#Insolvency and Bankruptcy Code

The NCLAT upheld jurisdiction under Section 60(5) IBC to direct buyer's directors to pay Rs. 3 crore in unpaid BPA consideration, piercing the corporate veil to impose personal liability on them as controlling minds. This empowers liquidators to pursue directors personally for unpaid acquisition dues, affirming corporate structure cannot shield controlling persons from contractual obligations in insolvency.

The Supreme Court held that CoC approval of a resolution plan under IBC creates a binding obligation that cannot be withdrawn, even if the corporate debtor's financial position improves. The Court directed the NCLT to expeditiously decide on plan confirmation and competing OTS applications, reinforcing finality of CoC approval and protecting successful resolution applicants.

The Supreme Court held that an Information Utility’s record creates a presumption of default under IBC Section 7, making quantum disputes and profitability irrelevant for admission. This eases CIRP initiation for creditors while raising burden on debtors.

The NCLAT held that a PIN code mismatch in invoices does not rebut the supply presumption under IBC Section 9 when TDS deductions and GST input tax credit establish debt and default, clarifying that minor clerical errors cannot defeat insolvency claims.

The SC ruled that an operational creditor whose claim is extinguished under IBC resolution plan may assert a set-off defence in arbitration initiated by resolution applicant, with no affirmative recovery. This limits clean-slate for OCs after CIRP.

The NCLAT held that under Section 154 IBC a bankrupt's estate vests in the trustee immediately, making post-bankruptcy withdrawals unauthorized even if claimed as excluded assets exceeding statutory limits, and affecting personal guarantors and debtors.

Section 32A IBC grants statutory immunity to a successor corporate debtor after an approved resolution plan, as held by the Orissa HC. This bars prosecution, requires trial court to vacate cognizance, and shields acquirers from legacy liability.

Recalling a CIRP initiated via fraud or collusion is within an Adjudicating Authority’s power, but continuation depends on whether it serves insolvency resolution with integrity, the Supreme Court held, requiring a hearing of the RP, CoC and stakeholders.

This bars parties from using limitation to defeat restoration where counsel’s misconduct caused delay, affecting stakeholders in IBC.

The NCLAT held that Section 238 of the IBC overrides rent control laws, letting a liquidator evict occupants under Section 60(5)(c) without rent control proceedings. This speeds asset recovery in insolvency, affecting liquidators, creditors and occupants.

The NCLAT held that a fraud-initiation claim under Section 65 IBC must be raised before the Adjudicating Authority and cannot be raised for the first time on appeal, forcing parties to raise such allegations at the CIRP stage to avoid belated challenges.

The Bombay High Court held IBC Section 96(4) applies retrospectively, lifting the interim moratorium on secured asset recovery from May 26, 2026. This lets banks and financial institutions enforce security interests in insolvency cases without the stay.

NCLAT ruled that advance payments for undelivered goods qualify as operational debt under Section 9 of the IBC, and that a demand notice sent via FedEx meets procedural requirements if delivery is proven. The decision expands creditors ability to trigger insolvency proceedings and validates courier based notice service.

NCLAT held that circumstantial evidence of removed hypothecated machinery suffices to prove fraudulent trading under Sec 66 IBC, upholding ₹17.23 crore liability against suspended directors, noting a single asset swap can trigger Sec 66 liability in context.

NCLAT held that the IBBI Liquidation Process (Second Amendment) Regulations, 2025 apply prospectively only and cannot affect liquidation already started under the earlier regime. The ruling shields ongoing liquidation from retrospective changes, impacting creditors, liquidators and purchasers.