2020 (11) TMI 535 - Tri - Insolvency and Bankruptcy

Tribunal Grants Extension for CIRP Completion Amid COVID-19 Crisis

The Tribunal granted the Resolution Professional's request for an extension of 116 days from the 180-day statutory period for completing the Corporate ... Completion of period of 116 days from the statutory period of 180 days' time limit for completion of the CIRP - section 12(2) of IBC, 2016 R/w Rule 11 of NCLT Rules, 2016 - HELD THAT:- Hon'ble Supreme Court of India in [2020 (5) TMI 418 - SC ORDER] where it was held that the period of lockdown imposed by the Central Government in the wake of Covid-19 outbreak shall not be counted for the purposes of computation of the time-line for any task that could not be completed due to such lockdown, in relation to any liquidation process. The material facts of the issue are not in dispute, and the law on the issue is also settled by the judgments cited above. Therefore, the Applicant is justified to seek extension and exclusion of time as sought for in the Application, and thus we are inclined to allow the instant Application. The exclusion of 116 days i.e., from the statutory period of 180 days and to complete the Corporate Insolvency Resolution Process - application disposed off. Issues:Extension of time for completion of Corporate Insolvency Resolution Process (CIRP) due to COVID-19 lockdown.Analysis:The judgment pertains to an application filed by the Resolution Professional seeking an extension of time for the completion of the CIRP of a Corporate Debtor due to the COVID-19 lockdown. The application sought to exclude 116 days from the statutory period of 180 days for the CIRP. The key issue revolved around the impact of the lockdown on the completion of valuation work and financial statements, necessitating an extension beyond the original deadline of 17.08.2020 up to 11.12.2020.The Tribunal considered the impact of the lockdown on the CIRP timeline and referred to the Hon'ble Supreme Court's observation regarding the extension of limitation periods due to the challenges posed by the COVID-19 pandemic. The Tribunal highlighted the insertion of Regulation 47A by IBBI, excluding the lockdown period for the computation of timelines in insolvency processes. The legal framework provided by the Supreme Court's order and IBBI's regulation supported the Resolution Professional's request for an extension.After careful consideration of the facts and legal provisions, the Tribunal acknowledged that the material facts were undisputed, and the law on the issue was settled by the relevant judgments and regulations. Consequently, the Tribunal found the Resolution Professional's request for extension and exclusion of time justified. The Tribunal granted the exclusion of 116 days from the 180-day statutory period for completing the CIRP, allowing the Resolution Professional to finalize the process and submit the necessary applications within the extended timeframe.In conclusion, the Tribunal disposed of the application by granting the extension as requested, emphasizing the Resolution Professional's responsibility to promptly finalize the CIRP and submit the required applications before the Adjudicating Authority within the extended period. The judgment exemplifies the judicial approach to accommodating the challenges posed by external factors such as the COVID-19 lockdown in insolvency proceedings, ensuring a fair and practical resolution within the legal framework.