Chavva Naga Sampathi Tayaru Vs Sri Ananda Lakshmi Narasimha Industries India Pvt Ltd (NCLAT Chennai)
The National Company Law Appellate Tribunal (NCLAT), Chennai, dismissed two company appeals challenging (i) the extension of the liquidation period granted by the National Company Law Tribunal (NCLT), Amaravati Bench, and (ii) the continuation of a Bankruptcy Trustee after attaining the age of 70 years. The appeals arose from insolvency proceedings relating to a corporate debtor against whom the Corporate Insolvency Resolution Process (CIRP) had commenced after default in repayment of credit facilities.
Following the failure to receive a viable resolution plan, the NCLT ordered liquidation on 19 December 2024, with the liquidation process initially to be completed within one year. After an earlier extension of four months, the Liquidator sought a further extension of 150 days. The NCLT granted only a one-month extension from 18 April 2026 to 17 May 2026 under Section 60(5) of the Insolvency and Bankruptcy Code, 2016, Regulation 44(2) of the IBBI (Liquidation Process) Regulations, 2016, and Rule 11 of the NCLT Rules.
The appellant argued that Regulation 44(2) did not permit a second extension of the liquidation period and further contended that the Liquidator, having attained the age of 70 years, was no longer eligible to continue in office. The NCLAT noted that the extension had been approved after the Stakeholders’ Consultation Committee (SCC), in its eighth meeting, validly resolved to seek the extension. The Tribunal observed that the members attending the meeting represented 35.57% of the voting rights, exceeding the quorum requirement of at least 33% prescribed under Regulation 22(1) of the IBBI (Insolvency Resolution Process for Corporate Persons) Regulations, 2016.
