Hon’ble NCLAT in the matter of The South Indian Bank Ltd. Vs Gold View Vyapaar Pvt. Ltd.[1 ]observed that fixing of the matter before NCLT for final hearing was on "a wrong premise" as no final hearing was postulated at the pre-admission stage.
The limited issue raised before NCLAT was that NCLT was overlooking the mandate of Section 7(4) I&B Code by postponing the order of admission on the application filed under Section 7 of the ‘I&B Code’.
The Appellant contended that application under Section 7 was filed in December 2019 and it has now fixed for the matter “for final hearing” on February 18, 2021.
NCLAT stated that at the pre-admission stage, hearing with limited notice to the Corporate Debtor was provided to only derive satisfaction in regard to the existence of debt, the occurrence of default and completeness of the application. On being satisfied, the Adjudicating Authority is required to pass an order of admission and it can safely be stated that no final hearing was postulated at pre-admission stage.
NCLAT remarked that:
"The Adjudicating Authority will be well advised to be alive to the phraseology/ terminology to be employed at different stages of the CIRP proceedings and not give impression of a final hearing at the pre-admission stage."
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1[Company Appeal (AT) (Insolvency) No. 40 of 2021]
Author:
P Ravi Charan
Partner
[email protected]
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