The NCLAT Single Bench of Justice M.Venugopal, Judicial member in the case of Vinod Tarachand Agarwal held that if exclusion of time of CIRP helps to revive the operations of the Corporate and thus achieve the objective of the Insolvency and Bankruptcy Code, such exclusion must be allowed.
The Appellant filed an appeal against the order of the NCLT, Ahemdabad Bench which refused to exclude a certain period of CIRP despite the Resolution being passed by 100 percent voting share of the Committee of Creditors of the Corporate Debtor for exclusion of the period for further 90 days as the properties of the Corporate Debtor had not been detached by the CBI and the ED due to Covid-19 pandemic.
The Appellant contended that exclusion of the 90 days period from the CIRP of the Corporate Debtor would save the company from liquidation. It was also contended that there was a Prospective Resolution Applicant, who submitted his Resolution Plan and there was likelihood of revival of the Corporate Debtor.
Case of the Appellant
The Counsel for the Appellant stated that since it was pursuing legal proceedings to get attachment of the sole property of the Corporate Debtor lifted before several judicial forums, the exclusion of the time period would allow the company to revive.
Observation of the Tribunal
The Tribunal conceded with the contentions of the Appellant stating that these are exceptional circumstances and since the object of the Code is to revive the Corporate Debtor, the exclusion of 90 days period from CIRP should be done for achieving the objective of the IBC.
Case Details
Before: NCLAT
Case Title:
Coram: Hon’ble Justice Vinod Tarachand Agarwal
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