Pre-pack under the IBC: an option for MSME Corporates to resolve its financial distress without losing control

India has made drastic change on the way insolvency is resolved for corporate entity with limited liabilities with the enactment of much coveted Insolvency and Bankruptcy Code, 2016 (the IBC). And recently it has witnessed the 6th amendment to the IBC. This shows that while the IBC is in the making (work in progress), what is heartening … Continue reading Pre-pack under the IBC: an option for MSME Corporates to resolve its financial distress without losing control

Asset held in trust not subject to the moratorium u/s.14 of the IBC

Asset held in trust not subject to the moratorium u/s.14 of the IBC. Sun Pharmaceutical Industries Ltd. filed application before NCLT, Chandigarh bench seeking its direction to allow it to lift its stock of raw materials of approx. Rs.14 crore in possession of the Parabolic Drugs Ltd (Corporate Debtor). The Corporate Debtor was undergoing the … Continue reading Asset held in trust not subject to the moratorium u/s.14 of the IBC

Supreme Court holds that the RBI Circular of 12 Feb 2018 not valid

Hon’ble Supreme Court, in Dharani Sugars and Chemicals Ltd v Union of India and Others, on 02 April 2019 held the constitutional validity of Ss. 35AA and 35AB of the Banking Regulations Act, 1949 (the Banking Regulation Act) and also held that the RBI circular of 12.02.2018 directing banking and non-banking companies to initiate action … Continue reading Supreme Court holds that the RBI Circular of 12 Feb 2018 not valid

Sec.138 of NI Act is not hit by Section 14 of I&B Code

This post is about the judgement of Hon’ble National Company Law Appellate Tribunal (NLCAT) in  Shah Brothers Ispat Pvt. Ltd v. P. Mohanraj & Ors. (Order dt.31.7.2018). The order is under challenge before Hon’ble Supreme Court. It may be recalled that upon the admission of matter for corporate insolvency resolution process (u/Ss. 7 or 9 … Continue reading Sec.138 of NI Act is not hit by Section 14 of I&B Code

The constitutional validity of the IBC upheld by the Apex Court

Sharing a summary of a landmark Judgement of Hon'ble Supreme Court (dated 25.1.2019) in Swiss Ribbons Pvt Ltd & Anr. vs. Union of India & Ors. The Constitutional validity of the Insolvency and Bankruptcy Code, 2016 (the Code or the IBC) was challenged by 10 writ petitions and an SLP. All these are disposed of … Continue reading The constitutional validity of the IBC upheld by the Apex Court

NCLAT triggers insolvency against an unincorporated Joint Venture IBC

On 30 Nov 2018, the NCLAT has held that insolvency can be triggered against an unincorporated joint venture between two companies. Effectively, insolvency will be triggered against both companies. It is a landmark judgement in several aspects. The most important aspect is that it gives relief to property buyers, where under the grab of tri-patry … Continue reading NCLAT triggers insolvency against an unincorporated Joint Venture IBC

Provident fund, Pension fund and Gratuity to have priority over waterfall u/s.53 of IBC

NCLT, Mumbai in the matter of Precision Fasteners Ltd vs. Employees Provident Fund Organisation, Thane, Vapi and Vashi Decision dated 12 Sept. 2018 M.A. 576 & 752 of 2018 in C.P. (IB) 1339 (MB) of 2017 Hon’ble NCLT holds that workmen’s due under the provident fund, pension fund and gratuity fund, even though remained unpaid … Continue reading Provident fund, Pension fund and Gratuity to have priority over waterfall u/s.53 of IBC

Proceedings pending u/s.34 of Arbitration Act whether constitute ‘dispute’ u/s.5(6) of IBC?

Facts in brief: M/s Vijay Nirman Company Private Limited, being an operational creditor, had initiated the Corporate Insolvency Resolution Process against corporate debtor viz. M/s Ksheeraabad Constructions Private Limited by way of an application under Section 9 of the Insolvency and Bankruptcy Code, 2016 (hereinafter referred to as “the Code”). The National Company Law Tribunal … Continue reading Proceedings pending u/s.34 of Arbitration Act whether constitute ‘dispute’ u/s.5(6) of IBC?

No approval of members for resolution plan under IBC – clarification by MCA

Insolvency and Bankruptcy Code, 2016 (the Code) Consent of members of Corporate Debtor not required for approval of the resolution plan or for its implementation. It is clarified by the Ministry of Corporate Affairs (MCA) on 25th October 2017 (vide General Circular No. IBC/01/2017) that once the resolution plan is approved by the Adjudicating Authority i.e. National Company Law Tribunal (NCLT), no further approval of the resolution plan … Continue reading No approval of members for resolution plan under IBC – clarification by MCA