liquidator with another professional, facilitating a smoother liquidation process. The order of liquidation and the appointment of the new Liquidator were deemed legally sound by the authority.
21.Mcdonald’s India Pvt. Ltd. & Ors. v Vikram Bakshi & Ors
Citation: Mcdonald’s India Pvt. Ltd. & Ors. Vs. Vikram Bakshi & Ors.: 2021 SCC OnLine NCLAT 2372, Company Appeal (Appellate Tribunal) No. 275 of 2017 (13.12.2022 – NCLAT New Delhi); Decided by Hon’ble Justice Ashok Bhushan (Chairperson) and Hon’ble Member Dr. Ashok Srivastava (Technical).
Ratio: In the above case, the Hon’ble National Company Law Appellate Tribunal considered an application filed by HUDCO (Housing and Urban Development Corporation) regarding the compliance of a recovery order against Vikram Bakshi, a shareholder in Connaught Plaza Restaurants Pvt. Ltd.
The Tribunal discussed the issue of whether the deposit of an amount corresponding to the share value of 3100 shares owned by Bakshi was sufficient compliance with the recovery order. The Tribunal also examined the argument presented by HUDCO to lift the corporate veil of Bakshi Holdings Pvt. Ltd., another company in which Bakshi held shares. The Tribunal referred to the doctrine of lifting the corporate veil, which allows disregarding the separate legal identity of a company in certain circumstances, such as fraud or evasion of legal obligations. Ultimately, the Tribunal concluded that the recovery order was specific to the 3100 shares held by Bakshi and did not extend to other companies. The Tribunal set aside the previous order and disposed of the appeals accordingly.
22.Nirmal Kumar Agarwal v State Bank of India & Ors
Citation: Nirmal Kumar Agarwal Vs. State Bank of India & Ors.: 2022 SCC OnLine NCLAT 3457, Company Appeal (Appellate Tribunal) (Insolvency) No. 983 of 2019 (19.12.2022 – NCLAT New Delhi); Decided by Hon’ble Justice Rakesh Kumar Jain (Judicial) Hon’ble Member Mr. Kanthi Narahari (Technical).
Ratio: The NCLAT observed that Sungrowth, being a financial service provider registered with RBI until 09.07.2018/11.07.2018, cannot be considered a banking institution under Section 5(5A) and is instead classified as a non-banking financial institution. Consequently, the application filed under Section 7 of the Code on 08.06.2018 was not maintainable at that time, and the Adjudicating Authority lacked jurisdiction to initiate CIRP proceedings. Referring to the Supreme Court decisions in Jagmittar Sain Bhagat Vs. Health Services, Haryana and Kiran Singh Vs. Chaman Paswan, it is established that if the Adjudicating Authority lacks jurisdiction to initiate proceedings, those proceedings are legally void and can be challenged on appeal. Therefore, considering the circumstances, the appeal was deemed meritorious, and the impugned order was set aside.
23.Shri Balaji Paperpack Pvt. Ltd. v Laxmi Crockery (Pune) Pvt. Ltd
Citation: Shri Balaji Paper Pack Pvt. Ltd. Vs. Laxmi Crockery (Pune) Pvt. Ltd.: 2020 SCC OnLine NCLT 656, Company Appeal (Appellate Tribunal) (Insolvency) No. 792 of 2022 (20.12.2022 – NCLAT New Delhi); Decided by Hon’ble Justice Ashok Bhushan (Chairperson), Hon’ble Member Mr. Kanthi Narahari (Technical) and Hon’ble Member Mr. Braun Mitra (Techinical).
Ratio: In the above matter, the Respondent had not raised any dispute or presented any invoices to the Appellant prior to the issuance of the demand notice on 23.07.2019. The lack of invoices and failure to claim dues from the Appellant meant that there is no basis for a set off or a dispute between the Appellant and the Respondent. The NCLAT determined that the Respondent’s arguments in their reply were merely an afterthought intended to undermine the proceedings.
Furthermore, according to Section 8(2)(a) of the Code, if there is a dispute, it must specifically pertain to the same amount and be recorded or pending in a lawsuit or arbitration proceedings before the receipt of the notice or invoice. In this case, the Respondent failed to raise any dispute prior to the demand notice, and their claim of a set off was deemed an afterthought, as mentioned earlier.
24.Paramvir Singh Tiwana v Puma Realtors Pvt. Ltd
Citation: Paramvir Singh Tiwana Vs. Puma Realtors Pvt. Ltd.: Company Appeal (Appellate Tribunal) (Insolvency) No. 554 Of 2021 (22.12.2022 – NCLAT New Delhi); Decided by Hon’ble Justice Anant Bijay Singh and Hon’ble Member Ms. Shreesha Merla (Technical).
Ratio: The Supreme Court has previously in a catena of judgments, has established that once a Resolution Plan is approved, the Tribunal has limited jurisdiction and cannot modify the claims outlined in the plan. In the above case, the Appellants argued that there is discrimination among creditors, with Greater Mohali Area Development Authority (“GMADA”) being paid in full despite not submitting a claim, while the Appellants received only 25% of their claim amounts. However, the Tribunal has ruled that as long as the provisions of the Insolvency and Bankruptcy Code (IBC) are followed, it is within the commercial wisdom of the Committee of Creditors (CoC) to negotiate and accept the Resolution Plan, even if it involves differential payments to different classes of creditors.
In this case, considering the nature of the real estate business and the dependency on land owned by GMADA, the CoC’s decision to make provisions for statutory dues owed to GMADA was justified. Although GMADA did not file a claim, the fact that the real estate project is being constructed on GMADA land and involves their approvals and licenses was taken into account by the CoC. The CoC’s decision is a business decision based on ground realities and binds all stakeholders, including dissenting creditors.
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