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ARTICLE · 31 AUGUST 2017

IBC Update | Supreme Court Allows Settlement Post Initiating Resolution Process

Mansukhlal Hiralal & Company
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Lokhandwala Case as decided by the Apex Court will set a new precedent for all the financial debtors who wish to settle disputes post admission of Application.

IndiaInsolvency/Bankruptcy/Re-Structuring
Mansukhlal Hiralal & Company
Mansukhlal Hiralal & Company
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Supreme Court of India while exercising its extra ordinary power under Article 142 of Constitution of India in Lokhandwala Kataria Construction Private Limited V/s Nisus Finance & Investment Manager LLP ("Lokhandwala Case") approved the recording of Consent Terms post the admission of application for initiation of corporate insolvency resolution process (Application) under the Insolvency and Bankruptcy Code, 2016 (IBC).

In June 2017, the National Company Law Tribunal, Mumbai (NCLT) admitted the Application against financial debtor, Lokhandwala Kataria Construction Private Limited. Post the admission of the Application, the disputes between the parties came to be settled.

The parties to the Application approached the National Company Law Appellate Tribunal, (NCLAT) for withdrawing the Application and recording the Consent Terms between the parties. However NCLAT dismissed the Appeal while mainly emphasising Rule 8 of Insolvency & Bankruptcy (Application

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