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The Tax Publishers Insolvency and Bankruptcy Code, 2016--Application by Promoters Maintainability of Application for Compromise and Arrangement filed by Promoter, being Ineligible under section 29Aduring Liquidation Proceedings Purnendu Sahai The present article enunciates the jurisprudence of the Insolvency and Bankruptcy Code, 2016 as well as the Companies Act, 2013 through the judgment of NCLAT in Jindal Steel & Power Ltd. v. Arun Kumar Jagatramka & Anr. (2019) 217 Company Cases 169 (NCLAT-New Delhi) : (2019) 2019 TaxPub CL 1095 (NCLAT-New Delhi) regarding the maintainability of application for compromise and arrangement during liquidation proceedings, where it was filed by the promoter, ineligible to be a resolution applicant to companies undergoing liquidation. 1. Facts of the case An appeal was filed under section 421 of the Companies Act, 2013 by Jindal Steel and Power Limited which is an unsecured creditor of Gujarat NRE Coke Limited ('corporate debtor')against an order passed by National Company Law Tribunal, Kolkata. The corporate debtor filed an application under 10 of the Insolvency and Bankruptcy Code, 2016 ('the Code') for initiation of corporate insolvency resolution process owing to various defaults committed by it and the same was admitted. The NCLT passed an order for liquidationof corporate debtor in the absence of a resolution plan. The resolution plan submitted by promoter (Mr. Arun Kumar Jagatramka) had not been accepted, thus, promoter had filed an appeal against the order of liquidation challenging the order holding him ineligible under section 29A of the Code. The National Company Law Appellate Tribunal (NCLAT) allowed the liquidation proceedings to continue. After that, the promoter of the corporate debtor filed an application under sections 230 to 232 of the Companies Act, 2013 before the NCLT to obtain the sanction for a scheme of compromise and arrangement between the erstwhile promoters and the creditors. The NCLT ordered to proceed under sections 230 to 232 of the Companies Act. Aggrieved by the said order, the unsecured creditor filed an appealunder section 421 of Companies Act, 2013 before the NCLAT challenging the same. SUBSCRIBE FOR FULL CONTENT

The Tax Publishers

Insolvency and Bankruptcy Code, 2016--Application by Promoters

Maintainability of Application for Compromise and Arrangement filed by Promoter, being Ineligible under section 29Aduring Liquidation Proceedings

Purnendu Sahai

The present article enunciates the jurisprudence of the Insolvency and Bankruptcy Code, 2016 as well as the Companies Act, 2013 through the judgment of NCLAT in Jindal Steel & Power Ltd. v. Arun Kumar Jagatramka & Anr. (2019) 217 Company Cases 169 (NCLAT-New Delhi) : (2019) 2019 TaxPub CL 1095 (NCLAT-New Delhi) regarding the maintainability of application for compromise and arrangement during liquidation proceedings, where it was filed by the promoter, ineligible to be a resolution applicant to companies undergoing liquidation.

1. Facts of the case

An appeal was filed under section 421 of the Companies Act, 2013 by Jindal Steel and Power Limited which is an unsecured creditor of Gujarat NRE Coke Limited ('corporate debtor')against an order passed by National Company Law Tribunal, Kolkata. The corporate debtor filed an application under 10 of the Insolvency and Bankruptcy Code, 2016 ('the Code') for initiation of corporate insolvency resolution process owing to various defaults committed by it and the same was admitted. The NCLT passed an order for liquidationof corporate debtor in the absence of a resolution plan. The resolution plan submitted by promoter (Mr. Arun Kumar Jagatramka) had not been accepted, thus, promoter had filed an appeal against the order of liquidation challenging the order holding him ineligible under section 29A of the Code. The National Company Law Appellate Tribunal (NCLAT) allowed the liquidation proceedings to continue. After that, the promoter of the corporate debtor filed an application under sections 230 to 232 of the Companies Act, 2013 before the NCLT to obtain the sanction for a scheme of compromise and arrangement between the erstwhile promoters and the creditors. The NCLT ordered to proceed under sections 230 to 232 of the Companies Act. Aggrieved by the said order, the unsecured creditor filed an appealunder section 421 of Companies Act, 2013 before the NCLAT challenging the same.