Sincere Securities Private Limited & Ors. Vs Chandrakant Khemka & Ors. (Supreme Court of India)
Supreme Court held that the commercial wisdom of the CoC must, accordingly, be given primacy during the CIRP. Once CoC decides that retention of the possession of the subject property was not in the interest of the CIRP, that decision must be given the respect that is lawfully due to it.
Facts- This appeal, under Section 62 of the Insolvency and Bankruptcy Code, 2016 calls in question the order dated 12.11.2024 passed by the National Company Law Appellate Tribunal, Principal Bench, New Delhi, allowing Company Appeal filed by Chandrakant Khemka, respondent No. 1, and setting aside the order dated 07.08.2023 of the National Company Law Tribunal, Kolkata Bench. Thereby, the NCLT had directed delivery of possession of the property in question to the appellants herein.
Conclusion- The commercial wisdom of the CoC must, accordingly, be given primacy during the CIRP. When UCO Bank, constituting the CoC, decided that retention of the possession of the subject property was not in the interest of the CIRP, that decision must be given the respect that is lawfully due to it.
Held that Section 14(1)(d) of the IBC states that once the adjudicating authority, by order, declares a moratorium, it would prohibit, amongst other acts, the recovery of any property by an owner or lessor where such property is occupied by or is in the possession of the corporate debtor.
