#recovery certificate

The Supreme Court ruled that a recovery certificate issued by the Debt Recovery Tribunal under the RDB Act does not qualify as a 'decree or order' under Section 9(2) of the Presidency Towns Insolvency Act, 1909. This strict interpretation bars creditors from initiating insolvency proceedings based solely on recovery certificates, reinforcing the need for a formal decree or order for insolvency notices.

The Bombay High Court has ruled that requiring a 50% deposit of the recovery certificate amount under Section 154(2A) of the Maharashtra Co-operative Societies Act is not a mandatory condition for condoning delay in filing revision petitions. This removes a procedural barrier for cooperative society members challenging recovery orders, reinforcing that substantive justice outweighs rigid compliance in appellate remedies.

The Securities Appellate Tribunal ruled that unregistered investment advisors cannot retain fees collected from clients, regardless of whether investors seek refunds. The decision underscores SEBI's power to enforce full restitution, reinforcing investor protection and regulatory compliance in securities advisory services.

NCLAT rules that a recovery certificate issued against a principal borrower triggers a fresh three-year limitation period for financial creditors to initiate CIRP against corporate guarantors. This holding clarifies the interplay between debt recovery mechanisms and IBC timelines, impacting asset reconstruction companies and lenders pursuing guarantor liability.

The Bombay High Court has ruled that once a recovery certificate is issued, the authority becomes functus officio and cannot later insert interest without a fresh adjudication, even if the interest was mathematically calculable. This reinforces that clerical corrections cannot substantively alter liability, protecting borrowers from unilateral administrative expansion of debt beyond the original order.

Bombay High Court holds that under Section 154B(29) of the MCS Act, flat owners are liable for society dues even without formal membership, if demand is lawful and based on bye-laws.