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AI Drafter ✕ Generate professional replies, appeals, opinions to Show Cause Notices, assessment orders, audit objections, and other legal communications using TaxTMI's AI Drafter.
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Issues: Whether the order permitting withdrawal of the corporate insolvency resolution process under section 12A, at the stage before constitution of the committee of creditors and on the application moved through the interim resolution professional under regulation 30A, was liable to be interfered with for want of notice or hearing to another alleged operational creditor.
Analysis: The settlement between the corporate debtor and the operational creditor had already been recorded, the Form-FA request for withdrawal was received before any public announcement was made, no committee of creditors had been constituted, and the interim resolution professional moved the withdrawal application within the prescribed time under regulation 30A(1)(a) and (3). The legal framework recognised in the binding precedents relied upon permits withdrawal before constitution of the committee through the interim resolution professional, and the requirement of approval by the committee of creditors arises only after its constitution. The appellant had filed no objection before the adjudicating authority, and the relied-upon decisions concerning objections by participating creditors on proved claims or cases where the withdrawal procedure was not followed were held to be distinguishable.
Conclusion: The withdrawal of the insolvency proceedings was held to be in accordance with section 12A read with regulation 30A, and no infirmity was found in the impugned order.
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