CIRP withdrawal on settlement was allowed, with insolvency costs directed to be paid and the board restored.

Withdrawal of the corporate insolvency resolution process was permitted after settlement, where Form FA was filed by the operational creditor and the sole committee of creditors member gave no objection. The Tribunal treated the application under the Insolvency and Bankruptcy Code and related regulations as maintainable at the preliminary stage and allowed exit from the process. It also directed the corporate debtor to pay the balance insolvency resolution process costs, including professional and litigation expenses, and restored the powers of the suspended board of directors. Pending applications were closed accordingly.

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Issues: Whether the corporate insolvency resolution process could be withdrawn on the basis of settlement and the consent of the sole member of the committee of creditors, and the incidental directions as to insolvency resolution process costs and restoration of the suspended board.

Analysis: The application for withdrawal was moved under Section 12A of the Insolvency and Bankruptcy Code, 2016 read with Regulation 30A of the Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) Regulations, 2016 and Rule 11 of the National Company Law Tribunal Rules, 2016. Form FA was filed by the operational creditor after settlement, the sole member of the committee of creditors recorded no objection, and the resolution process had not progressed beyond the preliminary stage. The Tribunal also considered the unresolved insolvency resolution process costs, including professional and litigation expenses incurred during the process, and found it to direct payment of the balance amount by the corporate debtor.

Conclusion: The withdrawal of the corporate insolvency resolution process was granted. The pending applications were closed, the balance insolvency resolution process cost was directed to be paid by the corporate debtor, and the powers of the board of directors stood restored.

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