Insolvency And Bankruptcy Code

NCLAT refuses to limit insolvency process of Spaze Towers to one project

Appellate tribunal NCLAT on Tuesday dismissed the plea filed by the former promoters of realty firm Spaze Towers to confine the Corporate Insolvency Resolution Process to only one project -- Spaze Arrow. The National Company Law Tribunal (NCLT), on October 21, 2024, directed the initiation of insolvency proceedings against Spaze Towers, admitting a plea filed by its flat owners. Appealing against the order, the former management approached the National Company Law Appellate Tribunal (NCLAT), requesting to confine the CIRP process to only one project. However, the appellate tribunal rejected it, saying, "When the claimants have filed claims for the Project Corporate Park, which is not complete despite the Occupancy Certificate and Completion Certificate, by confining the CIRP to only one Project shall be tantamount to excluding the claims filed before the RP from different Project". "We, thus, after considering the facts and circumstances, which have been brought on the record by th

SC calls out gaps in IBC, calls for more oversight of creditors' committee

The recent Jet Airways' liquidation case prompted the apex court to highlight how tribunal members often lack the domain knowledge required in high-stakes insolvency matters

NCLAT rejects Jaiprakash Associates' petition challenging insolvency

The National Company Law Appellate Tribunal (NCLAT) on Friday rejected Jaiprakash Associates Ltd's petition challenging the insolvency proceedings initiated against the company. While upholding an earlier order, the appellate tribunal NCLAT observed mere pending of loan restructuring arrangement with the lender before NCLT does not debar the creditors to file insolvency proceedings under section 7 of Insolvency & Bankruptcy Code 2016. A three-member bench led by Chairperson Justice Ashok Bhushan has upheld the order passed by the National Company Law Tribunal (NCLT), which had directed initiating the Corporate Insolvency Resolution Process (CIRP) against the company. The appellate tribunal said "after answering all the issues, we are of the view that no grounds have been made out to interfere in order of NCLT". The OTS (one-time settlement) proposal submitted to NCLT and as well as before this tribunal on behalf of JAL contains the "clear acknowledgment of debt" and ...

Govt working on integrated platform to speed up resolution processes

The government is working on an integrated platform for the insolvency ecosystem covering key stakeholders that will also help speed up resolution processes. The Insolvency and Bankruptcy Code (IBC), which came into force in 2016, aims to provide market-linked and time-bound resolution of stressed assets. However, there have been delays in the resolution process. Anita Shah Akella, Joint Secretary at the Ministry of Corporate Affairs (MCA), on Tuesday emphasised that IBC is not a recovery mechanism but a rescue mechanism. She was speaking at a conference in the national capital to mark the eighth annual day of the Indian Institute of Insolvency Professionals of ICAI. While mentioning various steps taken and also being planned to further improve IBC resolutions, she said the ministry is working on having an integrated platform for the insolvency ecosystem. "(It will be a) federated architecture that will push and pull data as and when required," she noted. The platform will connec

Creditors recover Rs 3.55 trn through resolution of 1,068 cases till Sep

Creditors have recovered around Rs 3.55 lakh crore through resolution of 1,068 cases under the insolvency law till September this year, the government said on Monday. In a written reply to the Lok Sabha, Minister of State for Corporate Affairs Harsh Malhotra also said that a total of 1,963 CIRP cases are ongoing and out of them, 1,388 have exceeded the time limit of 270 days. CIRP refers to Corporate Insolvency Resolution Process. The minister emphasised that realisation under the IBC is market driven and dependent on quality of assets at the time of resolution. "A total of 1,068 cases have been resolved under the Insolvency and Bankruptcy Code, 2016 (IBC) leading to a recovery of about Rs 3.55 lakh crore to the creditors since inception of IBC till September 2024," he said. So far, six amendments have been made to the IBC to strengthen the resolution process and to ensure proper implementation of provisions of the law. The Insolvency and Bankruptcy Board of India (IBBI) has made

NCLAT limits insolvency proceedings against Raheja to one project only

In a relief to Raheja Developers, the appellate tribunal NCLAT has confined the insolvency proceedings against the realty firm to only one of its projects 'Raheja Shilas'. However, it has directed Raheja Developers to provide the details regarding the other incomplete projects and the status of all ongoing projects, enabling appropriate orders to be passed. A three-member bench of the National Company Law Appellate Tribunal (NCLAT) led by Chairperson Justice Ashok Bhushan, directed the Interim Resolution Professional (IRP) to collate the claims related to the project and submit the status report. "We are of the view that, for the time being, as was prayed by the Applicant/Respondent herein, the insolvency may convene to one Project, namely 'Raheja Shilas (Low Rise)," said NCLAT in its interim order passed on Thursday. The NCLAT direction came over a petition filed by Navin Raheja, Chairman & Managing Director of the suspended board of the realty firm challenging an order from ...

