Tribunal Allows Exclusion of Days from CIRP Timeline The Tribunal granted the exclusion of specific days from the Corporate Insolvency Resolution Process (CIRP) timeline under the Insolvency and Bankruptcy ...
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Tribunal Allows Exclusion of Days from CIRP Timeline
The Tribunal granted the exclusion of specific days from the Corporate Insolvency Resolution Process (CIRP) timeline under the Insolvency and Bankruptcy Code, 2016. The exclusion was approved in accordance with Regulation 40C of IBBI Regulations and the impact of the Covid-19 lockdown. The Resolution Plan, already approved by the Committee of Creditors, was pending adjudication, justifying the exclusion of the requested days. The Tribunal emphasized that further extension of the CIRP period was unnecessary given the circumstances and compliance with legal provisions.
Issues: - Application seeking exclusion of 27 days from the CIRP timeline for approval of Resolution Plan under IBC, 2016. - Interpretation of Section 12 of IBC, 2016 regarding the completion timeline of the insolvency resolution process. - Invocation of Regulation 40C of IBBI Regulations for excluding the lockdown period due to Covid-19 from the CIRP timeline.
Analysis:
1. The application was filed by the Resolution Professional under Section 12 of the Insolvency and Bankruptcy Code, 2016, requesting the exclusion of 27 days from the available 60 days exclusion timeline for the approval of the Resolution Plan. The Corporate Insolvency Resolution Process (CIRP) was initiated against the Corporate Debtor, and various steps were taken in accordance with the IBC, 2016, including the appointment of Resolution Professional and valuation of assets.
2. The Tribunal noted the provisions of Section 12 of IBC, 2016, which mandate the completion of the CIRP within 180 days, extendable by a maximum of 90 days. The Tribunal highlighted the lack of clarity in the IBC Amendment Act, 2019 regarding extensions beyond 270 days. In this case, an extension of 60 days was already granted, leading to the end of the 240-day period on 18.03.2020, with a mandatory completion deadline of 330 days.
3. Considering the circumstances and the impact of the Covid-19 pandemic, the Tribunal analyzed Regulation 40C of IBBI Regulations, which excludes the lockdown period from the CIRP timeline. The Resolution Professional sought exclusion of specific days from the CIRP timeline, supported by the rationale of the Supreme Court's decision in a relevant case.
4. The Tribunal allowed the application, excluding the requested days from the CIRP timeline, in line with Regulation 40C and the specific circumstances of the case. The Resolution Plan had already been approved by the CoC and was pending adjudication, leading to the exclusion of lockdown period and additional days as requested. The Tribunal emphasized that further extension of the CIRP period was unnecessary due to the Resolution Plan being already filed.
5. In conclusion, the Tribunal granted the exclusion of the requested days from the CIRP timeline, considering the provisions of IBC, 2016, and the impact of the Covid-19 lockdown. The decision was based on a thorough analysis of the legal framework and the specific facts of the case, ensuring compliance with the relevant regulations and precedents.
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