[Dheeresh Kumar Dwivedi is a lawyer at APJ SLG Law Offices New Delhi] The Companies Act, 2013 (“Act of 2013”) was passed with the object of consolidating and amending the law of corporations in India. Before the passage of the Act, the winding-up of a corporate debtor on the ground of ‘inability to pay debts’ was governed by the provisions of sections 433(e) and 434 of Companies Act, 1956 (“Act...
The Insolvency and Bankruptcy Code: Moratorium and Personal Guarantors
[Aayush Mitruka is a lawyer based in Delhi] The latest ruling of the National Company Law Appellate Tribunal (Appellate Tribunal) in the case of State Bank of India (SBI) v V Ramakrishnan and another has evoked another controversy touching upon the Insolvency and Bankruptcy Code, 2016 (Code) that serves as a major setback to creditors. The moot question was whether a financial creditor can...
Winding-up and Liquidation: Demarcation by the Bombay High Court
[Shubham Sancheti and Prashamsha Tulachan are 4th Year B.A., LL.B. (Hons.) studentsat NALSAR University of Law, Hyderabad] The Insolvency and Bankruptcy Code, 2016 [“Code”] entailed various interpretation lacunae and, the Central Government is constantly seeking to bridge the emerging gaps. One of such lacuna pertained to the conflict between “Winding-up” under the Companies Act [“1956 Act” or...
The Liquidation Value- ‘Erstwhile’ Benchmark for Prospective Investors
[Rohit Sharma is a Company Secretary in Kolkata, and can be reached at [email protected]] Introduction In accordance with the provisions of the Insolvency and Bankruptcy Code, 2016 (‘Code’), the interim resolution professional was required to appoint two registered valuers for the valuation of the assets of the corporate debtor. The registered valuers were appointed for the valuation of...
Assignment of Debts under the Insolvency and Bankruptcy Code
[Aayush Mitruka is a lawyer based in Delhi] Synergies Dooray Automotive, the first corporate entity to be resolved under the new Insolvency and Bankruptcy Code (Code) posed a few very interesting questions and highlighted some grey areas in Code. In the present post I intend to discuss one important issue that came up in the context of assignment of debts. To put things in perspective, the Code...
Latecomers in Liquidation – Entitlements and Penalties
[Sikha Bansal is an Associate at Vinod Kothari & Company and can be reached at [email protected]] The Insolvency and Bankruptcy Code (the “Code”) provides for corporate insolvency resolution in respect of corporate debtors, and then liquidation where the insolvency proceedings fail. In case of liquidation of insolvent entities, the competing stakeholders stake their claims on...
The “May” and “Shall” Conundrum under the Insolvency and Bankruptcy Code
[Aayush Mitruka is a lawyer based in Delhi] The enactment of the Insolvency and Bankruptcy Code, 2016 (Code) was one of the most significant legal reforms in India in the recent past, aimed at solving the burgeoning problem of non-performing assets and bringing the insolvency law in tune with global standards. The Code incorporated recommendations made by various committees and went through a...
Interpretation of Essential Goods and Services under the Insolvency and Bankruptcy Code 2016
[Archis Choudhary is a 4th year B.A., LL.B. (Hons.) student at Hidayatullah National Law University in Raipur] Section 14(2) of the Insolvency and Bankruptcy Code 2016 (Code) restricts the termination of supply of essential goods or services to the corporate debtor during moratorium period. In the case of Innoventive Industries Limited v. ICICI Bank Limited (2017), the Supreme Court observed that...
Disclosures by Professionals under the Insolvency and Bankruptcy Code
[Himanshu Mene is an L.L.M Candidate (Specialization in Corporate Law) at Maharashtra National Law University, Nagpur] Introduction In the interest of transparency, Insolvency and Bankruptcy Board of India (“IBBI”) by way of a notification dated January 16, 2018 has issued a circular mandating that Insolvency Professionals (IPs) and all other professionals that are appointed by the IPs for the...
Abstention in a Committee of Creditors: Whether Counted for Voting
[Nitu Poddar is a Senior Associate at Vinod Kothari and Company, and can be reached at [email protected]] This post deals with the question whether, in determination of the assent at a Committee of Creditors (“CoC”) in corporate insolvency resolution proceedings, the votes of such creditors who (a) do not vote at all, at an electronic voting; or (b) abstain from voting at the meeting...
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