Supreme Court Chooses To Interpret The Insolvency Code For The First Time

Supreme Court holds that:

• the Code is exhaustive and will be applicable notwithstanding any other prior law in operation;
• after appointment of interim resolution professional, the directors of the company are no longer in management cannot maintain an appeal on behalf of the company;
• When an insolvency application is made by a financial creditor, the only scope of argument is that the debt is not due for any reason;
• The Code provides for strict timelines which must be given effect to;

Recently, the Supreme Court of India ("Supreme Court") in M/s. Innoventive Industries Ltd ("Innoventive") v. ICICI Bank & Anr ("Respondents") has passed their first ruling on the newly enacted Insolvency and Bankruptcy Code, 2016 ("Code"). The judgment provides much needed guidance on how the Code is to be interpreted including in case of a conflict with prior laws, and also opines on the ability of an erstwhile director to file an appeal once an interim resolution