[Vishal Hablani is a 4th year B.A.L.L.B. (Hons.) student at WBNUJS, Kolkata] Recently a judgment was passed by the Supreme Court in JK Jute Mill Mazdoor Morch v. Juggilal Kamlapat Jute Mills Company Ltd., wherein it was observed that a trade union could file an application in the capacity of an operational creditor, on behalf of workmen, for initiating the corporate insolvency resolution process...
Jurisdiction of Adjudicating Authorities over the Rejection of a Resolution Plan
[Piyush Rathi is a 4th year B.A. L.L.B student at NALSAR University of Law] Earlier this year in K. Sashidar v Indian Overseas Bank, the Supreme Court held that the adjudicating authorities, i.e., the National Company Law Tribunal (NCLT) and the National Company Law Appellate Tribunal (NCLAT) have no jurisdiction or authority to analyse or evaluate the commercial decision of the Committee of...
The CoC Stalemate: Issue of Voting Thresholds and the Way Forward
[Shubham Kumar is a student from Hidayatullah National Law University, Raipur Ayushi Tiwari from Dr. Ram Manohar Lohia National Law University, Lucknow. Both are in their 3rd year B.A. LL.B.] The preamble of the Insolvency and Bankruptcy Code, 2016 (IBC) states that the objective of the IBC is to promote resolution over liquidation. Keeping the said objective in mind, the interpretation of...
Concerns on Going Concern: Proposed Amendments to Liquidation Regulations Need a Relook
[Vinod Kothari is an insolvency practitioner at Vinod Kothari & Co and can be reached at [email protected]] The possibility of going concern sales in liquidations, visualised by adjudicating authorities in several early cases, received regulatory recognition by way of the Insolvency and Bankruptcy Board of India (IBBI) (Liquidation Process) (Second Amendment) Regulations, 2018...
The Frustrated Resolution Applicant
[Aayush Mitruka is a lawyer based in Delhi and can be reached at [email protected]] The Insolvency and Bankruptcy Code, 2016 has replaced the erstwhile debtor friendly model where the defaulting debtors could secure moratoriums, retain control and yet write off loans with the ‘debtor-in-possession’ model. The new creditor driven process has instilled fear amongst delinquent borrowers...
Schemes of Arrangement in Liquidation: A New Ray of Hope?
[Vinod Kothari is an insolvency practitioner at Vinod Kothari & Co and can be reached at [email protected]. An earlier post on the topic is available here.] The recent rulings of appellate judicial and quasi-judicial authorities in India permitting the pursuit of schemes of arrangement even after initiation of liquidation proceedings may have sounded surprising to many. However...
The Resurgence of Schemes of Arrangement in Insolvency and Liquidation
Schemes of arrangement have historically been available under Indian company law as a means to carry out corporate debt restructuring. However, as I have found in this paper, schemes were hardly used for this purpose in India. The enactment of the Insolvency and Bankruptcy Code, 2016 (IBC) and the implementation of the corporate insolvency resolution process (CIRP) therein were expected to...
Supreme Court on the Relationship between Insolvency and Winding-up Proceedings
[Akhil Kumar is a Fourth Year BA LLB (Hons.) student and Ayushi Singh a Third Year BA LLB (Hons.) student at NUALS, Kochi] The Insolvency and Bankruptcy Code, 2016 has amended several provisions of the Companies Act, 2013 through the eleventh schedule of the Code. This has, on a few occasions, led to several uncertainties regarding the application of the amended provisions to various company...
Treatment of Employment Benefits under the Insolvency and Bankruptcy Code, 2016
[Medha Rao is an Advocate based in Bengaluru] Following the reasoning of the National Company Law Tribunal (NCLT), Mumbai in Asset Reconstruction Company (India) Limited v. Precision Fasteners Ltd. [‘Precision’], the NCLT, Delhi in Alchemist Asset Reconstruction Co. Ltd. v. Moser Baer India Limited [‘Alchemist’] has also held that the dues owed to workmen from provident fund, gratuity fund, and...
Supreme Court on RBI’s Circular Relating to Insolvency: A Critical Analysis
[Rishabh Sant Tiwari is a 5th year B.A. LL.B. (Business Law Honours) student at National Law University, Jodhpur, India] The 12 February 2018 circular of the Reserve Bank of India (RBI) was assailed as ultra vires the powers given to it under the Banking Regulation Act, 1949 and the Reserve Bank of India Act, 1934 in Dharani Sugars and Chemicals Ltd. v. Union of India. The Challenge Curious Case...
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