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2020 (12) TMI 1228 - Tri - Insolvency and BankruptcyExclusion of period between 05.05.2020 and 31.10.2020 from CIRP - section 12(2) of the Insolvency and Bankruptcy Code, 2016 - HELD THAT - The CIRP in relation to the Corporate Debtor was initiated only on 05.05.2020 i.e. during the period of lockdown and as such the Applicant has sought to exclude the period from 05.05.2020 till 31.10.2020. The Applicant placed on record the G.O. Ms. No. 482, Revenue and Disaster Management (DM-IV) Department, Government of Tamil Nadu dated 12.09.2020 and G.O. Ms. No. 447, Revenue and Disaster Management (DM-IV) Department, Government of Tamil Nadu dated 30.08.2020 in order to substantiate the during such time, where the exclusion is sought for, the lockdown was in existence in the Government of Tamil Nadu. As to the facts of the present case, in view of Regulation 40C of the IBBI (Insolvency Resolution Process for Corporate Persons) Regulations, 2016 the period from 05.05.2020 till 31.10.2020 is excluded from the period of CIRP in terms of Section 12(2) of IBC, 2016 - Application allowed.
Issues:
1. Exclusion of time period between 05.05.2020 and 31.10.2020 from Corporate Insolvency Resolution Process (CIRP) due to lockdown. Analysis: The Resolution Professional filed an application seeking exclusion of the period between 05.05.2020 and 31.10.2020, including a 3-week stay granted by the High Court, from the CIRP timeline of the Corporate Debtor under the Insolvency and Bankruptcy Code, 2016. The application highlighted that the lockdown due to the Covid-19 pandemic hindered the completion of CIRP activities within the prescribed timelines. The Corporate Insolvency Resolution Process was initiated on 05.05.2020, and various events, including the appointment of the Resolution Professional and meetings of the Committee of Creditors (COC), were affected by the lockdown. The COC, with 100% voting power, passed a resolution to exclude the lockdown period from the CIRP timeline. The Applicant relied on Regulation 40C of the IBBI Regulations, which allows for the exclusion of the lockdown period from CIRP timelines. The Applicant presented government orders to support the claim that the lockdown was in effect during the period for which exclusion was sought. The Applicant emphasized the necessity of excluding the period to ensure compliance with the Code and timely completion of the CIRP. Considering the submissions and regulatory provisions, the Tribunal acknowledged the impact of the lockdown on CIRP activities and allowed the exclusion of the period from 05.05.2020 to 31.10.2020, totaling 179 days, from the CIRP timeline. The decision aligned with Section 12(2) of the IBC, 2016 and Regulation 40C of the IBBI Regulations. The Applicant was directed to make efforts to complete the CIRP within the remaining timelines prescribed by the Code, ensuring justice in the circumstances of the case. Thus, the application for exclusion was granted, enabling the Resolution Professional to proceed with the Corporate Debtor's insolvency resolution process effectively.
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