A recent judgment by the Hon’ble National Company Law Appellate Tribunal (NCLAT) has once again brought to light one of the many vulnerabilities in the Insolvency and Bankruptcy Code, 2016 (IBC/Code). The judgment primarily deals with the termination of a lease during the Corporate Insolvency Resolution Process (CIRP) and the effect of the moratorium under Section 14 of the IBC on leasehold properties.

Introduction-

In a landmark judgment in Re Compuage Infocom Ltd and Anr., the Singapore High Court (“Singapore HC”) has, for the very first time, recognised a Corporate Insolvency Resolution Process (“CIRP”) initiated under the Indian Insolvency and Bankruptcy Code, 2016 (“IBC”) as a ‘foreign main proceeding’ under the UNCITRAL Model Law on Cross-Border Insolvency (“Model Law”).

Case Title: Ganesh Ramkisan Rajale v. Panchtatwa Milk Industries Private Limited

Facts of the Case

Case:Bahadur Ram Mallah (Ex-Director, Uniworth Textiles Limited) Versus Assets Reconstruction Company (India) Limited and Anr

Facts of the Case

ICICI Bank and IFCI Ltd. had sanctioned loan facilities to Uniworth Textiles Ltd. (“UTL”), a company part of the larger Uniworth Group. These loan accounts eventually turned non-performing, and both banks assigned their respective debts to the Asset Reconstruction Company (India) Ltd. (“ARC”) — ICICI's on 31.03.2004 and IFCI’s on 12.01.2007.

Case:Rahee Jhajharia E to E JV v. MB Power (Madhya Pradesh Ltd.)

The National Company Law Appellate Tribunal (NCLAT), New Delhi, has ruled that an application under Section 9 of the Insolvency and Bankruptcy Code, 2016 (IBC), cannot be admitted when there is no direct contractual relationship between the Operational Creditor and the Corporate Debtor. In this case the Tribunal dismissed the claim of ₹16.08 crore, holding that the invoices were raised by the Appellant against Hindustan Thermal and not to the Corporate Debtor itself.

Case: Armaco Infralinks Pvt. Ltd. Versus B. S. Ispat Pvt. Ltd.

Facts of the Case

Armaco Infralinks Pvt. Ltd. (Operational Creditor) advanced ₹17,53,00,000 to B. S. Ispat Pvt. Ltd. (Corporate Debtor) between April 2021 and September 14, 2022, for the supply of coal. However, the Corporate Debtor supplied coal worth only ₹8,45,34,053, leaving an outstanding amount of ₹9,07,65,947.

The Hon’ble Supreme Court of India (“Supreme Court”) by a 2:1 majority in Independent Sugar Corporation Limited v Girish Sriram Juneja and Ors1, has held that in case of resolution plans proposing a combination (i.e., a merger or amalgamation of the entities) of a corporate debtor, the Competition Commission of India (“CCI”) must first grant the necessary approval before such Resolution Plan is placed before the Committee of Creditors (“CoC”) for it

1. Introduction

Introduction