The NCLAT has allowed the plea of a resolution applicant M/s. Alpha Corp Development Pvt. Ltd for extension of time to complete Corporate Insolvency Resolution Process (CIRP) of M/s. Earth Infrastructure Ltd.', and granted 90 days time from the date of commencement of Insolvency & Bankruptcy Code (Amendment Act, 2019) i.e., from 16th August, 2019.
Alpha Corp moved an application before the NCLT, New Delhi for extension of time by excluding 54 days from the CIRP, which was refused by the NCLT. It was against this order that Alpha Corp approached the NCLAT by way of an appeal.
Section 12, which described the time limit for completion of CIRP, was amended vide SO No. 2953E, which came into effect from 16th August, 2019. Section 12(3) of the IBC provides that if CIRP cannot be completed in 180 days, then the duration of such process maybe extended beyond 180 days by such further period as the NCLT thinks fit, but such period should not exceed 90 days. The amended proviso further lays down that where the CIRP is pending and has not been completed within the period of 180 days referred to in the second proviso of section 12(3), such resolution process shall be completed within a period of 90 days from the date of commencement of the Insolvency and Bankruptcy Code (Amendment Act, 2019).
The NCLAT Bench headed by Justice S J Mukhopadhyay held that since the CIRP of the Corporate Debtor Earth Infrastructure Ltd was pending and not completed within 180 days, the CIRP was directed to be completed within another period of 90 days from the date of commencement of the Amendment Act, 2019, 16th August, 2019.
With the aforesaid observations, the impugned of the NCLT was set aside and the Resolution Applicant was asked to move before the 'Committee of Creditors' (COC) and 'Resolution Professional' to complete the process within the extended time period. The NCLAT Bench further said that the COC while considering a 'Resolution Plan' submitted by the 'Resolution Applicant' or any other person, may pass appropriate orders in accordance with law preferably within 30 days. The Appeal was accordingly allowed.