While hearing an application for the initiation of Corporate Insolvency Resolution Process in the case of M/s Educomp Infrastructure & School Management Ltd. v M/s Millenium Education Foundation, the Delhi Bench of the National Company Law Tribunal, comprised of Justice Abni Ranjan Sinha and Hemant Kumar Sarangi, held that the chairman of the monitoring committee has the locus standi to apply for CIRP under the Insolvency Bankruptcy Code, 2016. (IBC).
The monitoring committee and its chairman are likewise governed by the IBC, therefore they have the right to initiate CIRP applications and take appropriate steps for the organization’s benefit.
An application for the beginning of the Corporate Insolvency Resolution Process (CIRP) by an operating creditor was being considered by the NCLT under the terms of Section 9 of the IBC.
The corporate debtor objected to the application, claiming that the chairman of the monitoring committee is ineligible to make an application for CIRP initiation under the IBC.
The court cited the IBC’s Section 2(d), which stipulates that “any other body incorporated under any legislation for the time being in force, as the Central Government may, by notification, specify in this matter”
The bench decided that the monitoring professional’s filing of the application to commence CIRP was covered by the clause.
As a result, it instructed the operational creditor to serve notice on the corporate debtor and, if necessary, file a rebuttal.
The applicant was represented by lawyer Anshul Sehgal.
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