Tribunal approves withdrawal of insolvency petition under Section 9 The Tribunal approved the withdrawal of the insolvency petition under Section 9 of the Insolvency and Bankruptcy Code. The Committee of Creditors, with ...
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.
Tribunal approves withdrawal of insolvency petition under Section 9
The Tribunal approved the withdrawal of the insolvency petition under Section 9 of the Insolvency and Bankruptcy Code. The Committee of Creditors, with 100% voting rights, accepted the settlement terms proposed by the suspended directors of the Corporate Debtor, leading to the approval of withdrawal. The Corporate Debtor, engaged in solar power projects, was relieved from insolvency proceedings, and the IRP was discharged from responsibilities, allowing the Company to resume operations under the Board of Directors' management.
Issues: Application for withdrawal of insolvency petition admitted under Section 9 of the Insolvency and Bankruptcy Code based on Form-FA filed by the Operational Creditor under Section 12A of the Code.
Analysis: The Interim Resolution Professional (IRP) filed an Interlocutory Application seeking withdrawal of the insolvency petition admitted under Section 9 of the Insolvency and Bankruptcy Code. The IRP requested an order for withdrawal based on the Form-FA filed by the Operational Creditor under Section 12A of the Code. The Tribunal admitted the initial application by the Operational Creditor against the Corporate Debtor and appointed the IRP. The IRP invited claims from stakeholders through newspaper publications and received claims from two creditors. The Committee of Creditors was constituted, and a meeting was convened to discuss the withdrawal of the application. The suspended directors of the Corporate Debtor submitted Form-FA for withdrawal along with consent terms, outlining the settlement agreement.
The settlement terms included fixing the due amount, partial payments made by the Corporate Debtor, and a monthly payment plan until the total amount was cleared. The Committee of Creditors noted that the Corporate Debtor was a going concern engaged in solar power projects, with only two claims received. The sole member, Punjab National Bank, and the Operational Creditor had settled their claims. Punjab National Bank agreed to the withdrawal proposal, with the right to legal action in case of default. The Operational Creditor agreed to cover expenses and fees until withdrawal approval. The Committee, with 100% voting rights, approved the withdrawal of the application.
After hearing the counsel for the IRP and the Operational Creditor, the Tribunal reviewed the resolution passed by the Committee of Creditors. The resolution approved the withdrawal of the application, subject to certain conditions, including the right to initiate fresh proceedings in case of default. The IRP was directed to bear expenses until disposal, and the Committee was not liable for CIRP proceedings expenses. With the resolution passed and Form-FA filed by the IRP for withdrawal, the Tribunal found no further action required. The Corporate Debtor was relieved from the insolvency process, the IRP discharged from duties, and the Board of Directors' powers restored for the Company to operate under their management.
In conclusion, the Tribunal allowed the Interlocutory Application for withdrawal of the insolvency petition, providing relief to the Corporate Debtor and discharging the IRP from duties, directing the Company to operate under the Board of Directors' management.
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 
