legal updates Directory
DELHI HC: DIRECTS THE FILLING OF AVAILABLE POSITIONS AT PMLA ADJUDICATORY AUTHORITY IN ORDER TO ENABLE PROPER FUNCTIONING
In a case filed in the Delhi High Court, the issue was regarding vacancies and appointments in the Adjudicatory Authority under the Prevention of Money Laundering Act (PMLA). The case came before the single-judge bench of Justice Pratibha M Singh. The counsel appearing for the respondent stated that there were
CALCUTTA HC REPEALED SINGLE BENCH ORDER HOLDING PMLA ADJUDICATING AUTHORITY NON-LITIGANT IN MONEY-LAUNDERING MATTERS
The part of the Ld. Single Judge’s order that held the Appellant authorities are to permit the Petitioners to operate the bank account and postal accounts were challenged by the PMLA Adjudicating Authority (the Appellant), and the Calcutta High Court granted the relief sought therein and stated that the provisional
SEBI PENALIZED TWO INDIVIDUALS FOR NOT COMPLYING WITH SUMMONS IN VIDEOCON INSIDER TRADING CASE
Due to the failure to respond to the summonses sent to these two individuals in the instant case, during the investigation into potential insider trading and volume manipulation in the scrip of Videocon Industries Ltd., SEBI fined two people Rs. 5 lakh each for violating the procedure of law. According
NCLT: ASSESSMENT ORDERS OF THE IT DEPARTMENT REGARDING THE PRE-CIRP PERIOD ARE “UNSUSTAINABLE IN LAW”
The Hon’ble NCLT invalidated the Income Tax Department’s assessment decisions against the Corporate Debtor for the time frame prior to the initiation of the CIRP, and held that the same is bad in law. The Hon’ble NCLT observed that – (i) Throughout the moratorium, the IT Department continued the assessment
SAT: SEBI OPINED TO CONDUCT INQUIRY, SAT RULED THE ORDER IS ‘NOT APPELLABLE’
SAT bench rejected an application against the SEBI’s decision wherein it was stated that SEBI is of the opinion that the enquiry should be undertaken and an opportunity should be granted of personal hearing to the Appellants so that they can appear and submit their contentions, the bench upheld that
SAT DENIES APPEAL AGAINST SEBI ORDER FILED BY NON-AGGRIEVED PARTY
The Securities Appellate Tribunal (SAT) rejected the appeal against the SEBI judgment clearing the Respondents of any insider trading allegations in 63 Moons Technologies Ltd. and Multi Commodity Exchange (MCX) shares, concluding that the appellants cannot in any way be considered “aggrieved people.” While considering whether the appeal is maintainable,
NCLT PERMITTED THE REMOVAL OF TATA POWER SOLAR SYSTEMS FROM THE AMALGAMATION SCHEME, TAKING COMMERCIAL VIABILITY INTO ACCOUNT
The National Company Law Tribunal Mumbai while hearing a Company Scheme Petition permitted to amend the composite scheme with effect to the removal of Tata Power Solar Systems Ltd. from the list of parties and put on record the Amended Composite Scheme of Arrangement. The Appellate Authority, while discussing the
DELHI HC: BASED ON REVENUE’S SUSPICION, HC QUASHED LOC ISSUED AND EXTENDED; FOUND VIOLATION OF RIGHT TO LIFE AND LIVELIHOOD
A writ was filed for a case where the MHA issued the LOC i.e., Look Out Circular and its extensions at the appeal of the Revenue to halt the Petitioner from traveling overseas due to the risk of fines and legal action for unreported foreign assets and interests in foreign
HC DENIED THE APPLICATION TO QUASH SUMMONS ISSUED UNDER THE PMLA FOR AN OFFENCE COMMITTED DURING A COMMERCIAL TRANSACTION
The Hon’ble Jharkhand High Court denied a request to revoke a summons order issued to the Petitioner Company and any related legal actions brought against the District Sessions Judge-cum-Special Judge, CBI, as a result of a special trial PMLA complaint made by the ED for the conduct of a money
NCLAT: IBC-MORATORIUM CANNOT PREVENT PROPERTY ATTACHMENT UNDER PMLA; NCLT CANNOT EXERCISE JURISDICTION IN MONEY LAUNDERING MATTERS
In an appeal filed by RP in NCLAT against the NCLT order, the issue raised was that the NCLT has no legal power to act on the matters under the Prevention of Money Laundering Act (PMLA), 2002. The appeal was heard by Dr. Ashok K Mishra (Member – Technical), Shri.
