NCLT Cases in Brief_ IP Rajnish

17/09/2023

सावजी भाई ढोलकिया
जन्म - 12 अप्रैल 1962 (अमरेली, गुजरात)
शिक्षा- चौथी पास
पत्नी - गौरीबेन ढोलकिया
संस्थापक- हरिकृष्ण ग्रुप
छह हजार करोड़ रु. की कंपनी लेकिन अपने ही MBA बेटे से करवाई मजदूरी, क्यों-
• 600 कर्मचारियों को दीपावली पर तोहफे में कार
• 900 को फिक्स्ड-डिपॉजिट दिए
• फ्लैट्स, जूलरी सेट,
• इंश्योरेंस पॉलिसी दे चुके हैं।
सूरत.
• तब सावजी भाई महज 12 साल के थे, जब उन्होंने सूरत पहुंचकर हीरा घिसने का काम शुरू किया था। उस समय सावजी भाई को तनख्वाह में महज 180 रुपए मिलते थे। आज उनकी कंपनी 6 हजार करोड़ रुपए से भी ज्यादा की है।
• हालांकि, इसके बावजूद अपने बेटे द्रव्या को जिंदगी का सबक सिखाने के लिए एक महीने के लिए केरल भेज दिया, वह भी केवल सात हजार रुपए देकर।
• द्रव्या ने अमेरिका से MBA किया था, लेकिन सावजी भाई चाहते थे कि उनका बेटा असल जिंदगी में मैनेजमेंट करना सीखे।
यहां भी रख दी 3 शर्तें
1. पहली, एक हफ्ते से ज्यादा कहीं काम नहीं करना है, मतलब अलग-अलग जगह का अनुभव लेना है।
2. दूसरी, सात हजार रुपए सिर्फ आपात स्थिति में ही खर्च करने हैं। यानी रोजमर्रा के काम के लिए उसे वहां कमाए पैसे ही इस्तेमाल करने हैं।
3. तीसरी, उसे कहीं भी अपने पिता का नाम या रसूख का इस्तेमाल नहीं करना है।
द्रव्या ने वहां फूड आउटलेट और जूतों की दुकान तक में काम किया।
सावजी भाई ने 12 साल पहले अपने भाई के बेटों को भी इसी तरह से दूसरे शहरों में काम करने के लिए भेज दिया था।
जानिए इस पर क्या कहना है सावजी भाई का
जब बच्चों के हाथ में पैसा होता है और उन्होंने किसी तरह की कोई आर्थिक परेशानी नहीं देखी होती तो ऐसे में
• संवेदनाओं,
• मानवीय मूल्यों
• और असल जिंदगी के संघर्षों
की सीख के लिए हमें इस तरह के रास्ते अख़्तियार करने पड़ते हैं। अगर जिंदगी में इस तरह के पाठ सीखने को मिल जाएं तो परिस्थितियों से निबटने के रास्ते इंसान को खुद-ब-खुद मिल ही जाते हैं।'
 खुद 10 साल तक हीरा घिसाई का काम किया
 सावजी भाई के पिता छोटे-से किसान थे।
 घर में पैसों की तंगी के चलते 12 साल की उम्र में पढ़ाई छोड़ दी
 और चाचा के पास सूरत आ गए। उन्होंने 10 साल तक हीरा घिसाई का काम किया।
 आज उनके ब्रांड 'कृष्णा डायमंड ज्वेलरी' के देशभर में 6500 से भी अधिक आउटलेट हैं।

ये है सावजी भाई का ध्येय
सावजी भाई के अनुसार जिंदगी में सफलता और काम में फायदा
1 अनुभव
2 और ज्ञान
को एप्लाई करने से मिलता है।
चाहे थोड़ा पढ़ा और सीखा हो, उसे ज्यादा से ज्यादा एप्लाई करना चाहिए।
सावजी भाई पहली बार 2014 में चर्चा में आए थे,

जब उन्होंने अपने कर्मचारियों को
 200 फ्लैट,
 491 कारें
 और 525 डायमंड जूलरी के सेट उपहार में दिए थे।

उसके बाद 2015-16 में भी हजारों कर्मचारियों को दीपावली पर तोहफे में कार-फ्लैट्स दिए।

