Sec. 8 Notice not Required if Statutory Notice in Winding up Petition Served for Plea u/s 9: NCLAT

  • Blog|News|Insolvency and Bankruptcy Code|
  • 2 Min Read
  • By Taxmann
  • |
  • Last Updated on 22 June, 2023

Recent Posts

News, Blog, Company Law

[Opinion] Company & Its Directors Penalized for Using Private Placement Funds in Existing Account Before Filing Return of Allotment

Blog, News, Company Law

SEBI Amends Buy-Back Regulations | Excludes Shares Held by Non-Participating Promoters from Entitlement Ratio

Latest from Taxmann

notice under section 8 of IBC

Case Details: Rajeev Srivastva v. Ahluwalia Contracts (India) Ltd. - [2023] 150 taxmann.com 403 (NCLAT-New Delhi)

Judiciary and Counsel Details

    • Justice Ashok Bhushan, Chairperson, Rakesh Kumar Jain, Judicial Member & Barun Mitra, Technical Member
    • Ankur Goel, Adv. for the Appellant.
    • Anil K. Airi, Sr. Adv., Mudit Ruhella, Mritunjay K. Singh, Karan Chhibber & Aman Dahiya, Adv. for the Respondent.

Facts of the Case

In the instant case, the corporate debtor awarded construction work through a contract agreement to the operational creditor. However, the work was suspended due to certain Government restraints. The operational creditor demanded compensation for idle costs, administrative costs, depreciation, losses etc. which were settled by the corporate debtor vide e-mail.

Since the construction work did not start, the operational creditor sent a notice under the Companies Act to the corporate debtor and filed a winding-up petition against the corporate debtor before the High Court. The said petition was transferred to the Adjudicating Authority (NCLT) after the enforcement of the IBC.

Upon receiving the record, the NCLT issued notices to both sides. The operational creditor then presented an application under section 9 before the NCLT, which was admitted vide the impugned order.

The appellant i.e. a suspended director of the corporate debtor contended that the section 9 application filed by the operational creditor without serving mandatory notice of demand u/s 8 was not maintainable.

NCLAT Held

The NCLAT held that since the operational creditor had already given a statutory notice in the winding-up petition, it was not necessary or mandatory to serve a notice u/s 8 of the IBC for treating the winding-up petition. Therefore, the NCLAT ruled that the application u/s 9 was maintainable without the service of notice. Thus, there was no merit in the instant appeal and the same was to be dismissed.

List of Cases Reviewed

List of Cases Referred to

Disclaimer: The content/information published on the website is only for general information of the user and shall not be construed as legal advice. While the Taxmann has exercised reasonable efforts to ensure the veracity of information/content published, Taxmann shall be under no liability in any manner whatsoever for incorrect information, if any.

Leave a Reply

Your email address will not be published. Required fields are marked *

«
»

Everything on Tax and Corporate Laws of India

To subscribe to our weekly newsletter please log in/register on Taxmann.com

Author: Taxmann

Taxmann Publications has a dedicated in-house Research & Editorial Team. This team consists of a team of Chartered Accountants, Company Secretaries, and Lawyers. This team works under the guidance and supervision of editor-in-chief Mr Rakesh Bhargava.

The Research and Editorial Team is responsible for developing reliable and accurate content for the readers. The team follows the six-sigma approach to achieve the benchmark of zero error in its publications and research platforms. The team ensures that the following publication guidelines are thoroughly followed while developing the content:

  • The statutory material is obtained only from the authorized and reliable sources
  • All the latest developments in the judicial and legislative fields are covered
  • Prepare the analytical write-ups on current, controversial, and important issues to help the readers to understand the concept and its implications
  • Every content published by Taxmann is complete, accurate and lucid
  • All evidence-based statements are supported with proper reference to Section, Circular No., Notification No. or citations
  • The golden rules of grammar, style and consistency are thoroughly followed
  • Font and size that's easy to read and remain consistent across all imprint and digital publications are applied