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Insolvency and Bankruptcy Code, 2016 Important Updates

Lex Witness Bureau | September 2025
Insolvency and Bankruptcy Code, 2016 Important Updates
NATIONAL COMPANY LAW APPELLATE TRIBUNAL (NCLAT)
  • ANIL KUMAR SETH V. VALPLAST TECHNOLOGIES PVT. LTD. AND ANR. COMP. APP. (AT) (INS) NO. 1105 OF 2024
    The Hon’ble NCLAT in the aforesaid judgment held that the Adjudicating Authority erred in dismissing the plea of pre-existing dispute solely because the Corporate Debtor failed to reply to the demand notice issued under Section 8 of the IBC and filed its reply to the Section 9 petition belatedly. The NCLAT observed that it is the duty of the Adjudicating Authority to examine all relevant material, including emails and letters exchanged prior to the Demand Notice, to assess the existence of a pre-existing dispute. Accordingly, the Hon’ble NCLAT set aside the admission order and remanded the matter back to the Adjudicating Authority to decide afresh after considering the communications on record and decide whether a dispute exists between the parties before filing of the Section 9 petition.
  • RAJENDRA KUMAR V. INDUSIND BANK LIMITED COMPANY APPEAL (AT) (INS) NO. 1410 OF 2025
    The Hon’ble NCLAT in the captioned judgment held that the Adjudicating Authority rightly admitted the Section 7 petition filed by IndusInd Bank against Hacienda Projects Pvt. Ltd. (“Corporate Debtor”), as the Corporate Debtor failed to demonstrate concrete steps, financial capability or credible settlement to repay its debt. The Appellant’s reliance on the judgment in Vidarbha Industries Power Ltd. v. Axis Bank Ltd. (2022) SCC On Line SC 841 was rejected on the ground that no exceptional circumstances or concrete evidence of funds to repay the outstanding dues were placed on record. The Hon’ble NCLAT further observed that, despite the grant of interim relief and considerable time, the project remained incomplete and substantial defaults continued. Finding no infirmity or legal error in the impugned order passed by the Adjudicating Authority, the appeal was dismissed as being devoid of merit.
  • LOTUS 300 APARTMENT OWNER’S ASSOCIATION V. INDUSIND BANK LTD & ORS. CIVIL APPEAL (AT) (INS) NO. 1471 OF 2022
    In the captioned appeal, the Hon’ble NCLAT held that the Adjudicating Authority rightly admitted the Section 7 application against the Corporate Debtor, rejecting the Appellant Association’s request to keep the CIRP in abeyance and permit it alone to complete the project. The Hon’ble NCLAT observed that such reliefs are neither contemplated under the Insolvency and Bankruptcy Code, 2016, nor legally sustainable, as the Resolution Professional is mandated to act under the supervision of the Committee of Creditors, where homebuyers already have a predominant stake. Finding no legal infirmity or exceptional circumstances to justify interference, the appeal was dismissed as devoid of merit.
  • VINOD SINGH V. CHANDRA PRAKASH JAIN & ORS. COMPANY APPEAL (AT) (INSOLVENCY) NO. 800 OF 2025
    The Hon’ble NCLAT in the aforesaid matter held that under Section 59 of the IBC read with the Voluntary Liquidation Regulations, the Board and shareholders of a corporate person have the statutory right to replace a voluntary liquidator without requiring prior approval of the Adjudicating Authority. Accordingly, the Hon’ble NCLAT set aside the status quo order passed by the Adjudicating Authority restraining the replacement of the liquidator and directed that the newly appointed liquidator may proceed with the voluntary liquidation process. The Tribunal further observed that the Adjudicating Authority must first decide the maintainability of the removed liquidator’s application instead of delving into procedural objections, and disposed of the connected appeal with appropriate directions.