14/09/2023

https://youtu.be/jsXYXhOXybE?si=X52FjtJRk50zLZhW

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29/06/2023

Best opportunity

29/06/2023

Very good opportunity to buy agricultural land between sampla to sonepat at 334B highway and KMP expressway , further under construction Delhi to Katra expressway.
—Here Maruti in 900 acre will be in function in 2025
—One University in 54 acre will be shortly inaugurated.
—Rate of agriculture land in this area is economic as compare to rest area of NCR in Delhi
Contact
Ca Rajnish Bansal
9999925301
Or 9899400108

22/05/2020

Update from NCLT/IBC Cases
by INSOLVENCY PROFESSIONAL RAJNISH BANSAL

👉 Lockdown has put final clearance from National Company Law Tribunal (NCLT) for NHPC limited to take over insolvency hit 120MW Rangit Stage IV hydroproject in Himalayan state Sikkim to a halt. But the Mini Ratna PSU has started its homework on the project to minimize cost and time overrun.

“After official clearance from NCLT, NHPC also needs formal nod from Public Investment Board (PIB) and Consultative Committee of Economic Affairs(CCEA) to start working on the project. This lockdown is undoubtedly for a greater cause. But it is delaying all these proceedings making things harder,” said D. Chattopadhyay, Executive Director, NHPC.

After emerging out as the highest bidder under a resolution plan for insolvency bound Hydropower Company Jal Power Corporation’s ‘Rangit stage IV’ HE Project, with its bid of Rs 165 crores.

“While waiting for the clearances, we have started preparing our tender award documents to avoid delay in initiating field work. These homework includes civil mechanical as well as electrical all the three main sectors. This can minimize cost or time overrun for the project.

Any delay in ex*****on pushes up the load of IDC (Interest During Construction) for the capital borrowed by us,” said Chattopadhyay.

👉 The last quarter (January-March) of financial year 2019-20 was quite fruitful for banks in terms of stressed asset resolution and recovery under the Insolvency and Bankruptcy Code (IBC), realising 64% of their dues. This was primarily led by ₹23,223 crore coming from the resolution of Jaypee Infratech Ltd.

While Jaypee's insolvency proceedings began in August 2017, the resolution plan was approved just two months ago, state-owned NBCC emerging as the successful buyer of the troubled company. The resolution plan approved in Jaypee Infratech has been challenged before the National Company Law Appellate Tribunal (NCLAT).

The realisation ratio (realisation as a percentage of dues) in the March quarter is higher than the total realisation ratio since the beginning of IBC at 46% and also higher than that of the December quarter of FY20, showed data from the Insolvency and Bankruptcy Board of India (IBBI). It was at 12.16% in the December quarter. These realisation numbers are based on resolution plans approved by bankruptcy tribunals and do not necessarily mean that banks have recovered the dues.

The average time taken for competition of the resolution process is 375 days, showed IBBI data. But last-minute litigations have plagued the system. Take the instance of Essar Steel. While IBC prescribes for asset resolution to happen within 330 days, Essar Steel’s resolution and sale to Arcelor Mittal took 866 days.

👉 You may send me any queries related to: [email protected].

IP CA. RAJNISH BANSAL
B.Com, FCA, DISA, CISA, I.P.
INSOLVENCY PROFESSIONAL
FORENSIC AUDITOR &
SYSTEM AUDITOR
M. 9999925301, 9899400108
E: [email protected]
Add: B-4/281-282,
Sector-7, Rohini
New Delhi- 110085
Date – 22/05/2020

21/05/2020

Update from NCLT/IBC Cases
by INSOLVENCY PROFESSIONAL RAJNISH BANSAL

👉 The National Company Law Tribunal (NCLT), Bengaluru, has ordered the winding up of Super Royal Holidays India Pvt. Ltd., Bengaluru, by declaring that the incorporation and conduct of business of the company was for “fraudulent objects” of ponzi scheme in the guise of offering holiday tour packages by collecting membership fees.

The Ministry of Corporate Affairs (MCA) sought the winding up of the company following the outcome of an investigation carried out after noticing that the company had deposited and withdrawn around ₹10 crore during the period of demonetisation in 2016.

“On perusing the financial statements of the company, it is clear that the money they collected by way of membership fees etc. was largely being pocketed by agents and director-cum-shareholders by way of commission, awards, dividends for directors, etc., leaving paltry remains for the so-called service [tour packages] for their members. Therefore, it is established that the company is running a ponzi scheme, as rightly contended by the MCA,” the tribunal held.

