Insolvent Companies

NCLAT dismisses petition seeking insolvency against Amazon Wholesale

The National Company Law Appellate Tribunal (NCLAT) has set aside a petition seeking to initiate insolvency proceedings against Amazon Wholesale (India). A three-member NCLAT bench upheld the order passed by the National Company Law Tribunal (NCLT), which had in March this year dismissed the insolvency plea filed by Multiplier Brand Solutions. Multiplier Brand Solutions had filed the plea under Section 9 of the Insolvency & Bankruptcy Code. It had alleged a default of Rs 3.7 crore for eight invoices raised between March 2023 and May 2023. However, rejecting it, NCLAT said the "claim of Appellant for payment of invoices which are the subject matter of Section 9 Application was disputed much before Demand Notice was issued". The appellate tribunal further said: "The adjudicating authority (NCLT) has not committed any error in refusing to initiate CIRP, there being pre-existing dispute which is reflected with the correspondence which took place between the parties much prior to ...

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 rejects tax claim against RCom after initiation of insolvency

The NCLAT has set aside a petition filed by the state tax department claiming dues from Reliance Communications (RCom) observing that it was based on the assessment made after the initiation of insolvency resolution process against the debt-ridden firm. A two-member NCLAT bench upheld the earlier order passed by the Mumbai bench of the National Company Law Tribunal (NCLT), which had rejected the state tax department's second claim of Rs 6.10 crore. Corporate Insolvency Resolution Process (CIRP) against RCom was initiated on June 22, 2019. The state tax department had filed two claims. The first claim was filed on July 24, 2019 for Rs 94.97 lakh and a second claim was filed on November 15, 2021 for Rs 6.10 crore, which arose out of an assessment order dated August 30, 2021. The NCLT had admitted the first claim, which was passed before the initiation of CIRP. However, it did not accept the claim which was based on an assessment order passed in 2021. The Committee of Creditors (CoC

Employee claims against Byju's top Rs 300 crore in ongoing insolvency case

But these claims still need to be reconciled with the complete and accurate books of accounts and records from the corporate debtor, in this case, the former management of Byju's

NCLT extends Go First's resolution deadline, asks to file reply in 3 weeks

Corporate dispute tribunal NCLT has extended the insolvency resolution deadline for grounded airline Go First for the fourth time and directed the suspended board of the debt-ridden firm to file a reply within three weeks. A two-member bench of the Delhi-based National Company Law Tribunal (NCLT) issued notice to the suspended management of the company on Tuesday and listed the matter for hearing in the first week of October. The resolution professional of Go First had moved the application under section 33 (1) of the Insolvency & Bankruptcy Code for the liquidation of Go First after the lenders failed to find a reasonable buyer within the stipulated time frame. During the proceedings, counsel appearing for Go First informed the NCLT that the Committee of Creditors decided to liquidate the company with a majority vote. This was the fourth extension for Go First to complete the Corporate Insolvency Resolution Process (CIRP), as the airline has been struggling to find a buyer. In ..

Lenders ask KSK Mahanadi Power Company bidders to better Adani offer

Adani has offered Rs 27,000 cr for Chhattisgarh project

SKS Power insolvency: CoC receive 1,950 cr from Sarda Energy and Mining

The lenders of SKS Power Generation have received an upfront payment of Rs 1,950 crore from Sarda Energy and Mining, the successful bidder for the debt-ridden thermal power producer, the insolvency appellate tribunal NCLAT was informed on Tuesday. Moreover, allegations of "malafide" intention or aligning towards any party while approving the resolution plan from Sarda Energy were also rejected during the proceedings of the NCLAT by senior advocate Mukul Rohatahi, representing the lenders. A proper evaluation was made based on the earlier direction given by the NCLAT in this matter and a "clear decision was made" by the Committee of Creditors (CoC) of SKS Power Generation. "There is no case of malafide and we are not aligning to one party or the other. We have taken a call based on the commercial decision," he said. Torrent Power and Singapore-based Vantage Point Asset Management Pte, which were also in the race to acquire SKS Power Generation, have challenged the NCLT order, approv

Rescued firms 2.5 times those liquidated in realty sector, shows IBBI data

IBC experts feel that despite the positive trend of more resolutions than liquidations in real estate insolvencies under the IBC, several challenges persist

No back-door entry for defaulting promoters: FM Nirmala Sitharaman

Statement comes in response to concerns over haircuts in insolvency cases

Byju's appeals to NCLAT Chennai against insolvency; hearing set for July 29

Byju's owes its creditors - BCCI, OPPO, Surfer Technologies, Cogent E Services, McGraw Hill Education India, and iEnergizer Services - more than Rs 200 crore

