TagInsolvency

Priority and Value of Security Interest Cannot be a Ground for Challenge of Resolution Plan

[Anugya Mukati and Kirti Dhoke are undergraduate students at the National Law Institute University, Bhopal] The Supreme Court of India in a recent judgment in the matter of India Resurgence Arc Private Limited v. Amit Metaliks Limited, held that a Resolution Plan that has been approved under the Insolvency and Bankruptcy Code ( “the Code”) cannot be challenged by a dissenting financial creditor...

Judicial Misinterpretation of Scope of Sanctions in Scheme of Arrangement

[Vasu Aggarwal is a student at National Law School of India University. He is grateful to Prof. Rahul Singh for inspiring him to write on this topic, and thankful to Prof. Rahul Singh and Prof. Umakanth Varottil for their comments on the earlier drafts of this post] This post argues that courts have misinterpreted the scope of ex-ante sanction requirement for compromise and arrangement due to the...

Terminating Contracts with the Corporate Debtor during CIRP: Revisiting the Position

[Vaishali Movva is an associate at a law firm and a practicing advocate in Bengaluru] The provisions of the Insolvency and Bankruptcy Code 2018 (‘IBC’) and the regulations thereunder mandate that a moratorium be imposed on the assets of the corporate debtor during the corporate insolvency resolution process (‘CIRP’). While the moratorium does not explicitly prohibit a third party from terminating...

Supreme Court on Applicability of IBC Moratorium to Cheque Bounce Cases

[Jai Anant Dehadrai is an Advocate based in New Delhi and Arnav Sinha is an Associate at Dehadrai and Company, New Delhi] The Supreme Court in its recent and landmark decision of P. Mohanraj v.  Shah Brothers Ispat Pvt. Ltd., has put to rest the debate as to whether criminal proceedings under section 138 and section 141 of the Negotiable Instruments Act, 1881 (“NI Act”) would be stayed in...

Call for Contributions: Contemporary Issues on the Laws of Insolvency and Bankruptcy

[Announcement on behalf of the Centre for Corporate Law, National University Odisha] Centre for Corporate Law, National Law University Odisha (hereinafter “CCL, NLUO”) proposes to come up with an edited volume with a multi-disciplinary approach on the “Contemporary issues on the laws of Insolvency and Bankruptcy”. Objective The Insolvency and Bankruptcy (hereinafter “I&B”) Code was enacted...

Section 29A and the Changing Landscape: The DHFL Saga

[Nikunj Maheshwari is a 4th year law student at the Institute of Law, Nirma University] The National Company Law Tribunal (NCLT), Mumbai Bench has recently provided a new twist to already labrynthine insolvency proceedings of the DHFL Group. The NCLT ordered the Committee of Creditors (CoC) to consider the resolution plan submitted by Mr. Kapil Wadhawan, who is the promoter and erstwhile director...

Insolvency and Personal Guarantors: Lalit Kumar v. Union of India

[Priyanka Pillai is an associate at IC Universal Legal, Mumbai] The protracted saga of the treatment of personal guarantors under the Insolvency and Bankruptcy Code, 2016 (the “Code”) seems to have been finally put to rest by the Supreme Court by way of its judgment in Lalit Kumar Jain v. Union of India. The inception of this tale was the notification issued by the Ministry of Corporate Affairs...

Initiation of CIRP against a Company in Liquidation: How Early is too Early?

[Subodh Asthana and Madhur Bhatt are 3rd year B.A., LL.B. (Hons.) students at Hidayatullah National Law University, Raipur.] Section 279 of the Companies Act 2013 [“Act”] envisages that no legal proceedings shall be admitted if the winding up petition of a company has been accepted by the court or the liquidation proceedings have begun. The article seeks to clarify whether an application to...

IBC vis-à-vis PMLA: Does Section 32A Resolve the Question of Primacy?

[Manisha Arora is a 3rd year B.A., LL.B. (Hons.) student at Damodaram Sanjivayya National Law University, Visakhapatnam] The absence of definitive jurisprudence on the interplay of the Insolvency and Bankruptcy Code, 2016 (“IBC”) and the Prevention of Money Laundering Act, 2002 (“PMLA”) has resulted in the uncertainty in their enforcement. While the IBC ensures the management of operations of a...

“Clean Slate Theory” under the Insolvency & Bankruptcy Code: An Analysis

[Aditya Saraswat is a 5th year student at National Law University, Jodhpur] One of the foremost objectives of the Insolvency and Bankruptcy Code, 2016 (the “Code”) is to ensure timely resolution and revival of corporate debtors. For this purpose, various resolution plans are invited and deliberated upon before a final plan is selected. However, what if certain liabilities are imposed by the...

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