Introduction
The Indian skies, once seemingly boundless with potential, have recently witnessed a few turbulent patches. The insolvencies of Jet Airways and Go First Airways sent ripples of concern through the aviation sector, illuminating the financial tightropes that airlines often walk.
The Supreme Court in the matter of National Spot Exchange Ltd. v. Union of India and Ors. ruled that the moratorium under IBC does not prohibit attachment of properties under the MPID Act3. The bench of Justices Bela M Trivedi and Satish Chandra Sharma was addressing a case stemming from the 2013 NSEL4 scam. In this, commodity exchange platform NSEL defaulted on ₹5,600 crores in payments to approximately 13,000 traders.
The Insolvency and Bankruptcy Code, 2016 (IBC), heralded a new era for debt resolution in India. Envisioned as a comprehensive framework, it aimed to streamline and expedite the reorganisation and insolvency processes for corporate entities, partnership firms, and individuals alike, with the overarching goal of maximising asset value.
The recent pronouncement by the Supreme Court in Kalyani Transco v. Bhushan Power and Steel Ltd & Ors serves as a stark reminder of the sanctity of IBC, and the perils of procedural laxity and opportunistic manoeuvring. The Apex court not only disapproved of the powers of NCLAT to judicial review over the decision taken by ED under PMLA but also delivered a scathing critique of the entire CIRP of BPSL, ultimately leading to the rejection of JSW Steel’s resolution plan and an order for liquidation.