HSA Advocates successfully represented IDBI Trusteeship Services Limited (IDBI), in its capacity as a Debenture Trustee for Assets Care & Reconstruction Enterprise Ltd. (ACRE), before the Hon'ble National Company Law Appellate Tribunal (NCLAT), New Delhi. The matter pertained to an appeal challenging the initiation of the Corporate Insolvency Resolution Process (CIRP) against Shipra Estate Ltd., under the Insolvency and Bankruptcy Code, 2016 (IBC).
Shipra Estate Ltd. and Just About Movies Pvt. Ltd. (JAMPL) are companies, inter-alia, engaged in the business of construction and development of real estate. JAMPL availed a loan facility from IIFL Finance Ltd. (IIFL) by issuing non - convertible debentures in favour of IIFL, for which Shipra Estate Ltd. stood as a Corporate Guarantor. Later, both JAMPL and Shipra Estate Ltd. failed to meet their repayment obligations as per the facility documents.
IDBI Trusteeship, being the Debenture Trustee for IIFL, filed a petition under Section 7 of the IBC, seeking initiation of Corporate Insolvency Resolution Process (CIRP) in respect of Shipra Estate Ltd., which was allowed by the National Company Law Tribunal, New Delhi (NCLT). During the pendency of this petition, IIFL's debt was assigned to ACRE. The order passed by the NCLT was challenged by the suspended board of directors of Shipra Estate Ltd. before the NCLAT. The NCLAT granted the Appellants an opportunity to explore settlement by allowing them to place a proposal before the Committee of Creditors under Section 12A of the IBC. Interim relief was also granted to facilitate this process. However, despite multiple extensions, the Appellants failed to arrive at a resolution or settlement of outstanding dues.
HSA represented IDBI, the Debenture Trustee pursuing the matter on behalf of the financial creditor (ACRE), and opposed any further delay in the insolvency proceedings. The NCLAT vacated the interim stay granted against the financial creditor and upheld the admission order passed by the NCLT, paving the way for continuation of the CIRP against Shipra Estate Ltd., thereby securing the interests of the financial creditor. This ruling reinforces the integrity of the IBC framework and underscores the need to curtail unsubstantiated challenges and undue delays in the resolution process.
This matter was led by HSA's restructuring and insolvency team comprising Abhirup Dasgupta (Partner), Ishaan Duggal (Associate Partner), and Ruchi Goyal (Senior Associate), who advised on strategy, drafted pleadings, and represented the Financial Creditor throughout the proceedings before the NCLT and the NCLAT, New Delhi.