Initiation of CIRP - Requirement of issuance of notice to the ...

CIRP doesn't require pre-admission notice to creditors; objectors must be heard during hearing. No natural justice breach.

May 23, 2023

Case Laws     Insolvency and Bankruptcy     AT

Initiation of CIRP - Requirement of issuance of notice to the creditors before admission of the application - Since the statutory Scheme does not contain any obligation of issuing notice to the creditors by the Corporate Applicant, any objector appearing at the time of hearing has to be heard and the objection may be noted by the Adjudicating Authority and thereafter the appropriate decision can be taken - the mere fact that no notice was issued to the creditors or any opportunity was given to the objectors before proceeding to hear, the Corporate Applicant, cannot be held to vitiate any procedure or violating the principles of natural justice, more so when objectors were heard by the Adjudicating Authority. - AT

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