Century Aluminium Company Limited Vs Religare Finvest Limited (NCLAT Delhi)
NCLAT Delhi held that by not filing of Application under Section 8 of the Arbitration and Conciliation Act, 1996 at the time of filing of a Reply to Section 7 of the Insolvency and Bankruptcy Code, 2016, Corporate Debtor has forfeited his right to file his Application under Section 8.
Facts- An Application u/s. 7 was filed by the Financial Creditor for Financial Debt of ₹16,89,54,976.03/–. Financial Creditor, unilaterally appointed an Arbitrator to adjudicate dispute between the Parties on 26.07.2019. Sole Arbitrator vide Order dated 26.10.2021 terminated the Arbitration Proceeding. On 23.06.2023, Financial Creditor filed an Application u/s. 7 against the Corporate Debtor before the Adjudicating Authority Kolkata bench.
On 20.12.2023, Corporate Debtor filed its Reply to the Section 7 Application. After filing of the Reply by the Corporate Debtor, an Application was filed being I.A. 542/2024 on 12.03.2024, seeking reference to Arbitration u/s. 8 of the Arbitration and Conciliation Act, 1996. The Application filed by the Corporate Debtor was opposed by the Financial Creditor.
Adjudicating Authority rejected the Application. Adjudicating Authority held that Section 7 Application need to be decided, the commencement of the Arbitration Proceeding before or after filing of Section 7 Application is immaterial.