The tribunal also said that the company was “established exclusively for the benefit of the three promoters-cum-directors-cum-shareholders and their agents” and hardly any service was provided to most its customers.

The company enrolled members by collecting ₹11,000 for single membership, ₹22,000 for triple membership, and ₹33,000 for family membership. This life membership fee carried an offer of free tour packages for two nights/three days, to be availed within the next three years by paying a package cost ranging ₹375 to ₹4,800, depending upon location. The company claimed that it had around two lakh members, but could not produce the complete membership details before the authorities.

On examination of the company’s business model, the MCA found that the company was running “nothing but a ponzi scheme by collecting deposits under the guise of membership fee/enrolment fee from the general public”.

👉 The last quarter (January-March) of financial year 2019-20 was quite fruitful for banks in terms of stressed asset resolution and recovery under the Insolvency and Bankruptcy Code (IBC), realising 64% of their dues. This was primarily led by ₹23,223 crore coming from the resolution of Jaypee Infratech Ltd.

While Jaypee's insolvency proceedings began in August 2017, the resolution plan was approved just two months ago, state-owned NBCC emerging as the successful buyer of the troubled company. The resolution plan approved in Jaypee Infratech has been challenged before the National Company Law Appellate Tribunal (NCLAT).

The realisation ratio (realisation as a percentage of dues) in the March quarter is higher than the total realisation ratio since the beginning of IBC at 46% and also higher than that of the December quarter of FY20, showed data from the Insolvency and Bankruptcy Board of India (IBBI). It was at 12.16% in the December quarter. These realisation numbers are based on resolution plans approved by bankruptcy tribunals and do not necessarily mean that banks have recovered the dues.

The average time taken for competition of the resolution process is 375 days, showed IBBI data. But last-minute litigations have plagued the system. Take the instance of Essar Steel. While IBC prescribes for asset resolution to happen within 330 days, Essar Steel’s resolution and sale to Arcelor Mittal took 866 days.

This resolution plan of Jaypee Infratech has almost single-handedly increased the aggregate realisation for financial creditors or lenders. Then there were assets resolutions that have led to frugal recovery for banks. For instance, in the case of Zion Steel Ltd, banks will recover ₹15 crore of the outstanding debt of ₹5,367 crore.

Since finance minister Nirmala Sitharaman announced that there will be no fresh cases in the IBC for the next one year, bankers have been worried about drop in resolutions. Mint reported on 18 May that lenders are concerned over deteriorating asset quality post covid-19 and also hamstrung with regard to resolution in the absence of IBC.

👉 You may send me any queries related to: [email protected].

IP CA. RAJNISH BANSAL
B.Com, FCA, DISA, CISA, I.P.
INSOLVENCY PROFESSIONAL
FORENSIC AUDITOR &
SYSTEM AUDITOR
M. 9999925301, 9899400108
E: [email protected]
Add: B-4/281-282,
Sector-7, Rohini
New Delhi- 110085
Date – 21/05/2020

20/05/2020

Update from NCLT/IBC Cases
by INSOLVENCY PROFESSIONAL RAJNISH BANSAL

👉 The special bench of the National Company Law Tribunal (NCLT) Mumbai to hear the scheme matters including mergers, demergers and amalgamation of companies have disposed of majority of the cases through virtual hearings.

Speedy disposal of such scheme matters will help restructure companies for better efficiencies during the ongoing slowdown period.

When the special bench had commenced hearing, about 350 cases were pending out of which over 200 have been disposed of already, and by the June end, all the pending cases are expected to disposed of, lawyers and consultants appearing in such matters, said.

“There is clearly a silver lining in the whole situation and with the deferral in the IBC triggers for the next one year, scheme and company matters will get heard and tribunals should pass orders expediently. It would be a good time to push internal reorganisations,” said Girish Vanvari, founder of a boutique advisory firm Transaction Square. “We have seen tribunal passing an order in about a dozen matters in last one month.”

Typically, NCLT takes up three kinds of cases, IBC matters, scheme matters for merger and amalgamation and also company cases that involve oppression and mismanagement.

According to Hemant Sethi, an advocate practising company matters at NCLT as well as the Bombay High Court, virtual courts have come to the rescue of various corporates in the time of global Pandemic. He has represented companies including Tata chemicals, Godrej industries, Lodha developers and De Beers India for various scheme matters.

