2019 (3) TMI 1016 - SCH - Insolvency and Bankruptcy

Withdrawal of application for insolvency admitted u/s 7, 9 or 10 - withdrawal after issue of invitation for expression of interest - HELD THAT - The only reason why the withdrawal was not allowed, though agreed to by the Corporate Debtor as well as the Financial Creditor -State Bank of India and the Operational Creditor-Respondent No.3, is because Regulation 30A states that withdrawal cannot be permitted after issue of invitation for expression of interest. According to us, this Regulation has to be read along with the main provision Section 12A which contains no such stipulation. Accordingly, this stipulation can only be construed as directory depending on the facts of each case. We allow the Settlement that has been entered into and annul the proceedings.

Summary

The Supreme Court allowed the settlement and annulled the proceedings as withdrawal was not allowed after the invitation for expression of interest, despite agreement from all parties. Regulation 30A was deemed directory and not mandatory, allowing for withdrawal based on the facts of each case. The Special Leave Petition was disposed of accordingly.