Tribunal grants 30-day extension for balance payment due to Covid-19 disruptions The Tribunal granted the Applicant an additional 30 days to make the balance payment of Rs. 32.41 Crores plus interest and security charges, with 12% ...
Cases where this provision is explicitly mentioned in the judgment/order text; may not be exhaustive. To view the complete list of cases mentioning this section, Click here.
Provisions expressly mentioned in the judgment/order text.
Tribunal grants 30-day extension for balance payment due to Covid-19 disruptions
The Tribunal granted the Applicant an additional 30 days to make the balance payment of Rs. 32.41 Crores plus interest and security charges, with 12% annual interest, due to Covid-19 disruptions. The liquidator did not oppose the extension request, considering the exceptional circumstances caused by the pandemic. The decision highlighted the need for flexibility and understanding in light of the challenges faced by the Applicant during the Covid-19 situation.
Issues: Application for extension of time to deposit balance amount for purchased property from Liquidator.
1. Background and Relief Sought: The Application was filed by the purchaser of immovable property seeking an extension to deposit the balance amount of Rs. 32,41,00,000 plus interest and reimbursement of security expenses. The property was acquired through e-auction after the Corporate Insolvency Resolution Process and liquidation order against the Corporate Debtor.
2. Auction Process and Payment Made: The Respondent conducted an e-auction where the Applicant emerged as the highest bidder for Rs. 46.01 Crores, paying an EMD of Rs. 4.60 Crores. The Respondent accepted the bid with conditions requiring 25% payment by a specific date and the balance with interest by another date.
3. Impact of Covid-19 on Payment: Due to the Covid-19 pandemic, the Applicant faced challenges in arranging the balance payment. The Ministry of Health & Family Welfare issued an Office Memorandum cautioning against mass gatherings, affecting banking activities. The Applicant's staff was under lockdown, hindering office work and financial transactions.
4. Request for Extension and Loan Approval: The Applicant requested an extension of 30 days for payment due to Covid-19 disruptions. Negotiations with L&T Finance Ltd. for a loan were delayed, impacting the disbursement process. Despite making additional payments, the balance due was Rs. 32.41 Crores plus interest and security charges.
5. Legal Precedent and Decision: The Applicant cited a previous NCLT Ahmedabad Bench order granting time for payments due to Covid-19. The liquidator did not object to the extension request during the virtual hearing. Considering the exceptional circumstances caused by the pandemic, the Tribunal granted the Applicant an additional 30 days to make the balance payment with 12% annual interest.
In conclusion, the Tribunal acknowledged the challenges faced by the Applicant due to the Covid-19 situation and decided to provide the requested extension for payment, emphasizing the need for flexibility and understanding during these extraordinary times.
Full Summary is available for active users!
Note: It is a system-generated summary and is for quick reference only.
TaxTMI 
of 
TaxTMI 