  • ANUJ GAUR & ORS. V. RABINDRA KUMAR MINTRI, RP OF SOM RESORTS PVT. LTD. & ANR. COMPANY APPEAL (AT) (INSOLVENCY) NO. 312 & 313 OF 2025
    The Hon’ble NCLAT in the captioned judgment held that the resolution plan submitted by the association of homebuyers was validly approved by the CoC and rightly upheld by the Adjudicating Authority, rejecting the appellant’s objections regarding eligibility and alleged contingent nature of the plan. The Hon’ble NCLAT observed that, as per the revised eligibility criteria approved by the CoC, the homebuyers’ association met the net worth requirement, and the plan’s alternative options were structured to regularise construction in compliance with applicable laws. Further, relying on Kalyani Transco, the NCLAT affirmed the appellant’s locus to appeal but found no merit in the challenges raised, concluding that the plan complied with Section 30(2) of the IBC and the CIRP Regulations.
  • SUPRIO GHOSH V. BANK OF MAHARASHTRA COMPANY APPEAL (AT) (INSOLVENCY) NO. 2353 OF 2024
    The Hon’ble NCLAT in the captioned judgment held that the Adjudicating Authority rightly dismissed the restoration applications filed by the appellants seeking revival of petitions under Section 94 of the IBC. The Hon’ble Appellate Tribunal observed that the appellants had been absent for three consecutive hearings and failed to demonstrate sufficient cause for non-appearance as required under Rule 48 (2) of the NCLT Rules, 2016. It further noted that the appellants acted casually, thereby abusing the interim moratorium under Section 96 to obstruct SARFAESI proceedings. Finding no merit in the explanations offered and treating the conduct as an attempt to misuse the legal process, the appeals were dismissed.
  • DRIVE INDIA ENTERPRISE SOLUTIONS LTD. V. BGM TELECOMMUNICATIONS PVT. LTD. COMP. APP. (AT) (INS) NO. 53 OF 2024
    The Hon’ble NCLAT in the aforesaid judgment held that the Adjudicating Authority erred in dismissing the Section 9 application merely by relying on earlier decisions against different Corporate Debtors without examining the facts and evidence of the present case. The Hon’ble Appellate Tribunal further held that each Section 9 petition must be adjudicated on its own merits, including whether any defence raised by the corporate debtor amounts to a genuine pre-existing dispute or is merely illusory. Accordingly, the impugned order was set aside, and the matter was remanded to the Adjudicating Authority to decide afresh by passing a reasoned, speaking order, keeping all issues open.
NATIONAL COMPANY LAW TRIBUNAL (NCLT)
  • STATE TAX OFFICER V. SHRI VINOD TARACHAND AGRAWAL IRP FOR M/S JAY FORMULATIONS LTD. IA/435(AHM)2025 IN C.P.(IB)/123(AHM)2022
    The Hon’ble NCLT, Ahmedabad Bench in the aforesaid order held that the dues of the State Tax Department arising under the Gujarat Value Added Tax Act, 2003 (GVAT Act) are to be treated as “debts owed to a secured creditor” in accordance with Section 53(1)(b)(ii) of the Insolvency and Bankruptcy Code, 2016 (IBC), and upheld the Department’s claim as a secured creditor to the extent of Rs. 15,90,276/-. However, the Tribunal clarified that the unpaid dues under the Central Sales Tax Act, 1956 (CST Act) and the GST Act, 2017 do not qualify as secured debts and shall be treated as government dues under Section 53(1)(e)(i) of the IBC.
  • IDBI BANK LTD V. HEMANGI PATEL IN CP(IB)/55(MP)2024
    The Hon’ble NCLT, Indore Bench in the aforesaid judgment held that the application filed under Section 95 of the Insolvency and Bankruptcy Code, 2016 by IDBI Bank against the Personal Guarantor, Ms. Hemangi Patel, was barred by limitation. The Tribunal noted that the guarantee was invoked on 24.10.2016, and even considering the issuance of the Recovery Certificate on 25.01.2019, the application filed on 02.09.2024 was beyond the extended limitation period, including the COVID-19 exclusion. The issuance of a demand notice under Rule 7(1) of the Insolvency Rules in March 2024 was held to be a procedural step and not a fresh cause of action. Accordingly, the petition was dismissed as time-barred.

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