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The Enlargement of Time to Complete the Process of CIRP, are Issued in Exceptional Circumstances, not to be Treated as a Precedent: Supreme Court of India

The IRP shall take all further steps in the manner that the processes of voting by the Committee of Creditors and his submission of report to the Adjudicating Authority (NCLT) are accomplished in all respects within the extended period of 45 days from the date of this judgment. These directions, particularly for enlargement of time to complete the process of CIRP, are being issued in exceptional circumstances and shall not be treated as a precedent. This honourable judgement was passed by Supreme Court of India in the case of Jaypee Kensington Boulevard Apartments Welfare Association & Ors v. NBCC (India) Ltd. & Ors [CIVIL APPEAL NO. 3395 OF 2020] by The hon’ble Dinesh Maheshwari.

The corporate insolvency resolution process in relation to the corporate debtor JIL got initiated on 09.08.2017 when the National Company Law Tribunal, Allahabad Bench admitted the petition filed by one of the financial creditors, IDBI Bank Limited, under Section 7 of the Code. However, when the Interim Resolution Professional invited claims in this CIRP, the treatment of homebuyers became an issue contentious, because they were treated only as ‘other creditors’, not at par with financial and operational creditors. The first set of objectors consists of such persons/entities who otherwise belong to the class of ‘homebuyers’ but had their own grievances in relation to the resolution plan and the subsequent orders. The sub-sect of objectors to the resolution plan consisted of the institutional financial creditor of the corporate debtor JIL, being ICICI

The court opinioned that, ‘The matter regarding approval of the resolution plan stands remitted to the Committee of Creditors of JIL and the time for completion of the process relating to CIRP of JIL is extended by another period of 45 days from the date of this judgment. It is made clear that the IRP shall not entertain any expression of interest by any other person nor shall be required to issue any new information memorandum. The said resolution applicants shall be expected to proceed on the basis of the information memorandum already issued by IRP and shall also take into account the facts noticed and findings recorded in this judgment.

The court disposed of the case stating that, ‘These directions, particularly for enlargement of time to complete the process of CIRP, are being issued in exceptional circumstances of the present case and shall not be treated as a precedent. the proceedings relating to CIRP of JIL were initiated by the Allahabad Bench of National Company Law Tribunal but, later on, the same were transferred to its Principal Bench at New Delhi. Therefore, the proceedings contemplated by this judgment shall be taken up by the Principal Bench of the National Company Law Tribunal at New Delhi.’

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