The National Company Law Appellate Tribunal (NCLAT) has set aside insolvency proceedings against Paramount Propbuild, noting that no notice was served to the NCR-based real estate firm before initiating the debt recovery process.
The appellate tribunal dismissed the application filed by Ultimate Infracity, an operational creditor of the company and directed the National Company Law Tribunal (NCLT) to close the proceedings.
The tribunal also set aside the order of NCLT appointing a resolution professional to run the company, declaring moratorium, freezing of accounts and other orders.
"In effect, order passed by Adjudicating Authority (NCLT) appointing Interim Resolution Professional', declaring moratorium, freezing of account and all other orders passed by Adjudicating Authority pursuant to impugned order and action taken by the Resolution Professional', including the advertisement published in the newspaper calling for applications and other orders and actions as taken are declared illegal and are set aside," the NCLAT order said.
The appellate tribunal also observed that parties have also reached the settlement on December 1, 2018.
"The Adjudicating Authority will now close the proceeding," said the NCLAT bench headed by Justice S J Mukhopadhaya.
The appellate tribunal has also asked Paramount Propbuild to pay Rs 2 lakh to the resolution professional, taking into consideration the nature of the work he had performed.
The Delhi bench of NCLT on November 16 passed an order admitting the insolvency plea filed by Ultimate Infracity and on November 27 appointed an Interim Resolution Professional.
The order was challenged by a shareholder of Paramount Propbuild before the NCLAT contending that notice under Section 9 was never served and ex-parte order of admission of insolvency plea was passed without giving any opportunity to it.
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