[Anjali Soni is a 2nd year student at National Law University, Odisha.] The Insolvency and Bankruptcy Code, 2016 (“IBC”) enumerates four types of vulnerable transactions, namely preferential, undervalued, fraudulent and extortionate and provides the procedure for the avoidance of the same. The resolution professional while facilitating the resolution of the corporate debtor, is dutybound to...
NCLAT on the Treatment of Power Purchase Agreements in Liquidation
[Apoorva Soni is a III year B.A. LL.B. (Hons.) student at National University of Study and Research in Law, Ranchi] The National Company Law Appellate Tribunal (“NCLAT”), by its decision in the matter of Gujarat Urja Vikas Nigam Ltd (GUVNL) v. Yes Bank Ltd dated October 20, 2020, held that a company could not terminate a Power Purchase Agreement (“PPA”) executed with a corporate debtor during...
Termination During Moratorium: An Alternative Perspective
[Kartik Adlakha is a 5th year B.B.A., LL.B. (Hons.) student at the Jindal Global Law School] On 24 June 2020, the National Company Law Appellate Tribunal (‘NCLAT’) in the case of Tata Consultancy Services Limited v. Vishal Ghisulal Jain(‘TCS Case’)upheld the National Company Law Tribunal (‘NCLT’) Mumbai bench’s order of stay on termination of a Facilities Agreement (‘Agreement’). This was because...
Dissolution without Liquidation: A Disguised Strike-off under the IBC?
[Megha Mittal is an Associate at Vinod Kothari & Co] In a first of its kind, the National Company Law Tribunal, Bengaluru Bench (‘NCLT’), by way ofits order dated 16 November 2020 in Synew Steel Private Limited, has ordered for direct dissolution from a corporate insolvency resolution process (‘CIRP’), thereby waiving the mandatory requirement to undergo the liquidation process. The said...
Creditors with Rejected Claims: Methods to Address Inadequacies under the IBC
[Anchit Jasuja and Preksha Mehndiratta are 3rd year law students at the Gujarat National Law University, Gandhinagar] The Insolvency and Bankruptcy Code, 2016 (‘IBC’) confers the resolution professional with the duty to collate and verify all claims submitted to him by the creditors. While the resolution professional does not formally have the power to reject claims, in practice the resolution...
The IBC’s Circle of Interpretation: Univalue Projects Pvt. Ltd. v. The Union of India
[Animesh Bordoloi is an Assistant Lecturer at the Jindal Global Law School and Hitoishi Sarkar is a III year student at the Gujarat National Law University. The authors would like to thank Mr. Rahul Sibal for his comments on the post] On August 18, 2020, a Single Judge of the Calcutta High Court in Univalue Projects Pvt. Ltd. v. The Union of India struck down an order passed by the Registrar of...
The Existential Crisis of a Decree-Holding Homebuyer under IBC
[Mayank Udhwani is a graduate of National Law University, Jodhpur] The decision of the National Company Law Appellate Tribunal (“NCLAT”) in Sushil Ansal v. Ashok Tripathi has become a cause for concern for the homebuyers. In this decision, the NCLAT has held that a homebuyer, who has obtained a decree in its favor from a court of competent jurisdiction, ceases to be a financial creditor. In this...
Why is Bilateral Netting Relevant?
[Lakshmi Babu is a corporate lawyer with an interest in financial regulation] The Central Government has recently notified the Bilateral Netting of Qualified Financial Contracts Act, 2020 (“Netting Act”), which intends to implement the process of bilateral netting among eligible financial parties. The Netting Act is effective from October 1, 2020. Netting, in essence, means the off-setting of all...
Demystifying the Air around Lease and Rental Operational Debt
[Aridaman Raghav is a 3rd year B.A. LL.B. (Hons.) student at National University of Study and Research in Law, Ranchi] The National Company Law Appellate Tribunal (‘NCLAT’) in Anup Dubey v. National Agricultural Co-operative Marketing Federation of India (NAFED) Ltd. & Ors.(7 October 2020) has held that lease rentals arising out of the use of a cold storage unit for commercial purpose can be...
An Argument in Favour of an Effectively Mandatory CCI Approval Under Section 31(4) of the IBC- Part II
[Mayank Udhwani and Ragini Agarwal have recently graduated from National Law University, Jodhpur. Part I in this series is available here] In this two-part series, the authors argue that the provision under section 31(4) of the IBC must not be watered down and that approval from the CCI must be obtained prior to the approval of the resolution plan by the adjudicating authority. In part-I, the...
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