Exclude Period of Judicial Intervention in calculation of CIRP Period: NCLAT

Anil Tayal, Resolution Professional for M/s. Horizon Buildcon Pvt. Ltd. Vs Committee of Creditors of M/S. Horizon Buildcon Pvt. Ltd. (NCLAT)

We are of the considered opinion that the period of judicial intervention w.e.f 21st October, 2020 till 9th November, 2020 (the period covering the time spent in pursuing the extension application in the first instance) and 12t^h January, 2021 to 3^rd February, 2021 (i.e. the period for which the orders were reserved by the Adjudicating Authority on the application) is justifiably required to be excluded while counting and computing the period of CIRP. We accordingly allow this appeal and direct exclusion of period from 21st October, 2020 till 9t^h November, 2020 and 12t^h January, 2021 to 3^rd February, 2021 for the purposes of calculation of CIRP period. The appeal is accordingly disposed off.

FULL TEXT OF THE NCLAT JUDGMENT/ORDER

Resolution Professional of ‘M/s. Horizon Buildcon Pvt. Ltd.’ (Corporate Debtor undergoing Corporate Insolvency Resolution Process (CIRP)) is aggrieved of declining of his prayer in terms of the impugned order dated 3rd February, 2021 for exclusion of period consumed in legal proceedings before the Adjudicating Authority (National Company Law Tribunal) w.e.f 21st October, 2020 till 9t^h November, 2020 and 12t^h January, 2021 to 3^rd February, 2021 for purposes of calculation of CIRP period.

2. After hearing Mr. Abhishek Anand, learned counsel for the Appellant, we are of the view that the appeal can be disposed off without issuing notice to the Respondent- Committee of Creditors (COC) which itself had directed the Resolution Professional to seek extension of 60 days beyond the period of 270 days in the CIRP of the Corporate Debtor as reflected in para 2 (xix) of the impugned order.

3. After going through the records and hearing Mr. Abhishek Anand, learned counsel for the Appellant, we find that while the Adjudicating Authority deemed it fit, in the peculiar circumstances of the case, to extend time by 40 days beyond the extended time of 330 days for bringing the CIRP to a logical conclusion, the Adjudicating Authority has not taken care to exclude the period of judicial intervention viz. the period spent in pursuing the application seeking extension for exclusion to render the exercise productive. Mr. Abhishek Anand, learned counsel for the Appellant has brought to our notice that as a result of exclusion of period of judicial intervention not been allowed, the extension granted has virtually proved to be futile and meaningless as even the extended period expired on 19^th February, 2021.

4. On a careful consideration of the matter, we are of the considered opinion that the period of judicial intervention w.e.f 21st October, 2020 till 9th November, 2020 (the period covering the time spent in pursuing the extension application in the first instance) and 12t^h January, 2021 to 3^rd February, 2021 (i.e. the period for which the orders were reserved by the Adjudicating Authority on the application) is justifiably required to be excluded while counting and computing the period of CIRP. We accordingly allow this appeal and direct exclusion of period from 21st October, 2020 till 9t^h November, 2020 and 12t^h January, 2021 to 3^rd February, 2021 for the purposes of calculation of CIRP period. The appeal is accordingly disposed off.

Copy of this order be communicated to the Adjudicating Authority for information.