Byju's founder told ally to flee US to avoid testifying against him

William R Hailer said Raveendran sent him a plane ticket to Dubai just two days before Hailer was set to testify about Raveedran's efforts to regain control of parts of the Byju's education empire

SpiceJet faces fresh insolvency pleas from Sabarmati Aviation, JetAir 17

Two more insolvency petitions were filed by Sabarmati Aviation and JetAir 17 against budget carrier Spicejet at the National Company Law Tribunal (NCLT) on Monday. The NCLT issued a notice to the airline over the plea by operational creditor Sabarmati Aviation while asking another complainant, JetAir 17, to file additional documents in support of its claims of USD 27 million. During the proceedings, senior advocate Krishnendu Datta representing SpiceJet submitted that a reply would be filed over the plea of Sabarmati Aviation. However, he opposed the plea of JetAir 17 contending that their claims as an operational creditor are disputed. In the matter of JetAir 17, the NCLT asked the company to file additional documents to support its claims as SpiceJet contended that it has not entered into a lease agreement with it. JetAir 17, an Irish company, operates within the renting and leasing of air passenger transport equipment industry. Dutta submitted that JetAir 17 is claiming its du

Frequent breach of timelines leading to more liquidations under IBC: ICRA

Banks have had to take a haircut of over two-thirds in the corporate insolvency cases being resolved through the bankruptcy courts, a report said on Wednesday. In over 71 per cent of the cases, the 270-day timeline is getting exceeded, the report by rating agency Icra said, adding that this is resulting in a higher number of liquidation orders as the elongated process erodes value. "'Lenders continue to face steep haircuts or reduction in loan amounts of nearly 72 per cent in Q2 FY2025 as the overall resolution process continues to face material delays emerging from litigations from either promoters or dissenting creditors," the agency's group head for structured finance ratings Abhishek Dafria said. He added that 71 per cent of the ongoing corporate insolvency resolution processes (CIRPs) had exceeded 270 days, post-admission by the NCLT. "The elongated process results in further erosion of the corporate debtor, which has also resulted in a high share (44 per cent) of CIRPs being

NCLAT directs IL&FS to complete resolution of remaining firms by March 31

The Insolvency appellate tribunal has directed the debt-ridden IL&FS group to complete the resolution of the remaining 58 firms by March 31, 2025 and has extended the moratorium until the date. A two-member bench observed that the resolution process for the remaining 58 entities is at an advanced stage and "considerable progress has been made by IL&FS (Infrastructure Leasing and Financial Services), which is pairing debts through asset resolution and other mechanisms. "We, thus, for the time being, are of the view that a direction needs to be issued to IL&FS and a new board to complete the resolution process of 58 entities as captured in paragraph 24 of the affidavit by March 31, 2025," said NCLAT in an order passed on Tuesday. NCLAT also directed IL&FS to take "appropriate steps" before the National Company Law Tribunal (NCLT) to close the process. Earlier, on August 28, 2024, the National Company Law Appellate Tribunal (NCLAT) questioned the continuation of the ...

BCCI may move NCLT to seek withdrawal of Byju's insolvency proceedings

The Supreme Court last month annulled the National Company Law Appellate Tribunal ruling that sanctioned a settlement of Rs 158 crore between Byju's and the BCCI on Oct 23

Insolvency law must protect homebuyers, avoid complex resolution process

A more effective solution would be to adopt the waterfall mechanism from the FSC framework, which prioritises the interests of customers over those of other claimants

Include land authority in CoC for real estate insolvency cases: IBBI

The IBC has seen successful resolution in 46 per cent of cases admitted in the real estate sector as of June 2024, IBBI data shows

IBBI proposes mediation mechanism for operational creditors in IBC

IBBI stated that in most insolvency cases initiated by operational creditors, the creditors are more focused on the repayment of money claims than on admission or resolution of the corporate debtor

IBBI, IBA to launch centralised platform for asset liquidation auctions

Initially, the platform will be deployed in pilot mode, with a full rollout planned at a later date after incorporating improvements based on usage feedback

Mahagenco-NTPC emerges as top bidder for Sinnar Thermal at Rs 3,800 crore

The Mahagenco-NTPC has outbid at least seven others including Adani Power, Vedanta Group, Jindal Power, Orissa Metaliks, and Singapore-based VFSI Holdings

Regulatory changes to provide necessary push to surety bonds biz: Experts

Regulatory changes like amendment in the Insolvency & Bankruptcy Code and standardization of bond wordings would give a fillip to newly introduced product underwritten by general insurance companies, called surety bonds, experts said. This product launched in 2022 is going to play a crucial role in supporting India's infrastructure development and heavily reduce reliance on bank guarantees for project finance. As a result, banks can focus on other productive sectors for lending. Bajaj Allianz General Insurance, which is the pioneer of the product said that it has been able to add more than 50 beneficiaries who have started accepting surety bonds. According to Bajaj Allianz General Insurance Chief Technical Officer TA Ramalingam, possible amendments in the legal framework are crucial in providing insurance companies with equal legal recourse as banks under the Insolvency and Bankruptcy Code (IBC). This parity would provide a level playing field, encourage fair competition and ...

Supreme Court sets aside NCLAT order halting Byju's insolvency proceedings

With this, Byju Raveendran and his brother Riju Raveendran have again lost control over Think and Learn Pvt Ltd or Byju's

Byju's in trouble again as SC scraps NCLAT ruling on insolvency proceedings

A bench led by Chief Justice DY Chandrachud revoked the NCLAT's approval of Byju's settlement of Rs 158.9 cr in outstanding dues to the BCCI

When will India celebrate failure? Insolvency key to small business growth

Entrepreneurs, fearful of social judgement, often hesitate to seek help, allowing their struggles to fester until it is too late