The National Company Law Appellate Tribunal, Principal Bench,...

The National Company Law Appellate Tribunal, Principal Bench, New Delhi, addressed the validity of the admission of a section 7 application in a Corporate Insolvency Resolution Process (CIRP) case. The issue raised was the alleged violation of the principle of natural justice due to the denial of an opportunity for the corporate debtor to file a reply. The Tribunal found that the corporate debtor had not shown sufficient cause for not appearing despite being duly served notice. The Tribunal interpreted Rule 49(2) of the NCLT Rules, 2016, stating that it provides the Adjudicating Authority with the jurisdiction to proceed ex parte if the corporate debtor fails to appear. The financial creditor argued that the debt and default were not in question due to a consent decree passed by the DRT against the corporate debtor. The Tribunal noted that the appellant did not address the debt and default during oral submissions challenging the rejection under Rule 49(2).

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