Fraudulent initiation of insolvency proceedings not made out where NOC dispute arose after default and lacked mala fide material.

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....NCLAT held that a Section 65 challenge requires pleadings and material showing fraudulent or malicious initiation of CIRP, and that a grievance over non-issuance of NOC, without more, does not meet that threshold. The homebuyers' complaint was confined to prejudice in obtaining possession and conveyance, but the Tribunal found no cogent material indicating that the Section 7 process was filed for a purpose other than insolvency resolution. As the NOC issue arose after default, it could not invalidate or obstruct the insolvency proceedings. The rejection of the Section 65 application was therefore affirmed and the appeal dismissed.....