Resolution Professional - The Legal Chamber

Verified Claim is Key: Supreme Court Distinguishes Between Timely and Belated Homebuyers in Insolvency

16Oct

By The Legal ChamberNo Comments

Supreme Court

Verified Claim is Key: Supreme Court Distinguishes Between Timely and Belated Homebuyers in Insolvency

The Supreme Court held that a homebuyer's claim, once verified and admitted by the Resolution Professional and reflected in the list of creditors, must be honoured as per the plan's provisions for verified claims. It cannot be relegated to a residuary clause meant for belated or unverified claims, as this would misapply the approved resolution plan. Facts Of The Case: The appellants, residents of Bengaluru, booked an apartment in 2010 in the 'IREO Rise (Gardenia)' project developed by M/s Puma Realtors Private Limited. They executed an Apartment Buyer’s Agreement in 2011 and paid Rs. 57,56,684 out of the total consideration of Rs. 60,06,368. The Corporate Debtor failed to deliver possession by the agreed date of November 2013. The appellants initially filed a consumer complaint, which wa...

Supreme Court Ruling: No Certified Copy, No Appeal – NCLAT’s Order Set Aside on Technical Ground

15Sep

By The Legal ChamberNo Comments

Supreme Court

Supreme Court Ruling: No Certified Copy, No Appeal – NCLAT’s Order Set Aside on Technical Ground

The Supreme Court held that an appeal against an NCLT order under the IBC must be filed within 30 days from the date of its pronouncement. It reiterated that mandatory filing of a certified copy of the impugned order is integral to a valid appeal, and non-compliance renders the appeal barred by limitation. Facts Of The Case: The case originated from an order dated June 23, 2023, passed by the National Company Law Tribunal (NCLT), Mumbai Bench, which approved a resolution plan submitted by Ashdan Properties Pvt. Ltd. in the corporate insolvency resolution process of the corporate debtor. The respondent, DSK Global Education and Research Pvt. Ltd., being aggrieved by this order, filed an appeal before the National Company Law Appellate Tribunal (NCLAT) challenging the NCLT's decision. The ...

Supreme Court Quashes FIR in Loan Case, Says Mere Default Doesn’t Make It a Crime

13Sep

By The Legal ChamberNo Comments

Supreme Court

Supreme Court Quashes FIR in Loan Case, Says Mere Default Doesn’t Make It a Crime

The Supreme Court held that a loan transaction creates a debtor-creditor relationship, and a mere breach of its terms does not automatically constitute criminal breach of trust under Section 405 IPC without evidence of dishonest intention. The Court clarified that such disputes, arising from commercial transactions, are primarily civil in nature and a preliminary inquiry is permissible before registering an FIR. Facts Of The Case: The appellant, a director of M/s Benlon India Ltd., availed three loans from the first respondent, Hero Fincorp, for purchasing machinery. While the first two loans were used for the intended purpose, a fire destroyed the plant shortly after the disbursement of the third loan. Consequently, this third loan was converted into an unsecured corporate loan. Benlon ...

Supreme Court Rules Property Can Be Returned During Insolvency If Not Needed

6Sep

By The Legal ChamberNo Comments

Supreme Court

Supreme Court Rules Property Can Be Returned During Insolvency If Not Needed

This Supreme Court judgment affirms the paramountcy of the commercial wisdom of the Committee of Creditors (CoC) under the Insolvency and Bankruptcy Code, 2016. It clarifies that the moratorium under Section 14(1)(d) does not bar the return of possession of a corporate debtor's leased asset when such a decision is a conscious business choice made by the CoC and the Resolution Professional to alleviate a financial burden on the estate. Facts Of The Case: The case originated from a dispute over the possession of a property leased by Nandini Impex Private Limited, the corporate debtor. The appellants had provided loans to the company, secured by the title deeds of the property's front and rear portions. Following a default, the property was conveyed to the appellants through separate deeds ...