👉 On February 03, 2020, Ministry of Corporate Affairs ("MCA") notified Section 230(11) and (12) of Companies Act, 2013 ("NotifiedProvisions"). The said notification has opened another door for majority shareholders to acquire the shares held by minority shareholders. Section 230 deals with scheme of compromise or arrangement between a company and its creditors or members. Such scheme may include a takeover offer by a member of the company under Section 230(11) while under Section 230(12) an aggrieved party can report its grievance to such offer before the tribunal i.e. NCLT. MCA also released Companies (Compromises, Arrangements and Amalgamations) Amendment Rules, 2020 ("AmendmentRules") (Notified Provisions and Amendment Rules shall be together read as "Takeover Regulation") and National Company Law Tribunal (Amendment) Rules, 2020 ("NCLT Amendment Rules") dealing with the procedural aspects of Notified Provisions. Currently majority shareholders take the route of Section 66 and Section 236 of Companies Act, 2013 ("Act") to squeeze out the minority shareholders. So let's discuss the Takeover Regulation in pari passu with the existing framework of squeezing out.

Takeover Regulation

Section 230(11) and Amendment Rules:

The minimum threshold for making takeover application by a member of the company is holding minimum 3/4th or 75% 'shares' of the company either alone jointly with other members. Here the definition of 'shares' include equity shares and other securities carrying any voting rights such as depository receipts.

A report of the registered valuer detailing the valuation of the shares shall be attached with the above application. The valuation must have been determined after taking into account the following factors:

the highest price paid for acquisition of shares in preceding 12 months;

Return on net worth;

Book values of shares;

Earning per share;

Price earning multiple vis-à-vis the industry average;

Such other factors customary in valuation of shares.

The takeover application shall also contain the details of a bank account which is to be opened separately and half of total consideration of the takeover offer shall be deposited in such account.

Transfer or transmissions of shares through any contract, arrangement and succession or in pursuance of any statutory or regulatory requirement are exempted here.

In case of takeover of listed companies provisions of SEBI (Substantial Acquisition of Shares and Takeovers) Regulations, 2011 shall be applicable.

👉 You may send me any queries related to: [email protected].

IP CA. RAJNISH BANSAL
B.Com, FCA, DISA, CISA, I.P.
INSOLVENCY PROFESSIONAL
FORENSIC AUDITOR &
SYSTEM AUDITOR
M. 9999925301, 9899400108
E: [email protected]
Add: B-4/281-282,
Sector-7, Rohini
New Delhi- 110085
Date – 20/05/2020

19/05/2020

Update from NCLT/IBC Cases
by INSOLVENCY PROFESSIONAL RAJNISH BANSAL

👉 The Hon'ble Prime Minister of India on April 14, 2020 announced the extension of the lockdown till May 03, 2020 in view of containing the COVID 19 infection. Pursuant to the extension, the functioning of the courts have been further suspended. In view of the extension of the nationwide lockdown, the National Company Law Tribunal (hereinafter referred to as 'NCLT') has decided to maintain the status quo as it has decided to continue hearing only unavoidable urgent matters1.

The NCLT had issued a notice on March 22, 2020 whereby it had suspended its judicial work and notified that it would hear only unavoidable urgent matters. Through its notice dated April 14, 2020, the NCLT has now extended the applicability of the earlier notice till May 03, 2020 and has reinstated the points of consideration of the earlier notice.

The notice dated March 22, 2020 had instructed adherence to the following:

All NCLT benches shall remain closed from March 23, 2020 to March 31, 2020 for the purpose of judicial work, and only unavoidable urgent matters shall be heard on application by the aggrieved, through email to the registry NCLT Chennai after service of notice to the other side.

Parties/counsels were abstained from making oral submissions. The NCLT further discouraged persons arriving to NCLT Chennai. The verification had to be carried out through an affidavit.

As regard to the IBC-2016 matters, extension of time, approval of resolution plan and liquidation will not be construed as urgent matters. These matters will be taken up as soon as regular benches start functioning, until such time such application not to be filed.

The notice dated April 14, 2020 further added on the functioning of NCLT during Lockdown. It stated that the President, in addition to the earlier notices, will take further steps depending upon the exigencies of the litigant public and the same will be announced as and when any further decision is taken.

