Case Law Analysis
|National Company Law Appellate Tribunal
Section 60(5)(c) IBC | Adjudicating Authority Has Residuary Jurisdiction for Consequential Reliefs in Going Concern Sale; Clean Slate Doctrine Extended to Liquidation : NCLAT
The NCLAT ruled that the Adjudicating Authority possesses residuary jurisdiction under Section 60(5)(c) of the IBC to issue consequential directions necessary for implementing a going concern sale during liquidation. The tribunal extended the 'clean slate' doctrine - typically applied in resolution plans - to liquidation proceedings, ensuring that a successful auction purchaser receives the corporate debtor's assets free from encumbrances. This decision clarifies the AA's powers to facilitate liquidation sales and protects buyers from legacy claims, impacting liquidators, successful bidders, and secured creditors.