Introduction:

A two-judge bench of the Supreme Court of India (“Supreme Court”) in its recent judgment Abhishek Singh v. Huhtamaki PPL Ltd.

Introduction

Facts:

Introduction

Introduction:

The Supreme Court (“SC”) in the recent judgment of K. Paramasivam v. The Karur Vysya Bank Ltd. & Anr.[1], held that a Corporate Insolvency Resolution Process (“CIRP”) can be initiated against a corporate guarantor, even if the principal borrower is not a ‘corporate person’.

Factual Matrix and Arguments:

The case of Uniworld Sugars Limited (the Corporate Debtor) has a long and chequered history which started before the Allahabad Bench of the NCLT and after doing a round before the NCLAT and the Supreme Court, has been finally decided by the Chandigarh Bench of NCLT vide an Order dated March 20, 2023.

Introduction

March, 2023 For Private Circulation - Educational & Informational Purpose Only A BRIEFING ON LEGAL MATTERS OF CURRENT INTEREST KEY HIGHLIGHTS ⁎ Delhi High Court: Arbitrator has no jurisdiction to set aside sale notice issued by secured creditor under Section 13(4) of the SARFAESI Act. ⁎ NCLAT: Majority shareholders of a company have the locus to challenge an admission of CIRP against the corporate debtor where the admission took place on account of collusion amongst the creditors. ⁎ NCLAT: The nature and character of financial debt does not change upon breach of consent terms.

There has always been a matter of contention for a Committee of Creditors, Resolution Professionals, legal fraternity during Corporate Resolution Insolvency Process (CIRP), whether the dues of the Government like Income-Tax, Sales Tax, Value Added Tax etc. are secured debt and whether the Government is a secured creditor.

The National Company Law Appellate Tribunal has answered this question in affirmative in its recent𝗷𝘂𝗱𝗴𝗲𝗺𝗲𝗻𝘁 𝗱𝗮𝘁𝗲𝗱 𝟳𝘁𝗵 𝗙𝗲𝗯., 𝟮𝟬𝟮𝟯 𝗶𝗻 𝗖𝗼𝗺𝗽𝗮𝗻𝘆 𝗔𝗽𝗽𝗲𝗮𝗹 (𝗔𝗧) (𝗜𝗻𝘀𝗼𝗹𝘃𝗲𝗻𝗰𝘆) 𝗡𝗼. 𝟮𝟰𝟮 𝗼𝗳 𝟮𝟬𝟮𝟮 (𝗣𝗿𝗶𝗻𝗰𝗶𝗽𝗮𝗹 𝗖𝗼𝗺𝗺𝗶𝘀𝘀𝗶𝗼𝗻𝗲𝗿 𝗼𝗳 𝗜𝗻𝗰𝗼𝗺𝗲 𝗧𝗮𝘅 & 𝗔𝗻𝗿. 𝘃𝘀. 𝗔𝘀𝘀𝗮𝗺 𝗖𝗼𝗺𝗽𝗮𝗻𝘆 𝗜𝗻𝗱𝗶𝗮 𝗟𝘁𝗱).