04 October 2018
NCLT and NCLAT should refrain from interfering in insolvency resolution proceedings by the Interim Resolution Professional and the Committee of Creditors: Supreme Court
The Hon’ble Supreme Court has held that the National Company Law Tribunal (NCLT) and National Company Law Appellate Tribunal (NCLAT) should refrain from interfering in insolvency resolution proceedings by the Interim Resolution Professional and the Committee of Creditors of the lender banks of a sick enterprise under the Insolvency and Bankruptcy Code. The Division Bench of Justice Rohinton Fali Nariman and Justice Indu Malhotra made it clear that the role of adjudicating bodies -- NCLT and NCLAT -- come only after resolution plan is finalised, and observed that "jumping in" when the proceedings before IRP and CoC is going defeat the entire purpose of the Insolvency and Bankruptcy Code. The observation came in the course of the hearing of a petition by ArcelorMittal (Arcelormittal India Private Limited Vs Satish Kumar Gupta & Ors. (Supreme Court of India)- Appeal Number : Civil Appeal No .9582 of 2018 on challenging the NCLAT order directing it to clear Rs 7,000 crore liability. On hearing of submissions by Ld. Senior Counsels Mr. Harish Salve and Mr. Abhishek Manusinghvi, the Hon’ble Bench stated that insolvency proceedings are being carried out by the resolution professional and CoC within the timeframe of 270 days, and the adjudicating bodies should stay away till that period.