Comments
The Supreme Court Civil Appellate Jurisdiction on Tuesday upheld the National Company Law Appellate Tribunal (NCLAT) order, which dismissed the petition filed by Ramesh Kymal, former Chairman and Managing Director of Siemens Gamesa Renewable Power Pvt Ltd from claiming alleged dues of ₹104.11 crore from the company.
Justice Dhananjaya Y Chandrachud in his order said, “We are in agreement with the view which has been taken by the NCLAT for the reasons which have been set out earlier in the course of this judgment. We affirm the conclusion of the NCLAT. The appeal is accordingly dismissed. There shall be no order as to costs.”
The Chennai Bench of National Company Law Tribunal (NCLT) in July 2020 rejected an insolvency petition filed by Kymal over alleged non-payment of settlement dues. It rejected his plea citing Section 10 A’s insertion in the Insolvency and Bankruptcy Code (IBC) through the promulgation of the ordinance, which provided relief from the filing of insolvency proceedings on defaults which happened on or after March 25, 2020.
In October, the NCLAT, New Delhi, dismissed an appeal filed by Kymal challenging the NCLT’s order of rejecting an insolvency petition filed by him against the company over alleged non-payment of settlement dues. The NCLAT noted that the bar created was retrospective as the cut-off date had been fixed as March 25, 2020 and the newly inserted Section 10-A had come into effect on June 5, 2020.
Kymal challenged NCLAT's order in the Supreme Court.
In his order, Justice Chandrachud said that the date of the initiation of the Corporate Insolvency Resolution Process (CIRP) is the date on which a financial creditor, operational creditor or corporate applicant makes an application to the adjudicating authority for initiating the process. On the other hand, the insolvency commencement date is the date of the admission of the application. This distinction is also evident from the provisions of sub-section (6) of Section 7, sub-section (6) of Section 9 and sub-section (5) of Section 10. Section 7 deals with the initiation of the CIRP by a financial creditor; Section 8 provides for the insolvency resolution by an operational creditor; Section 9 provides for the application for initiation of the CIRP by an operational creditor, and Section 10 provides for the initiation of the CIRP by a corporate applicant.
The NCLAT had explained the difference between the initiation of the CIRP and its commencement succinctly. In agreement with the views of the NCLAT, the Supreme Court dismissed Kymal’s appeal.
Comments
COMMENT NOW
Comments
Comments have to be in English, and in full sentences. They cannot be abusive or personal. Please abide by our community guidelines for posting your comments.
We have migrated to a new commenting platform. If you are already a registered user of TheHindu Businessline and logged in, you may continue to engage with our articles. If you do not have an account please register and login to post comments. Users can access their older comments by logging into their accounts on Vuukle.