SEBI: RELEASES RESTRICTIONS IMPLIED ON CERTAIN ENTITIES VIA INTERIM ORDER IN THE INFOSYS INSIDER-TRADING CASE
SEBI amended the interim order imposed against 8 Entities for allegedly trading in Infosys’ stock while in possession of UPSI, i.e., the company’s audited financial figures for the three months ending June 30, 2020, pointing out that the Entities’ arguments and supporting evidence partially refute the initial findings made in
NCLT: CIRP CAN NOT BE INITIATED BASIS OF A FOREIGN ARBITRAL AWARD PRESUMING DEBT
NCLT dismisses Sec.9 application under IBC filed by a company incorporated under the laws of Singapore (“applicant/operational creditor”) seeking to initiate CIRP against corporate debtor/respondent by a foreign arbitral award. Respondent contended that arbitral award cannot form the foundation of CIRP and NCLT is not empowered to execute the foreign
WITHOUT SUFFICIENT EVIDENCE, “SERIOUS” CHARGES LIKE INSIDER TRADING CANNOT BE JUSTIFIED PROCEEDS ARE DROPPED
SEBI dismissed the SCN issued against the entity for trading in the Company’s stock while in possession of its UPSI, acknowledging that there is insufficient evidence to support the judgment that the entity had access to the UPSI and to satisfy the preponderance of the evidence standard; Remarked that “…the
SEBI QUASHED PROCEEDINGS AGAINST LIQUIDATED COMPANY ALLEGING SHARES WERE ALLOCATED WITHOUT FUND INFUSION
Upon finding that the Entity (undergoing liquidation) was the subject of the adjudication proceedings for an alleged allotment of shares by the conversion of warrants made by the Entity and other promoter entities without the infusion of funds from preferential allottees, SEBI dismissed the adjudication proceedings. Commented that the IBC’s
DELHI NCLAT: NCLAT QUASHED NCLT ORDER FOR THE ADDITION OF CLAIM TO THE TIME-BARRED DEBT WHICH CANNOT BE ENTERTAINED
An appeal was filed by the suspended Director of the Corporate Debtor in the matter of commercial wisdom of CoC. The issue was whether the additional claims with respect to the time-barred debt can be entertained or not. The case was decided by Justice Ashok Bhushan, Chairperson, Justice Jarat Kumar
DELHI NCLAT: NCLAT REJECTS RP’S PLEA SEEKING RESTORATION OF SUB-LEASED PLOT
An appeal was made by a Resolution Professional before the NCLAT seeking quashing of the NCLT order dismissing the Appellant’s plea to restore the possession of a sub-leased portion on account of the lease deed being void ab initio. The bench comprised Justice Jarat Kumar Jain and Dr. Ashok Kumar
NCLT: OWNERSHIP OF ASSETS TO BE DETERMINED BY THE COURT, AND IT FORMS PART OF A CORPORATE DEBTOR’S LIQUIDATION ESTATE
According to National Company Law Tribunal (NCLT) regulations, the assets whose ownership is subject to resolution by the Court or Authority would be included in the Corporate Debtor’s Liquidation Estate. The Hon’ble NCLT ruled that the assets which are subject to the determination of ownership by the Court or Authority
NCLAT: AFTER PAYING EMD, THE BIDDER CAN NOT MAKE CONDITIONAL BIDS OR RESCIND BIDS
NCLAT bench headed by Justice A.B. Singh and Ms Shreesha Merla held that after payment of Earnest Money Deposit (EMD), the Appellant/bidder cannot be allowed to forfeit his bid and subsequently claim any refund on account of the bid being a conditional offer. NCLAT observed that the Liquidator made it
TELANGANA HC: HC UPHOLDS THE CONSTITUTIONALITY OF RBI MASTER DIRECTIONS ON FRAUD
In a writ filed by the Director and Promoter of a Company (“Petitioner”), the question raised before the division bench constituting of Chief Justice S.C. Sharma and Justice N. Tukaramji of Telangana HC was the validity of RBI circular dated 01.07.2016, titled “Reserve Bank of India (Frauds – Classification and
NCLAT: NCLT IS NOT OBLIGATED TO DEFER CIRP PROCEEDINGS IF LENDERS CONSIDERING A RESTRUCTURING PROPOSAL
An appeal was filed in NCLAT for the order given by NCLT for admitting the application filed by a financial Creditor (Respondent) against Corporate Debtor (Appellant) and initiating the Corporate Insolvency Resolution Process (CIRP). The issue was raised by the Suspended Director when he came to know about the default
NCLAT: AUCTION BUYERS ARE NOT REQUIRED TO PAY PROPERTY TAXES FOR THE PRE-LIQUIDATION PERIOD