The above notification has arrived on time and has avoided any unforeseen situation or confusion that might have potentially arisen due to non-issuance of the notice. It has further reiterated upon the clarity for urgent matter and their qualification, removing all concerns in this regard whatsoever.

👉 New Delhi, May 18 (IANS) The Delhi Gymkhana Club has told the National Company Law Tribunal (NCLT) it has been facing harassment after it resisted pressure to give membership to a former high ranking member of the Ministry of Corporate Affairs (MCA).

The NCLT on April 24, issued notices to Delhi Gymkhana Club and its general committee (GC) managing its affairs, on a petition by MCA seeking management control of the facility. In its reply before the NCLT, through advocate Gaurav Liberhan, the club said "Insofar as the complaint of Navrang Saini is concerned, it arises out of the Club having resisted pressure to give him membership. The club verily believes that since Saini was a high-ranking member in the MCA, the harassment that the club has been facing from the Department of Corporate Affairs harps back to that episode."

Saini served as a member of the Indian Corporate Law Service (ICLS). He has served the Ministry of Corporate Affairs in various capacities. His last assignment was Director General, Ministry of Corporate Affairs. Saini is currently a Whole Time Member, Insolvency and Bankruptcy Board of India.

The club said that Saini along with other applicants named in the petition had paid the initial principal amount of Rs 10,000. "Their grievance is limited towards the revision of registration fee and not the imposition or the power to impose a registration fee. Needless to say these are facile arguments raised by disgruntled applicants," the club argued in its plea.

The Centre, through an urgent petition moved by MCA, had alleged "fraudulent and rampant mismanagement" by the general committee of the club, besides others, and sought to take over the management control under section 241 and 242 of the Companies Act, 2003. The club has refuted MCA''s allegations that the club''s affairs are being mismanaged by the former''s general committee.

👉 You may send me any queries related to: [email protected].

IP CA. RAJNISH BANSAL
B.Com, FCA, DISA, CISA, I.P.
INSOLVENCY PROFESSIONAL
FORENSIC AUDITOR &
SYSTEM AUDITOR
M. 9999925301, 9899400108
E: [email protected]
Add: B-4/281-282,
Sector-7, Rohini
New Delhi- 110085
Date – 19/05/2020

18/05/2020

Update from NCLT/IBC Cases by INSOLVENCY PROFESSIONAL RAJNISH BANSAL

👉 In a big relief to cash-starved firms, the government on Sunday said insolvency proceedings against fresh defaulters would remain suspended for up to one year and Covid-19-related debt would be excluded from the definition of default. The breather, however, will potentially hit financial and operational creditors hard and bleed their balance sheet, apart from temporarily depriving them of a credible mode of bad debt resolution. Lenders may be forced to seek regulatory forbearance on provisioning and capital requirements.

Initially, proceedings under the Insolvency and Bankruptcy Code (IBC) can’t be invoked for six months, which can then be extended by another six months, depending on the pandemic situation. There will be a special insolvency framework under section 240-A of the IBC. Already, in a bid to insulate small businesses from being dragged to the NCLT, the default threshold for triggering insolvency has recently been raised to Rs 1 crore from just Rs 1 lakh earlier.

Finance minister Nirmala Sitharaman said an ordinance will be promulgated soon to implement the proposed changes. However, proceedings in the cases already admitted will remain unaffected by the latest move. Data available with the IBBI show, proceedings in 1,961 cases were going on as of December 2019.

Despite risks of a sharp deterioration in credit quality of banks and cash flows of operational creditors due to the suspension of IBC initiation, many experts believe that given the unprecedented crisis, the existence of companies must take precedence over the resolution of stressed assets.

The suspension on fresh initiation of insolvency proceedings for one year is likely to increase provisioning for banks. “The advantage we were getting to refer a case to the National Company Law Tribunal (NCLT) was reversal of additional provisioning, now that option will not be there,” an MD & CEO of a bank who did not wish to be named told FE. According to the June 7, 2019, circular of the Reserve Bank of India (RBI), banks can reverse 20% provisioning for unresolved cases, after referring a case to the NCLT.