Go First heads towards liquidation after failed EaseMyTrip, SpiceJet bids

Go First owes creditors - Central Bank of India, Bank of Baroda, and IDBI Bank - around Rs 6,200 crore

NCLT orders initiation of insolvency proceedings against Simbhaoli Sugars

The National Company Law Tribunal (NCLT) has ordered initiation of insolvency resolution proceedings against Simbhaoli Sugars Ltd on a petition filed nearly six years ago. The plea was filed in September 2018 by erstwhile Oriental Bank of Commerce which has been merged with state-owned Punjab National Bank (PNB) now. The lender had sought initiation of Corporate Insolvency Resolution Process (CIRP) against the company under section 7 of the Insolvency and Bankruptcy Code. "... petition has been admitted by the NCLT, Allahabad Bench vide order dated July 11, 2024," Simbhaoli Sugars said in a filing to stock exchanges on Friday. NCLT has appointed Anurag Goel as interim resolution professional. With the NCLT ruling, the company's board stands suspended and it would be run by Goel. According to the application filed before the NCLT, the default amount stood at over Rs 130 crore as of November 22, 2017. A leading sugar company, Simbhaoli sells sugar under the brand 'Trust' and has ..

NCLT extends insolvency resolution process for Go First by 60 days

The National Company Law Tribunal warned the airlines that this would be the final extension offered

NCLT admits personal insolvency plea against Zee's Subhash Chandra

Zee's Subhash Chandra had argued that the NCLT cannot rule on an individual's insolvency

Debtors resolving cases before admission under insolvency law: IBBI

Over 27,500 applications for resolution process against corporate debtors have been withdrawn before their admission, with regulator IBBI emphasising that the credible threat of the insolvency law that ownership of debtors might change has changed the behaviour of debtors. These Corporate Debtors (CDs) had an underlying default of Rs 9.74 lakh crore. The Insolvency and Bankruptcy Code (IBC), introduced in December 2016, provides for a time-bound and market-linked resolution of stressed assets. "The credible threat of the Code, that a CD may change hands, has changed the behaviour of debtors. Thousands of debtors are resolving distress in early stages of distress. "They are resolving when default is imminent, on receipt of a notice for repayment but before filing an application, after filing application but before its admission, and even after admission of the application, and making best effort to avoid consequences of the resolution process," the IBBI said in its latest ...

Go First's lenders to seek extension of insolvency process by 60 days

Under the country's Insolvency and Bankruptcy Code, the National Company Law Tribunal (NCLT) has the authority to extend the resolution timeframe to a maximum of 330 days

Insolvency professionals can be crucial in resolution process: Report

Insolvency professionals can play a crucial role in the pre and post-Corporate Insolvency Resolution Process stages, according to a report. The report by the Indian Institute of Insolvency Professionals of ICAI (IIIPI) also highlighted various methods and processes to diagnose corporate distress at an early stage and suggested interventions to mitigate insolvency processes. Exploring the advantages of addressing stress early, the report -- Roles of Insolvency Professionals Across Insolvency Value Chain from Incipient Stage till Post-Resolution Stage -- delved into areas to identify and control the initial signs of distress, providing valuable insights for effective intervention. It also underscores the importance of addressing stress early to prevent the escalation of financial difficulties, positioning companies for long-term success. "This report will help the Insolvency Professionals (IPs) to manage the stress in companies at both, pre and post CIRP stages as they bring speciali

NCLAT sets aside notice against lenders over liquidation without bids

The National Company Law Appellate Tribunal (NCLAT) on Wednesday set aside an order of the NCLT, which had issued a show cause notice for recommending liquidation of realty firm SARE Realty Projects, without exploring the possibility of finding a buyer. The appellate tribunal said there is an "error in the approach" of the National Company Law Tribunal (NCLT) for taking a decision regarding the liquidation of a corporate debtor (CD) and the lenders have to complete all the steps regarding resolution. "The CoC has the jurisdiction to pass the order of liquidation of the CD, approving it by not less than 66 per cent of the voting share, but it should be before the confirmation of the resolution plan," said NCLAT. Earlier, the New Delhi Bench of NCLT had on March 16, 2023 issued a show cause notice to the lenders asking why penalty stipulated under Section 65 of the Insolvency & Bankruptcy Code should not be imposed on them. NCLT had said that "it was prima facie of the opinion that .

IBBI forms panel of 787 professionals to expedite resolution process

This move by the insolvency regulator aims to avoid delays and preserve asset value amid rising stressed cases

Government may implement 2-month asset freeze of airlines under insolvency

To prevent immediate repossession of aircraft by lessors after default, the government is contemplating a two-month moratorium rule for the aviation sector