The National Company Law Tribunal (NCLAT) validated the National Company Law Tribunal (NCLT) ruling quashing the demand notice for pending property tax dues issued by the Appellant (a Municipality) to the Auction-purchaser (‘Respondent’) concerning a property sold by the Corporate Debtor’s liquidator. The Appellate Authority ordained that “The auction-purchaser cannot
PROMOTERS ARE NOT REQUIRED TO COMPETE WITH OTHER SOLUTIONS AS PER NCLAT; APPLICANTS TO RESTORE CONTROL OF MSME-CORPORATE DEBTOR
The Hon’ble NCLAT accepted appeals against the NCLT decision denying the appellant’s insolvency application because the appellant was ineligible under IBC Section 29(A)(e) and the appellant is attempting to access the corporate debtor’s assets through a backdoor by posing as an MSME. The Appellant had contested the NCLT’s decision to
NCLAT: NCLAT UPHOLDS THE EXCLUSION OF 87 DAYS FROM THE INSOLVENCY PERIOD
In an appeal decided by a bench of Justice A.B. Singh and Ms Shreesha Merla, NCLAT rejected the appeal against the order of NCLT whereby the Adjudicating Authority excluded 87 days from the total duration of 180 days of the CIRP period. The Appellant claimed that IRP submitted the exclusion
SEBI: TITAN EMPLOYEES PENALIZED FOR VIOLATING THE NORMS OF INSIDER TRADING, “IGNORANCE OF THE LAW IS NO EXCUSE”
SEBI penalized Titan employees (‘noticees’) for an amount of INR 1 Lakh as they failed to disclose the trade as entered into in excess of INR 10 Lakh, which resulted in the infringement of PIT regulations. The bench noted that-(i) On several incidents, the noticees had traded in the shares
DELHI HC: HC REVOKES COMPLAINT AGAINST DIRECTOR FOR DISHONOURED CHEQUES ISSUED AFTER HIS RESIGNATION
In a writ filed by the Director (“Petitioner”) of a company, the question was on the liability of the Petitioner in the issuing of disputed checks after he had ceased to be the Director of the accused business, was raised before the bench constituting Justice Manoj Kumar Ohri of Delhi
NCLAT RATIFIED THE NCLT ORDER DIRECTING CLUBBING OF REAL ESTATE ALLOTTEES’ INITIAL INSOLVENCY APPLICATIONS
Given that the contested order of the National Company Law Tribunal (NCLT) had legal flaws, National Company Law Appellate Tribunal (NCLAT) set aside the same, requiring that all Corporate Insolvency Resolution Proceedings CIRP initiation applications filed by allottees of the same project against the same Corporate Debtor (real estate developer)
TELANGANA HC: HC REJECTS KARVY’S WRIT APPEALS AGAINST SFIO INVESTIGATION, RAPS BROKER FOR “CREATING HINDRANCES”
The Telangana High Court upheld the Single Judge’s ruling supporting the MCA’s move to direct SFIO to conduct an inquiry into the business dealings of Karvy Stock Broking Ltd. (the “Appellant”). The decision was made in light of the fact that the case is still under investigation and that the
NCLAT: FAILURE TO REFLECT CORPORATE GUARANTEE IN THE DEBTORS’ BOOKS DOES NOT RENDER THE CREDITORS CLAIM INVALID
The Hon’ble NCLAT, Chennai Bench overturned the NCLT’s decision that denied the appellant’s claim based on a corporate guarantee which stated that the corporate debtor had provided for money borrowed by a subsidiary (the Borrower) in question. Upon concluding that the Corporate Guarantee’s existence is undisputed in reality or in
SAT: CAN NOT ENTERTAIN SEBI’S PLEA FOR ORDER RECONSIDERATION IN THE ABSENCE OF EXCEPTIONAL GROUND
A review application was filed by SEBI to SAT requesting a review of the orders based on two grounds: that there was an error that was obvious from the record and that, as a result, the case qualified for the use of the review authority granted by Sec. 15U of
NCLT: SALES TAX PAID BY OPERATIONAL CREDITOR, NOT ‘OPERATIONAL DEBT’; DISMISSED INSOLVENCY APPLICATION
While adjudicating a Section 9 application filed by the Operational Creditor, the National Company Law Tribunal Delhi denied a request for the Corporate Debtor to pay back a Sales Tax Demand as an “Operational Debt”. The Hon’ble NCLT observed that the entire claim of the Operational Creditor is based on
P&H HC: HC DENIES BAIL TO DIRECTOR ALLEGEDLY INVOLVED IN SIPHONING-OFF OF FUNDS BY ADARSH GROUP
Punjab & Haryana HC rejected a plea, filed by one of the Directors (‘Petitioner’) of Adarsh Credit Co-operative Society Ltd. (‘ACCSL’) seeking regular bail in a complaint case alleging fund mobilization. The order was conceded by Justice Meenakshi I. Mehta. The HC observed that pursuant to MCA orders issued in