Tribunal excludes days due to judicial intervention & lockdown in Corporate Insolvency Resolution Process case

The Tribunal decided to exclude 92 days due to judicial intervention and 160 days due to the lockdown, along with the time spent in filing the Appeal, in a Corporate Insolvency Resolution Process case. This decision reflects a balanced approach, considering the exceptional circumstances presented and the necessity to safeguard stakeholders' interests in the insolvency resolution process.

---

---

Issues Involved:
1. Exclusion of time consumed due to lockdown and pendency of judicial intervention in the Corporate Insolvency Resolution Process (CIRP).
2. Interpretation of Section 12(3) of the Insolvency and Bankruptcy Code (IBC) regarding the completion period of CIRP.
3. Consideration of exceptional circumstances for extending the CIRP period beyond 330 days.

Analysis:

Issue 1: Exclusion of time due to lockdown and pendency of judicial intervention
The Appellant filed an Application seeking exclusion of time lost during the lockdown and due to the pendency of a specific judicial intervention. The Adjudicating Authority excluded only 97 days of the lockdown period instead of the requested 160 days and rejected the exclusion of time due to judicial intervention. The Appellant argued that the exclusion of the full period was necessary to prevent the Corporate Debtor from going into liquidation. The Appellant cited the impact of the pandemic as an exceptional circumstance warranting the exclusion of time. The Adjudicating Authority emphasized the mandatory completion of CIRP within 330 days, including any extensions.

Issue 2: Interpretation of Section 12(3) of the IBC
The Adjudicating Authority relied on the provisions of the IBC to determine that time consumed in judicial intervention could be considered as an extension of the CIRP period, as mandated under the Code. The Authority highlighted the absence of exceptional circumstances beyond 330 days for the exclusion of time. The Appellant referred to the judgment in "Essar Steel India Ltd. Vs. Satish Kumar & Ors." to support the argument for extending the CIRP period in exceptional cases.

Issue 3: Consideration of exceptional circumstances for extending CIRP period
The Appellant contended that exceptional circumstances, such as the lockdown and pending judicial proceedings, justified extending the CIRP period beyond 330 days to avoid liquidation. Citing previous judgments and the interest of stakeholders, the Appellant argued for a holistic approach to ensure the successful resolution of the Corporate Debtor. The Tribunal, considering the exceptional circumstances presented, decided to exclude 92 days due to judicial intervention and 160 days due to the lockdown, along with the time spent in filing the Appeal.

In conclusion, the Tribunal's decision to exclude specific periods from the CIRP timeline reflects a balanced approach considering the unique circumstances of the case and the need to safeguard the interests of all stakeholders involved in the insolvency resolution process.

---