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    Weighted deduction for research expenditure and flawed transfer pricing benchmarking were both rejected in the Revenue's challenge.
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      Corporate debtor filed a reply to the financial creditor's...

      NCLAT Rules Section 7 Application Takes Precedence Over Arbitration; Corporate Debtor's Appeal Dismissed.

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      IBCNovember 19, 2024Case LawsAT
      Corporate debtor filed a reply to the financial creditor's Section 7 application in December 2023, but moved an application u/s 8 for reference to arbitration only on March 7, 2024. The financial creditor had initiated arbitration proceedings by unilaterally appointing an arbitrator in July 2019, but the arbitrator terminated the proceedings in October 2021, holding the appointment contrary to law. The NCLAT held that if an application u/s 8 is filed, the adjudicating authority must first decide the Section 7 application by recording satisfaction regarding default. The pendency or initiation of arbitration proceedings after filing the Section 7 application is immaterial. Allowing the Section 8 application would defeat the IBC's purpose by asking the adjudicating authority to await arbitration proceedings. The corporate debtor admitted debt and default in one-time settlement offers in 2019 and 2022. The adjudicating authority rightly rejected the Section 8 application, and the NCLAT dismissed the appeal.

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      ActsIncome Tax