👉 Group Insolvency is a process in which claims against debtors of the same group are consolidated in a single resolution application to adjudicate upon by the Adjudicating Authorities ("hereinafter referred as AA"). It was difficult for the AAs across the country to adjudicate upon such resolution requests by the creditors due to the lack of provisions in Insolvency and Bankruptcy Code ("hereinafter referred as IBC"). The Companies Act 2013 itself provides for separate legal entity and preparation of consolidated financial statements of associate and subsidiary companies in the same form. The rule of 'separate legal entity' requires modifications owing to the increase in formation of Corporate Groups in Indian markets. The author in this article analyses the concept of Group Insolvency in brief in the light of judgments and the recommendations put forth by the Working Group formed by the Insolvency Bankruptcy Board of India.

United States Bankruptcy Laws, Bankruptcy Courts have consolidated proceedings along with assets and liabilities of the Debtors on the basis of criteria for substantive consolidation viz.

The degree of difficulty in segregating and ascertaining individual assets and liabilities;

presence or absence of consolidated financial statements;

the profitability of consolidation at a single physical location;

the commingling of assets and business functions;

the unity of interests and ownership between the various corporate entities;

The existence of parent and inter corporate guarantees on loans; and g. the transfer of assets of without formal observance of corporate formalities.

👉 You may send me any queries related to: [email protected].

IP CA. RAJNISH BANSAL
B.Com, FCA, DISA, CISA, I.P.
INSOLVENCY PROFESSIONAL
FORENSIC AUDITOR &
SYSTEM AUDITOR
M. 9999925301, 9899400108
E: [email protected]
Add: B-4/281-282,
Sector-7, Rohini
New Delhi- 110085
Date – 18/05/2020

17/05/2020

Update from NCLT/IBC Cases by INSOLVENCY PROFESSIONAL RAJNISH BANSAL

👉 The National Company Law Tribunal (NCLT), Bengaluru, has ordered the winding up of Super Royal Holidays India Pvt. Ltd., Bengaluru, by declaring that the incorporation and conduct of business of the company was for “fraudulent objects” of ponzi scheme in the guise of offering holiday tour packages by collecting membership fees.

The Ministry of Corporate Affairs (MCA) sought the winding up of the company following the outcome of an investigation carried out after noticing that the company had deposited and withdrawn around ₹10 crore during the period of demonetisation in 2016.

“On perusing the financial statements of the company, it is clear that the money they collected by way of membership fees etc. was largely being pocketed by agents and director-cum-shareholders by way of commission, awards, dividends for directors, etc., leaving paltry remains for the so-called service [tour packages] for their members. Therefore, it is established that the company is running a ponzi scheme, as rightly contended by the MCA,” the tribunal held.

The tribunal also said that the company was “established exclusively for the benefit of the three promoters-cum-directors-cum-shareholders and their agents” and hardly any service was provided to most its customers.

The company enrolled members by collecting ₹11,000 for single membership, ₹22,000 for triple membership, and ₹33,000 for family membership. This life membership fee carried an offer of free tour packages for two nights/three days, to be availed within the next three years by paying a package cost ranging ₹375 to ₹4,800, depending upon location. The company claimed that it had around two lakh members, but could not produce the complete membership details before the authorities.

👉 Established under Sec 410 of Companies Act, NCLAT hears appeals against the orders of benches of NCLTs across the country under IBC and Companies Act as well as appealable orders of CCI. Till recently NCLAT had only one Bench at New Delhi. However, in a welcome move, vide notification dated 13 March 2020, Central Government announced that a bench has been constituted at Chennai which shall entertain appeals against orders passed by benches of NCLT in Andhra Pradesh, Telangana, Karnataka, Kerala, Tamil Nadu, Puducherry and Lakshwadeep. Therefore, NCLAT now has two benches ~ the Principal Bench at New Delhi and the Chennai Bench which shall be functional from 18 March 2020 but shall operate from New Delhi for some time.

The setting up of the Chennai Bench undoubtedly after the verdict of the Apex Court in WP (Civil) No 99 of 2018 - Swiss Ribbons Private Ltd Vs Union of India on 25 Jan 2019 is a positive step forward in ensuring that NCLAT is considered an "efficacious" remedy. However, there shall still be exceptions where High Courts have stepped in and may continue to step in what is the ambit of NCLAT.

