Case Law Details
Nehru Place Hotels And Real Estates Private Limited Vs Sanjeev Mahajan (NCLAT)
In a recent development, the National Company Law Appellate Tribunal (NCLAT) in Delhi has overturned an order issued by the National Company Law Tribunal (NCLT), New Delhi, permitting a suspended director to engage in settlement discussions while the approval process for a resolution plan was underway. The case, titled Nehru Place Hotels And Real Estates Private Limited Vs Sanjeev Mahajan, saw the NCLAT delving into complex procedural matters surrounding insolvency proceedings.
The crux of the matter revolved around the proceedings initiated by Indian Bank, which triggered the Corporate Insolvency Resolution Process (CIRP) in 2021 concerning M/s. Nimitya Hotel & Resorts Limited. The Appellant, as the successful resolution applicant, submitted a resolution plan on August 20, 2022, accompanied by an Earnest Money Deposit (EMD) of Rs. 5 Crores.
Amidst these proceedings, the suspended director, identified as Respondent No. 1, filed multiple applications seeking consideration of settlement proposals under Section 12A of the Insolvency and Bankruptcy Code (IBC). Despite these efforts, the resolution plan submitted by the Appellant received unanimous approval from the Committee of Creditors (CoC) in a meeting held on January 8, 2023. Conversely, the settlement proposal put forward by Respondent No. 1 was rejected outright.
Undeterred, Respondent No. 1 persisted in submitting revised settlement proposals, leading to a series of legal back-and-forths. Notably, the NCLAT highlighted the rejection of Respondent No. 1’s settlement proposals by the CoC, emphasizing the lack of merit in further attempts to prolong the process.
Please become a Premium member. If you are already a Premium member, login here to access the full content.
