The following is a snapshot of the important orders passed by the National Company Law Appellate Tribunal ("NCLAT"), under the Insolvency and Bankruptcy Code, 2016 ("Code"), during the period between June 1, 2023 and June 15, 2023. For ease of reference, the orders have been categorized and dealt with in the following categories i.e., Pre-admission stage, Corporate Insolvency Resolution Process ("CIRP") stage and Miscellaneous.


  1. In Narendra Rajani, erstwhile director v. Pegasus Assets Reconstruction Private Limited and Another (Company Appeal (AT) (Insolvency) No. 524 of 2023), the NCLAT held that an order of the Adjudicating Authority which takes into account pleadings which are not on record are patently illegal and remanded the matter back to the Adjudicating Authority to decide again without reference to such pleadings.
  2. In SFO Technologies Private Limited v. Vanu India Private Limited (Company Appeal (AT) (CH) (INS.) No. 436 / 2022), the NCLAT held that failure to produce any invoice to substantiate existence of debt is fatal as admission under Section 9 requires strict proof of debt and default.
  3. In Paresh Rastogi v. Piramal Capital & Housing Finance Limited (Company Appeal (AT) Insolvency No. 743 of 2023 & I.A. No. 2513 of 2023), the NCLAT held that the fact that one of the projects of the Corporate Debtor is registered with Real Estate Regulatory Authority, has no bearing on maintainability of Section 7 application.
  4. In Rajesh Kumar Tripathi v. Era Housing & Developers (P) Limited (Company Appeal (AT) (Insolvency) No. 357 of 2020 & I.A. No. 1925 of 2022), the NCLAT, while noting that only aggrieved person could file an appeal against the order of Adjudicating Authority under Section 61 of the Code, held that a homebuyer from a parent company could not be considered as creditor of subsidiary company and did not have a locus standi to file an application under Section 61 of the Code.
  5. In Guruprasad V Hishobkar v. Shree Aashraya Souhard Credit Society Limited and Ors. (Company Appeal (AT) (CH) (Ins) No. 51/2021), the NCLAT held that once the default has been established to be over and above the threshold, determination of the exact quantum of debt need not deter the admission of a Section 7 application, where both debt and default are established.
  6. In KK Ropeways Limited v. Billion Smiles Hospitality (Comp. App (AT) (CH) (INS.) No. 246 / 2021), the NCLAT held that a challenge to an ex-parte arbitral award under Section 34 of Arbitration and Conciliation Act, 1996 was a 'pre-existing dispute' and thus a valid ground for rejection of Section 9 application.


  1. In Bhim Sain Goyal v. Myntra Designs Private Limited and Another (Company Appeal (AT) (Insolvency) No. 295 of 2023), the NCLAT held that no directions under Section 19(2) of the Code lie for recovery of amounts owed to the Corporate Debtor.
  2. In ShyamRathod v. Gopalsamy Ganesh Babu (Comp. App. (AT) (CH) (Ins.) No. 137/2023), the NCLAT held that delay in filing a claim before Resolution Professional could only be condoned if the delay was explained and filing of a claim under wrong category was not sufficient reason for condonation of delay.
  3. In Hari Babu Thota (Comp. App. (AT) (CH) (Ins.) No. 110 of 2023), the NCLAT observed that erstwhile promoter of the corporate debtor would not be eligible to take benefit under Section 240-A of the Code, where MSME registration is obtained post initiation of CIRP.
  4. The NCLAT, in Puissant Towers India Private Limited v. Neueon Towers Limited and Ors. (Company Appeal (AT) (CH) (Ins) No. 181/2022), noted that no prior permission of the Reserve Bank of India is required for an Asset Reconstruction Company to act as a co-resolution applicant, where such ARC was not proposing to acquire any equity shareholding.
  5. In Anheuser Busch Inbev India Limited v. Pradeep Kumar Sravanam (Comp. App (AT) (CH) (INS.) No. 12 / 2023), the NCLAT held that a claim could be kept in abeyance by Resolution Professional where the arbitral proceeding and counter-claim for determining the liability and quantum of the claim, is pending for adjudication.


  1. In Renuka Devi Rangaswamy v. Madhusudan Khemka (Company Appeal (AT) (CH) (INS.) No. 356 of 2022), the NCLAT held that transfer of assets among the group companies, ex-facie, would not come within the ambit of fraudulent trading under Section 66(1) of the Code.
  2. In IFCI Limited v. Sutanu Sinha (Company Appeal (AT) (Ch) (Ins.) No. 108/2023), the NCLAT held that, if as on the date of the admission of CIRP, the outstanding compulsorily convertible debentures ("CCDs") held by an investor had reached the compulsory conversion period, the CCD-holder cannot seek status of financial creditor basis such CCDs, as post such conversion period, such CCDs would not have qualified as debt.

    Whilst NCLAT could have based its decision on the basis of the aforesaid fact, it went on to further observe that fully convertible debentures would qualify as an equity instrument and not a debt and placed reliance on Master Direction on Foreign Investment in India, issued by RBI, in support of the aforesaid proposition. In our view, such an observation may not be free from criticism, as the reason for treating compulsorily convertible instrument as an equity from the perspective of foreign investment cannot be bodily applied in the context of the Code. For instance, if the analogy could be extended, a redeemable preference share, which is treated as debt under the FDI norms, could equally be considered to confer the redeemable preference shareholder the status of creditor, which is definitely not intended.
  3. In Kwality Catering Services v. Vineeta Maheshwari & Anr. (Company Appeal (AT) (Insolvency) No.737 of 2023), the NCLAT held that where an order is passed ex-parte, instead of an appeal, the proper remedy lies in filing an application under Rule 49 of the NCLT Rules, 2016 before the Adjudicating Authority seeking recall of the ex-parte order.

The update was first published on Bar & Bench.

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