Banks Can Classify Accounts as Fraud During CIRP: NCLT

Union Bank of India Vs Rolta India Limited (NCLT Mumbai) National Company Law Tribunal (NCLT) in Mumbai has dismissed an application filed by the Resolution Professional of Rolta India Limited, ruling that a bank can classify a corporate debtor’s account as fraud during the pendency of a Corporate Insolvency Resolution Process (CIRP). The NCLT stated that the moratorium under Section 14 of the Insolvency and Bankruptcy Code (IBC) does not bar such a classification. The application was filed against Union Bank of India, which had classified Rolta India’s account as fraud. The Resolu...