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2020 (2) TMI 1309 - AT - Insolvency and BankruptcyConstitution of CoC - Settlement of dispute - HELD THAT - The direction was not to constitute CoC, if not yet constituted. If it was already constituted, natural course under IBC will follow. In view of the matter, IRP may hold the meeting of CoC. List the Appeal in Orders category on 12th March, 2020.
Issues: Settlement with creditors, compliance with undertakings, constitution of Committee of Creditors
The judgment addresses several key issues. Firstly, it acknowledges that the Appellant has settled with the original Operational Creditor and is actively working towards settling with the only Financial Creditor, the State Bank of India, as well as other Operational Creditors who have responded to the Insolvency Resolution Process (IRP). The Appellant is directed to continue these settlement efforts. Additionally, it is noted that the Appellant and the Directors are taking steps to ensure compliance with an undertaking given on a specific date. The IRP seeks permission to hold a meeting of the Committee of Creditors (CoC) despite a previous order directing not to constitute the CoC if not already done so. The Tribunal clarifies that the previous direction was not to constitute the CoC if it had not been formed yet, and since it was already constituted before the order, the IRP is permitted to hold the CoC meeting. The record does not reflect any specific direction against holding the meeting, and the natural course under the Insolvency and Bankruptcy Code (IBC) will be followed in this regard. The judgment schedules the appeal in the 'Orders' category for a specific date in March 2020. The judgment emphasizes the importance of settlement efforts with creditors, compliance with undertakings, and the proper procedure for the constitution of the Committee of Creditors under the Insolvency and Bankruptcy Code. It clarifies the previous directive regarding the CoC and allows the IRP to proceed with convening the CoC meeting as required by the IBC. The Tribunal's decision aims to ensure adherence to legal processes and facilitate the resolution of insolvency issues in accordance with the law.
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