Q: Elaborate rule 11 of NCLT rules, 2016 ?

Ans: Rule 11 of the NCLT Rules, 2016 entails the inherent powers of the tribunal. However, the NCLAT held that Rule 11 cannot be applied for reopening or modifying an approved resolution plan by the NCLT. After approval of the plan, the powers of the NCLT are confined to Section 60 of the I&B Code.

Pressing on the limited powers of the NCLT after approval of the resolution plan, the NCLAT held as follows:-

“Since rectification of the resolution Plan does not involve the question of priorities or any question of law or facts, arising out of or in relation to the insolvency resolution or liquidation proceedings of the corporate debtor or corporate person under this Code, therefore it is not permitted to modify the Resolution Plan under the guise of inherent powers of the Tribunal.”

Hence the NCLAT held that the NCLT does not have the jurisdiction to amend an approved resolution plan and hence set aside the order of the NCLT in QVC Exports Pvt. Ltd Vs. R.P. Deloitte Touche Tohmatsu India LLP and allowed the appeal.

Comments

Post a Comment

Popular posts from this blog

Q: What is corporate applicant ?

Ans: Corporate Applicant: The term 'Corporate Applicant' is defined under Section 5(5) of the IBC to include the company itself and any member, partner or individual who is authorised to supervise or control the affairs of the company. When a Corporate Debtor commits a default, a corporate applicant can initiate insolvency in terms of Section 10 of the IBC. In simple words, when a company becomes a corporate debtor and it wants to initiate a corporate insolvency resolution process against itself, such a corporate debtor being the corporate applicant can file a Petition under Section 10 of the IBC. It is to be noted here that company is corporate applicant who renders credit and company is also a corporate debtor and since every member of company is corporate debtor, so any member can file petition under Section 10 of IBC . 
Read more

Q: Delineate about the appointment of resolution professional ?

  Appointment of RP: Since an RP is someone who is appointed by a Committee of Creditors (hereafter, referred to as “CoC”) before its constitution an Interim RP is appointed because committee of creditors take all the important decisions in corporate insolvency resolution process from appointment of resolution professional to termination of resolution professional. The interim RP acts in the same way an RP would and manages the affairs of the CD till the appointment of an RP. As per section 22 of the Insolvency and Bankruptcy Code, 2016 (hereafter, referred to as the “Code”) within seven days of the CoC’s formation it must hold its first meeting and decide whether it would like to appoint the Interim RP as the RP or it can select a new RP. The outcome of the same must be communicated to the RP, the Corporate debtor and the NCLT.  The NCLT is a tribunal here for RP and CoC and it was constituted under section 408 of companies act, 2013.  NCLT is a quasi judicial body and i...
Read more