Case Law Details
Parikshit Madanmohan Sharma Vs M.S. Gopikrishnan & Ors. (NCLAT Delhi)
Introduction: In a significant development, the National Company Law Appellate Tribunal (NCLAT) in Delhi has directed the National Company Law Tribunal (NCLT), Mumbai Bench, to reassess compliance with Section 7(1) of the Insolvency and Bankruptcy Code, 2016 (IBC), specifically concerning the threshold of the number of allottees required for the initiation of the Corporate Insolvency Resolution Process (CIRP). The case, titled Parikshit Madanmohan Sharma Vs. M.S. Gopikrishnan & Ors., sheds light on the procedural nuances of admitting applications under the IBC.
Detailed Analysis: The appeal challenges the NCLT Mumbai’s decision dated 08.02.2023, which admitted a CIRP application against K.D. Lite Developers Private Limited filed by some home buyers. The appellants contended that the application did not meet the threshold requirement as per Section 7(1) of the IBC, which mandates a minimum percentage of home buyers to file such an application. According to the appellants, the total number of home buyers was 209, setting the threshold at 21, but the application was filed by fewer home buyers than required.
The NCLAT found that the NCLT’s order lacked a detailed discussion or findings on several crucial issues raised by the appellants, including the threshold limit and whether the application was within the limitation period. Additionally, there was a contention regarding the actual number of allottees, with the appellants claiming 209 and the respondents asserting 124. This discrepancy called for a factual determination, which was absent in the NCLT’s order.
Conclusion: Considering the lack of a comprehensive analysis on the part of the NCLT and the dispute over the factual details such as the number of allottees, the NCLAT has set aside the impugned order and remanded the matter back to the NCLT for a thorough re-examination. The NCLAT emphasized the need for a speaking order that addresses all issues raised by the parties, ensuring adherence to the principles of natural justice.
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