Settlement reached in Corporate Insolvency Resolution Process after default. Withdrawn petition with payment agreement. The Corporate Insolvency Resolution Process under the Insolvency and Bankruptcy Code, 2016 was sought due to a default by the Corporate Debtor. After ...
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.
Settlement reached in Corporate Insolvency Resolution Process after default. Withdrawn petition with payment agreement.
The Corporate Insolvency Resolution Process under the Insolvency and Bankruptcy Code, 2016 was sought due to a default by the Corporate Debtor. After multiple adjournments, a settlement was reached between the parties. The Corporate Debtor agreed to pay a specified amount in installments, leading to the withdrawal of the petition by the Applicant. The Tribunal allowed the withdrawal with the option to file a new petition if the settlement terms were not met. The case was disposed of as withdrawn, contingent on the Respondent's compliance with the settlement terms.
Issues: Initiation of Corporate Insolvency Resolution Process under IBC, 2016 for default in payment.
Analysis: The judgment pertains to C.P.(IB) No. 131/BB/2020 filed by the Applicant as an Operational Creditor under Section 9 of the Insolvency and Bankruptcy Code, 2016 against the Corporate Debtor, seeking to initiate Corporate Insolvency Resolution Process due to a default amounting to Rs. 45,25,432 as of 30.08.2019. The case underwent several adjournments for reasons such as notice service, reply filing, and issue settlement.
Upon hearing both parties' counsels and examining the relevant provisions of the Code and Rules, it was revealed that the parties had reached a settlement. The settlement agreement included the Corporate Debtor agreeing to pay Rs. 8,67,307 in two installments towards gratuity claim and litigation expenses, leading to the withdrawal of the petition by the Applicant.
As the Company Petition was not admitted and the issue was resolved through settlement, the Tribunal allowed the Petitioner to withdraw the petition with the liberty to file a fresh Company Petition if the terms of the settlement were not adhered to by the Respondent. Consequently, C.P. (IB) No. 131/BB/2020 was disposed of as withdrawn, subject to the Respondent's compliance with the settlement terms, failing which the Petitioner could initiate fresh proceedings in accordance with the law.
Full Summary is available for active users!
Note: It is a system-generated summary and is for quick reference only.
TaxTMI 
of 
Join Channel
TaxTMI 