This critique therefore is an attempt to analyse the setting up of Chennai Bench of NCLAT on the basis of the verdict of the Apex Court in Swiss Ribbons supra, established principles whereby High Courts can step in even when a forum for statutory appeal has been provided for in exceptional cases, and some case laws where High Courts have intervened and can continue to intervene. It is in the interests of the entire fraternity of IPs that NCLAT which has delivered some landmark judgments involving substantial questions of law becomes stronger by the day and intervention of High Courts under Article 226 and 227 would be a rare exception rather than the rule. There is no denying the fact that had it not been for NCLAT, matters which are now being adjudicated in a couple of months would have taken a year or more in cases that land in High Courts. Lex dilationes semper exhorret. The other justification for NCLAT is that with the perpetual shortage of judges which plagues the entire Indian justice delivery system, NCLAT is a necessity and not a luxury for India.

👉 You may send me any queries related to: [email protected].

IP CA. RAJNISH BANSAL
B.Com, FCA, DISA, CISA, I.P.
INSOLVENCY PROFESSIONAL
FORENSIC AUDITOR &
SYSTEM AUDITOR
M. 9999925301, 9899400108
E: [email protected]
Add: B-4/281-282,
Sector-7, Rohini
New Delhi- 110085
Date – 17/05/2020

16/05/2020

Update from NCLT/IBC Cases
by INSOLVENCY PROFESSIONAL RAJNISH BANSAL

👉 Jaiprakash Associates (JAL), the parent firm of Jaypee Infratech (JIL), has moved the National Company Law Appellate Tribunal (NCLAT) challenging the March 3 order of the National Company Law Tribunal (NCLT), which made the Rs 750 crore it deposited with the registry of the Supreme Court a part of the approved bidder NBCC’s resolution plan for JIL.

NBCC had, in its resolution plan, said that it might withdraw its resolution plan in case the amount, along with interest, was not made available with it. The NCLT approved state-run NBCC’s resolution plan for JIL on March 3, 2020. Directed by the Supreme Court, JAL had deposited the fund towards refund of homebuyers’ money. The apex court had on August 9, 2018 directed the NCLT to decide on the fund.

“Promoters of JIL have challenged the NCLT order, arguing that the money should not be given to NBCC,” said advocate Bishwajit Dubey, who appeared on behalf of lead banker IDBI in the NCLAT on Friday.

Advocate Sumant Batra, who appeared on behalf of the resolution professional, said that the NCLT was asked by the Supreme Court to decide on the fund deposited with the apex court’s registry by the JIL’s promoters.

Batra said the two-member NCLAT bench, headed by its acting chairperson justice Bansi Lal Bhat, has directed IDBI, IRP, NBCC and others to file their responses on the JIL’s promoters’ plea within two weeks and posted the matter for further hearing on June 19.

👉 Sumant Batra, counsel for Interim Resolution Professional (IRP) for Jaypee Infratechon Friday informed the National Company Law Appellate Tribunal (NCLAT) that the Interim Monitoring Committee in terms of order dated April 22, 2020 has been constituted.

The IRP wil file a status report with regard to implementation of the approved resolution plan soon.

The NCLAT on Friday accepted plea Jaiprakash Associates and issued notices to NBCC India, ICICI Bank, IDBI Bank and home buyers association. They have to file their reply affidavits within two weeks. Rejoinders, if any be filed within one week thereof.

In NBCC India appeal, NCLAT directed registry to issue fresh notices. NBCC had appealed against the order of National Company Law Tribunal (NCLT) on March 20, 2020 because of the modifications made by the adjudicating authority in the ‘Resolution Plan’ submitted by it and as approved by the committee of creditors to the extent it allows objections of ICICI Bank and Yamuna Expressway Industrial Development Authority (YEIDA) and directs payment to unclaimed Fixed Deposit Holders.

"Home buyers should be happy as no stay has been granted by the court and order passed by NCLT is in force and NBCC has to work accordingly," said Ashwarya Sinha, an advocate representing home buyers.

The company in its appeal had said that the adjudicating authority could not intercede the business decision of the committee of creditors taken by the prescribed voting shares and it exceeded its jurisdiction in making such modifications.

👉 You may send me any queries related to: [email protected].

IP CA. RAJNISH BANSAL
B.Com, FCA, DISA, CISA, I.P.
INSOLVENCY PROFESSIONAL
FORENSIC AUDITOR &
SYSTEM AUDITOR
M. 9999925301, 9899400108
E: [email protected]
Add: B-4/281-282,
Sector-7, Rohini
New Delhi- 110085
Date – 16/05/2020